West Wits Mining Ltd (ASX:WWI, OTCQB:WMWWF) has been focused on the transition to gold production this financial year, devoting its efforts to securing financing to develop the flagship Qala Shallows project within the Witwatersrand Basin Project (WBP) in South Africa.
The company’s potential bankers have almost completed due diligence for a debt facility to cover 50 – 60% of the development funding requirement (approximately US$30 - 35 million), which will underpin Qala shallow’s construction.
WWI expects the mine to produce 70,000 ounces of gold per year for nine years, with all regulatory approvals in place and mining infrastructure ready for ramp-up once funding is locked-down.
Finalising supply agreements
West Wits is already in the process of finalising agreements with key suppliers to ensure a swift start-up of the mine.
The company recently extended a toll treating agreement with major mining house, Sibanye-Stillwater Ltd, to a three-year term from date of first ore delivery.
WWI has also negotiated:
- a mining contractor agreement in line with its 2023 definitive feasibility study;
- supply and maintenance agreements with OEM to ensure underground equipment availability;
- supply and service agreements for hydro-powered in-stope mining equipment to ensure energy-efficient ore production;
- explosive supply agreements for a reliable and safe supply of explosives, ensuring uninterrupted mining operations; and
- Engineering, Procurement, Construction Management (EPCM) agreements for constructing permanent infrastructure while using existing infrastructure to produce gold ore.
Key infrastructure approvals
West Wits has also developed relationships with several partners and secured all the necessary permits and licensing for its proposed mining activities.
These include:
- Strategic Partnership: Collaboration with Calgro M3 Developments, a local JSE-listed property development firm, to install a vital potable mains water supply pipeline which established permanent infrastructure for local communities and the Qala Shallows mine.
- Water Security: Water supply agreement with Johannesburg Water to access mains water which satisfies the project’s long-term operational requirements.
- Reliable Power: Approval from Joburg City Power of a substantial 7.5MVA power supply, strategically located at the newly constructed Fleurhof 88/11kV primary substation ensuring a steady and cost-effective electricity source. Mains power will be backed up by diesel generation and the company is assessing opportunities to install a solar power farm.
- Explosive Licence: Approval from the Chief Inspector of Explosives in the South African Police Service. This critical milestone ensures the company adheres to stringent safety and regulatory standards, enabling the use of explosives for mining operations.
- Road Access and Intersections: Approval from the Joburg Roads Agency for modifications to road intersections near its operations.
The road access approval is instrumental in improving access to the mine site, enhancing transportation efficiency for both materials and personnel, and ensuring the safety of the local community and environment by adhering to best practices in infrastructure development.
WWI is also consulting with Bara Consulting to conduct a study assessing the engineering and other factors needed to achieve a production target of 200,000 ounces per year, based on Qala’s sizeable 4.28-million-ounce mineral resource estimate.
The company believes the project has potential to support a much larger production schedule.
The study will evaluate the potential to increase production and the necessary additional infrastructure, including a process facility, tailings storage and shafts necessary to achieve higher throughput rates.