Submission to the Parliamentary Portfolio Committee on Water and Environmental Affairs John Munro - CEO 28 th June 2011

Practical Steps being taken by Rand Uranium – 2008 to date 1.AMD Treatment Plant Operations – Interim Measures  Partially treat an average of 12 ML/d of AMD from the Western Basin  Approximately 50% of the AMD discharge rate required to reduce to ECL  At maximum reliable capability of the AMD Plant  Maintained and optimised performance of this plant  Executed emergency measures on behalf of DWA March to June  Provided assistance to affected parties - alternative water sources, flood control  However RU is running out of capacity to continue even partially treating the AMD  Regular reporting and interaction with regulators on AMD and AMD Plant  Facilitated ongoing community awareness training and access to site by Civil Society, media and academia-total transparency Incurred costs in excess of R60m since December

Practical Steps being taken – 2008 to date 2. Secured the development of a Long Term Solution to the AMD  Supported WUC in development of a Long Term Solution  Supplied ongoing human capital into the solution  Championed the Implementation of a Long Term Solution and Action  September 2009 – Appeal to DWA regarding Long Term Solution - DDG level  December 2009 – Follow up appeal engagements - DDG level  March 2010– Hosted Minister Sonjica at AMD Site  March 2010 – Further DWA Workshop - DDG level and HoD’s of DWA and DMR  June 2010 – Presentation to Minister Sonjica re Long Term Solution  June Long Term Solution tabled to new DDG  July 2010 –Presented and Hosted PPC on Water at AMD Site  July 2010 – Detailed Proposal Document presented to DWA on Long Term Solution  August Hosted GDARD MEC for Environment  September 2010 – Presentation to IMC Team of Experts 3

Practical Steps being taken 3.IMC Engagement  Presented position and proposals to IMC technical team in Sept 2010  Prepared alternative short term treatment plan for Western Basin, in line with IMC recommendations released February 2011:  Expansion of RU AMD Treatment Plant Operations  Linkages to Mintails AMD Treatment Plant  Or Link to Central Basin  Presented ideas to DWEA, TCTA and National Treasury  Continued constructive engagement through various engagements, site visits and information provision  Continued operating the AMD Treatment Plant at R2.5 m/month 4

Legal Position 1. Rand Uranium was formed in December 2008,  New company, which could not have undertaken the mining that caused the Western Basin AMD  RU does not operate UG mines in the Western Basin  RU’s operating mines are 20 kms away from the Western Basin and are not connected underground  RU acquired the property on which the AMD decants and on which the AMD Treatment Plant is located 2.Water Treatment Plant Governance 1. Directives  2005 Directive – Expired in 2006, pre RU incorporation  2009 Directive - RU appealed to Water Tribunal, DWA withdrew the Directive prior to the WT hearing  2010 Revised Directive Issued  RU lodged an appeal with the Tribunal - November 2010 – Awaiting hearing date  Status in question (lapsed January 2011?) 2. Expended considerable financial and human resources on this matter  Ongoing engagement with DWA and local stakeholders regarding the AMD Treatment Plant pre and post IMC report  Rand Uranium continues ongoing partial treatment of AMD 5 THE AMD IS A LEGACY LIABILITY, WAS NOT CREATED BY RAND URANIUM

Conclusion Rand Uranium :  Has and continues to undertake very costly partial AMD treatment operations  on a without prejudice basis, given RU did not create this problem  when few other parties were taking any action in the face of an ownerless crisis  Has undertaken extensive engagement with Government to argue for action  Has extensively supported the development and implementation of a SUSTAINABLE, EXTERNALLY FUNDABLE LONG TERM SOLUTION thus obviating long term liability disputes  Has proposed various short and long term measures to meet the needs identified in the IMC Report.  Has reached a critical decision point in the face of the rejection by DWA of the Long term WUC solution 6