It has been a busy time for South African and Australian junior gold resources company Gold One International Limited of late.
On July 15, the world media announced the company was listing its American Depositary Receipts (ADR) on OTCQX. It was reported that each ADR will represent ten Gold One shares.
“OTCQX gives Gold One a visible market tier to increase US investor awareness for international companies that wish to have a reputable and liquid secondary market for their US shareholders, in accordance with home-country compliance requirements,” Cromwell Coulson, chairman and CEO of Pink OTC Markets told the press.
But that is not all.
Just two days later, Gold One hit our headlines again. Reports flooded in that the company had begun their second phase of resource drilling on their Ventersburg Project, located on the Witwatersrand Basin in South Africa’s Free State province.
“With Modder East fully funded and with project and production delivery occurring as planned, it is now appropriate to move Ventersburg forward more aggressively. Having secured A$37.5 million pursuant to a recent capital raising, Gold One is also well-funded to progress drilling on its pipeline of advanced gold projects. We consider Ventersburg to be Gold One’s next flagship asset,” Gold One CEO and President Neil Froneman told the press.
Then on July 21 came yet another pertinent news announcement when the company achieved their first gold pour at Modder East. The approximate 240-ounce pour comes ahead of schedule, soon after the Modder East project’s processing plant was commissioned only in June this year.
“Certainly in the short term, our focus is to bring Modder East into production in line with our budget and schedules of which the first one we’ve achieved quite comfortably, this being the first gold pour,” Froneman says exclusively to IRJ.
The company saw an 8 per cent rise in their share price on the JSE in line with the announcement of this pour.
On July 23, IRJ bagged a quick interview with Mr Froneman to catch up on all of these exciting new developments and get the definitive word on what will happen next at Gold One International.
“Modder East is a mine that’s going to produce 180,000 ounces a year at cash costs of $250 dollars an ounce. It’s got an eight-year mine life and it cost $100 million U.S dollars to bring intro production,” Froneman says.
But how has Gold One managed to exceed expectation and scheduling on this project?
“First of all, our South African assets are very different to the typical South African gold assets that you find. Here in South Africa we are focused on a shallow, low technical risk type of gold deposit of which we’ve accumulated three or four prospecting permits and assets over the last five years,” Froneman explains.
“This is in contrast to most South African gold mines because they are relatively deep and therefore probably have much higher cost structures than what we would have. I think that’s really the major difference.”
Froneman says that Gold One has always had a very clear idea of what kind of potential projects they are interested in and how they might go about embarking on such ventures.
“Our motto is that ‘you are the one in Gold One’ meaning we are very people-orientated. From a business perspective, our focus is looking for shallow gold opportunities which in turn means they are low-cash cost opportunities, which again means that we will build a business of producing gold in the lower quartile of the industry from a cash cost perspective,” he says.
“We really want to be a high-margin business and we do not want to be marginal gold producers. Our two most important assets are our people and of course the resources we have with those characteristics.”
GOLD ONE PEOPLE & COMMUNITIES
The subject of social and environmental responsibility is somewhat of a conversational breeze block when it comes to companies working in South Africa—there’s a big chunk to work through.
Of course, this has not hindered Gold One an iota. Their approach to working with and supporting the communities around their mining areas is both innovative and forward-thinking. The value the company places on people transcends fluidly to their work with local communities.
“We have well-structured and well-defined programs,” Froneman says.
“We have a social and labour plan—which is a legal requirement—that is approved and audited by the South African government. In this regard, we are focused on building an agricultural business with local and indigenous people within the region where we source our labour. We are also committed to sourcing labour within the regions that we have mines with a view to improving the overall living standards of our employees. Also, we have committed and complied with the South African mining charter which means that we support and have a very active Black Economic Empowerment initiative in place.”
THE FUTURE GOLD ONE FLAGSHIP EMERGES
Froneman is realistic about the challenges the company will face going forward.
“The biggest challenge is accessing capital at low cost. That is probably the biggest challenge we face. Certainly we have far smaller challenges when it comes to people and the quality of our assets,” he says.
But it is plain to see that Gold One has gone about selecting and developing projects which minimize these sorts of qualms. When asked about what will hit the headlines next, Froneman is upfront and confident about the potential of their Ventersburg project.
“Ventersburg currently has a 1.4 million-ounce indicated resource. We’ve just mobilized drill rigs and we are aiming to increase that resource by another million ounces by the end of the year,” he reveals.
“With Modder East well on its way to delivering according to target, our next focus area and our next flagship project is Ventersburg. I think your readers can definitely look forward to some very exciting developments at this, our next flagship project.”
Media reports state that the company plan to undertake a prefeasibility study in 2010 and a feasibility study in 2011.
So to Ventersburg and beyond, Gold One continue to impress.
“In the longer term we look to build a company that will produce at least 500,000 ounces of gold there and with a low cost base,” Froneman says.
On Friday July 31, Froneman announced that Gold One plans to produce 140 000 ounces of gold in 2010 and 180 000 ounces of gold in 2011.