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Sustainable Development REPORT 2013

Above: Irrigation is an important part of rehabilitation on the tailings dams

Natural capital

Natural capital refers to our natural assets including water, land, air, renewable and non-renewable resources.

The natural capital components are interconnected and provide us with goods and services that are wide-ranging and diverse. The collective benefits provided by the resources and processes supplied by natural capital are essential for our survival and well-being and form the basis of all economic activity.

Our context

We comply with relevant environmental legislation and integrate environmental management into our business practices from the planning stage of our projects. This ultimately helps to minimise the influence of our activities on the environment in which we operate. We have environmental management programmes in place and our environmental impacts are monitored, audited and reviewed by management to evaluate the success of our interventions before mitigation measures are considered. Management also ensures that environmental risks are identified and managed through effective controls and procedures as identified in the risk register.

Detailed Environmental Management Programmes (EMPs) are prepared which address the management and mitigation of impacts at each of the operations. At Crown Gold Recoveries (CGR), base EMPs for the Crown, Knights and City operations are supplemented with detailed site-specific documents which are prepared for each reclamation site that is reclaimed according to the mining work programme. There is a detailed EMP for the Ergo operations, revised in 2012, which takes cognisance of the impacts associated with the reprocessing of the Benoni dumps as well as the Elsburg complex. The ERPM EMP addresses the impacts associated with mining activities at this operation and was also recently amended to reflect the current status at this operation. Additionally, for ERPM, detailed closure plans, aligned with the EMP have also been prepared and implemented. The closure plans address in detail the systematic closure of all mining areas and associated activities superfluous to the current – as well as possible future – mining activities at ERPM.

Our approach

Our environmental management systems comply with legislation and regulations and endorse the principle of integrated environmental management as contemplated by the National Environmental Management Act,1998, the principal suite of legislation regulating the environment in South Africa. Compliance at our operations is measured taking account of all applicable regulatory requirements. In addition, and to effectively manage outcomes, we use the following mechanisms:

The following management actions are actively applied to lessen the impact that our activities may have on the environment:

Stakeholder engagement on environmental issues

The proximity of our operations to local communities means they can be significantly affected or inconvenienced, mainly by dust. We have established relationships with the leaders of these communities and engage with them regularly.

Before we embark on any project which will affect our stakeholders, we engage in a public participation process with I&APs.

Improving land use and management rehabilitation and seeking closure

In FY2013, some 4 803 ha of land was disturbed by our mining and processing activities. Our extensive footprint includes historic mining sites extending as far back as the 19th century. Many of the environmental issues experienced by DRDGOLD are a legacy of past mining activities.

However, at DRDGOLD we take our environmental responsibilities seriously and aim to rehabilitate the land we have used or disturbed. In FY2013 we spent R67.9 million (FY2012: R68.1 million including Blyvoor until May 2012) on rehabilitation.

Today, our policy is to mitigate dust on dumps and deposition sites as we proceed. DRDGOLD has two nurseries in the Crown and Brakpan areas where indigenous plants, suitable for the prevailing conditions on mine dumps, are cultivated and cared for by members of the local communities. The combined cost of these projects is R3.1 million (FY2012: R2.7 million). A total of 75ha (FY2012: 20ha) of top surface has been vegetated and 46ha (FY2012: 8.6ha) of side slopes vegetated.

Under our guidance members of the local communities are also being employed to remove alien plant species and replace them with plants with root systems that bind the soil, preventing water run-off.

Land rehabilitated

Legislation dictates that mining companies must rehabilitate the land on which they work to an aesthetically acceptable standard, and environmental management plans must outline details of closure arrangements, including the financial provisions that have been made to implement the plans.

All DRDGOLD operations have EMPs detailing plans for closure. In addition, detailed and site-specific closure plans have been prepared as follows:

During FY2013 there have been a few highlights in terms of the management of environmental issues. The following are worthy of note:

Land disturbed by mining and processing activities (ha)
Plants Plant area Reclamation
sites
Tailings Total
Crown 15.3 992 341 1 348.3
City Deep 10.2 560 587
Knights 4 583 56.1
Brakpan tailings dam 400 1 500 1 900
Elsburg slimes dams 341.8 341.8
Total 85.6 2 876.8 1 841 4 803.4
Rehabilitation closure
Operation Net closure liabilities Trust funds
  FY2013 (R'000) FY2012 (R'000) FY2013 (R'000) FY2012 (R'000)
Crown 219 359 182 009 62 758 59 614
Ergo 155 456 154 683
ERPM 77 149 79 128 23 599 22 421
West Rand Consolidated* 20 382 24 295
Total 451 964 436 202 86 357 106 330
  1. * No longer part of the DRDGOLD group.

