Good morning, everybody, and thank you for joining us for our results for the six months ending 31st of December 2021. Joining me on the webinar this morning are Riaan Davel, our Chief Financial Officer, and Jaco Schoeman, Chief Operating Officer. I'm going to be doing part of the presentation as per usual, and then Riaan will take over to talk you through the financials. Right at the end, we'll also consider your questions, and then the three of us will be available to answer whatever questions you may have. Moving on to the first slide. That's just the disclaimer. There once again. Let's just see here. Once again, I think the picture in the background is not coincidental.
It's really to give a sense of some of the stuff that we're doing in terms of our environmental containment. What you're seeing there on that picture is a piece of earth-moving equipment putting cladding on top of our tailings dam in the Brakpan area. That, of course, is for vegetation to be established, and you'll see some of those numbers there as well. Then please note the three words there. Mine, enhance, and sustain. It's really an integrated value proposition that we're hoping to bring to the market, and we're hoping that that will also appear from the content of this presentation. Moving on to the first slide, and assuming that you've read through the disclaimer. Just dealing very briefly with the highlights for the six months.
We're comparing the six months here with the first half of 2020, which was the first half after COVID had really set in. You'll see that the numbers are actually quite different between the two. The tone here is maybe also slightly different compared to what you'll see in the shareholder's letter. The letter to shareholders, you'll see that I started off by pointing out that we were actually quite pleased with the way that the business had responded in the second three months, the second quarter of the year, in terms of both volume and extraction efficiency. That notwithstanding the fact that we had quite a bit of disruption nationally in terms of electricity supply. Then the weather also started playing up.
It's been a very interesting year in terms of weather. The group key features, the highlights, we deal with six months ending December 2020 compared to the six months ending December 2021. There again, the highlights are familiar. It's our revenue, just under ZAR 2.5 billion for the six months. Operating profit, just over ZAR 830 million. Production, about 2,886 kg, 114 kg shy of 3 tons. That's a good number. It's an easy number to talk to because by referring to the amount of gold that we produce with reference to tons, it's also easy to illustrate the impact that the movement in the gold price, for example, had.
That's also in one of the slides you have there. You'll see that the gold price here for the six months on average was ZAR 863,000 per kg compared to ZAR 988,000 in the six months ending December. That's by and large or a big contributor to the change in the numbers that you see here. It's very hard to talk to these numbers compared to the six months ending December 2020, because not only did we have a very high gold price for that six months, but it also was probably one of the best producing or production periods that we've had, probably in the 12 years that I've been involved in this portfolio.
I think it's important to note that in interpreting these numbers, it's probably better to take a slightly longer-term view as to trends and how we developed over the last few years towards the position where we're now, and also the nature and the quality of the ore body that we're producing. On the whole, if one were to consider the period ending 2020 as a bit of an outlier, I think on trending you'll see why we are not dissatisfied with the way that the business has performed during that period. Head grades are down, but the gold production numbers that came through based on the extraction efficiencies that we managed to achieve were in fact very encouraging.
You'll also see that in the letter to shareholders. I make mention of the fact that we're just over 5,000 ounces over the forecast or the plan that we had for the six months. Income tax contribution of ZAR 101 million for the six months and Pay As You Earn ZAR 118 million for the same period. Maintaining a sustaining cost margin of 23%. Now, my reference to the six months ending 2020 may sound like a bit of a limitation, but I think a gold price of ZAR 863,000 a kg is still, considering the trend of the gold price over the last few years, is still a very attractive gold price.
It's still enabling us to, notwithstanding the fact that it's reduced quite a bit since last year, but still enabling us to pay dividends, to still generate free cash flow, just over ZAR 400 million free cash flow. This dividend will be the 15th year in a row that this company has paid a dividend. I think you're aware of the fact that we are a company that's cash flow focused. It's one of it's an important measure in terms of how we look at our own efficiency internally, and also an important measure in terms of how we look at growth opportunities. Being able to, again, be in a position to declare an interim dividend is something that we treasure.
It's an important part of our makeup, important part of who we are. Looking at some of the numbers at the bottom of this screen there, women in mining. It remains unchanged at 22% of total staff, which is still among the highest in the industry. Socioeconomic development spend continues the pace just under ZAR 20 million, and some very interesting developments also in that regard that I'll refer to later on. One of our important measures in terms of both our environmental dividend and also the impact that we have on society is the amount of dust coming off our facilities. We've seen a slight decrease in the total number of so-called dust exceedances.
That's dust measurements taken over a very, very large area into, I think, just over 290 dust monitors or dust buckets. We compare the outcomes there in terms of solids to the regulated threshold or standard that we need to report. Also in that regard, less dust over Johannesburg. Now moving on to the next slide, the operational trends for the period, and I think, this will give some color as to what I was alluding to earlier in terms of the six months last year being a bit of an outlier.
Looking at the operating trends, the volume operating trends at Ergo, firstly, you see that volume throughput was on par, slightly lower than the second half of last year, but still higher than the comparable six months in 2020. The yield has picked up nicely also from the second half of 2021. We're quite pleased with the way that that's trended up. That is as a consequence of plant stability and the recovery efficiencies really being maintained at a level that we're very comfortable with.
Looking at production kilos there too, you could see an improvement on H2 2021, although slightly down on H1 2021. That's in terms of Ergo. Moving on to Far West Gold Recoveries. Far West Gold Recoveries' coming into its own now. See that the volume throughput there, it's very stable. It's a single resource or single site reclamation facility. It's an all or nothing scenario, but fortunately, they've been able to maintain pretty much all through the periods that we're reflecting here. We're seeing an improvement in yield. Of course, they've started their mills. The closed circuit mill is now fully operational again. There's been some initial hiccups in terms of thickener starting, in terms of the mill gear or the axle, et cetera.
