JOHANNESBURG (miningweekly.com) – JSE- and NYSE-listed gold newcomer Sibanye Gold is turning Beatrix gold mine’s lethal methane gas into a power generation blessing at a third of the Eskom tariff.

The highly explosive gas, which killed 40 employees between 1983 and 2001, is captured and brought to surface from depths of more than 800 m.

By month end, the five-million-reserve-ounce mine in South Africa’s Free State province, will begin self-sourcing 2.4% of the electricity it requires and increasing that to 4.8% over time.

Beatrix currently pays 57c/kWh for the 82 MW of Eskom power that it consumes and will be receiving the methane-fired power at a 33%-lower 37.44c/kWh, a discount that will mount as Eskom imposes higher tariffs over the next five years.

“We’ll do 2 MW now and, as our extraction rate increases and as we get more gas, we’ll do another 2 MW,” Beatrix environmental engineering manager Dirk van Greuning tells Mining Weekly Online.

The mine has been earning carbon credits for flaring and now stands to earn a 25% premium on that for generating electricity.

In 2010, Gold Fields, out of which Sibanye Gold was unbundled, became the world’s first gold-mining company to sell certified emissions reductions (CERs), the financial securities used to trade carbon emissions, at a time when CER projects in Africa made up less than 2% of the total number of projects that the Clean Development Mechanism (CDM) had registered.

Project development firm Promethium Carbon designed the project for implementation as a carbon credit project under the CDM of the Kyoto Protocol.

The CDM allows industrialised countries with emission-reduction commitments to meet part of their commitments by investing in projects in developing countries that reduce greenhouse-gas emissions.

Methane’s contribution to global warming is calculated to be 21 times higher than the effects of carbon dioxide, which is the most abundant greenhouse gas.

The mine’s ventilation system currently dilutes the air to decrease the presence of methane from between 5% and 15% to less than 1%.

“We are, as far as we know, the only hard-rock mine in the world with this amount of methane. It’s unique and it’s also not coming from the gold seams, it’s actually coming from the Karoo rock formations deeper down, according to the geologists,” Van Greuning tells Mining Weekly Online.

Some 1 900 litres of methane a second are needed for every megawatt of power generated and the total methane-related carbon footprint reduction is some 30%.

The project idea began in 2006 and the United Nations Framework Convention on Climate Change approved the project design document in October 2008.

“We saw the potential. There has been a lot of admin and documentation through the CDM process, which takes time, to the point where we started flaring in May 2011, and [we] have now reached the point of being able to generate electrical power as well,” Van Greuning says.

The flaring required a capital investment of some R42-million for an expected return of R200-million in carbon credits over time.

The mine, 40 km south of Welkom, has since entered into a rental contract with power company Aggreko for the methane-fired electricity.

“Renting the units has minimised our capital outlay. What we’ll do in future is decide whether to procure and install our own equipment. But currently, we’re exercising the rental power option,” he adds.

South Africa’s designated national authority, which falls under the management of the Department of Minerals Resources, approved the project as one of more than 40 projects submitted for approval under the CDM.

Group Five built the flare infrastructure on surface, to which the gas is transported over a 3.6 km distance.

The Journal of the Southern African Institute of Mining and Metallurgy in December 2011 cited as major benefits the removal of more than half of the total volume of methane gas and the reduction in the risk of methane-related incidents.

The Journal said the methane was released into the mine atmosphere in the course of normal mining operations, during which it was diluted by ventilation air to below its explosion limits, before being released into the atmosphere through the mine’s ventilation shafts.

The system, it said, was equipped with flashback arrestors, which isolated the surface main flare installation and the underground system from the main shaft column.

Self-closing valves at monitoring positions, the Journal added, slammed shut if any operating conditions were breached and preset alarm levels activated strategically placed shutoff valves in emergency situations.