Name of the Project
South Deep gold mine expansion.

Location
Gauteng, South Africa.

Client
Gold Fields.

Project Description
South Deep is a fully mechanised underground mine, extracting a wide multiple band reef at depths of between 2 000 m and 3 000 m below surface. The extraction of such deep-level, wide reefs have not been totally mechanised elsewhere in the world. The production methods used at the mine are, therefore, unique and differ markedly from the labour-intensive mining method traditionally applied in underground mines in South Africa.

The project comprises a main shaft and a ventilation shaft – collectively referred to as the Twin Shaft complex, which will have a combined hoisting capacity of 370 000 t/m of ore.

The main shaft was completed in 2004 and comprises a single drop to a depth of 2 995 m.

The ventilation shaft has been deepened from 2 760 m to about 2 950 m and is fully equipped with ore-storage silos and conveyor belts at shaft bottom, a new rock winder and new headgear.

The mine’s headgear at the vent shaft was completed in 2011 using one of the largest fabricated steel headgear frames in the world.

The South Deep metallurgical plant, which was commissioned in November 2012, has also been expanded and has increased processing capacity from 220 000 t/m to 330 000 t/m.

From 2010 to 2012, the mine completed the construction of the centralised tailings storage facility, developed and installed infrastructure around the shaft systems and changed to full plant tailings backfill for increased production levels. The backfill plant was commissioned in early 2012.

The South Shaft complex will add an additional 120 000 t/m of hoisting capacity to the mine, bringing the total hoisting capacity to 450 000 t/m.

The South Deep operation had a mineral resource of 69.8-million ounces as at December 31, 2014, and a mineral reserve of 34.9-million ascertained ounces, which will give the operation a life-of-mine until about 2087.

Jobs to be Created
Most of the critical skill positions identified at the start of 2015 have now been filled, with a limited number of specialist skill positions unfilled as yet.

Net Present Value/Internal Rate of Return
Not stated.

Value
An estimated R28-billion has been invested to date.

Duration
A timeline for the roll-out to steady-state production is still being developed and will be presented to the board in February 2017.

Latest Developments
Production at South Deep in the first half (H1) of 2016 increased by 87% to 140 000 oz from 75 000 oz in H1 2015 driven by increased volumes and grade. All-in cost (AIC) in H1 2016 decreased 19% year-on-year to R622 453/kg ($1 257/oz).

Mine development at Gold Fields’ South Deep mine increased from 1 773 m for H1 2015 to 3 078 m in H1 2016.

New mine capital development (Phase 1, sub 95 level) increased by 524%, from 83 m for the six months ended June 30, 2015, to 518 m for the six months ended June 30, 2016. Development in the current mine areas in 95 level and above increased by 51% from 1 690 m to 2 560 m.

Destress mining increased by 46% from 13 619 m² for the six months ended June 30, 2015, to 19 845 m² for the six months ended June 30, 2016. The destress conversion from low- to high-profile mining was completed before the end of the quarter.

Longhole stoping volume mined increased by 120% from 136 858 t for the six months ended June 30, 2015, to 300 966 t for the six months ended June 30, 2016. High-profile destress mining started in June 2015 and improved significantly from 52 m2 for the six months ended  June 30, 2015, to 10 599 m² for the six months ended June 30, 2016, mainly owing to the introduction of three new drill rigs, improved productivity and the continued roll-out of the method across the entire mine. The high- and low-profile methods contributed 53% and 47%, respectively, to total destress for the six months ended June 30, 2016.

The current mine (95 level and above) contributed 65% of the ore tonnes for the six months ended June 2016, while the new mine (below 95 level) contributed 35%. The long-hole stoping method accounted for 42% of total ore tonnes mined compared with 37% for the six months ended June 2015.

As a result of the better than expected performance at South Deep, Gold Fields has increased the 2016 financial year production guidance for the mine from 257 000 oz to 289 000 oz. However, the company also increased the AIC guidance for the year from $1 265/oz to $1 310/oz.

The higher AIC relates to increased capital expenditure, from $15-million to $86-million, owing to a change in strategy on housing, namely a decision to build instead of rent, and the acquisition of additional new fleet.

Key Contracts and Suppliers
Redpath (backfill piping, battrice panel installation and replacing the South Shaft steelwork); Newrack (secondary support); TWP (metallurgical plant design); AEL Mining Services (supply of explosives for blasting) Atlas Copco and Sandvik (suppliers of heavy mobile equipment and spares).

Previous contractors and suppliers:
Murray & Roberts Cementation (mine development and shaft deepening); Wilson Bayly Holmes-Ovcon (WBHO) and Wade Walker (tailings dam); MM&G (steelwork fabrication); Steel Services and Allied Industries, Hatch and Cadhouse Design Enterprises (ventilation shaft headgear); Howden Africa (commissioning of main surface-ventilation fans) and Sarens South Africa and Crane Corporation (overhead crane for the ventilation shaft headgear).

On Budget and on Time?
The project is on budget.

Contact Details for Project Information
Gold Fields VP corporate affairs Sven Lunsche, tel +27 11 562 9763 or email media@goldfields.co.za.
Redpath, tel +27 11 974 2051.
TWP, tel +27 11 218 3000, fax +27 11 218 3100 or email twpinfo@twp.co.za.
AEL Mining Services, tel  +27 11 606 0000.
Atlas Copco, tel +27 11 821 9000.
Sandvik, tel +27 11 929 5300.

Previous contractors and suppliers:
Murray & Roberts Cementation, tel +27 11 201 5000.
MM&G, tel +27 11 914 4740.
Wade Walker, tel +27 11 466 0377.
WBHO, tel +27 11 321 7200, fax +27 11 887 4364 or email wbho@wbho.co.za.
Steel Services and Allied Industries, tel +27 18 787 2059 or fax +27 18 787 3416.
Hatch, tel +27 11 239 5300 or fax +27 11 239 5790.
Cadhouse Design Enterprises, tel + 27 16 429 1643 or email info@cadhouse.co.za.
Howden Africa, tel +27 11 240 4000, fax +27 11 493 0545 or email enquiries@howden.co.za.
Sarens South Africa, tel +27 11 861 3800, fax +27 11 861 3899 or email info@sarenssa.co.za.