Those are engineering issues that have been overcome. We're also getting a better in terms of the gold that's recognized that we deliver to Rand Refinery. We're getting a higher percentage recognition or a lower penalty, so to speak, because the percentage of gold in our doré bar is up. The amount of copper in our percentage copper in the doré bar is down. That is as a consequence of the copper elution circuit, so that also contributed quite nicely to these numbers. Then you'll see the production there steadily on the up to 792 kg for the half year under review. Looking at the group then consolidated. Volume slightly down on half two of 2021, slightly up on half one.
You can see a lot of what's happening here, a lot of what we're reporting here is in the recovery yield. Then that is a function really of head grade and also plant efficiency. There's ongoing focus on that, making sure that we don't leave any gold, any extractable gold back in the tail. Manage this as carefully as we possibly can. Then there also you could see the production trend, slight improvement on half two of 2021, which is an encouraging trend for more normal circumstances. At this point, I'd like to hand over to Riaan, who will take you through the financial review. Thanks, Riaan.
Thank you very much, Niël. Good morning, everyone. As always, it's my privilege to join this reporting platform with Niël. If I may just provide some context before I hit the detail on the financial numbers. Niël alluded to it, the mine's enhanced sustainability on the screen. Just to note again, it's what we're trying to do as a business, and I encourage you again to have a look at our website. It has been revamped recently in our integrated report where we specify our purpose as rolling back the environmental legacy of mining and hopefully through that, starting in South Africa.
Hopefully take that further as a vision to also look at that solution, responsible environmental management and sustainable development, theoretically in any place in the world where large scale mining has taken place. Just to provide what does that mean? What does that mean to roll back the environmental legacy of mining? Now for me, and one great example of that is that we wanna mine for as long as we can 'cause if we can do that, we do more environmental cleanup, we improve lives of people living close to those dumps. We have sustainable land use, and at the same time, we also give our shareholders exposure to the gold price over a long period of time.
Again, what that doesn't mean for me is if we only look at a financial point of view, so we do not go only to the highest grade sites that we have and try to extract high -grade yield over a very short period of time and make a massive financial return. That's definitely not what it means. It's always around blending. It's always around sustainability. That's really what excites me about this business. You would have seen through all our capital projects, and I know Niël will talk through that in our planned capital expenditure of ZAR 600 million that we've guided the market to. All that we have in mind there is to optimize our process so that we can reverse the environmental legacy of mining.
That's what's really exciting to me. Obviously what we're gonna present now is a snapshot in that journey that, as you know, started in 1895, so a 127-year-old company, and we're giving a six-month snapshot of how the production and income statement and balance sheet and cash flows as it looked. Niël already alluded to it. A big theme of this six months, and obviously we compare to the six months that's ended 31st December, 2020, is gold price relatively down. Although as Niël said, and I agree, it's still a very good price where it is. Then the other theme is costs that we've seen creep up.
Obviously our business, that's the factor that we always look at very closely, 'cause obviously everything that happens, every cent per ton is multiplied by 2.4 million tons per month. That's something that we manage closely, but to a very large extent on some of our reagents, something like electricity, we are price takers. We need those products to operate. You would've seen that is a theme. We're not alone in that. For other companies and also in the world, there's a theme around supply pressures and cost pressures, inflation, for example, in the United States of America. Let me go and talk through the specific numbers with that theme in mind.
With the context that Niël has provided, for Ergo, simplistically, what that boils down, if we compare again the period ended 31 December, 2020 to the recent period of six months that's ended, our gold price is down 13%. From the ZAR 989,000 a kg to ZAR 863,000. At Ergo, as a result of also the very high yield that we experienced in that period, gold sold is down 9%, which explains the 20% decrease in revenue period on period. If you just look at the revenue numbers, you could see the gold price very clearly shining through there.
The ZAR 989,000, second half of financial year 2021, it was at ZAR 847,000 a kg, and now up to ZAR 863,000 a kg. Cash operating costs, what I've alluded to. Period- on -period for Ergo, an increase of 12%. Again, slightly higher volumes contributed to that. Increase in consumption of reagents, with changes in mineralogy of some of the sites. As I've alluded to, above CPI increases in products like steel, reagents, electricity. To a large extent, on some of those, we are price takers. It's obviously something we'll continue to manage as best we can. We are fortunately not, we have to absorb some of those costs, but it's something that we'll continuously monitor.
Again, it just shows that the decrease in gold price and gold sold, slight increase in costs, has quite a big impact on the operating profit period-on-period for Ergo, down by 62%. Moving on to Far West. As Niël has described, different operation to Ergo. Again, a very solid performance throughout the periods. What was very encouraging is gold sold period-on-period up by 13% for Far West. Niël alluded to it, the implementation of the copper elution circuit assisted with that. Also at Driefontein, Far West floor clean-up, which assisted with yield.
Although the tonnages were stable and also the cost per ton that they've managed very well, the yield was improved, and that all helped to keep revenue stable despite the gold price being down 13% period-on-period. Very solid, stable performance by Far West Gold. Again, shows the magnificent diversification in the two operations at the moment and assisting us to produce solid results overall. If you look at the group financial trends, very much the theme of gold price period-on-period. The operating margin fortunately diluted by the gold price drop that I've mentioned. Again, period-on-period it is down. The same on the all-in sustaining cost margin.
You could see the different gold prices for the different periods shining through there. Sustaining capital expenditure is stable. I'll mention that in the cash flow statement, we are expecting quite a significant uptick to reach our ZAR 600 million. All of this, as you'll see in the income statement, revenue, costs all flow down to the bottom line, which reflect as our headline earnings per share. That's down 48% period-on-period. Obviously earnings is one of the factors that we look at for dividends, free cash flow as well, capital expenditure that lies ahead. That is in line, that decrease with our interim dividend if we compare back to the same period last year.
As Niël alluded to it, really happy that we can declare a fifteenth consecutive financial year of cash return to our shareholders. Onto the income statement, or the statement of profit or loss. Just analyzing with all that background, revenue is down 16% period-on-period, with the gold price contributing 13% of that decrease, and the gold sold down 4%. Cost of sales up 8%, slightly lower than the numbers we've alluded to previously. Some positive movement in gold in process also captured in that line item. Leaving the gross profit from operating activities just over ZAR 667 million, down 48% period-on-period. Just noting our change in long-term incentive scheme.
