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3 April 2013
Australian Securities Exchange
Level 5, 20 Bridge Street
SYDNEY NSW 2000
OPENING OF RIETFONTEIN MINE - PHASE 1
ASX ANNOUNCEMENT
HIGHLIGHTS
• Opening of Rietfontein Mine to be fast tracked
• Pre-feasibility study successfully completed and mining to commence two years
ahead of schedule
• Phase 1 targeting small scale production of 5,000 tpm, targeting 1,294 ounces
for the year of 2013 and ramping up to 8,200 ounces p.a. by 2014
• Capital cost of only $3m estimated to ramp up to 8,200 ounces p.a thereby
targeting an excellent capital to gold ratio
• Targeting revenue of approximately $2.17m for the year of 2013 and
approximately $13.73m for production in 2014.
Stonewall Resources Limited (ASX: SWJ) (“Stonewall”) is pleased to announce the
successful conclusion of the pre-feasibility study into the re-opening of the Rietfontein
underground mine. Mining is set to commence at a rate of 5,000 tpm, targeting production
of 1,294 ounces for the year of 2013 and increasing to 8,200 ounces by 2014. With the
feasibility study, mining and mine plan completed, production is commencing two years
ahead of schedule. The Rietfontein Mine is the first project for Sabie Mines Proprietary
Limited (“Sabie Mines”), a subsidiary of Stonewall.
In commenting on the opening of Rietfontein Mine, CEO, Lloyd Birrell said:
“The Stonewall approach has been to commence with bulk test work and small scale
mining and then upgrade production steadily. This approach has served us well in the past,
as demonstrated with the processing of the TGME tailings and the Klipwal tailings, both of
which are precursors to full on underground mining operations. Commencing mining
operations on a small scale allows us to build the right team, conduct underground
exploration, gain a comprehensive understanding of the geology and metallurgy and learn
about the working conditions.”
Rietfontein Mine is one of several areas of gold mineralisation held under the approved Rietfontein New Order Mining Right of
Sabie Mines. This Mining Right includes the farms, Rietfontein, Waterval, Maliveld Valley and Spitskop.
MARKET DATA
ASX code: SWJ
Current share price: $0.094
Total free floating shares: 186 million
Total restricted shares: 219 million
Deferred consideration
shares:
73 million
South African shares: 65 million
Total shares: 543 million
DIRECTORS & SENIOR MANAGEMENT
David Murray, Chairman
Trevor Fourie, Director
Nathan Taylor, Director
Liu Yang, Director
Shen Jian, Director
Lloyd Birrell, CEO
MAJOR SHAREHOLDERS
Khan International Limited
Salamanca Ventures Limited
Murray SA Investment (Pty) Ltd
Hanhong New Energy Holdings Ltd
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Re source Catego ry
ABSENT
Indicated
Inferred
Measured
Rietfontein
Resource Categor ies
Scale 1:20000 YZ Plane Time: 12:50
BACKGROUND
The Board undertook the decision to open the Rietfontein Mine ahead of schedule, after Stonewall‘s Independent Expert,
Minxcon, delivered a pre-feasibility study including a detailed mine work programme based upon a Mineral Resource of
1.901Mt as defined by the JORC Code, with a content of 1,244 Mt (316,700 ounces) indicated at 7.92 g/t and 0.657 Mt
(152,500 ounces) inferred at a grade of 7.23 g/t. In addition, during the course of January and February 2013, mine
management gained access to the mine and carried out extensive preliminary investigative work into the mining
development and infrastructure available.
The pre-feasibility study, which commenced late 2012, yielded a mining plan that would fit in with available and existing
plant infrastructure in Pilgrim’s Rest. Accordingly, an accelerated Phase 1 plan was proved in terms whereof Rietfontein
would be opened and mined at a rate of 5,000 tpm.
Geology
The Rietfontein Reef is a vertical hydrothermal quartz vein occurring in the basement granites. It penetrates the overlying
Black Reef Quartzite for a short distance before petering out. The quartz vein follows the regional trend of faulting on a NNE
– SSW direction. It has been traced over 16 km on strike and mined for 3 km along its strike length. The gold-bearing material
contains appreciable amounts of silver, copper, arsenic and bismuth. The granite surrounding the quartz vein is heavily
decomposed as a result of the hydrothermal fluids and influx of surface water along the outcrop trace of the quartz vein.
