Pan African Resources Share Discussion Threads

[stonedyou] 23/9/2020 08:37

China is reportedly expanding and upgrading a large number of military facilities along the border with India


•China has not just expanded but doubled the number of military facilities along

its shared border with India, according to a report by Stratfor.




Security and military analyst Sim Tack estimates that at least 13 new military

positions have appeared since the 2017 Dokhlam standoff.

After fresh tensions sparked in May, China initiated the construction of four new

heliports.

[risa5] 22/9/2020 21:56

Authorities laudably supportive of grid-tied Pan African solar project – coordinator

22ND SEPTEMBER 2020

JOHANNESBURG (miningweekly.com) – The authorities have been laudably supportive of the R150-million grid-tied photovoltaic solar project that is to be built to supply electricity to Pan African Resources’ highly successful Elikhulu tailings retreatment plant in Evander, Mpumalanga.

The nigh-10 MW solar plant, which is expected to be completed next year, will provide most of the daytime electricity requirements (about 30% of its total requirements) of the R1.79-billion Elikhulu operation, one of South Africa’s lowest-cost gold-from-tailings plants.

Being targeted is a de-risked, self-generation solar plant equipped with controllers that will prioritise the solar energy when it is available and revert back to the grid when it is not, to fulfil the power requirements on a sustainable, constant-wattage and continuous electricity delivery basis.

The 12-year-life Elikhulu produced close to 60 000 oz in the 12 months to June 30, at the very low all-in sustaining cost of $660/oz.

The solar project’s timeline will, not in any set order, be determined by permission being granted by State electricity utility Eskom and the National Electricity Regulator of South Africa (Nersa), as well as commercial agreements being concluded.

“One of the things we’ve been quite successful with up to now has been the adoption of an approach of working very closely with Eskom and Nersa, as well as the Department of Mineral Resources and Energy and local stakeholders,” M Squared Resources director Kobus Breytenbach told Mining Weekly in a Zoom interview. M Squared Resources is serving as project coordinator.

“We’ve been speaking to Eskom very regularly. We started engaging with Nersa long before we were required to, and it’s been very successful up to now. Accelerating the timeline has been, I think, the value that we can add, while working with a whole suite of consultants. We’re hopeful that we’ll be able to get this through in a very, very short period,” Breytenbach added.

To accelerate the solar project’s timeline, certain project development aspects are being conducted in parallel.

“The authorities have really been going out of their way to support this project and we hope to be operational in the third quarter of next year. The fact that the plant is on the urban edge and on previously disturbed land made a big difference,” Breytenbach added.

The solar plant will be built on a site that once housed a mine hostel. Of four sites evaluated, this site was chosen as it qualified for an environmental impact assessment (EIA) waiver. The EIA waiver, granted by the Department of Agriculture, Rural Development, Land and Environmental Affairs, restricts the solar plant’s output to being below 10 MW, in this case at 9.975 MW alternating current. It also stipulates that it occupies an area that is no bigger than 25 ha, translating into 2.5 ha per megawatt.

BUILD, OWN AND OPERATE MODEL

A build, own and operate model, using an engineering procurement and construction (EPC) contractor, is the chosen approach of dual London- and Johannesburg-listed Pan African Resources. The company also has an American Depository Receipt programme sponsored by the Bank of New York Mellon.

Envisaged is that the same EPC contractor, or potentially a different party, will operate the plant for one year, during which time skills will be transferred to Pan African Resources’ employees, who will then run the plant to the full extent possible.

The names of the various contactors that M Squared Resources have been working with will be released once all contract awards have been concluded, at which point it will be made known whether a monocrystalline or polycrystalline solar solution will be used.

“Solar is becoming very competitive. If you look at the renewables programme, there has been an exponential decrease in terms of cost per kilowatt or megawatt. The reliability is there, which helps, and it is modular, which is great.

