Navachab production shines, expansion funded
Highest production in history recorded last year
QKR Navachab in 2021 embarked on the Project Khaima initiative to transition towards underground mining, in addition to its open-pit operations.
The Navachab gold mine, the country's oldest open-pit mine, had a remarkable year in 2023, according to the Chamber of Mines of Namibia's annual review. The mine, which refines gold bullion for onward sales at the Rand Refinery in South Africa, recorded its highest production in its history.
More recently, early in June, RMB was appointed by QKR Navachab as the initial mandated lead arranger, underwriter and coordinator of a syndicated loan from Namibian and South African banks. The loan, providing bespoke term funding worth US$155 million - or about N$2.9 billion, is earmarked for the mine’s recently announced expansion programme.
The funding will prove crucial for the critical ramp-up of the mining and processing activities. This expansion will significantly scale up the mine’s gold output. In addition to the funding, RMB and the banking syndicate will provide risk management solutions to optimise the mine’s exposure to commodity prices, currency and major operating expenses.
Comprehensive solution
Jason Shikalepo, head of investment banking at RMB Namibia, said the deal underscored RMB's ability to deliver tailor-made solutions to its stakeholders in Namibia. “This deal stands out as one of the largest resource transactions structured and executed by a Namibian financial institution. It underscores RMB’s ability to deliver complex, market-leading solutions, bringing together stakeholders from across the financial ecosystem. By participating in such opportunities, RMB demonstrates its commitment to develop Namibia's capital markets and fostering shared prosperity for our clients and the communities in which they operate."
According to him, the transaction reinforces RMB’s long-standing relationship with QKR Navachab. "The comprehensive solution exemplifies the corporate investment bank’s unique ability to address client needs by leveraging expertise across several business units."
QKR Navachab in 2021 embarked on the Project Khaima initiative to transition towards underground mining, in addition to its open-pit operations - in line with its mine expansion strategy. “Project Khaima enabled the mine to turn around the unsustainable cost base which faced us in 2018 to a sustainable cash-flow position, which has made the company self-funding and has enabled investment into expansion projects which are critical to the sustainability of the mine,” QKR Namibia managing director George Botshiwe said at the time.
Last year, the mine's output increased by 37.4% from 2 411 kilograms of gold bullion in 2022 to 3 312 kilograms in 2023. This significant increase in production was facilitated by the ramping up of the Navachab mining fleet to 24 million tonnes per annum in 2023, from 22 million tonnes per annum in 2022. This is the highest volume mined in the history of the mine.
Increased production
In the first quarter of 2023, Navachab commissioned a second milling circuit, which contributed to the increased production. The mine also received its first own production drill rig in the fourth quarter of 2023, with the remaining production drill rigs expected to be received during the course of this year.
Navachab remains committed to the development of the resources within its mining licences, ML 31 and ML 180, and its exploration licenses, EPL 3275 and EPL 999. Most of the exploration efforts were focused on EPL 3275, which included an extensive drilling programme to assess the potential of the new Twin Hills lookalike and the Windpomp target.
In terms of safety, the Navachab gold mine retained its ISO 45001:2018 certification as recommended during the integrated management systems audit conducted in July 2023. The mine recorded no fatalities and only one lost-time injury for the year. To curb the increasing number of high potential incidents, the mining team equipped all heavy mining equipment with fatigue detection systems.
Meanwhile, labour relations in the company remained stable and cordial, with no strikes, demonstrations or labour disputes recorded in 2023. The company also invested in upskilling management with soft skills, particularly in supervisory management, and provided on-the-job technical skills training to new recruits.
Committed to development
Navachab also demonstrated its commitment to the development of its surrounding communities. The mine donated a back-up generator to the local clinic and supported farming projects in the Otjimbingwe and Usakos area. Additionally, Navachab donated two vehicles to the Namibian Police and contributed towards the electrification of an informal settlement.
In terms of environmental impact, the gold mine continued its partnership with Environmental Compliance Consultants to equip the onsite team with the required skills and knowledge on environmental management and mitigation. The environmental team embarked on a campaign to keep employees aware of the impact of their activities on the environment.
2023 was a year of significant achievements for the Navachab gold mine. It not only achieved its highest production in its history, but also made significant strides in safety, community development and environmental management.