Previously, was the final tranche, the final settlement of our cash settled scheme, which had a reversing charge in the income statement, and we've changed our scheme to a equity settled scheme, which is that ZAR 9.3 million charge in the current year. Then around corporate expenses, administration expenses, there is an increase period-on-period. Again, in line with, as we've alluded to in our integrated report around our short-term and medium-term outlook, is to look for growth also in PGMs, and we're doing studies, we're looking at investigations to see how we can grow our business. There's definitely costs supporting that coming through, but hopefully at the same time in the short to medium term, we'll also enhance our growth opportunities accordingly.
Finance income around interest and dividends. Dividends mostly from our investment in Rand Refinery and the finance expense there, only mostly non-cash, the unwinding of the rehabilitation or decommissioning liabilities through time value of money unwinding that goes through the income statement. Income tax is driven by the profits, slightly lower period-on-period, and then leaves the profit for the period just under ZAR 500 million. Also down 48% period-on-period. Again, what that boils down to, as you would know, our business is driven by the top line, by revenue and costs. That 48% decrease on the gross profit line essentially flows through all the way to the profit line. What that means though is it's not only negative.
Obviously, any uptick in the gold price will have a similar effect in that we don't have any debt. So that increase in the gold price, because we're unhedged, immediately flows through to the top line in revenue and then straight through to the bottom line. Which I believe is quite an exciting proposition, specifically for our shareholders. Statement of financial position or balance sheet, very stable period-on-period. Obviously you could see the investment in property, plant and equipment reflected in that increase. Non-current investments and other assets includes our environmental rehab assets, cell captive assets. A slight decrease mainly attributed to the fair value adjustment on our Rand Refinery investment. Cash and cash equivalents, I'll explain in the cash flow statement.
As I always say, and Niël alluded to it, one of the most important statements to indicate the exact cash flow position and other current assets up with some investment in inventory or stockpiling. Now you would see that period-on-period change up to ZAR 582 million. Equity, you see the profit and the dividends flow through the equity line. Provision for environmental rehabilitation, stable. Deferred tax liability was, you can see the uptick there. What that indicates is, yes, as we are profitable, there's definitely tax that we will continue to pay into the future if the business stays the way it is. Current liabilities and other non-current liabilities, stable.
It leaves us with an extremely healthy current ratio of 5.1 and more than the 4.5 that it was in the prior period. On the statement of cash flows, it's reflected in the cash generated by operations, the gold price impact, slightly lower gold sold. You can see the cash interest and dividends that we've received of ZAR 93 million. The interest paid, nominal around just keeping our facilities in place, as I've alluded to the finance income. Sorry, finance cost in the income statement, being mostly non-cash. Niël mentioned that, just over ZAR 100 million provisional tax payment that has gone through in this six-month period. I just wanna pause on the acquisition of property, plant, and equipment, ZAR 182.5 million.
What you can note there is that we've guided the market for ZAR 600 million. Quite a bit of capital investment that we are planning for the remainder of the financial year to 30 June, 2022. Then the dividend payment. What you see reflected there is our final dividend declared just after the end of the financial year, and then paid in September 2021 of ZAR 0.40 at ZAR 345 million. Yeah, it leaves us with a very, very stable cash position of just over ZAR 2.2 billion. Then just from our side, heading off with the share price before I hand over to Niël. Yeah, maybe some high-level comments.
Obviously, it's off its highs that it reached in August, September 2020. Just wanna remind everyone, obviously at that time, November or August 2020, we were rated the number one company through the Sunday Times Top 100 Companies. Which is reflected in a five-year total shareholder type of return. Where if any dividends is declared, that's reinvested back in the company. We're very, very proud of that achievement. Similarly, last year in November 2021, our performance over the five years, we were rated company number 17 on the JSE. What's important for me, we were still the best performing gold company listed on the Johannesburg Stock Exchange.
That's something that we're really proud of, that even over that five-year period, through capital growth and dividends, our company relative to the other gold companies still performed very well. We're very, very proud of that achievement. Niël, yeah. That's it from my side. I'm gonna hand over to Niël to take us through the rest of the presentation.
Thanks, Riaan. Yes, maybe perhaps just a little bit on the performance of that share price, obviously. The fact that our company is a dividend-paying company and that we are maintaining a return of between 3%-5%. That is something that obviously supports the share price amongst the shareholder grouping with a particular requirement or appetite in this regard. Also we do take full exposure to the gold price, and I think that's another feature of our company. There are a number of reasons why we do that. Obviously, in the first place, you don't wanna sacrifice potential upside. You don't have to protect revenue unless it's absolutely essential to do that.
With the gold price as volatile and as responsive as it is to a number of different market dynamics, we're never gonna be able to anticipate all of those. Unless for specific purpose in the short term, we don't wanna walk away from potential upside. The reality of the matter is that the company adjusts to the revenue line. The costs adjust to the revenue line over time. If you create an artificial support base for your revenue line, then at some point or another, your costs might just start challenging that revenue line.
If the instrument then expires and you're back to a gold price that is reduced all of a sudden because of the maturity of the position, the forward position, then you might find yourself potentially in a very unhealthy cost situation. We don't try to call the market, we take full exposure to the gold price. What the gold price does for those who understand its dynamics and who have an appetite for this sort of thing is it allows for buying opportunities and it provides opportunity to also take a bit of profit. I'm hoping that those who invested in our company, that they do make use of those opportunities.
That even if you long gold and long DRD, that you do take advantage of these short-term trends, and then hopefully reinvest when the buying opportunity presents itself. Moving on to the next slide, which is the shareholder profile or ownership as at 31 December, 2020. Sibanye-Stillwater is still there with a controlling stake and determined to maintain a controlling stake. I think the alignment between the two companies, the business combination potential business combination partnerships going forward, I think those are being increasingly looked at and better articulated and understood. So we're very, very comfortable with this relationship. Also something that I suppose is, you know, mentioned more and more, DRD GOLD is a company that has a fairly conservative approach to risk, to taking risk.