“If planning is good enough, solar facilities can be built up on a modular basis, and then with battery technology increasing and becoming more economical, expensive morning and afternoon demand peaks can be eliminated,” Breytenbach said.

Elikhulu has access to 183-million tonnes of tailings that have accumulated over Evander’s 70-year gold mining history and it is playing a positive environmental role by re-mining the legacy dump sites of their mine waste and freeing the land beneath the waste for alternative usage.

The Evander tailings storage facilities (TSFs) being reclaimed are the Kinross, Leslie-Bracken and Winkelhaak TSFs, in that order. Once processed, these TSFs will be consolidated into one, shrinking Evander Mines’ environmental footprint substantially. The average gold content of the material being processed is 0.3 g/t, ranging from 0.28 g/t to 0.30 g/t.

The solar plant represents the first phase of solar power generation at Evander. Pan African Resources may consider looking to expand this power facility to a possible 25 MVA for Evander’s Egoli underground gold mine project that was recently announced. A similar solar plant is also being considered at Pan African Resources’ Barberton Mines, in Mpumalanga.

[risa5] 22/9/2020 21:47

Pan African Resources PLC 2020 Q4 - Results - Earnings Call Presentation

Sep. 16, 2020 6:18 AM ET

The following slide deck was published by Pan African Resources PLC in conjunction with their 2020 Q4 earnings call.

[risa5] 19/9/2020 09:18

Egoli likely to be S Africa’s least complicated underground gold mine
Sep 17, 2020



JOHANNESBURG (miningweekly.com) – What is expected to be South Africa’s least complicated underground gold mine is on the way at Evander, Mpumalanga, in the form of the Egoli gold project.

[risa5] 18/9/2020 12:20

Cobus Loots doing a good job promoting the company as much as he can.

[chipperfrd] 18/9/2020 11:03

Yes, thanks Risa, your work is saving us a lot of time :-)

[glawsiain] 18/9/2020 10:43

Cheers Risa for these articles and videos... most helpful

[risa5] 18/9/2020 00:04

Harmony Gold, Pan African, platinum make headlines
Sep 17, 2020

[risa5] 17/9/2020 23:45

Solar to provide most of gold plants’ daytime power – Pan African
Sep 16, 2020

[risa5] 17/9/2020 23:27

Pan African Resources - executive interview
Sep 17, 2020



Pan African Resources i is a mid-tier, Africa-focused gold producer, dual-listed on the London AIM Market and the Johannesburg Stock Exchange, as well as a sponsored Level-1 ADR programme in the US. The company has three major producing assets in South Africa, with total production capacity of 200,000oz of gold pa. These include its flagship Barberton Mines complex, the Barberton Tailings Retreatment Project (or BTRP) and Elikhulu, which now incorporates the Evander Tailings Retreatment Project (or ETRP). With a strong focus on both safety and ESG, Pan African’s strategy is to deliver value-accretive projects with low-cost production and manageable execution risk.

[stonedyou] 17/9/2020 16:19

Pan African Resources pays record final dividend as production surprises

Pandemic affected group’s mining operations, but gold miner increased activity at surface operations



Pan African Resources, a gold miner with underground and surface operations, declared a record final dividend and slashed debt amid soaring gold prices and better-than-expected production output.

The mid-tier producer announced a strong set of results for the year to end-June despite the Covid-19 pandemic and nationwide lockdown, which is estimated to have shaved 10,000 ounces off Pan African’s annual production, equating to R300m in lost revenue.



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[risa5] 16/9/2020 20:19

SLP is also based in SA but tax is not deducted from declared dividends so I'm not sure what is the difference.

[stonedyou] 16/9/2020 18:40

Silver and Gold Order Minimums




Due to high order volumes, temporary minimum orders are in effect - 250oz Silver or 10oz Gold.


Please complete the following form or email [e-mail] for quote information. We will try to reply as soon as possible, but appreciate patience as it could take a few days to reply. You are also welcome to call our direct line, but please leave a voicemail if we don’t immediately pick up.

