TORONTO (miningweekly.com) – Platinum-group metals producer Anooraq Resources has had a “tough” production quarter during the first three months of this year at its Bokoni mine in South Africa, CEO Philip Kotze said on Thursday.

“We had a slow start-up in January, and in February we were negatively impacted on with Section 54 stoppages once again,” he said on a conference call to discuss the group's fourth-quarter and year-end earnings.

Section 54 of South Africa's Mine Health and Safety Amendment Act 2008 orders the closure of a shaft or mining area deemed unsafe.

The company is focused on increasing development to improve mining flexibility, improving concentrator recoveries and lowering operating costs.

Anooraq bought control of the Bokoni mine (then called Lebowa) from Anglo Platinum in July 2009 and has upgraded the concentrator to improve recoveries and boost production.

But Kotze conceded on Thursday that turning the operation around has not been an easy task.

“Certainly it was more difficult that we'd anticipated,” he said.

The company replaced about 80% of the management at the mine in the last year, and some 50% of middle-management, Kotze said.

“We just needed to sort-of jack up the core skills on that mine.”

Anooraq reported cash operating profit for the fourth quarter of C$959 000, but a quarterly after-tax loss of C$32,4-million.

Production in the quarter rose 7%, to 30 776 oz, and tons milled increased 10% quarter-on-quarter, to 278 242 t. The recovered grade was 4% higher, at 4,17 g/t.

However, operating costs in rand terms rose 4% quarter-on-quarter, to R964/t, excluding the effects of a stockpile adjustment.

Kotze said that he is optimistic that productivity and operating costs should improve going forward.

“There's no reason why our operation...can't run at similar levels to what the rest of the industry is running at.”

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