Amplats' third-quarter PGMs output down 2% y/y

22nd October 2020

By: Simone Liedtke

Creamer Media Social Media Editor & Senior Writer


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By the end of the third quarter, platinum group metals (PGMs) mining company Anglo American Platinum's (Amplats') own-managed operations reached 94% of normal capacity.

The Mogalakwena, Unki and Motolo operations delivered strong performances, with output up by 12%, 9% and 6%, respectively, for the quarter.

Amplats' total PGMs production of over 1.1-million ounces was, however, 2% lower year-on-year, largely owing to lower production from Modikwa and Kroondal, as well as lower production from Amandelbult.

Platinum production, overall, was down 2% to 516 400 oz, while palladium production remained flat at 352 200 oz.

The impact of the pandemic on the business continued during the quarter and PGM ounces lost for the quarter amounted to 119 000 oz, bringing the year-to-date total to 712 000 oz. The most notable impact in the third quarter was at the miner’s joint operations, where 55 000 oz were lost, while a further 52 000 oz were lost from third-party metal providers. Amandelbult lost 5 000 PGM ounces.

Mototolo lost 6 800 PGM ounces owing to Covid-19 for the quarter, but production exceeded that of the second quarter.

Owing to the overall metal-in-concentrate (M&C) production performance during the three months, Amplats has increased its full-year M&C production guidance to between 3.6-million and 3.8-million ounces of PGMs, an increase on the previous guidance of between 3.1-million and 3.6-million ounces.

Meanwhile, total PGMs production from own managed mines increased by 1% to 652 000 oz, comprising a platinum production decrease of 1% to 295 100 oz and a palladium production increase of 6% to 238 600 oz.

Mogalakwena's PGMs production increased by 9% to 315 000 oz (platinum production increased by 7% to 132 000 oz and palladium production increased by 12% to 146 000 oz). The PGMs production increase is owing to higher throughput and improvements in concentrator recovery, but partly offset by a decrease in the platinum, palladium, rhodium and gold, or 4E, built-up head grade.

The mine continued to operate at normal production capacity during the quarter.

Amandelbult's PGMs production decreased by 12% to 204 800 oz (platinum production decreased by 13% to 102 800 oz and palladium production decreased by 11% to 48 300 oz).

The lower production against the third quarter of 2019 was primarily owing to infrastructure closures at the end of 2019 at Tumela Upper (9 800 PGM oz), surface material/opencast production coming to its end of life (21 200 PGM oz) and Covid-19 restrictions (5 000 PGM oz). This was partially offset by increased production from Dishaba Upper of 7 200 PGM oz.

Amandelbult was operating at 90% of normal operating levels at the end of the quarter.

Mototolo's PGMs production increased by 6% to 72 200 oz (platinum production increased by 6% to 33 300 oz and palladium increased by 7% to 20 700 oz). This performance was despite suffering 6 800 PGM ounces of losses as a result of Covid-19 during the quarter, as the prior period was impacted by geological features that resulted in a grade decline.

Unki's PGMs production increased by 12% to 60 000 oz (platinum production increased by 14% to 27 000 oz and palladium production increased by 10% to 23 600 oz).

PGMs production from joint ventures (50% own mined production and 50% purchase of concentrate) in total decreased by 23% to 190 600 oz (platinum production decreased by 22% to 85 400 oz and palladium production decreased by 24% to 56 400 oz), largely owing to the impact of Covid-19 and the safety stoppage at the Modikwa joint operation, where the group experienced one work-related fatality at Modikwa, and another at Amandelbult.

Modikwa's PGMs production decreased by 27% to 61 400 oz (platinum production decreased by 25% to 24 000 oz and palladium decreased by 27% to 23 200 oz). This was largely owing to Covid-19 restrictions, as well as owing to a tragic loss of life incident and associated safety stoppages.

Kroondal's PGMs production decreased by 21% to 129 200 oz (platinum and palladium production decreased by 21% to 61 400 oz and 33 200 oz, respectively), largely owing to Covid-19 restrictions.

The purchase of PGMs concentrate (POC) from third parties increased by 8% to 270 200 oz (platinum POC increased by 13% to 136 000 oz and palladium POC increased by 10% to 57 200 oz). Increases in volumes were from the Bafokeng Rasimone Platinum Mine and Platinum Mile while lower production was received from other providers.

Meanwhile, PGMs production decreased by 16% to 884 900 oz (platinum and palladium sales volume both decreased by 17% to 448 500 oz and 261 700 oz respectively) owing to lower refined production and the rebuild of refined inventory during the third quarter.

PGM sales volume from trading increased by 210% to 341 000 oz (platinum trading volumes increased by 499% to 105 000 oz and palladium trading volumes increased by 170% to 214 600 oz).  

PGM sales volumes for the year will remain highly dependent on the level of refined production in the fourth quarter, the miner said.

Refined PGMs production (owned) decreased by 14% to just over one-million ounces. This lower output, the company explained in a statement on October 22, was principally owing to interruptions at the Anglo Converter Plant (ACP), and was offset marginally by increased throughput.

CEO Natascha Viljoen lamented that refined production continued to be interrupted by water leaks at the ACP’s Phase B unit, but said Amplats has put increased monitoring in place at the Phase B unit to ensure an ongoing safe operating environment for employees, averring that Amplats “will continue to take all appropriate measures to keep people safe” while waiting for the Phase A unit to restart.

The ACP Phase B unit, which was recommissioned following the incident at the ACP Phase A unit, has been operating past its useful life and is therefore challenged with reliability issues, and increased monitoring has been put in place at the ACP Phase B unit to allow for proactive risk control, ensuring an ongoing safe operating environment for our employees and to maintain the integrity of our assets.

Owing to these proactive measures, water leak repairs, essential maintenance, testing and monitoring at the ACP Phase B, production was disrupted for 20 days during the quarter.

Refined production in the final quarter is highly dependent on the ongoing stability of Phase B, Amplats said, at least until a controlled switch-over to Phase A can be completed. As a result, the miner said it “remains cautious” on refined production in the fourth quarter and have therefore revised full-year refined PGMs production guidance to the lower end of previous guidance to between 3.1-million and 3.3-million PGM ounces.

The ACP stoppages have resulted in a slight increase in work-in-progress (WIP) inventory between the second and third quarters. The build in the work-in-progress inventory is not lost production, and only the timing of the release of WIP inventory to refined inventory is impacted, Amplats said.

If the ACP Phase B unit creates a material risk to employees or assets by continuing to operate, the company said it “will proactively conduct a safe shut-down” by taking Phase B offline until the recommissioning of Phase A.

The rebuild of ACP Phase A remains on schedule with completion estimated towards the end of the fourth quarter.

Edited by Chanel de Bruyn
Creamer Media Senior Deputy Editor Online




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