Purchases are now on pre-order, and will require same day payment with either;
1) Wire
2) Direct deposit via personal / business / cashiers check at your local Bank of America.

Before purchasing with us:

•Please make sure your local branches are open and if not, that you can initiate a wire REMOTELY, same-day.​R03;

•We will try to reply as soon as possible, but appreciate patience as it could take a few days to reply. You are also welcome to call the main line, but please leave a voicemail if we don’t immediately pick up.


Premiums have risen quite a bit since the mints are receiving record volume. However, we are one of the few companies that can pre-order and lock-in prices.

Thank you in advance and we look forward to working with you and getting precious metals in your hands!

Reach out if need by calling 1-888-465-3160 or [e-mail]

[risa5] 16/9/2020 17:40

Solar to provide most of gold plants’ daytime power – Pan African
16TH SEPTEMBER 2020

JOHANNESBURG (miningweekly.com) – The 10 MW solar electricity plant that Pan African Resources will construct on site at its Elikhulu gold-from-tailings plant next year at a cost of R50-million will take care of most of Elikhulu’s daytime power requirements.

This is the first phase of solar power generation at Evander. Pan African will be looking to expand this power facility to a possible 25 MVA for the upcoming Evander’s Egoli underground gold mine project. A similar solar plant is also being considered at Barberton. (Also watch attached Creamer Media video.

Payback on the Egoli project under way is estimated at less than five years from inception of construction, with funding provided on a nondilutive basis by a dedicated debt facility.

The amazing Elikhulu operation at Evander generated almost R1-billion of earnings before interest, taxes, depreciation and amortisation (Ebitda) in the last year, at a much lower gold price than the prevailing spot price.

Remarkably, Elikhulu, Zulu for ‘The Big One’, produced 29% more ounces at, wait for it, the extremely low all-in sustaining cost of just over $600/oz.

Elikhulu at one stage had its naysayers, but Pan African’s firm belief in its efficacy turned the naysayers into yaysayers – and the stakeholder applause is intensifying.

Mining Weekly can report that Elikhulu has access to 178.7-million tonnes of tailings that have accumulated over Evander’s seventy-year gold mining history and it is playing a positive environmental role by catalysing the removal from dump sites of legacy mine waste and freeing the land beneath the waste for new development.

The Evander tailings storage facilities (TSFs) being reclaimed are the Kinross, Leslie-Bracken and Winkelhaak TSFs, in that order. Once processed, these TSFs will be consolidated into one, shrinking Evander Mines’ environmental footprint substantially. The average gold content of the material being processed is 0.3 g/t, ranging from 0.28 g/t to 0.33 g/t.

In the next two years, Elikhulu’s tailings footprint – which yielded 59 626 oz in the period – will be enlarged and a move made to the Leslie/Bracken tailings facility, Pan African Resources CEO Cobus Loots said at the company’s presentation of superlative results for the 12 months to June 30.

The capital required for these initiatives is R300-million split over the two years. Once this move is complete, the capital will again drop to a very limited number.

The London-, Johannesburg- and New York-listed midtier gold mining company’s 2020 financial year was a year of highpoints at the safety, financial and operational levels.

On the safety front, Elikhulu went for 11 months without recording a single lost-time injury and for the first time in its history, Barberton Mines achieved three-million fatality-free shifts, with two-million at the Fairview mine.

“ESG, or environmental, social and governance, is really part of our DNA. In the past, we’ve probably not articulated this focus and our achievements sufficiently. This has to change and we have to do even more,” said Loots.

The Pan African board has approved a major agriculture project in Barberton utilising very fertile but currently fallow mine land. This initiative has the potential of creating more than 400 permanent jobs.

CLOSURE COSTS FULLY FUNDED

Pan African’s mine closure costs are fully funded and during the year ongoing rehabilitation initiatives were increased, which included the final closure of Evander’s 5 Shaft and 9 Shaft.