That is not coincidental if you look at the recent history of the company. Up until before Sibanye-Stillwater became a prominent shareholder, then, the money we spent was the money we made, and we had very little flexibility beyond what our single operation profile offered. That has changed now. We can be a little bit more robust in our approach, perhaps a little bit more ambitious, and learn from our core shareholder. Learn from our controlling shareholder in terms of innovation, expansion, entrepreneurial innovation, et cetera, et cetera. You would have seen in recent reports from our company, some of the presentations that we've done, is that we have aligned ourselves with the strategy of Sibanye-Stillwater venturing into other metals, and we're looking at opportunities in that regard as well.
We're hanging on to their coattails, so to speak, in terms of forward momentum. Some exciting opportunities, I'm sure, are potentially coming our way in that regard. We still have Bank of New York Mellon that are the custodians of our ADR program, just over half of the free float. What we're seeing is that because of the prominence of some of the investors in that ADR program, some of whom are quantitative and others who are qualitative, we're seeing that the trend pretty much is still determined in New York. New York trend pulls the South African Stock Exchange. We're still working on our register locally.
We're very thankful for some of the names that have come onto the register, and we're hoping to become increasingly a stock considered by serious investors managing the funds of clients who are serious about money. That's really who we want to be. The trend is still pretty much determined by what's happening on the New York Stock Exchange in terms of shareholding amongst the company itself. Ergo is still prominent with just on 6.6 million shares. That of course also helped us to or enabled us to cover the first tranche of the long-term incentive that performed really well late last year. That we managed to cover that without a dilution to shareholders. Very cost-effective.
The position of directors, I think that position has also, as you can see, increased quite a bit. I myself doubled my position at the end of the year through the LTI scheme and just topped up the income tax in that regard. It's still the only share that I own on the JSE. Very comfortable with where my financial future lies. That to a large extent because of the quality of my colleagues and the quality I think of this business and how we're positioned. You can see the other public ownership which is held here in South Africa and some European holdings, entities holding in South Africa.
That's the register we really want to improve in terms of quality and hopefully become a little bit more appealing in that regard. I do believe that the offering that we have, especially moving on to the next slide, is becoming increasingly compelling in terms of a broad-based integrated value proposition. On the one hand, we remain serious about cash flow, and we must be among the longest uninterrupted dividend-paying gold shares on the JSE. On the other hand, we offer the volatility, call it opportunity or full exposure to the gold price. Now what's becoming increasingly prominent is also our performance in this regard in terms of ESG. The next slide. In summary, if you look at where DRDGOLD is positioned at the moment, it's a zero waste enterprise.
We don't dig holes, we fill holes. The only waste that we produce is waste that's already on surface. No new waste is produced. We take it from where it shouldn't be, where it's become a nuisance or a risk, either in terms of the environment or in terms of society. We process it. The process that we use is very efficient, and it's the basis for a sustainable business. Then it gets stored where it no longer poses that risk or where it no longer poses that environmental nuisance. It's a contained facility that is managed towards the standards that are emerging and that are being established in terms of various governance bodies and interest groups across the globe when it comes to tailings management. Zero waste producing.
Most of the water that we're using, and you'll see if you go through the letter to shareholders, most of the water that we're using is recycled water. We've again reduced the use of potable water by 5%. It's a very, very small percentage of water. Grey water goes into the system. In the near term, we will be using more and more solar power and making use of battery storage, which will bring about a significant reduction in our carbon footprint. Here's a metals producer that creates no waste, uses recycled water, and increasingly is also going to be relying more and more and ultimately, predominantly on solar power. In terms of delivering into this broader ESG agenda, this could really be a textbook scenario.
In terms of future viability, future sustainability, we know that there are a whole host of metals that are going to be required to do this transitioning into green power. We've said that we're aligning with Sibanye-Stillwater in that regard, and we are looking at opportunities in that regard. The world is 100% committed to doing this conversion to green power, but the world is as determined to oppose mining. Globe is not a mining-friendly environment. As a consequence, accessing resources are going to become increasingly hard, and the ones that are probably the most accessible are the ones that are already stockpiled in the mine waste dumps across the globe. That's really where our focus point is, where we want to take this model of grey water and green energy and produce those metals.
I think we're at the threshold of exciting times, which we do want to pursue in parallel with Sibanye-Stillwater. It's a model that I think is a very good fit for where the world's mind is at this stage in terms of environmental impact and also in terms of society. I think we are approaching those at two, maybe three levels. On the one hand, we've made a very significant contribution and continue to make a significant contribution into the fiscus by way of income tax.
The money currently being spent by government in terms of social grants is probably one of the most important things that's happening in South Africa, the fact that we do have a very healthy social support system, and one of the main things standing between us and complete anarchy and abject poverty as a nation. On the one hand, we're putting money into the system that finds its way back into the communities where we operate. On the other end, at the other end of that scale, almost, I suppose, another closed economy loop here, we are focusing a lot of our social investment efforts on the development of that informal economy.
The picture that you're seeing on the screen here, which is of a farm that's sort of taken the next step out of the little beds, the little trenches into something slightly bigger and on its way to becoming a sustainable enterprise. Of that network, which is in excess of 4,000 families, in and around the Johannesburg and now also Carletonville area. Of that network, we are at the start, the threshold of initiating a program in collaboration with Enterprises, which is affiliated with the University of Pretoria. They've come up with 41 different programs, and there's quite a bit of information that will find its way onto our website in the near term, in the near future, aimed squarely at not just the quality of life aspect, but also on the development of the informal sector.
We believe that the informal economy is the best and the surest way out of poverty. The formal economy, especially now with industrial revolution and it's becoming so much harder to employ, formal economy is not going to be able to absorb the majority of employable individuals in South Africa and ultimately also the world. That trend is going to worsen. There will be more people unemployed at some point in future than people that are employed. You'll have these large companies generating big revenues, paying income tax. Income tax find its way into either social grant, which is what we call it, or universal income, which is what the national, international notion, this emerging notion is.
