TRANS HEX Group, the Parow-headquartered diamond miner, is shedding the old as it prepares to bring onboard a shiny new operational asset from industry giant De Beers. Last month Trans Hex sold off its subsidiary Pioneer Minerals for R35m to Bondeo 140 CC.
Trans Hex directors said the sale represented the final step of a strategic process - initiated in March 2007 - to dispose of the company’s mining and prospecting projects located between Douglas and Prieska in the Middle Orange River region of the Northern Cape Province.
Pioneer holds a diamond mining right on the farm Remhoogte, and Bondeo owns other diamond mining and prospecting operations in the Middle Orange River region.
The sale should not surprise those familiar with Trans Hex’s recent efforts to find a new lease on its mining life. In the latest annual report CEO Llewellyn Delport stressed that Trans Hex’s existing South African assets were nearing end of life in their current form. “We believe that it is, however, still possible to continue to mine profitably in the lower Orange River region.”
But he argued that this would require the projects to transition to smaller and more focused operations.
While Trans Hex looks for to game changing transaction to bring the old De Beer’s Namaqualand Mine into its camp, the old Baken operation remains the flagship operating-asset. Delport said stripping in the Baken central channel would continue until the economically viable gravel had been exhausted – which could be by the end of the 2015 financial year.
But Delport said the performance at the company’s Richters-veld operations was expected to improve in the coming year due to increased volumes and grade. He said this had been made possible by equipment upgrades and the re-commissioning of the Jakkalsberg Mine.
Delport estimated that production for Trans Hex’s South African operations at 55,000 carats for the 2015 financial year.
Delport still speaks optimistically about the effects the recent acquisition of the Namaqualand Mine will have on Trans Hex.
“I believe that the companies that will succeed are those who focus on acquiring proper cash-generative projects. For us, Namaqualand Mines is such a project.”
He pointed out that substantial progress had been made in concluding the acquisition of the Namaqualand Mine from De Beers. “We expect the effective date of the acquisition to be on or about 31 October this year.”
He reminded that the conclusion of this transaction would extend the life of the Trans Hex’s local operations to 14 years.
By Jenni McCann