It was subject to a number of independent audits and reviews, including on its tailings facilities and its carbon emissions.

Loots expressed pride in the volume of work being done with regards to schools and clinics in the Barberton area.

HEDGING LOSSES

Pan African CFO Deon Louw summarised the company’s 26% increase in turnover, resulting from a combination of a 1% increase in gold sold and a substantial 24% increase in the dollar gold price and a 37% increase in rand terms, following a year-on-year depreciation in the rand:dollar exchange rate.

Although earnings increased year-on-year by 17%, the 2019 comparative financial results show that earnings actually increased by 93% if an impairment reversal that is included is eliminated, as is reflected in the company’s headline earnings.

“Under these circumstances, this is a more appropriate indicator of the relative performance,” Louw said.

These impairment reversals relate to the commencement of Evander’s 8 Shaft pillar project from the impairment of the 8 Shaft complex in the 2018 financial year. Adjusted Ebitda, which also excludes impairment reversals, increased by 52% to $87-million, enabling the reduction in net senior debt by 52% to $62-million, relative to the $130-million owing at the end of the prior financial year.

Both in dollar and rand terms, all-in sustaining cost was adversely impacted by the Covid-related production losses and the inclusion of realised hedge losses.

Production guidance has been pushed up to 190 000oz for financial year 2021, ending on June 30.

The board has proposed a record final dividend of R 312.9-million or $18.7-million, subject to approval by shareholders at the annual general meeting.

[stonedyou] 16/9/2020 16:47

The wholesale physical gold demand in China improved in August. This was primarily due to three key reasons. Firstly, Qixi – Chinese Valentine’s Day and a jewellery shopping occasion for young consumers – provided a boost for gold jewellery sales during the last week of the month, lifting wholesale demand as a result.


Secondly, even though the Shenzhen Jewellery Fair in September might not be as well attended as previous years due to the COVID-19 pandemic, many jewellery manufacturers in Shenzhen held their own promotion events, which attracted lots of retailers from all over the country.


The Chinese local gold price discount widened to the largest ever. The SHAUPM was US$69/oz cheaper than the LBMA Gold Price AM in August on average, a widening of the discount by more than 200% m-o-m.


As mentioned in my previous blog, the diverging real rates in China and Western countries such as the US – possibly a result of the faster economic recovery in China – might be the key driver for the acceleration in the widening of the discount despite an uptick in local gold wholesale demand. In other words, Chinese investors’ opportunity cost to hold gold is relatively higher than Western investors’.

[stonedyou] 16/9/2020 16:20

China’s gold market in August: strategic gold allocation rose, wholesale gold demand improved


Summary


•Both the LBMA Gold Price AM in US dollars (USD) and the Shanghai Gold Benchmark Price PM (SHAUPM) in renminbi (RMB) ended the month lower, mainly due to strong performances in equity markets1

•China’s economic signals were mixed: while supply-side economic indicators continued to improve, demand showed a relatively slower recovery

•Au(T+D)’s volumes rose further due to the greater gold price volatility in early August. Chinese gold-backed ETFs’ total gold holdings increased by 4t in the month

•Wholesale gold demand in China rose in August as gold jewellery manufacturers were preparing for Chinese Valentine’s Day late in the month, and various promotional events during September2

•The Chinese local gold price discount recorded another record level of US$69/oz last month, as real rates in China and Western countries continued to diverge3

•The People’s Bank of China (PBoC) kept its gold reserves unchanged at 1,948t in August, accounting for 3.7% of its total reserves.


Bullish momentum in the gold price paused after it reached record highs in early August. Strong stock market performance, rising interest rates, and increased global economic activity created headwinds for the gold price. As a result, the LBMA Gold Price AM in USD and the SHAUPM in RMB fell 0.95% and 2.13% respectively in August. In addition, positive news around the development of a COVID-19 vaccine also raised optimism among investors.4

With RMB strengthening and Chinese Treasury yields rising further during the month – chiefly driven by the continued improvement in the domestic economy and policy makers’ prudent attitude towards monetary easing – the RMB-denominated gold price experienced a sharper decline than in USD.