That informal economy, that's its source of capital, and that's where we're gonna be busy over the next few years in assisting communities to become sustainable, slums to become villages, and for those economies to become increasingly sustainable. Very exciting programs. As I say, 41 different programs aimed at various levels of groups, et cetera, to try and develop those. The one thing that we will not do is to participate in some sort of a false redistributive economy of taking work away from value-adding participants in the economy and they're just pretending to be empowering individuals or companies when in fact what you're doing is just moving capital around and they're not really adding value at all.
That seems to be an expectation that is emerging and we're not gonna be part of any false economy or anything in that regard. Right. Moving on to the next slide, which is the environmental performance for the six months, pretty much on trend. I see, I undersold us a little bit in terms of potable water. It's not a 5% decrease, it's a 10% decrease in externally sourced potable water. This is not something that we decided upon yesterday. I seem to recall 10 years ago we said that we want to reduce the amount of potable water that we consume every year by 10%. It was sort of a Paul Polman kind of goal that we set for ourselves.
Not very scientific, but we knew we had to start somewhere, and it's now become embedded in how we approach the consumption of a scarce resource. A very, very sophisticated system to make sure that water stays in a closed circuit. We're not wasting any water. The water that we lose is water that evaporates, but everything else gets used again. Then on the dust emissions side that I already speak about earlier, ZAR 34 million spent on rehabilitation. This is money that find its way in that line. It's not the operating cost component of rehabilitation. Basically by mining, we rehabilitate. That's not the part that's recognized here. This is dedicated towards rehabilitation, the extra cost. 37 hectares of vegetation. It's still our biggest defense against dust.
The city has become, i t's gotten over the years closer and closer to these facilities, and as a consequence, the standards of containment, environmental containment had to change and improve. Vegetation, well, in fact, exclusively in terms of new vegetation, local species, indigenous species, all of 37 hectares done there. You saw the picture right at the beginning of the presentation with the cladding that's put across tailings dam to make sure that these species can in fact settle. After about two-three years of irrigation, they become permanent. Then in terms of governance, the management of tailings, which is a hot topic internationally driven by the Church of England. It's important. I firmly believe that at some point in future, the status of tailings will become a matter of real-time public record.
We'll be able to log on to a website and see exactly what the key drivers or the key parameters are of tailings dams in terms of phreatic surface and water that's being pulled off and geotechnical data, et cetera. I think all of those will become public because it's a matter of public safety and of public interest. It's important to ensure that one's standards conform or at least are developed towards those. If you have some of the largest tailings storage facilities in the world, the Ergo tailings or the Brakpan tailings is enormous and the one that will go up in the Far West Rand at some point, those are equally impressive in size.
They need to be managed towards a very specific set of standards, and that are measured, measurable and measured, and that are reported, that are accessible. The manner in which we set up our entire governance system in this regard, I believe is a step in the right direction. With very solid in-house expertise and direct line of sight from the office, the Chief Operating Officer and his three MDs into his tailings. Very competent staff on site as well, management staff on site as well. Very good technology, including satellite imagery that can detect movements as little as 1 cm, maybe even less. Scanning by way of electromagnetic scanning.
In addition to that, also an independent panel or a panel that's made up of independent world-class experts to provide guidance and to test our ideas. Also the contractors that we use, decades, if not in excess of close to a century of experience, in many instances, to make sure that this part of the business is maintained properly and being managed in the right direction. All right. Moving on to the next slide. There we go. All right. The value add at a glance, and I've covered most of those. You'll see what the environmental spend was. Hectares, electricity consumption, MWh .
You can work out what the carbon emissions were and also see what an initial 20 MW capacity will do to that out of solar and ultimately quite a bit more other than that in eventually halving our carbon emissions once our entire solar power project is put in place. Then the potable water consumption, you can also see there 1,362 million L of water consumption. All right. Just waiting for the slide to change. All right. Now we've got two for the price of one. In terms of social spend, just under ZAR 20 million. Most of that went through the broad-based livelihood program, which was just under up from ZAR 19.6 million in the previous quarter.
As I said, that is the platform, the network through which we intend to launch the many of the programs under the Enterprise initiative. We're very fortunate of having had any fatalities. Focus very much still on making sure that we not only provide a safe working environment, but also adequate safety training and also the right sort of equipment. Considering the sort of forces and heights that are involved in what we do, a very small mistake can have very big consequences. The focus in terms of safety is a very keen focus. In terms of women in mining, a repeat of what we said in the highlights, 22% and a 73% HDSA presence in management.
Moving on to the next slide, which is just the various codes that we hold up as an aspirational goal or way we're trending. What we consider to be the governance goals that we ought to be developing towards. There you can see the Integrated Reporting standard, IIRC, GRI, Sustainable Development Goals of the United Nations, and also the World Gold Council. At the bottom there, the Sustainable Development Goals of the United Nations that particularly resonate with our activities and what we involve ourselves in. Moving on to the next. Response to COVID. I'm not going to spend too much time on this except to reflect briefly on the state of vaccination in our organization.
We didn't have anybody passing away from COVID in the period under review, which we are very thankful for. We were also really impressed with the response from staff and the staff of contract suppliers in the campaign of vaccination that we launched. At the moment, we are north of 90% of all staff completely vaccinated. This was rather the response to the campaign from our side, appealing to the sense of propriety and responsibility on the part of staff to really participate in this. To not only protect themselves, but also protect their colleagues.
With most people back at work, while we're still maintaining COVID protocols in terms of social distancing and sanitizing and so forth, the fact of the matter is that we are far more integrated now than what we were a few months ago during hard lockdown. The fact that the numbers are where they are and that the vaccination percentages are as high as they are is something that we're really encouraged by in terms of just the support from staff in this regard. Very briefly, just the community support during the period. There's a quick, very brief reference to the Enterprise study that was done.
