Kolomela Mine

During the year the new mine was renamed Kolomela Mine, which means to seek deeper or further, to persevere.

The Sishen South project, to develop the Kolomela Mine, made major strides forward during 2009. The project continues on time and on budget. The first blast took place on 17 September 2009 and a total of 4.0Mt of waste material was mined during the year. The project is scheduled for first production from the mine during the first half of 2012, ramping up to full capacity of 9.0Mtpa of direct-shipping ore for export in 2013.

The project has so far had an exceptional safety performance, having gone 14 months without a lost-time injury. This is pleasing for a new project with many new staff members working with large equipment and substantial civil works.

The project has a life of mine of 30 years with the possible extension to a beneficiated product thereafter. Total mineral resource is 373Mt at a 60% Fe cut-off and 408Mt at a 55% Fe cut-off. The mine will be a standard truck and shovel operation with all mining done in house. It will consist of three different pits and will be a full dry crush and screen operation with a lump to fine ratio of 60:40. Total capex is expected to be R8.5 billion. Significant progress has been made with the construction of the primary, secondary and tertiary crushers as well as the 36km Transnet railway line linking the mine to the Saldanha line.

Major earthworks have been concluded and 50% of the civil work has been completed. Long lead time equipment has been manufactured and is in the process of being delivered. A full operations team has been appointed under general manager Aart van den Brink and a hand-over process is now underway with the project team.

Construction of 718 houses is planned in two phases around Postmasburg, the nearest settlement to the mine. The first phase will consist of 421 houses and the second 297 houses, at an estimated total cost of R550 million. Construction of civil and electrical services was undertaken during 2009 and housing construction began in February 2010. Kumba has also invested in various projects in the local area, including storm water projects, upgrading of local transport facilities and various business development projects.