Name and Location
Khumani expansion project (KEP), Northern Cape, South Africa.

Client
Assmang, a 50:50 joint venture between Assore and African Rainbow Minerals (ARM).

Project Description
The Khumani project involved the development of a greenfield iron-ore export mine on the Bruce, King and Mokaning farms near Kathu, in the Northern Cape.

The first phase of the project involved the development of a ten-million-ton-a-year iron-ore export mine.

The KEP entails the expansion of the mine from ten-million tons a year to 16-million tons a year, which will include the development of a new mining area to exploit additional orebodies. To service the new mining area, the primary and secondary crushers will be duplicated, while a new overland conveyor will be constructed.

The existing washing, screening and beneficiation plant will be expanded to allow for the increased capacity.

Storage areas for run-of-mine materials and product, as well as the primary thickener and paste plant, will also be expanded.

A new rail loop and load-out station will be built and a direct rail link to the local line will be built.

The six-million-ton expansion will enable the export of four-million tons and the possible supply of two-million tons to the domestic market.

Assmang has received a commitment from Transnet to extend the current iron-ore export allocation from ten-million tons a year to 14-million tons a year, increasing Assmang's export capacity accordingly. This will dovetail with the iron-ore channel expansion of 47-million tons a year to 58-million tons a year.

Value
The Phase 1 and Phase 1A expansions to ten-million tons a year cost R4.5-billion.

The estimated total capital expenditure for the KEP is R6.7-billion.

Duration
Phase 1A has been completed and the mine is ramping up to ten-million tons a year.

A feasibility study on the second phase of the project was completed in June 2009. Production ramp-up was expected to begin in January 2012, with full production in the 2013 financial year.

Latest Developments
After completing the expansion of the Khumani mine expansion one year ahead of schedule and below budget, additional work is under way to further optimise the Khumani mine.

The wet, high-intensity magnetic separation (Whims) plant, which improves recoveries and optimises the life of the Khumani mine, has been commissioned within budget and ahead of schedule. The construction of an additional finished-product stockpile area has also been completed.

The diversion of the Transnet Freight Rail main line, which runs through the King Mining area, will be completed and handed over by April 2014.

