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West Wits Mining Ltd passes milestone on monetising gold project

West Wits Mining Ltd passes milestone on monetising gold project

West Wits Mining Ltd (ASX:WWI) has crossed an important milestone by commencing mining at the Sol Plaatjies Project,  within the Soweto Project in Johannesburg, South Africa.

First stage plans at Sol Plaatjies provide for extraction of up to 130,000 tonnes of ore over 12 months with a further 50,000 tonnes identified in the second stage.

The total JORC 2012 resource at the Soweto Project is 1.32 million ounces of gold at 3.36 g/t gold (2.0 g/t gold cut-off).

The work at Sol Plaatjies will involve the removal, rehabilitation and processing of a 1,500 metre section of the Kimberley Reef outcrop.

The presence of the reef had, in the past, attracted activity from illegal miners, which in turn led to significant social challenges in the area.

Under the terms of an agreement with a mining contractor, proceeds from the project will be first paid to the contractor for the cost of extracting and processing each tonne of ore.

After these costs have been reimbursed, West Wits will be paid at a rate equal to the prevailing price of 0.6 grams of gold (currently circa US$25) for each tonne of ore mined from the project.

After West Wits has been paid, the contractor will be entitled to a payment equal to the value of 0.4 grams of gold for each tonne with any additional surplus cash to be then shared equally between West Wits and the contractor.

Following extraction of the reef, the land would be progressively rehabilitated to enable the land owner to start development of an affordable housing project.

Sol Plaatjies is expected to provide cash flows to West Wits to expedite the company’s development plans for the larger Soweto Cluster area.

 

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