Geology – Resource Distribution
Planned Stopes
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Resources
Rietfontein has Mineral Resource of 1.901Mt (469,000 ounces), which is categorised in the table below.
Notes
1. Effective date October 2011
2. The tonnages and grade are quoted as in-situ tonnes
3. Kg to Oz conversion : 32.15076 ounces per kilogram
4. SG of Rietfontein 3.0t/m³
5. Cut-off ~ 133 cm.g/t
OBJECTIVES
The objective in commencing phase 1 mining operations on a bulk scale is three fold:
1. Generate an operating profit
2. Test for metallurgical and operational condition
3. Gain experience and understanding of the detailed underground infrastructure and build mining capability.
This effectively means that the Rietfontein Mine will commence operations two years prior to what was originally proposed.
This project is a key supplementary component in achieving Stonewall’s near-term production target of 40,000 ounces per
annum by the end of 2013*,85,000 ounces by the end of 2014, 155,000 ounces by the end of 2015 and 205,000 ounces by
the end of 2016*.
MINING PROCESS FLOW
Test Work & Ore Characteristics
Sample test results in 2009 on oxidised Rietfontein ore showed that the ore is amenable to conventional leaching. Retention
time of 24 hours resulted in recoveries of up to 95%. Based on these tests, the current circuit at TGME can be used to initially
process the oxidised Run of Mine ore as follows:
• Crushing, milling, thickening, CIL, elution, regeneration and smelting
Historical results show that a portion of the Rietfontein ore is refractory. As a result, Stonewall plans to commission the
flotation circuit to process refractory ore as follows:
• Crushing, milling, gravity, flotation, separate low and high grade leaching of float tails and concentrates respectively
• The flotation concentrate will be send to a fine grind circuit prior to leaching.
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Processing & Recovery
The mining plan will see production commencing in September 2013 and continuing until 2022. The ore that is mined at
Rietfontein will exit at the level 3 adit and be trucked to TGME Pilgrim’s Rest approx. 40km away where it will be fed into
circuit no 2. Circuit no 2, which was utilised to treat surface material, will now be utilised to treat the Rietfontein material for
a period of 12-18 months until a plant has been built in Sabie. Accordingly, it utilises the existing infrastructure which results
in a low capital requirement. The capital approved is $3m and the process flow options are fully in accordance with existing
infrastructure.
Transport
The Rietfontein Mine is situated west of Sabie and is accessible from Pilgrim’s Rest via the southbound R532 tarred main
road, which leads into the town of Sabie. An all-weather forestry gravel road off the R532 leads to the Mine after about 1 km.
(Please see map on page 1)
Planned Panels with cm.g/t per Panel
Aerial view of TGME Plant
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Timelines
Insofar as the mine planning and scheduling is concerned, mining will commence on level 3 and migrate to levels 4, 5, 6 and 7
over the next 9-10 years. The upgrading of the mining tonnages is facilitated at the same time so that the underground
exploration can continue. The development profile, waste development profile and reef development profile have all been
designed.
NEXT PHASE
As announced on 11 November 2012, Stonewall has commenced resource drilling at its TGME and Sabie Projects. At Sabie
Mines, Stonewall is targeting an increase of 0.11 Moz to 1.2 Moz (inferred) at grades of 2.02 to 6.51 g/t at Rietfontein.
Stonewall is set to carry out additional exploration drilling and bulk test work as part of its extended feasibility studies at
Rietfontein Mine, targeting an increase of the categorisation of its mineral resources, extending the Life of Mine and
increasing the mine plan to target up to 40,000 ounces p.a. by end 2014.
The bulk test work is set to include development to sample existing faces, introduce development ends at 2m intervals and
stoping on a 3 x 3m grid.
Exploration will be extended to include underground diamond drilling, drilling from off-reef development into the inferred
resource shell and target indicated resources for which 50m spaced data points are required. To attain this, cross-cuts will be
developed at 100m intervals with two holes drilled from each point to reach the desired spacing.