[stonedyou] 16/9/2020 16:05

Secret Tibetan Military Force Raises Stakes in India-China Clash




(Bloomberg) -- At a funeral last week in the mountains of northern India, one of Prime Minister Narendra Modi’s top aides paid respect to a Tibetan soldier killed on the front lines of deadly clashes with China.Surrounded by troops waving the flags of both India and Tibet, Ram Madhav laid a wreath before the coffin during a ceremony that gave the deceased man full military honors. In a now-deleted tweet, the national general secretary of Modi’s ruling Bharatiya Janata Party said he hoped the soldier’s death would lead to peace along the “Indo-Tibetan border.”

The rare recognition of a secretive Indian military unit with Tibetan soldiers by itself threatened to escalate a border dispute that has killed dozens since May and tanked economic ties between the world’s most-populous nations. Even more significant was the suggestion that India questioned China’s sovereignty over Tibet -- a red line for Beijing, which sees separatism as a cause also worth fighting for in places from Xinjiang to Hong Kong to Taiwan.

“The Indians are sending a message -- a very strong message, which they probably have not sent for decades,” said Robbie Barnett, who headed Columbia University’s Modern Tibetan Studies Program until 2018 and has written about the region since the 1980s. “The involvement of exiled Tibetans and the use of exiled Tibetan icons, images and flags, is hugely significant for China’s interpretation.”

Tensions High

While India and China’s foreign ministers agreed on the need for restraint during a meeting in Moscow last week, tensions along the border remain higher than at any point since hostilities resumed. Both sides continue to ramp up forces in the disputed area, which is key to controlling vital Himalayan mountain passes, with warning shots fired this month along the Line of Actual Control for the first time in more than four decades.In the past few weeks China moved fighter planes and heavy bombers to the Indian frontier from the Central Theater Command, Beijing’s strategic reserve, which wasn’t done even when the two sides went to war in 1962, according to Indian defense officials, who asked not to be identified due to rules for speaking with the media. China’s defense ministry didn’t reply to faxed questions.

[risa5] 16/9/2020 14:45

John’s Mining Journal: Pan African Resources – to sell or not to sell?

By John Cornford 16 September 2020

With gold on, possibly, a bit of a plateau, or even at what some investors might think is a peak, they might be thinking of re-deploying their profits from my gold coverage. But from which stock?

Pan African Resources (LON:PAF) (market cap £463m @24p) is definitely not one to sell, even though the price is down 15% since the end of July – when at 27.5p they had surged 150% above my buy recommendation a year ago.

Full results for the year to June will have just been published when you read this but were flagged by the company on 1st September. On about the same volume as last year, PAF’s gold sales were 26% higher, producing underlying earnings per share 87% ahead, with company debt halved throughout the year’s second half.

These results were better than expected only a few months ago, and better than forecast by Edison, which follows the company in more detail than I can (they get paid to do it by PAF after all, and are more reliable than some other ‘paid-for’ researchers I could name).

No doubt a few traders took their profit at that point, but the shares now look as though ready to resume their up-trend, if only because, on Edison’s forecast of earnings per share of 16 cents, the forward PER at 24p is less than two. Not only that, but Edison is also forecasting a 1.5 cent dividend (1.15p) to deliver a 4.8% yield.

Admittedly that is less than the 11% that was behind my strong recommendation a year ago, but it is highly likely to continue to increase when the company’s planned re-opening of the refurbished Egoli project (which it acquired along with Evander Mines – which initially proved disappointing – in 2013) starts producing in three years’ time. It will add 38% to PAF’s current gold output at an above average profit margin, while PAF’s solidly existing high-grade Barberton Mines continues to extend its already long life to at least another 15-20 years.

So, Pan African Resources is not dependent on gold continuing strong. It shouldn’t be sold.