The following challenges, among others, were encountered during FY2013:

Energy and fuel used
  Unit Year Crown ERPM Ergo Total*
Electricity MWh FY2013 325 509 325 509 LA
    FY2012 168 591 11 386 124 119 677 472
    FY2011 169 210 7 003 115 378 689 562
Diesel litre FY2013       1 526 098 LA
    FY2012 1 203 675 246 533 2 375 933
    FY2011 1 373 314 60 000 2 439 363
Petrol   FY2013       -
    FY2012 37 500
    FY2011 41 112
FPP waxy fuel   FY2013        
    FY2012
    FY2011
  1. * FY2011 and FY2012 totals include Blyvoor until end May 2012.
  2. LA Limited assurance.

Direct and indirect emissions

Direct emissions of CO2 (scope 1 emissions) are those for which DRDGOLD is directly responsible: the means of combustion are owned by the company and include all the emissions from liquid and waxy fuel consumed on site. In FY2013 this figure comprises the diesel purchased and consumed by Ergo.

The total scope 1 emissions equal 4 227 tons of CO2 and equivalents, representing a potential carbon tax liability of R635 050 at R150 per tonne. However, it is recognised that the specifics of the proposed carbon tax are still a long way from being finalised and will, in all likelihood, differ substantially from this figure. Thus, this number is for illustrative purposes only. A final decision on carbon taxation has not yet been made by the South African government.

Indirect CO2 (scope 2 emissions) refers to emissions generated in the production of the electricity used by DRDGOLD.

Travel emissions (scope 3 emissions) are based on reported kilometres claimed by DRDGOLD employees. These are included in total CO2 emissions. Air miles are unreported and are excluded from these calculations.

DRDGOLD showed a consistent reduction in total carbon emissions year-on-year from 2009 to 2011 and a marginal increase in FY2012, largely as a function of increased emissions from Eskom per unit electricity sold. As a result of restructuring, the size of DRDGOLD is significantly smaller, resulting in an almost 50% decrease in emissions across the board.

In South Africa, electricity is supplied by Eskom, which generates approximately 89% of its power at coal-fired power stations, resulting in significant indirect emissions for South African customers. The emission factors related to the use of Eskom power change subtly year-on-year, but since these all reflect the actual emissions expected for that year, data is not analysed for 2012 factors.

Emissions and inputs per unit of Eskom electricity consumed
    Units Ergo (incl ERPM) Corporate
Electricity consumption Factor MWh 325 509 LA 0
Coal use 0.56 t 182 285 0
Water use 1.42 kl 462 223 0
Particulate emissions 0.32 t 104 0
CO2 emissions 1.00 t 325 509 LA 0
CO2 emissions 1.20 t 390 611 0
SOx emissions 8.23 t 2 679 0
NOx emissions 4.35 t 1 416 0

The emission factor for CO2 of 1.2kg per kWh has been used as recommended by the United Nations Framework Convention on Climate Change.

Summary table of total of emissions (tonnes)
Measure FY2013 FY2012 FY2011
Direct CO2 (scope 1) 4 090 LA 8 159 8 472
Indirect CO2 (scope 2) 390 611 LA 697 796 682 666
Travel emissions (scope 3) 146 265 234
Total CO2 emissions 329 745 706 220 691 372
NOx 1 521 3 096 3 050
SOx 2 686 5 586 5 355
VOC 9 13 14
Carbon monoxide 23 35 36
Methane 0 2 2
Particulate emissions 112 217 228
  1. LA Limited assurance.

DRDGOLD uses cyanide in the gold liberation process. In accordance with the requirements of Section 9 of the MHSA, mandatory Codes of Practice on cyanide management are in place at all DRDGOLD operations. The transport, offloading and use of cyanide, as well as training and safety requirements to ensure the safe handling of cyanide are managed according to the Code of Practice which is strictly adhered to.

Primary materials used (tonnes)
Measure FY2013 FY2012* FY2011*
Cyanide 5 712 LA 6 574 6 682
Steel (grinding) 5 757 8 098 9 274
Hydrochloric acid 1 312 1 656 1 482
Caustic soda 2721 2 465 2 403
Lime 38 463 29 306 42 973
Carbon 859 1 267 1 114
  1. * Figures include Blyvoor until end May 2012.
  2. LA Limited assurance.

Nuisance dust prior to and during RECLAMATION

Modern-day retreated tailings are deposited according to stringent regulations when compared with deposits in the 1970s. However dust, especially during the winter months on the Witwatersrand, remains one of our most challenging issues. In December 2012 Government Notice 1007 was published on the Draft National Dust Control Regulations for South Africa. Our dust suppression measures are in line with this regulation. Dust monitoring is performed monthly by SGS Environmental Services and quarterly dust monitoring meetings are held at the Crown site to discuss the quarter's results.

