Dual-listed Pan African Resources expects first gold production to start at its Evander Tailings Retreatment Plant (ETRP) during this month.

The company, which last week warned that its earnings per share (EPS) and headline earnings per share (HEPS) for the six months ended December 31 were likely to be significantly lower than in the prior comparable period, said the project was on schedule and within budget.

The ETRP was expected to add 10 000 oz/y of gold production to Evander Mines’ output.

Pan African said its EPS and HEPS for the six months ended December, in rand terms, would likely be between 3.02c and 6.04c, representing a drop of between 60% and 80% on the 15.11c reported for the six months ended December 2013.

The company, which is led by CEO Ron Holding, attributed the fall in its EPS and HEPS to its Evander Mines being in a low-grade mining cycle, which was expected to continue until February; power supply interruptions, as a result of load-shedding by power utility Eskom; and forced safety-related production stoppages by the Department of Mineral Resouces (DMR), which resulted in five days’ lost production at Barberton Mines and three days’ lost production at Evander Mines.

In November, the DMR had issued orders to stop operations at Evander and Barberton, after deviations had been identified by the department’s Mine Health and Safety Inspectorate in respect of certain operating procedures and administrative processes pertaining to the mining operations’ lamp room, self-rescuers and gas monitors.

The group, together with the operations’ safety and health committees, has since corrected the deviations.

Pan African also reported that the Evander operation was implementing measures to ensure that the impact of future lower-grade mining cycles would be less pronounced. These measures included advancing the lower section of the mine downwards from 25 level to 26 level.

“In addition to increasing Evander Mines’ life-of-mine, this development will create additional stoping areas and, therefore, alleviate the mining flexibility constraints experienced,” it stated.

Meanwhile, Barberton Mines’ Biox plant was subject to oil contamination from a breakdown at the Fairview primary crusher. This setback continued to impact on operations during the current six-month reporting period; however, the Biox plant recoveries had improved to almost 96% by December.