It was interesting what we're finding is that amongst the livelihood program, many of the green shoots of individuals that have now taken this on and that are doing quite well, community members are learning from them. There's one family in particular, the Kumeka family, who have now inspired several other families to do the same thing. One of them is actually starting to sort of develop to the same standard as the Kumeka. We're very happy to see how this has taken on. It's an intuitive program, brings dignity to its participants, and that's really what lies at the heart of these programs is dignity and sustainability.
Very pleased also to have reached the three-year wage agreement at Far West Gold that will take effect from July that it will run. There's something that we probably don't talk enough about, but the Empowerment Trust, the DRDGOLD Empowerment Trust, which and 6% initially of Ergo Mining was rolled up into DRDGOLD in 2014. They, following the Once Empowered, Always Empowered principle, the fact that it was established, they sold their shares in DRDGOLD late last year, which yielded all of ZAR 152 million. Then we actually had a look.
We did a quick calculation, and we'll put that onto the website. The value add for our BEE partners, the value created for our BEE partners, both staff and our initial BEE partners was in excess of tenfold. We believe that the shareholders of DRDGOLD could participate in a very significant economic empowerment of historically disadvantaged South Africans through that program. Moving on to the next slide, which will be the looking ahead slide. There's one more, which is the copper elution circuit at Far West Gold Recoveries, which I spoke about briefly. The fact that we're now getting recognition for a higher percentage of gold content and lower copper content, and as a consequence, we now get paid for more of the gold that we deliver. There's less of a penalty. This is a big number over a year. This is a really good story, the copper elution plant.
The final slide is the looking ahead slide. As I mentioned earlier that we are 5,000 ounces ahead of plan for the year. We're trending nicely towards guidance also in terms of cash operating costs and capital investment. Very extensive capital investment this year, both towards the green power project and also towards the volume rather, volume throughput projects that we've got in place in terms of tailings enhancement and also plant enhancement, the kilns at Ergo, et cetera. In fact, on our website, our very, I think, user-friendly new website. We have these hot button features where we discuss some of these projects.
They might be small in nature and sort of looked at in isolation and against the total balance sheet. Each one incrementally adds to the efficiency, but also to the longer-term sustainability of the business. From an engineering perspective, they're all really exciting. I encourage you to please page through those and have a look at those. At Ergo, the solar plant is a big priority for us. Over the next few months we really wanna start to get going there. Then the first phase which we talk about in the letter to shareholders, there's a plan to also upgrade our reserves, and this is now within the context of infrastructure development. Then also the plans that we have in place to increase deposition capacity.
That is the main catalyst for this. If you are gonna be reprocessing mine waste, you need somewhere to take that waste to where it can be stored permanently. You need to be able to do it at a particular throughput rate. In order to maintain that throughput rate, you need a tailings deposition facility with a particular capacity, a particular size, because the rate of rise requires a very large horizontal area. That's where all of these things come into play. We're very active in that regard to make sure that we can mine as much of our resources we possibly can, as Riaan had mentioned during his presentation.
Mine, it also, in the right sort of mix, make sure that the blend is a sustainable blend, that you can almost flatline your head grade over that entire period, maintain production throughput rate, and then make sure that we maintain a cost line that's below the revenue line. Position ourselves towards both resilience but also taking full advantage of the gold price as and when it has an upcycle, as we've been experiencing in the last two years. At Far West Gold Recoveries, full steam ahead on Phase 2 plans. Plan big, but then implement incrementally towards that big plan. That means for the time being at an interim phase, and we're planning to have a day in the next few months where we'll be sharing the details of that interim plan.
It really is to take us to a doubling of volume throughput at Far West Gold and a more consolidated approach to deposition initially in order to give us the few years that we require to get the license conditions for the large tailings dam. Let's call it the regional tailings dam for that area. Get those license conditions approved. We've come up against a dead end with the Department of Water and Sanitation. They're fixating on a liner. We're taking a risk-based approach to them, and we're wanting to convince them of the merits of a risk-based approach. Minerals Council is fully on side in this regard too, because other players in the industry are experiencing a similar issue.
We'll get past that eventually because we believe that both our engineering and our science are sound and that we strike the perfect balance between geotechnical stability, safety in other words, and environmental containment. Our design will not be a bigger environmental threat than a dam with a liner, but it will be considerably safer, and it will be in the long run. Also from a long-term perspective, it will be in our opinion, it will be a guarantee against environmental pollution because liners are not permanent. At some point or another they might fail, and that defeats the whole object. The interim phase is going to be an important part also of our focus in the foreseeable future. That is everything that we have. We'll now take your questions.
I'll have a first stab at the questions, and if they're too difficult for me to answer, then I'll pass them on to Riaan and to Jaco. Thank you very much for tuning in, and thank you also for listening. Okay, I'll just click out the chat box. Right. Sandile, you've got a question. I wanted to ask Niël to provide a bit of update on the green metal strategy, specifically regarding commodities of interest. Excuse me, uranium, copper. And if this ambition will be funded from external or by controlling shareholder. Secondly, I would like to get a sense where yields are likely to normalize. Performance gold, Ergo in the next two years. Lastly, for modeling purposes, how should I think about progress long term all-in sustaining cost?
Well, not all of that is in the public domain, but we'll try and give as much information as we can at this stage. In terms of the other commodities. Sibanye-Stillwater has made it clear that it wants to focus and expand into battery metals or future metals. We've announced that we would want to partner them and align ourselves with their strategy. Where they go, we want to go with them. Where they find tailings that could be reprocessed for this purpose, we want to be involved in that process. Early days in terms of actual projects, but the conversations that we're having at this stage are good conversations. I think the right people in Sibanye-Stillwater have taken an interest in what we do.
We have the full support of their C-suite and their CEO in pursuing these goals, and it will be basically aligning ourselves with that. We don't have anything at this stage to announce that requires any sort of announcement. Obviously, the moment that there is, we will announce that. In terms of near term, in terms of uranium, it's not something that we are explicitly targeting simply because we do not have resources at this stage that are large enough in or attractive enough in terms of content to be brought into another circuit. These are very, very expensive plants to build. We would probably venture into something a little bit less challenging initially, but without closing the door on that.