Navachab is primarily owned by QKR Namibia Mineral Holdings and JG Investment Investments, with a 92.5% stake, while state-owned EpangeloGold possesses the remaining 7.5%.
More recently, early in June, RMB was appointed by QKR Navachab as the initial mandated lead arranger, underwriter and coordinator of a syndicated loan from Namibian and South African banks. The loan, providing bespoke term funding worth US$155 million - or about N$2.9 billion, is earmarked for the mine’s recently announced expansion programme.
The funding will prove crucial for the critical ramp-up of the mining and processing activities. This expansion will significantly scale up the mine’s gold output. In addition to the funding, RMB and the banking syndicate will provide risk management solutions to optimise the mine’s exposure to commodity prices, currency and major operating expenses.
Comprehensive solution
Jason Shikalepo, head of investment banking at RMB Namibia, said the deal underscored RMB's ability to deliver tailor-made solutions to its stakeholders in Namibia. “This deal stands out as one of the largest resource transactions structured and executed by a Namibian financial institution. It underscores RMB’s ability to deliver complex, market-leading solutions, bringing together stakeholders from across the financial ecosystem. By participating in such opportunities, RMB demonstrates its commitment to develop Namibia's capital markets and fostering shared prosperity for our clients and the communities in which they operate."
According to him, the transaction reinforces RMB’s long-standing relationship with QKR Navachab. "The comprehensive solution exemplifies the corporate investment bank’s unique ability to address client needs by leveraging expertise across several business units."
QKR Navachab in 2021 embarked on the Project Khaima initiative to transition towards underground mining, in addition to its open-pit operations - in line with its mine expansion strategy. “Project Khaima enabled the mine to turn around the unsustainable cost base which faced us in 2018 to a sustainable cash-flow position, which has made the company self-funding and has enabled investment into expansion projects which are critical to the sustainability of the mine,” QKR Namibia managing director George Botshiwe said at the time.
Last year, the mine's output increased by 37.4% from 2 411 kilograms of gold bullion in 2022 to 3 312 kilograms in 2023. This significant increase in production was facilitated by the ramping up of the Navachab mining fleet to 24 million tonnes per annum in 2023, from 22 million tonnes per annum in 2022. This is the highest volume mined in the history of the mine.
Increased production
In the first quarter of 2023, Navachab commissioned a second milling circuit, which contributed to the increased production. The mine also received its first own production drill rig in the fourth quarter of 2023, with the remaining production drill rigs expected to be received during the course of this year.
Navachab remains committed to the development of the resources within its mining licences, ML 31 and ML 180, and its exploration licenses, EPL 3275 and EPL 999. Most of the exploration efforts were focused on EPL 3275, which included an extensive drilling programme to assess the potential of the new Twin Hills lookalike and the Windpomp target.
In terms of safety, the Navachab gold mine retained its ISO 45001:2018 certification as recommended during the integrated management systems audit conducted in July 2023. The mine recorded no fatalities and only one lost-time injury for the year. To curb the increasing number of high potential incidents, the mining team equipped all heavy mining equipment with fatigue detection systems.
Meanwhile, labour relations in the company remained stable and cordial, with no strikes, demonstrations or labour disputes recorded in 2023. The company also invested in upskilling management with soft skills, particularly in supervisory management, and provided on-the-job technical skills training to new recruits.
Committed to development
Navachab also demonstrated its commitment to the development of its surrounding communities. The mine donated a back-up generator to the local clinic and supported farming projects in the Otjimbingwe and Usakos area. Additionally, Navachab donated two vehicles to the Namibian Police and contributed towards the electrification of an informal settlement.
In terms of environmental impact, the gold mine continued its partnership with Environmental Compliance Consultants to equip the onsite team with the required skills and knowledge on environmental management and mitigation. The environmental team embarked on a campaign to keep employees aware of the impact of their activities on the environment.
2023 was a year of significant achievements for the Navachab gold mine. It not only achieved its highest production in its history, but also made significant strides in safety, community development and environmental management.
Navachab is primarily owned by QKR Namibia Mineral Holdings and JG Investment Investments, with a 92.5% stake, while state-owned EpangeloGold possesses the remaining 7.5%.
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