Exxaro Resources Limited Consolidated Mineral Resources and Mineral Reserves Report 2019
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EXXARO RESOURCES LIMITED CONSOLIDATED MINERAL MINERAL LIMITED CONSOLIDATED EXXARO RESOURCES RESOURCES AND MINERAL RESERVES REPORT 2019 REPORT RESERVES AND MINERAL RESOURCES Exxaro Resources Limited Consolidated Mineral Resources and Mineral Reserves report 2019 Foreword Exxaro Resources continuously strives to enhance the level of estimation and reporting of Mineral Resources and Mineral Reserves. The group is committed to the principles of transparency, materiality and competency in reporting its Mineral Resources and Mineral Reserves. The information in this report is aligned with the JSE Listings Requirements (section 12) and encapsulates information on reporting governance, competence, tenure, risk, liabilities and assurance as well as auxiliary descriptions of applicable projects, operations and exploration activities. Mineral Resources and Mineral Reserves were estimated by competent persons on an operational or project basis, and in line with the South African Code for Reporting of Exploration Results, Mineral Resources and Mineral Reserves, 2016 edition (SAMREC Code 2016) for African properties (coal), except for Vedanta’s base metal property, and the Australasian Code for Reporting of Exploration Results, Mineral Resources and Mineral Reserves, 2012 edition (JORC Code) for Australian (coal) and Vedanta’s properties. For Coal Resources and Coal Reserves under Exxaro management’s control, estimation is in line with the South African National Standard: South African guide to the systematic evaluation of Coal Resources and Coal Reserves (SANS 10320:2004). Resource and Reserve estimates are quoted in full, irrespective of Exxaro shareholding. The report primarily encapsulates all aspects relating to Exxaro’s coal estimation and reporting, and we therefore predominantly use the terminology of Coal Resources and Coal Reserves throughout the report. We do, however, apply the terminology of Mineral Resources and Mineral Reserves where the content collectively refers to coal and base metal estimates. Exxaro reports mineral estimates that are directly under its management’s control and includes estimates for entities in which we hold a 25% interest or more. For 2019, we have excluded Tronox Mineral Sands estimates because of the decrease in Exxaro shareholding. Supplementary descriptions are provided for projects and operations directly under our management’s control. For projects and operations referred to in the report but in which Exxaro does not have management’s control, the reader is referred to that company’s website, shown below, for supplemental information. This approach ensures maximum compliance with the principles of materiality and transparency. Anglo American Coal operations and projects: www.angloamerican.com/investors/annual-reporting Kumba Iron Ore: www.angloamericankumba.com/investors.aspx Feedback Tronox: www.investor.tronox.com/secfiling.cfm We welcome feedback from stakeholders. Please send your suggestions to: Vedanta Resources base metal operations and projects: www.vedantaresources.com/investor-relations/ Hanno Olinger Manager: Integrated reporting and ESG Tel: +27 12 307 3359 Mobile: +27 83 609 1094 Fax: +27 12 307 5327 Email: [email protected] www.exxaro.com www.exxaro.com 1 Exxaro Resources Limited Consolidated Mineral Resources and Mineral Reserves report 2019 Foreword Certification by group company secretary and legal In terms of section 88(2)(e) of the Companies Act, 2008 (Act 71 of 2008), as amended (Companies Act), I, Saret van Loggerenberg, in my capacity as group company secretary and legal, confirm that, to the best of my knowledge, for the year SE van Loggerenberg ended 31 December 2019, Exxaro Resources Limited (Exxaro) Group company secretary and legal has filed with the Companies and Intellectual Property Pretoria Commission all such returns and notices as required of a public company in terms of the Companies Act and that all such 20 April 2020 returns and notices appear to be true, correct and up to date. Certification by competent persons The Exxaro lead competent persons are appointed by the The Exxaro lead Mineral Reserve competent person is Exxaro executive management team. Chris Ballot, a mining engineer registered (20060040) with the Engineering Council of South Africa. He has 23 years The Exxaro lead Mineral Resource competent person is of experience in iron ore, mineral sands and coal in Henk Lingenfelder, a member of the Geological Society of various technical and management roles. His qualifications South Africa and registered (400038/11) with the South include BEng (mining), GDE and MBA. African Council for Natural Scientific Professions. He has a BSc (Hons) in geology and 24 years of