Leeuwpan

Previous ownership

Material notes

Iscor – Iscor mining – Kumba

Exploration began in 1990, the first box cut was commissioned in 1992 and rights were ceded to Exxaro in 2006.

Exxaro

Infill exploration drilling; the mine has been in operation for approximately 32 years – OL has been operational since 2013, OI since 2018 and the western OI extension since 2020.

Stuart Colliery, Delta Mining Company and HCI Khusela Coal coal mines own property near Leeuwpan. Thaba Chueu Mine (silica mine) is adjacent to Leeuwpan.

Leeuwpan lies alongside the R50 provincial road and is serviced by a railway line that includes a rapid load-out station inside Leeuwpan's rail loop. Eskom supplies electricity to the mine directly by means of a substation at Witklip, which is linked to a nearby Eskom power line. Potable water is supplied from drill holes and pumped to different storage facilities, due to the presence of Escherichia coli (E. coli) bacteria this is used as grey water and purified water is purchased for drinking water. Process water is supplied from a closed system, which includes the plant, slimes dams and pit dams. Water replenishment for processing comes from the pits.

Leeuwpan mine is in the Delmas coalfield, on the western border of the Witbank coalfield. The geology within the Delmas coalfield is similar to that of the Witbank coalfield.

Like the Witbank coalfield, the Delmas coalfield has up to five coal seams in the middle Ecca group sediments of the Karoo supergroup. The Karoo sequence in the area is represented by the Dwyka formation and the middle Ecca with little or no lower Ecca development. The middle Ecca sequence of coal horizons, interbedded with sediments, is highly truncated due to erosion with minor areas where the full sequence is developed. The basement is generally the Malmani dolomites from the Transvaal supergroup.

We identified two coal seams at Leeuwpan: top coal seam and bottom coal seam. The bottom coal seam correlates with the S2 of the Witbank and Highveld coalfields and the top coal seam correlates with S4 and S5. The bottom coal seam qualities are generally higher than the top coal seam qualities.

The coal seams at Leeuwpan are primarily interbedded with sandstone, shale and carbonaceous shale.

The coal was deposited on glacial sediments of Dwyka tillite, which in turn was deposited on dolomite of the Transvaal supergroup. A significant amount of magma intruded as concordant sills of dolerite in the Karoo strata in the Delmas area. Thin dolerite dyke structures that transgress the stratigraphy are associated with the dolerite intrusion. Factors controlling geological and quality continuity are mainly surface weathering, significant variation in seam thickness due to an undulating tillite floor, faulting associated with dolerite activity and dolomitic basement, and devolatilisation and weathering due to dolerite intrusions (sills and dykes).

Coal Resources and Coal Reserves occur in opencast pits OI, OL and UB.

Leeuwpan is an opencast operation with Reserves in various pits mined simultaneously. Current mining operations are on the OL and OI Reserves. The mine uses a conventional truck-and-shovel mining method.

Leeuwpan has two dense medium separation plants that beneficiate coal primarily for the thermal export market and two crushing plants, crush-and-stack and bypass plants that handle selectively mined thermal coal either for the local market or the export market depending on the quality. The second dense medium separation plant, commissioned in 2016, is operated by an independent contractor whereas the original plant is operated by Exxaro.

The dry crushing and screening plants are capable of producing either a 4 200kCal, 4 800kCal or 5 300kCal product depending on the inherent coal qualities. The beneficiation plants are used to produce a 5 300kCal product.

Leeuwpan supplies domestic and export markets.

Leeuwpan has an approved mining right that covers 4 269ha. Execution is pending following a section 102 to consolidate the two mining rights being granted.

Environmental authorisations are in place for the declared Reserves.

Vertical surface drill holes are drilled and subsequently logged on site. Lithological codes are used when capturing the lithology. Photographs of the core are taken after marking the core. Samples are split on the lithological contact, if needed, using a chisel and hammer to ensure a clean break. Each sample is put in an individual bag with all material represented in that interval, ensuring no contamination occurs between materials to be sampled. Two sample tags are marked using a permanent marker. One sample tag is placed inside the bag and the second on the outside of the bag then sealed with a cable tie.

SGS, SANAS T0561

All samples collected and bagged are registered in a sample sheet, which is also used as a dispatch sheet. The dispatch sheet is signed by the receiving laboratory personnel after ensuring that the number and sample ID on the dispatch sheet matches that of the actual samples to be analysed. Once the laboratory receives and signs the dispatch sheet, it is responsible for safekeeping and storing that batch of samples.

