Name of the Project
Sishen ultrahigh dense-media separation (UHDMS) project.

Location
Northern Cape, South Africa.

Project Owner/s
Anglo American subsidiary Kumba Iron Ore.

Project Description
The UHDMS project will maximise product quality and extend the life-of-mine (LoM) to 2039. 

UHDMS is a specialised technology that has been locally developed. The project makes it possible for Kumba to increase the densities in the Sishen plant and in the DMS plant by a difference of between 3.6 and 4.2.

This will enable Kumba to improve beneficiation so that it can upgrade its premium product from 18 % to 50 % a year.

Further, because the company can lower the cutoff grade, it can introduce about 130-million tonnes of reserves into its portfolio, which extends the LoM.

Potential Job Creation
About 53% of the population of the area is either directly or indirectly employed by the mine.

Net Present Value/Internal Rate of Return
The project has an estimated after-tax internal rate of return of about 30%, with a payback period of about three years and an earnings before interest, taxes, depreciation and amortisation margin of more than 40%.

Capital Expenditure
R3.6-billion.

Planned Start/End Date
The project was approved in February 2021 and is expected to be commissioned in the second half of 2023.

Latest Developments
Kumba has reported in its interim results for the six months ended June 30, 2022, that all procurement packages for the UHDMS project have been placed, work on the site establishment continues with the contracts for civil and earthworks, and structural mechanical piping and platework are under way.

The company has indicated cost inflation in the project, linked to higher material and tender prices as it awards the major contracts, and will provide an update with its 2022 annual results once it has evaluated the full impact thereof.

The project is slightly behind schedule, which Kumba has said it will focus on stabilising  in the second half of 2022.

Key Contracts, Suppliers and Consultants
A total of 71 % of the major works packages have been scoped, tendered and awarded. 

Contact Details for Project Information
Kumba Iron Ore investor relations, Penny Himlok, tel +27 12 622 8324 or email Penny.himlok@angloamerican.com.
Kumba Iron Ore media relations, Sinah Phochana, tel +27 12 683 7019 or email Sinah.Phochana@angloamerican.com.