The big challenge for uranium at this stage is not its prospects, but its price at the moment and justifying the CapEx to go into there. A dual product plant is a challenging plant. It's a complex plant. There is a degree of sacrifice also in terms of efficiency. If you prioritize uranium, then you lose a bit of gold. If you prioritize gold, then you lose a bit of uranium. It's really only once you see where the price of these commodities, where they settle, where that balance is established, that you could really decide the extent to which you want to go dual product. We're not there yet, though.
In terms of the rest, let's say where Sibanye-Stillwater goes, that's where we wanna go and see what opportunities present itself. Right. In terms of what the yields are, this is not something that we really put into the public domain. I mean, we give our guidance as we go forward, and you could have a look at the guidance that we give and reconcile it with the numbers that we publish. We'll see what all of those numbers are in the presentation, both in terms of Ergo and Far West Gold, and extrapolate those. In as much as we anticipate that there'll be either an increase or a reduction, we'll give due notice in that regard. My suggestion would be to extrapolate what you're seeing in the presentation now.
That will give you the weighting as well, based on the volume throughput of the two. Then also in terms of Ergo's long-term all-in sustaining cost. Yeah. Ergo's capital numbers at the moment are a little distorted because of the amount of capital that's being spent on infrastructure, so strategic, which is not sustaining CapEx in the true sense. Typically, Riaan, help me here, and I don't know if we've really, if we've departed off this rule of thumb, but it's about 5% of cash costs, is the sustaining cost, if I'm not mistaken. About $50.
That's right. As you mentioned, Niël, it is probably distorted in the short term, and it's included, some of that is included in that ZAR 600 million capital guidance. We'll definitely see in the short term the all-in sustaining costs for Ergo go up suddenly based on that spend. As Niël has alluded to it, we're obviously looking to firstly upgrade the reserve for Ergo. Closely linked to that is the increase of the Brakpan/Withok Tailings Facility. Maybe conceptually long term, and hopefully as that information becomes available, obviously the reserve upgrade will publish information in that respect.
Just conceptually, as you know, Ergo is a challenging operation in that it has many sites at the moment. If you look sort of medium-term to long-term, the idea is to approach larger sites, which has less of a cost base, a smaller cost base. That's really the vision. Volumes up from smaller sites or from fewer sites. As we see over time, maybe the grades simplistically, as you would see in the reserve statement, will decrease. Hopefully when that is available, we'll publish it. Just to give you a sense at a high level.
Thank you. All right. Then the next question is from Carl. Wanna get an update on the timelines for the PV plant and the intended total expenditure. Right. So the first phase you would have seen in the letter to shareholders is a 10 MW solar facility. Correction, a 20 MW solar facility, and then a number of storage modular storage units. And importantly also an upgrade of the existing, we call it grid infrastructure of an 88 kV line. And that's a modular sort of design, so it can be 2x that, it could be 3x that depending on the availability of CapEx and also the model on which we decide. We haven't taken a final decision on whether we wanna do this off balance sheet or internally.
Much of what you see here in terms of the first phase, we believe will be done internally. In terms of the timing, we're waiting for one letter with one signature from one regulator, one external party. Once we get that, we'll see some yellow machines, hopefully starting to move some spoilers out and we can get going. I suppose that's part of the frustration really of listening to the political promise when you know, if you do bother to listen to these speeches, and then implementing it. There is still administrative process that needs to be followed and not everybody kinda goes through his entire or her entire inbox every day and stay at the office before that inbox is clear. Some of them take a little bit longer.
Some of them seemingly don't bother to look at their inbox. Am I being cynical now. Jaco, true or not?
I don't think so. I think we might actually get that letter anytime soon. Yeah. No, we've made some good progress and we expect the costing data from Eskom. That is the only thing outstanding. Eskom has been good. They have been responsive, so I'm being a little bit unfair. In terms of capital, Riaan, I don't know if you want to share some of the numbers in terms of capital, but maybe just in terms of the 88 kV line that we wanna build. I mean, that is something that we know we'll spend internally in the near term.
Maybe Jaco wouldn't like me to do that. We probably wouldn't wanna be too specific on the capital. As you've mentioned, we wanna provide that information in the next two or three months in a day, where we give some insights on that. Let's wait for that letter, and then. It's a really exciting project. Let's wait for that. Maybe if I can combine a response to under what conditions from Peter will we look to leveraging our balance sheet, Niël, and taking on some debt and that's one scenario.
Clearly with the power plant and the battery backup, clearly our balance sheet at face value is ready for some debt and that just makes a lot of sense for us to bring in some green financing, sustainability-linked financing. I really see that as a huge opportunity 'cause as you've mentioned, it just fits like a glove with our strategy around sustainable development, green power, cheaper power, and more reliable power from a business that operates 24 hours a day. Yeah. Let's hopefully in the next, as you mentioned, two or three months, we'll be able to update the market on more specifics. I know Mr. Schoeman will hopefully be comfortable with that as well.
Yeah. I mean, You know, speaking as a person naturally conservative about this sort of thing, these are numbers that conceptually are well within our reach at the moment. It's not really going to test the balance sheet. And taking on debt and, you know, it's got green bond written all over it. That would be a matter of choice, not a matter of necessity. At least in terms of $30 million in the first phase is all about. Thank you. Thanks, Riaan. Then Nick is asking about Ergo costs. Cost increases were one-off and related to trucking, et cetera. Now we're out of the basis, we assume. Part of the reason giving us the cost increases around steel, et cetera. These costs apply equally to Far West Gold Recoveries. Why costs have not increased yet.
Remember we're talking about a vastly different volume throughput arrangement there. Ergo is close to 2 million tons a month, whereas Far West Gold Recoveries is around about 500,000 tons and a much shorter distance also in terms of pumping. With Ergo having I think adjusted to a slightly lower head grade profile and with a higher volume throughput, naturally you're going to see an increase in reagents. If you look at the cost per ton, then the increase is not significant, but the higher tons and at lower gold content, and as a consequence, more reagents. The steel is something which we simply just had to absorb.