Windblown dust fall-out is measured and monitored based on the American Society of Testing and Materials Standard Method for collection and analysis of dust fall (ASTM D 1739). A simple device, consisting of a cylindrical five-litre plastic container (bucket) half-filled with de-ionized water is used. This container, which is placed within a bucket stand on a 2.1 metre galvanized steel pole, is exposed to the elements for cycles of one calendar month (30.3 days). The buckets are collected monthly and the de-ionized water within the container treated with an inorganic biocide to prevent algae growth. At the laboratory the buckets are rinsed and de-ionized to remove all residue from the sides of the bucket. The bucket solids are processed through a coarse filter to remove insects and grit, and then filtered through a pre-weighed paper filter to remove the dust fraction. This dust fraction as well as the filter are both dried and gravimetrically weighed and analysed to determine the insoluble dust fraction which is then reported as dust fall-out in milligrams per square metre per day, averaged over a one-month period.

Dust complaint registers are kept at the operations. We log and register all complaints for attention.

During FY2013, a total of 115ha of high-risk areas were stabilised using netting which proved very effective. The re-vegetation programmes for the Crown and Ergo tailings dams were expedited and significant progress made. This programme will be further advanced during FY2014. On the Ergo complex, numerous trials using chemical dust suppressants were undertaken. We make use of water carts to wet roads in the areas where reclamation activities are being undertaken. The measures implemented have been effective when compared with the FY2012 dust fall-out results, as shown below.

Dust fall-out results
Operation Number of points monitored Number of points monitored Number of exceedances Number of exceedances Exceedances as a percentage of
total in 2013
Exceedances as a percentage of
total in 2012
  2013 2012 2013 2012 (%) (%)
Crown 827 942 31 105 3.75 11
Ergo 223 264 9 10 4.04 14
ERPM 247 258 11 40 4.45 14
Group 1297 1 464 51 155 4.08 13

Pollution caused by pipeline leakage

The length and route of our pipelines require that we dedicate significant resources and time to pipeline monitoring and maintenance. To mitigate the risks of leakage, new pipes were installed along the route from Crown to Ergo via City Deep as well along a number of the other pipeline routes. There is a programme in place to systematically replace any old and/or worn pipes. A 24/7 telemetric pressure, flow-monitoring system is in place to indicate leaks.

In addition, a pipeline and spill management programme has been implemented which includes daily patrols of all major pipeline routes, a reporting mechanism to immediately report any leaks encountered and a preventative maintenance team which immediately and pro-actively addresses leaks to prevent a minor problem escalating into a major incident.

AMD and water pollution

The central basin, created during decades of mining on the Witwatersrand, is currently flooding and water is expected to decant around ERPM Cinderella Shaft unless preventative measures are taken. This water, known as AMD, is contaminated with metal sulphides.

Government has rejected the proposal to contain the situation which was submitted by various mining companies, including DRDGOLD, opting instead to contain the situation itself and appointing the TCTA as the main contractor to implement its plan. DRDGOLD is collaborating with the TCTA and has placed both land and infrastructure at its disposal from where it can pump AMD and construct a treatment plant. The TCTA pump station and plant is expected to come into operation early in 2014. The plant will treat water to a "grey" standard before releasing it into the environment. DRDGOLD has negotiated an option to purchase up to 30Ml grey water per day from TCTA should it need to do so.

During FY2013 Crown and Ergo each had two spillage incidents. At Crown the return water dams overflowed at one of the main tailings complexes, commonly referred to as GMTS. The following action was immediately taken in order to prevent a recurrence of this incident:

The return dams at another tailings complex associated with the Crown operations (Mooifontein) also overflowed and the pump station was subsequently upgraded to prevent future occurences. Two pollution incidents associated with pipe bursts and dam overflows at the Ergo operations were also addressed during the year and the affected areas were cleaned. We have also applied to have all Crown's existing water usage licences and permits consolidated into an Integrated Water Usage Licence (IWUL).

The status of the Ergo IWUL is as follows:

DRDGOLD has received authorisation from the DWA to utilise nearby waste water treatment works to replace potable water in its circuits and to irrigate the vegetation on its tailings dams. Once we have received the various authorisations we will begin construction of the pipelines that link our workings with the plants later this year. This source will bring about a significant saving in water costs and also reduce our usage of potable water.

Total water used and recycled (000m³)
Measure FY2013 FY2012* FY2011*
Potable water from external sources 5 748 8 301 8 491
% of total water used that is sourced from external sources 20 23 26
Groundwater used 1 800 15 198 6 299
% water used that is groundwater 6 43 19
Water recycled in process 21 773 15 154 17 674
% of water that is recycled 74 43 55
Total water used 29 321 LA 35 508 32 464
  1. * Figures include Blyvoor until end May 2012.
  2. LA Limited assurance.

To address legitimate concerns of stakeholders and affected parties DRDGOLD will:

DRDGOLD did not receive any material fines in respect of non-compliance with laws and regulations during FY2013.

DRDGOLD believes that, commensurate with its formal Environmental Policy, it is pro-active in effectively managing environmental impacts at its operations. Mindful that careful monitoring of policies should result in continued improvements, DRDGOLD will, as part of its Environmental Management System, aim to remain pro-active and continue to develop measures over time.