What changes did South Deep introduce to enhance operational efficiency?

South Deep implemented several initiatives to enhance operational efficiency, particularly following the restructuring at the end of 2018. One significant initiative was the Siyaphambili intervention, which continued to yield positive results in 2019. This intervention focuses on building the capacity and capability of middle managers and front-line supervisors through a leadership program. It also includes a Maintenance Improvement Program, which aims to improve the reliability and effectiveness of the mine’s fleet.

As a result of these efforts, the mine’s overall productivity improved to 303 tonnes per employee in 2019, up from 286 tonnes per employee in 2018.

Can you elaborate on your solar plant investment at the South Deep mine?

The estimated capital investment for the solar plant at South Deep is R660 million, including contingencies and escalation. The funding for this investment will come from the mine’s positive cash-flow over the next two years. The escalating tariff increases and unreliable electricity supply from Eskom pose significant risks to mining companies.

Once the solar plant is completed, it has the potential to provide approximately 22% of South Deep’s average electricity consumption. This translates to a cost-saving of around R120 million per year and a reduction in the mine’s carbon footprint by 100,000 tonnes per year, bringing it down from 490,000 tonnes to 390,000 tonnes.

Could you outline the extent to which you rely on automated and remote equipment and machinery at South Deep?

At South Deep, the adoption and successful deployment of technology and remotely operated equipment are crucial. It allows us to achieve a step change in safety and health performance, productivity, and operational efficiency. Currently, we extensively use line-of-sight remotely operated Load, Haul Dump Loaders (LHDs) for loading in unsupported long hole stopes, which account for approximately 60% of the ore mined.

Building on this capability, we have also converted underground impact breakers to function tele-remotely from our surface control center. Furthermore, we have successfully deployed a non-line-of-sight tele-remote LHD operated from the surface Control Centre, and we are in the process of commissioning a second machine to expand this capability. The LHD is fully automated, except for the loading activity performed by the operator from the surface operator station. We plan to expand this capability to our underground truck fleet operating in separate haulages.

What are some of the initiatives you are promoting in the region to integrate local communities into your operations?

Integration of local communities into our operations is a key focus for South Deep. The mine is located within Rand West City Local Municipality and has nine identified host communities within its boundaries.

One of our primary focus areas is host community spend, and we have steadily increased our procurement spend in the host communities. From 2% of the mine’s total procurement spend in 2012, it reached 24% in 2020, surpassing the targets set in South Africa’s regulatory Mining Charter.

Another important focus area is host community employment, which currently stands at 70% of total employment. We believe that this plays a vital role in building strong and stable communities that can thrive, ultimately becoming a source of future employees and suppliers critical to the sustainability of our business.

Our third focus area is local Socio-Economic Spend (SED), which amounted to R26.2 million in 2019.

Can you elaborate on Gold Fields’ growth strategy and investment plan in Africa in the upcoming years?

Gold Fields is making significant investments in its African operations. Over the past few years, we have spent over US$340 million on our Damang mine in Ghana. In 2019, we also acquired a 45% stake in the Asanko mine, also located in Ghana. In South Africa, we continue to invest in our South Deep mine, focusing on improving efficiencies and returns. As of now, we do not anticipate further capital investments in the region beyond annual sustaining capital expenditure.

However, the gold market is highly dynamic, and we remain alert to potential mergers and acquisitions (M&A) opportunities on the continent that could add value for our shareholders.