Key Contracts and Suppliers
Africon (consulting services for detailed earthworks design - King and Parsons); Alliance Cost Management Services (consulting services for quantity surveying (civils and structural, mechanical and piping construction, or SMP); Alstom (signal construction at local siding - Parson); Alstom, Megatron, ABB, Siemens (design, fabricate and supply of medium voltage switchgear - King); ATC (supply and delivery of cable); B & W lnstrumentation (installation of the 22 kV reticulation ring and installation of ID tags for the 22 kV overhead); B&W Instrumentation (supply and erect construction power for King and Parsons); Bosworth (manufacture and supply of conveyor pulleys and bearings - King); Brelko (supply of conveyor belt scrapers - King); Bulk Solids Flow (consulting services); Burgess & Burger (fabricate, supply and erect King infrastructure - SMP package 1); Concor (civil and earthworks works); Control Lab (civil and earthwork quality surveillance); Cosira lMS (supply and installation tunnel vacuum cleaner - King); Crane Load Tech, Terex, MMS (supply of mobile cranes - King); DesSoft (supply of instrumentation and electrical design software package - King and Parsons); Desta Power, Alstom, Steelcor, Zest (design, fabricate and supply of distribution transformers - King); IDesta Power, Alstom, Steelcor, Zest (design, fabricate and supply of distribution transformers - Parsons); DRA (engineering, procurement and construction management early works contract C2917); ECE (design, fabricate, supply and erect pressurisation systems for crushers); Eclipse (supply of control-room computer equipment - King); ECMP (design, fabricate, supply and erect compartmentalisation of tailings dam - King); Eisen (supply of impact idlers - King); Fabricated Steel (supply and erect temporary mobile construction offices and ablutions - King and Parsons); FLSmidth (design, fabricate and supply of cyclones - Parsons); FPS (fabricate, supply and erection of piping at PE rail crossing - King); FSM (supply and erect permanent prefabricated buildings/offices - King and Parsons); Hatch (consulting services); Humboldt Wedag (supply lumpy and fines jigs); lnkjet Technology Supplies (fleet vehicle signage); Ivuzi (consulting services); Joest (design, fabricate and supply of screens and vibrating feeders - King and Parsons); KPMG (consulting services for escalation variables); Lilliput (Installation of Lilliput SBC 6000 - King); M&J Engineering (design, fabricate and supply of WEBA chutes - King); Malvern (design, fabricate and supply of conveyor belt magnets - King); Matador (supply of conveyor belting - King); Metso (supply of secondary and tertiary crushers [long-lead items] - King and Parsons; supply of centrifugal, spillage and clean water pumps - King and Parsons; and supply of primary crusher [long-lead items]); Moody International (consulting services); Morris Materials (design, fabricate and supply of EOT cranes - King); Office Furniture Suppliers (supply of construction office furniture for King and Parsons); Osborn (design, fabricate and supply of apron feeders - King); Qfinsoft (consulting services); Rufco (fabricate, supply and erect King overland conveyors - SMP package 213); Saco Systems (supply and erect access control/time and attendance – King and Parsons; and local siding); Sandvik (design, fabricate, supply and erect run-of-mine stackers and reclaimers - Parsons); Scaw Metals Eclipse East Foundry (supply of manganese liners - King and Parsons); Sectional Poles (design, fabricate, supply and erect high-mast lighting - King and Parsons); Siemens (supply of conveyor drives - King); SMEI (fabricate, supply and erect King structures and conveyors - SMP package 2A); Snowden Mining (mine planning services); SRK Consulting Engineers (consulting services for geotechnical drilling - King and Parsons); Sunglide 28 (design, supply and install construction water - King and Parsons); Vivo-Tech Engineering (consulting services); Vuleka (consulting services); WEC (supply and erect sewage plant - King and Parsons); Westech (design, fabricate, supply and erect primary thickener mechanism and rails - King and Parsons); Willchem (consulting services); Minopex (contract operations provider); ER Signs & Safety (supply of safety and construction signage); Matthee Furniture Removals (transportation of goods); Office Furniture Suppliers (supply of construction office furniture for King and Parsons); Charles Corbett Photography (photographic services); Swift Flite (charter flights to Sishen); Smart Words Editing Services (editing of the KEP feasibility) and Benja Trading (domestic waste bins and removal of waste).

On Budget and on Time?
The expansion project was handed over to the mine about one year ahead of schedule and well below budget.

