Pan African Resources has hit a major milestone with the successful launch of its Mogale tailings retreatment (MTR) operation, west of Johannesburg. The operation, which was commissioned on October 3, 2024, has not only been completed ahead of schedule but has also come in under budget. This project marks a key success for the company, proving that investing in South Africa’s mining sector can yield rapid and profitable results.
"We’ve scoured Africa for business expansion opportunities and, ironically, found a goldmine right here in South Africa, just an hour from our corporate headquarters," said Pan African CEO Cobus Loots. "With 1.1 million ounces of recoverable gold reserve, we acquired this asset for just over $1 per ounce—a fantastic deal."
Rapid Payback and Sustainable Costs
Pan African expects to recover its initial investment within two to three years. The all-in sustaining cost is projected to be less than $1,000 per ounce, at a time when the gold price is soaring to $2,500 per ounce. This significant margin demonstrates the financial soundness of the Mogale project.
The company has built a strong portfolio of tailings retreatment operations, with MTR being the latest addition. "It’s exciting to see surface remining play such a critical role in our portfolio," Loots noted. Pan African’s other tailings operations, including Elikhulu and the Barberton Tailings Retreatment Plant (BTRP), currently produce 50,000 ounces of gold annually. With MTR expected to generate 50,000–60,000 ounces a year, the company’s combined output from low-cost surface operations will exceed 100,000 ounces annually.
Community Impact and Job Creation
The MTR project has made a significant positive impact on the local community, far exceeding job creation estimates. Initially, the project was expected to create 700 jobs during construction and 300 during operation. However, there are currently 1,600 people employed on site, with 1,040 of those jobs filled by local residents. Once fully operational, the project will sustain 500 permanent jobs.
The company’s community engagement efforts have extended beyond employment, with substantial investments in local schools and enterprise development. "We’ve seen a real economic upliftment here, with new opportunities for local businesses," Loots emphasized.
Environmental Cleanup and Renewable Energy Integration
In addition to its economic benefits, the MTR project is addressing longstanding environmental issues. The tailings dump, which had become a significant environmental hazard, posed an estimated liability of over half a billion rand. Pan African’s efforts to treat the dump will significantly reduce this liability, while cleaning local water sources and repurposing the land for future developments.
"We’re committed to not just economic gains but also cleaning up this environmental headache," Loots said. "The studies show clear improvements in water quality are on the way."
Pan African is also leading the charge in renewable energy. The company has already commissioned utility-scale renewable energy plants at its Evander and Barberton operations and is planning a 20 MW renewables plant at MTR within the next 12 to 24 months.
Future Growth Potential
Looking ahead, the Soweto Cluster, an adjacent project, holds further potential to increase gold production by an additional 50,000 ounces per year. "We want to focus on getting MTR fully operational in the next month, and after that, the Soweto Cluster could be another exciting opportunity," Loots shared.
The R2.5 billion Mogale project was completed in just 14 months, underscoring Pan African’s efficiency and commitment to delivering under budget.
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