SGS is accredited for analytical work and participates in monthly local and international round robins.

Cape datum – LO29

acQuire

4 128

705

605

Data compositing is conducted per seam using a weighted value from individual samples that make up the seam, along with the relative density and length of each individual sample. This is conducted in GEOVIA Minex^TM.

Conducted using queries in acQuire, Minex^TM and Excel.

GEOVIA Minex^TM

Growth algorithm

2019

2021

20m x 20m

1 000m

200m

Upper: limit of weathering and topography/collar

Lower: basement/Dwyka

Roof, floor and thickness grids generated for seam structure

Raw and wash quality grids

None

2021 model ≤0.5m (S5 ≤1m)

Ash ≥50%, a non-material amount of coal ≥50% ash may be included to ensure optimised extraction.

Data has been validated and signed off by Competent Person

Yes

Seam depth, seam thickness ≤0.5m all seams except S5 thickness ≤1m, ≥50% ash content but a non-material amount of coal with ≥50% ash may be included to ensure optimised extraction, coal qualities are reported on an adb.

The Geological model was considered and signed off

Yes

2021

Structural model was considered and signed off

Yes

2021

Mining assumptions were considered and defined

Yes

Opencast

Exxaro internal audits and external audit conducted

Yes

External audit by EY in 2021.

Exploitation study with economic and mining assumptions, including geotechnical and geohydrological assumptions

Yes

LoM exploitation study (2022).

Reasonable demonstration that environmental approvals can be obtained within the context of local, regional and national governmental legislation

Yes

Current required approvals in place.

Formal tenure must be demonstrated with reasonable demonstration that a mining right approval can be obtained within the context of local, regional and national governmental legislation

Yes

Mining right valid to 2039 with no impediments noted.

Assumptions used should be reasonable and within known/assumed tolerances or have examples of precedence

Yes

Current infrastructure.

OCCS

Reserve scheduling is determined using a mine scheduling application (Scheduler) from OCCS, which is the same software used to develop the LoMP schedule. The geological three-dimensional (3D) model used for the Resource statement is referred to as the Reserve geological 3D model.

The geological model is supplied to mining, projects and technology in the form of Minex^TM grids. The grids are then imported into a reserving application (Reserver) from the same OCCS software. This application validates the geological information received by checking the integrity of the geological structure and that quality and wash table values are consistent, and to convert the geological 3D model into mineable block sizes.

Careful product selection and balancing of remaining Reserves is required at Leeuwpan to ensure maximum value for Exxaro.

Indicated Resources are generally converted to Probable Reserves and Measured Resources to Proved Reserves, after consideration of all applicable modifying factors. If one or more of the modifying factors have not been fulfilled, a Measured Resource is either not converted or the Measured Resource is converted but downgraded to a Probable Reserve and the associated risk is clearly stated. This is the case for UB, where it is classified as a Probable Reserve because of additional modifying factors such as low volatiles and the limited market for this particular quality of coal. Inferred Resources are not converted to Coal Reserves.

0.5m all seams except S5, which is 1.0m.

N/A

S5 0.31m, S4U 0.12m, S4L 0.12m, S2U 0.5m, S2L 0.12m, UB S2 0.26m.

100m boundary pillar along the new R50 road at OI West pit.

S5 0.05m, S4U 0.11m, S4L 0.12m, S2U 0m, S2L 0.11m, UB S2 0.25m.

Included in rest of modifying factors.

Included in rest of modifying factors.

45 degrees. For highwall stability, soft material is mined at least one strip ahead of hard material and coal mining activities.

90% dense media separation and 90% Fraser Alexander dense medium separation with slimes loss on dense media separation of 9% and 15% on Fraser Alexander dense media separation.

Strip ratio is determined using the energy strip ratio assessment and is considered in the reserving process using the economic model to get mining boundaries.

Environmentally sensitive areas applications made, and approval acquired before mining.

Applicable mining right considered, and all the reserved areas are within the mining rights boundary.

Applicable communities considered. Socially sensitive areas in the mining right (such as graveyards) are excluded from Reserves in the reserving process.

Applicable surface and groundwater models are considered. The pit floor was taken into consideration to minimise water handling in the pit face.