JOHANNESBURG (miningweekly.com) – The growth of the once small community-based Royal Bafokeng Platinum (RBPlat) into the fully fledged mining company that it is today, provides ample evidence that transformation is best served by collaborative partnerships rather than heavy-handed laws.
“Anglo American Platinum have been an excellent partner to us. From the early days of RBPlat taking operational control, Anglo Platinum have been extremely supportive in fostering this unique transformation vehicle,” RBPlat CEO Steve Phiri told analysts and journalists on Monday, when the company reported a 5.9% increase in four-element platinum group metals production to 164 500 oz and forecast full-year production of 370 000 oz to 387 000 oz. (Also watch attached Creamer Media video.)
Black-controlled RBPlat last month announced that Anglo Platinum, its former Bafokeng Rasimone Platinum Mine (BRPM) joint venture partner, had agreed to accept R1.8-billion for the remaining 33% of the mine, giving the JSE-listed RBPlat greater exposure to one of the highest quality Merensky orebodies, which occurred at a time when the low-cost, high-grade Styldrift growth project that it has developed from scratch, has been derisked.
“Our relationship with Anglo Platinum remains excellent. The input, support and cooperation of the Anglo Platinum team has been invaluable in helping to develop our ambitions.
“I believe that we’re a model for what a mining enterprise in South Africa should be, and Anglo Platinum has played a big role in that.
“This provides ample evidence that our industry does not need heavy-handed laws to be forced to transform South Africa, but rather more collaborative partnerships, built around real transformation for sustainable growth and development.
Currently, because of the negative global sentiment towards platinum, brought about by anti-diesel sentiment in Europe, RBPlat, along with all platinum-mining companies, is having to navigate “the murky waters of ongoing market weakness”.
“It’s been a big, big challenge. Our ambitions for growth have had to be balanced by the realities of the world,” Phiri said.
But this has not stopped the company investing close to R10-billion in the quality Styldrift orebody, which lends itself to mechanised mining.
This has given the company the opportunity to pursue organic growth at a time when other big players in the platinum-mining industry are downscaling.
In the six months to June 30, RBPlat kept its cost increase well below the rate of inflation, exemplified by the unit cost of a platinum ounce rising by only 1.5%.
In the same period, Styldrift’s ramp-up contributed R476-million, which went towards paying for its capital cost.
The earnings margin improved to 13.4%, when the acquisition of the Maseve mine positioned the company to increase output at Styldrift beyond the targeted 150 000 t a month to 230 000 t a month.
BRPM operations have been improved through the life extension of South Shaft Merensky beyond 2020 and the holding on to uneconomic upper group two ounces while market conditions are unfriendly.
The decline in the group’s safety metrics is a disappointing feature of the period under review. Lost-time and serious injury frequency rates deteriorated by 3.1% and 54.6% respectively.
After the reporting period employee Venizelos de Palma Alfeu was fatally injured at BRPM South Shaft in a scraper winch related incident.
“We’re concerned about the increasing frequency of safety incidents and their reduction is a priority at all levels of the business. We’ll be diligent about implementing an intensive safety focus particularly in the second half of the year,” Phiri promised.
As at June 30, RBPlat had cash and near cash investments of R729.7-million and R2-billion in debt facilities.
The total capital expenditure (capex) for the period under review increased by 63% to R1 381-million, reflecting largely the accelerating construction activities and ramp-up to 150 000 t a month at Styldrift.
Total stay-in-business capex fell to R57-million, R42-million of it spent at BRPM and R15-million at Styldrift, to overhaul load haul dump vehicles and drill rigs.
The mining scope of the BRPM Phase III replacement project has been completed bringing total project expenditure to R1 091-million.
Development at Styldrift remains focused on establishing infrastructure and stoping face length with 3.3 km of capital development completed in the half-year and 402 000 t of ore delivered to the concentrator.
The 6.8 km overland conveyor belt between Styldrift and the BRPM concentrator and the services shaft has been commissioned, and progress has been made on silo and ventilation shaft construction. Strike conveyors and other associated ore handling infrastructure were completed in four stoping sections.
Half-year capex on the project amounted to R1 303-million, bringing total capex to R9.76-billion.