The bulk test work, development and exploration all endeavour to achieve:
• Geological structure delineation;
• Geological model updating;
• Pay-shoot delineation;
• Increased confidence in resource; and
• Mining guidance
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Sabie Mines Proprietary Limited
Sabie Mines is situated in the Mpumalanga Province of South Africa, and holds Mining Rights for a number of mines
surrounding the town of Sabie. The Sabie Mine complex includes the Rietfontein and Glynn’s mines. This area was
extensively mined from 1895. Production ceased in the area in 1950. It is estimated the area produced 1.6m oz of gold during
that time. Sabie Mines is a subsidiary of Stonewall, alongside Transvaal Gold Mining Estates and Bosveld Mines. Stonewall
owns 74% of Sabie Mines, and the balance is owned by historically disadvantages South Africans (BEE), which includes a
Community Trust.
Rietfontein Complex with Proposed Exploration Drilling
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ABOUT STONEWALL RESOURCES LIMITED
Stonewall Resources Limited (ASX: SWJ) is a gold mining company that holds a range of prospective gold assets, most of
which are located in the world-renowned South African gold mining regions. These South African assets, which include
several surface and near-surface gold mineralisations, provide cost advantages relative to other gold producers in the region.
Stonewall’s three key projects are the TGME Project, located around the towns of Pilgrims Rest and Sabie in the Mpumalanga
Province of South Africa (one of South Africa’s oldest gold mining districts), the Bosveld Project, located in South Africa’s
KwaZulu-Natal Province, and the Lucky Draw Project, located in Australia, near the township of Burraga in New South Wales.
Stonewall owns 74% of TGME, Sabie Mines and Bosveld Mines.
The Company began production from the TGME Project tailings operations in the 2nd quarter of 2011 and commissioned the
second tailings operation at the Bosveld Project in the 3rd quarter of 2012, and is currently earning revenue from both
operations.
Near-term projects target an increase in production to 40,000 ounces pa by the end of 2013, increasing to 205,000 ounces pa
by the end of 2016.
The near-term objective of the Company's exploration strategy is to identify an additional 330,000 to 3,070,000 ounces of
Mineral Resources by end 2013, including an upgrade of between 399,000 and 665,000 ounces from Inferred to Indicated by
end-2013, with particular focus on the Company's TGME Project.
Beyond its current strategies, Stonewall has access to nearly 40 historical mines and prospect areas that can be accessed and
explored.
For more information please visit: www.stonewallresources.com
For further information please contact:
On behalf of the Board
Peter Hunt
Company Secretary
Competent Persons Statement
The information in this Presentation that relates to Exploration Results, Mineral Resources or Ore Reserves is based on information compiled by Charles Muller, who is a Member
or Fellow of the South African Council for Natural Scientific Professions, which is a Recognised Overseas Professional Organisation’ (ROPO) included in a list promulgated by the
ASX from time to time. Charles Muller is employed by Minxcon and has sufficient experience which is relevant to the style of mineralization and type of deposit under
consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the ‘Australasian Code for Reporting of Exploration
Results, Mineral Resources and Ore Reserves’. Charles Muller consents to the inclusion in this Presentation of the matters based on his information in the form and context in
which it appears.
Forward looking statements
Statements in this announcement regarding the Company’s plans with respect to its mineral properties are or may be forward-looking statements. There can be no assurance that
the plans for development of its mineral properties will proceed as currently expected. There can also be no assurance that the Company will be able to convert Inferred resources
to Indicated resources or Indicated resources to Measured resources, that any mineralisation will prove to be economic, or that a mine will successfully be developed at any of the
Company’s mineral properties. The potential quantity and grade of exploration targets is conceptual in nature at this stage as there has been insufficient exploration to define a
Mineral Resource quantity under the JORC code. Further, it is uncertain if future exploration will result in the determination of a Mineral Resource.
Trevor Fourie, Director
Stonewall Resources Limited
Rod North, Managing Director,
Bourse Communications Pty Ltd
T: (03) 9510 8309, M: 0408 670 706,
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