Robert Friedland, Executive Chairman of Ivanhoe Mines, and Lars-Eric Johansson, Chief Executive Officer, announced today that a new agreement will provide local, treated water to supply most of the bulk water needed for the first phase of production at the Platreef platinum-group metals, nickel, copper and gold mine now being constructed in South Africa.
Ivanhoe’s 64%-owned subsidiary, Ivanplats, signed a memorandum of agreement on May 3, 2018, with the Mogalakwena Local Municipality for the supply of a minimum of five million litres of treated water a day for 32 years, beginning in 2022, from the town of Mokopane’s new Masodi Treatment Works.
Ivanplats expects to begin receiving a small quantity of processed wastewater this year after the Masodi plant has been commissioned. Further treatment will be conducted at the Platreef mine’s on-site filtration plant to ensure compliance with Ivanplats’ quality standards. The initial supply will be used in Platreef’s ongoing underground mine development, including drilling, and surface infrastructure construction.
Friedland said the agreement is an important milestone in Platreef’s development. “Our ability to re-use this assured supply of extensively upgraded wastewater that can be produced by the modern Masodi plant from flows it receives from local households and offices is a cost-effective and sustainable approach. Similar, industrial-quality water has long been used in some mining operations. Masodi will provide most of the water we need to process our ore and, at the same time, help to minimise Platreef’s environmental footprint. Our commitment to effectively manage environmental impacts of our operations is central to Ivanhoe’s undertaking to build some of the ‘greenest’ mines in the world.”
Dr Patricia Makhesha, Ivanplats’ Managing Director, added: “We are on course to develop Platreef into South Africa’s next great platinum-group metals mine, while ensuring that we do it in a way that is environmentally responsible and resource efficient. Our water-supply partnership with Mogalakwena is an important step toward our goal of achieving a balance of economic prosperity, environmental stewardship and social responsibility.”
In July 2017, Ivanplats published its independent, definitive feasibility study for the first phase 4 Mt/y development of the Platreef mine, approximately 8 km from Mokopane. Processing of ore at the mine is projected to begin in 2022.
Ivanplats estimates that it will require approximately 7.5 million litres/day (Ml/day) of bulk water during the first-phase of steady-state production. A water-balance model developed for the mine calls for the bulk water for the first phase of production to consist of 5 Ml/d from the Masodi treatment plant, with the balance provided from ground water from local, licenced boreholes, and rainwater collected in storage ponds at the mine.
Under the terms of Ivanplats’ agreement with Mogalakwena, which is subject to certain suspensive conditions, Ivanplats will provide financial assistance to the municipality for certified costs of up to a maximum of ZAR248 million (approximately $19.6 million) to complete the Masodi Treatment Works. Ivanplats will purchase treated wastewater at a reduced rate of ZAR5 per thousand litres for the first 10 Ml/d to offset a portion of the initial capital contributed.
The Masodi plant and related infrastructure have been designed with a capacity of 10 Ml/d, with an option to be expanded by a further 5 Ml/d. Included in the agreed capital contribution is an unencumbered, upfront payment of up to ZAR37million (approximately $2.9 million) to settle outstanding debts related to the construction of the Masodi Treatment Works that will entitle Ivanplats to a right of first refusal for the purchase of all current and future treated wastewater from the plant. Ivanplats and the municipality will endeavour to collaborate on future water-supply and development projects, including other potential sources, to increase the volumes of available water to more than 5 Ml/d.