West Wits’ proposed development of the Qala Shallows gold project within South Africa’s rich Witwatersrand Basin has been endorsed by the Industrial Development Corporation of South Africa.

The IDC – a prominent development finance institution committed to driving economic growth and industrial development in South Africa – has expressed formal interest in providing loan funds of ZAR300 million ($23.96m) to help develop the gold project.

Qala Shallows is part of West Wits Mining’s (ASX:WWI) broader Witwatersrand Basin Project and is currently the subject of an update to its already attractive Definitive Feasibility Study.

The Qala Shallows DFS had estimated pre-tax Net Present Value and Internal Rate of Return, both measures of profitability, at US$180m and 38% respectively using a gold price of US$1,750/oz and an exchange rate of ZAR15/USD.

It will produce 680,000oz of gold over a 17-year mine life through an underground operating mining 3.2Mt of ore grade an average of 2.8 grams per tonne gold per annum.

West Wits notes that the IDC’s proposed funding package aligns with customary conditions for loan facilities, which neatly highlights the institution’s confidence in Qala Shallows and Witwatersrand.

Both parties are now collaborating to expedite the due diligence process and secure final approval of terms and conditions by the IDC’s Executive Credit Committee.

“Today, we are delighted to share the news of the IDC’s interest in providing a debt facility for our Qala Shallows project,” chairman Michael Quinert said.

“This is a testament to the immense potential and confidence in our vision for the Witwatersrand Basin Project.

“With this formal expression of interest and terms, we can now proceed to expedite the due diligence process, secure final approval, and embark on a transformative journey.” 

IDC funding and forward activity

The IDC funding will provide the foundation for funding the entire development plan outlined in the DFS.

Initial funds will be used to mobilise the mining contractor and acquire essential equipment to initiate operations.

This will enable the company to establish a robust 30,000-tonne ore stockpile, facilitating a steady delivery of 15 kilo-tonnes per month to Sibanye-Stillwater’s plant.

Qala Shallows is expected to generate revenues from gold production within six to eight months from the commencement of production.

West Wits will then build the mine up gradually towards steady-state production of 5,000 ounces of gold per month.




This article was developed in collaboration with West Wits Mining, a Stockhead advertiser at the time of publishing.


This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.