experience as a The person in Exxaro designated to take corporate geologist in coal, iron ore and industrial minerals. responsibility for Mineral Reserves, Chris Ballot, the undersigned, has reviewed and endorsed the reported The person in Exxaro designated to take corporate responsibility estimates. for Coal Resources, Henk Lingenfelder, the undersigned, has reviewed and endorsed the reported estimates. JH Lingenfelder CC Ballot BSc geology (Hons) BEng (mining) Pr Sci Nat (400038/11) ECSA 20060040 Group manager: geoscience Group manager: mining processes 263 West Avenue, Die Hoewes 263 West Avenue, Die Hoewes Centurion 0163 Centurion 0163 South African Council for Natural Scientific Professions Engineering Council of South Africa Private Bag X540 Private Bag X691 Silverton 0127 Bruma 2026 Gauteng Gauteng South Africa South Africa Both parties are in the full-time employment of Exxaro, Henk Lingenfelder as the group manager: geosciences and Chris Ballot as the group manager: mining processes. Both parties have consented to the inclusion of Resources and Reserves estimates in the integrated report 2019. Exxaro has written confirmation from the competent persons (Table 82) that the reporting is compliant with the SAMREC Code, the relevant portions of Table 1 and the JSE section 12 requirements, and they consent to the publication of the report. 2 Exxaro Resources Limited Consolidated Mineral Resources and Mineral Reserves report 2019 Contents IFC Foreword List of figures 1 Certification by group company secretary and legal 5 Figure 1: Locations of our coal operations and projects 1 Certification by competent person 6 Figure 2: Exxaro estimates over time 4 Performance at a glance 9 Figure 3: Resource-to-market model 5 Overview of Coal Resource and 12 Figure 4: Exxaro’s mining and prospecting rights in the Coal Reserve estimates Waterberg 9 Unlocking value in the estimation process 14 Figure 5: Exxaro’s mining and prospecting rights in 10 Our consolidated Mineral Resource Mpumalanga and Mineral Reserve report 16 Figure 6: Locality map for ECC mining and 11 How we report prospecting rights 17 Figure 7: Locality of the Australian MDLs and EPCs 12 Our Mineral Resources and Mineral Reserves statement 22 Figure 8: Coal joint venture operations in Mpumalanga 32 Figure 9: Arnot mine 12 Limpopo 33 Figure 10: Arnot drilling history 13 Mpumalanga 34 Figure 11: Typical north-south (A-A) section through 16 Prospecting and mining tenement information Arnot geological model 37 Figure 12: Belfast mine 16 Mpumalanga 38 Figure 13: Belfast west-east cross-section 17 Limpopo 42 Figure 14: Grootegeluk mine 17 Australia 44 Figure 15: Grootegeluk mine and the adjacent 18 Governance Thabametsi project area 19 Competent persons 45 Figure 16: Typical west-east section through Grootegeluk 20 Assurance geological model showing the various benches 22 Summarised group Mineral Resource and and zones Mineral Reserve estimates 50 Figure 17: Thabametsi project 23 Coal Resources 51 Figure 18: Generalised profile of the Grootegeluk 25 Coal Reserves and Thabametsi geological profile 27 Base Metal Resources 52 Figure 19: Cross-section through 2015 Thabametsi 27 Base Metal Reserves geological model 28 Estimation methodology summary 55 Figure 20: Dorstfontein complex 57 Figure 21: Typical southwest-northeast section through 32 Ancillary Resource and Reserve information by operation Dorstfontein geological model 61 Figure 22: Forzando complex 32 Arnot mine 63 Figure 23: Typical west-east section through Forzando 37 Belfast mine geological model 42 Grootegeluk mine 67 Figure 24: Matla mine 50 Thabametsi project 68 Figure 25: Typical north-south section through Matla 55 Dorstfontein complex geological model 61 Forzando complex 73 Figure 26: Leeuwpan coal mine 67 Matla mine 74 Figure 27: Typical cross-section through Leeuwpan 73 Leeuwpan mine geological model (Moabsvelden) 78 Tumelo mine 78 Figure 28: Tumelo locality map 83 Exploration 79 Figure 29: Tumelo cross-section 85 Endorsements 86 Abbreviations 87 Appendix A 3 Exxaro Resources Limited Consolidated Mineral Resources and Mineral Reserves report 2019 Overview of Resource and Reserve estimates List of tables 57 Table 41: Dorstfontein Coal Resource reporting criteria 18 Table 1: Exxaro reporting structure 58 Table 42: Dorstfontein Coal Resource estimation criteria 21 Table 2: Findings, impact and corrective measure 58 Table 43: Dorstfontein Coal Resource classification for Belfast tier 2 review criteria 21 Table 3: 2019 Coal Resource and Coal Reserve estimation 58 Table 44: Dorstfontein Resource and Reserve statement process audit categories 59 Table 45: Dorstfontein RPEEE considerations 22 Table 4: Attributable Coal Resource and Coal Reserve 60 Table 46: Dorstfontein production figures tonnages 60 Table 47: Dorstfontein modifying factors considered in 24 Table 5: Coal Resources