Contact Details for Project Information
ARM corporate development and head of investor relations Jongisa Klaas, tel +27 11 779 1507 or email jongisa.klaas@arm.co.za.
Africon, tel +27 12 427 2200 or fax +27 12 427 2010.
Alstom, tel +27 11 871 6600 or fax +27 11 871 6868.
Alstom, Megatron, ABB, Siemens, tel +27 11 820 5111 or fax +27 11 823 9047.
ATC, tel +27 16 430 6136 or fax +27 16 423 6103.
B&W Instrumentation, tel +27 907 1663 or fax +27 11 907 1957.
Benja Trading, tel +27 76 545 5212.
Bosworth, tel +27 11 864 1643 or +27 11 908 5728.
Brand Engineering South Africa, tel +27 21 550 9100, fax +27 21 550 9108 or email info@brandsa.com.
Brelko, tel +27 11 838 2991 or fax +27 836 7124.
Bulk Solids Flow, tel +27 11 979 4770 or fax +27 11 979 4775.
Burgess & Burger, tel +27 11 894 3271 or fax +27 11 894 6227.
Charles Corbett Photography, tel +27 11 704 6876.
Concor Civils, tel +27 11 495 2222 or fax +27 11 495 2226.
Concor Roads, tel +27 11 495 2222 or fax +27 11 495 2496.
Control Lab, tel +27 43 722 5420 or fax +27 43 743 9942.
Cosira IMS, tel +27 11 794 9955 or fax +27 86 665 7879.
Crane Load Tech, Terex, MMS, tel +27 11 21 9181 or fax +27 86 546 8478.
DesSoft, tel +27 12 654 7516 or fax +27 12 654 7520.
Desta Power, Alstom, Steelcor, Zest, tel +27 11 820 5111 or fax +27 11 820 5295.
DRA, tel +27 11 202 8600 or fax +27 11 202 8924.
ECE, tel +27 11 791 2950 or fax +27 11 791 2955.
Eclipse, tel +27 51 410 4660 or fax +27 51 447 3597.
ECMP, tel +27 11 705 1111 or fax +27 11 705 1908.
Eisen, tel +27 11 900 1821 or fax +27 11 300 4213.
ER Signs & Safety, tel +27 11 881 8080 or fax +27 11 811 1068.
Fabricated Steel, tel +27 11 821 5600 or fax +27 11 873 0890.
FLSmidth, tel +27 11 474 8875 or fax +27 11 474 7347.
FPS, tel +27 11 828 4388 or fax +27 11 858 2147.
FMS, tel +27 11 821 5600 or fax +27 11 873 0890.
Hatch, tel +27 11 239 5609 or fax +27 11 239 5795.
Humboldt Wedag, tel +27 11 397 4660 or fax +27 11 397 4411.
Inkjet Technology Supplies, tel +27 86 684 9674 or fax +27 11 452 1911.
Ivuzi, tel +27 11 807 8925.
Joest, tel +27 11 923 9000 or fax +27 11 923 9011.
KPMG, tel +27 11 647 7111 or fax +27 11 647 8000.
Lilliput, tel +27 31 783 4276 or fax +27 31 783 4074.
M&J Engineering, tel +27 11 827 9372 or fax +27 11 827 6132.
Malvern, tel +27 11 873 9010 or fax +27 11 873 9596.
Matador, tel +27 32 946 1210 or fax +27 32 946 1576.
Matthee Furniture Removals, tel +27 53 313 1432 or fax +27 53 313 1761.
McLachlan du Plooy Gauteng, tel +27 12 803 3620 or fax +27 12 803 3634.
Melco Conveyor, tel +27 11 255 1600 or fax +27 825 3592.
Metso, tel +27 11 961 1111 or fax +27 11 397 5960.
Moody International, tel +27 16 422 2870 or fax +27 16 421 2036.
Morris Materials, tel +27 11 748 1000 or fax +27 11 748 1079.
OD Trading, tel +27 82 850 3940.
Office Furniture Supplies, tel +27 41 582 1520 or fax +27 51 586 2367.
Osborn, tel +27 11 820 7600 or fax +27 11 388 1136.
Qfinsoft, tel +27 12 345 1917 or fax +27 12 345 2526.
Rufco, tel +27 53 313 1651 or fax +27 53 313 2081.
Safco Systems, tel +27 11 652 5555 or fax +27 11 805 5507.
Sandvik, tel +27 11 455 5581 or fax +27 11 455 5512.
Scaw Metals Eclipse East Foundry, tel +27 747 5000 or fax +27 422 2706.
Sectional Poles, tel +27 12 348 8660 or fax +27 12 348 9195.
Siemens, tel +27 11 571 2000 or fax +27 11 392 2434.
Smart Words Editing Services, tel +27 11 476 1766.
SMEI, tel +27 11 914 4101 or fax +27 11 914 4108.
Snowden Mining, tel +27 618 923 9213 or fax +27 618 932 2576.
SRK Consulting Enegineers, tel +27 11 441 1111 or fax +27 11 880 8086.
Sunglide 28, tel +27 53 723 2319 or fax +27 53 723 1733.
Swift Flite, tel +27 11 701 3298 or fax +27 11 701 3529.
Vivo-Tech Engineering, tel +27 79 876 1351.
Vuleka, tel +27 11 782 1643 or fax +27 11 782 1645.
WEC, tel +27 11 745 5500 or fax +27 11 464 2977.
Westech, tel +27 11 791 5526 or fax +27 11 791 5524.
Willchem, tel +27 11 462 6052 or fax +27 11 704 4593.