I don't think it was foreseeable that it was going to be quite this steep. That's been factored in. That impacts more sort of on the capital expenditure. It's not a big impact in terms of operating costs. In terms of operating costs, it's really been the reagents and trucking costs. We are trucking in more high grade material. I suppose the decision that we've got to make is, are we gonna produce less gold in order to sort of preserve the cost base? Or are we going to take advantage of the higher gold price in order to bring in high grade material and still produce gold at a profit?
I think we sort of opted for the latter. Because the more tons you bring into your plant, the more on the whole you also dilute your costs. Yes, I can understand if there's a degree of frustration, but I suppose if you work with the numbers every day, they make a little bit more sense. Yes, you know, Ergo's costs, I think Ergo's is pretty much settled now at sort of the head grade levels that we can expect going forward. It's also settling into the volume profile that we can expect going forward. The increases in costs that we might see would be external. It would be inflationary. It wouldn't be because of a change in the cost makeup.
Jaco, I don't know if you wanna elaborate on that, but I think we're probably sort of into a slightly more stable profile now.
Yeah, Niël. Riaan has already alluded to it where he indicated that the mining plan calls for us to moving to bigger sites with more stable tonnages and therefore moving off some of the clean-up sites. The clean-up sites are good. They produce additional gold, but it comes at a cost, which is also some of the costs that you're seeing in that circuit. As the mining plan changes to the larger sites, we also do expect the cost to come off similarly. That is in the medium term.
We've got a vast footprint at the moment, and it's got a lot of moving parts. It is a complex footprint at Ergo at the moment. I think there are 15 sites where we are active. Two of those sites are stockpiling sites where the costs, we're stockpiling material, but we're not producing that material just yet. You would recognize some of those costs, but there's no revenue coming in. That revenue will come in at some point or another. That is how you manage and that is how you balance clean-up and production. We're in a position to do it now, and as a consequence, we are hitting these sites quite hard.
There's seven clean-up sites starting in the Far West Rand all the way through to the East Rand, and they are being sequentially targeted. Whatever we can lift and stockpile, in as much as it may have value in there, we do. Not all of that's coming into the circuit just yet because it's competing for space with some of the other throughput sites. If you compare this model now and once this has all been done, the machines are off-site, the areas have been cleared, and you're no longer reclaiming from six or seven sites, but you're down to two or three or four sites.
Of course, your cost profile looks a lot different because it's far less complex, more higher volume sites, fewer moving parts, and that could bring that ZAR 129 per ton. That could bring it down quite significantly. Admittedly, also lower yield, and you'll have to see what the reagent balance will look like at that point in time. We're talking sort of three years into the future. At the moment, the Ergo site is a complex site with a lot of moving parts, and I think the team understands it. The team is approaching it from the perspective of sustainability. We learnt a hard lesson in 2017, 2018. We had to go back to a site, go and clean it up. It was a legacy site.
While we had other sites waiting to get into, coming into circuit a lot closer to plant, but not being able to because all of the volume throughput, all the capacity was being taken up by this clean-up site. Just in the revenue in a period of six months that cost us ZAR 77 million. That's not adding the opportunity cost. We're not making that mistake again. We're making sure that, you know, once we're off-site, we're off-site, and then we can move on to the next site. Bear with us for the near term, you know, as we sort of migrate towards a slightly less complicated profile. At the moment, there are a lot of moving parts.
Yeah. Niël, if I may just from our perspective, Nick, you are right. What you've seen from the Ergo costs over the last six months. Costs will be under pressure in the near term. I think that is the reality that we're managing and our cost guidance of the cash operating cost for the group of ZAR 600,000 per kg will be under pressure. I think that is the reality of the cost pressures that we're seeing in the short term. That will remain.
Thanks. Yeah, and then I just wanna briefly deal also with a question from Arnold. His question is: We're aligning with Sibanye-Stillwater. Does that mean you're not looking at anything outside of Sibanye-Stillwater? No. I think Riaan mentioned earlier in the presentation that our purpose is to roll back the environmental legacy of mining, and our vision is to do that internationally, globally. Obviously, if there is something appealing outside of South Africa that can enable us to also diversify in terms of jurisdiction and in terms of product, provided that it's within this band of product that we've identified, then we will wanna look at that. That will be done obviously in consultation with Sibanye-Stillwater. I think theirs is still the closest. It's the shortest route to growth.
It's almost in-house growth, and one can structure those quite dynamically depending on what the sort of value unlock is that you want or the value proposition is. Do you wanna present something to the market as a standalone, something that can be modeled and brought into a balance sheet and be recognized in terms of market cap? Or is it going to be sort of a revenue-earning service that we provide because the value unlocked would not be as profound, for example, as what we had seen in the Far West Gold? There's the opportunity for dynamic conversation and structuring if that conversation is between ourselves and Sibanye-Stillwater. But yes, no, we're not closing our minds to other opportunities. We've looked at a few. South America, we've had a look in Europe, a number of things.
You know what, if it sort of fits the profile, then we might send people to go and have a look. We're not rushing into anything. Yes, we are looking broader than Sibanye-Stillwater and broader than South Africa. I think we've covered them all. Sorry, Arnold, yours was out of sequence. I didn't scroll all the way up to the top. Yes. I think we've covered them all. I don't see any other questions.
Niël, if I may, there's just one come in right at the end, from Nick Dunham, saying the increase in the transmission line for Daggafontein can't happen too far ahead of the expansion of the TSF. When do you expect the expansion to happen?
Well, as soon as we get the letter. We wanna do it now. If it's been approved. We've been sort of sitting in the starting blocks now, holding our breath, and we just need to get this cost letter from this. We think it'll be due anytime soon.
There's no further questions.
Good. All right. Well, thanks, everybody. Thank you very much for dialing in. If anything material happens, we'll announce it. In the meantime, please have a look at our website and please go through the Integrated Report. A lot of what we're trying to convey here has actually been summarized very nicely in that Integrated Report. Good. Thank you very much. Have a good day.