Quarterly Activities Report (31 March 2016)

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(excerpt from Quarterly Activities Report)


Safety, Environment & Community

There were no a lost time injuries reported for the quarter. The Company has now achieved 1,335,336 hours without a Lost Time Injury (“LTI”) since October 2013. In addition, the Company’s Total Recordable Injury Frequency Rate (“TRIFR”) statistic continues to decrease.

The Company continues its commitment in respect to the social and economic upliftment of its Black Economic Empowerment partners at Xolobeni and in the Social Labour Plan (“SLP”) programmes that are focused on education, training and gainful employment within the local community and surrounding districts of the Tormin mine.

During the quarter, the Company opened the Koekenaap Primary School Resource Centre. The project included the construction of additional pre-fabricated classrooms, ablution facilities as well as the supply of a fully equipped and fitted out computer training room with computer hardware and software. The cost was in excess of ZAR 2 million.


Run of Mine (“ROM”) production of 444,888 tonnes during the March quarter versus budget of 442,000 was slightly ahead for the quarter. ROM ore grading 51.28% Valuable Heavy Mineral (“VHM”) was mined for the quarter, consisting of a garnet grade 31.81%, ilmenite grade 15.05%, zircon grade 3.42% and rutile grade 0.64%, and was consistent with budget estimates of 51.31% VHM. The replenishment of the beach is still occurring, however management of the variable deposition of the ROM resource on the beach mining area requires ongoing monitoring to optimise the correct consistent constituent mix of VHM delivered.


Quarterly processing of Heavy Mineral Concentrate (“HMC”) production through the two Primary Beach Concentrators (“PBCs”) produced 140,416 tonnes for the March quarter. The result was 14.9% below budget of 165,017 tonnes. HMC production was affected by seasonal low tides and unseasonal rough seas which affected the supply of process water. This issue has been addressed with the extension of the seawater intake piping by an additional 100 metres into deep water. Zircon recovery and overall HMC contained zircon were in line with budget. Ongoing monitoring and blending will be required to ensure consistent PBC feed grade and adjustment for variability in the ROM mine feed from the beach.

Initiatives are being taken to commission the recently completed Tailings Scavenger Plant (“TSP”) prior to the completion of the GSP, in an attempt to optimise zircon recovery from the PBC spiral circuits.

The Secondary Concentrator Plant (“SCP”) processed throughput of 139,424 tonnes in the March quarter, which was 14.13% below budget. SCP throughput was directly affected by a premature failure of the secondary SLON magnet main rotor drive shaft due to substandard manufacturing material from the supplier. This was further impacted by the failure occurring over the Easter Public Holiday period and the unavailability of a 120 tonne crane to remove and install the SLON magnet for repair. The resulting down time for ongoing failure of the SLON magnet over the quarter was in the order of 1 week.

Overall concentrate production for the quarter was down on budget due to the SCP plant downtime caused by the SLON magnet failure.

SCP recoveries were above budget for zircon and garnet and below for rutile and ilmenite.

Zircon/rutile concentrate production for the quarter was 10,170 tonnes versus budget of 12,007 tonnes. Contained zircon in the concentrate of 71.76% was below budget of 73.19% zircon, whilst rutile was above budget at 13.75% contained rutile in concentrate.

For the March quarter, ilmenite concentrate production was 24,415 tonnes versus budget of 31,045 tonnes, and garnet concentrate production was 73,353 tonnes versus budget of 82,442 tonnes.

In February 2016, the Company was pleased to advise that its subsidiary, Mineral Sands Resources (Pty) Ltd (“MSR”), had secured US$4.5 million via a loan facility from the GMA Group (“GMA”) to fund the completion of the GSP.

The GSP is being installed at the front of the existing Secondary Concentrate Plant (“SCP”). The installation of the GSP will increase the non-magnetic zircon/rutile feed grade to the SCP by removing the Garnet fraction from the Heavy Mineral Concentrate (“HMC”) prior to the SCP. This, in turn, will allow a higher grade non-magnetic concentrate to be fed to the existing magnetic circuit, and thereby increase overall final zircon/rutile concentrate production.

Operating the to-be-installed GSP in-conjunction with the recently installed TSPs is expected to:

  • Increase the overall GSP/SCP HMC feed rate from the current SCP design feed rate of 61.6tphr (current operating throughput is circa 77tphr) of HMC feed to a combined GSP/SCP HMC feed rate of 100tphr of HMC feed;
  • Increase overall zircon recoveries from circa 68% in the current SCP to 85% in the GSP/SCP;
  • Increase combined zircon recovery from the PBCs and TSPs, expected to be 92%;
  • Produce a higher quality zircon/rutile concentrate product, increasing from circa 72% contained zircon from the current SCP to 80% contained zircon in the GSP/SCP;
  • Increase overall GSP / SCP processing garnet and ilmenite recoveries;
  • Produce a higher quality garnet concentrate product from the current circa 60% to +80% contained garnet;
  • Increase the production on zircon/rutile concentrates by approximately 25%; and
  • Increase ilmenite concentrate production by circa 180%.

Completion of the GSP is still expected on or around 30 June 2016, with commissioning and tie-in to the existing plant completed in early July 2016.

The loan agreement entered into with GMA provides for US$4.5 million funding with a 3 year repayment term commencing on the re-start of shipping of garnet concentrate product to GMA (planned for January 2017). Currently MSR stockpiles garnet concentrate, on behalf of GMA, at the Tormin mine site.

The offtake agreement previously entered into with GMA has also been amended to increase the term of the agreement to be a life of mine agreement, with an increase in the annual offtake tonnage to 210,000 tonnes, up from 150,000 tonnes, and an option to take all other remaining garnet concentrate production.

The Company produced approximately 285,000 tonnes of garnet concentrate for the year ended 31 December 2015.

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