As a consequence of Covid-19 and its related impacts on the process plant construction schedule, JSE-listed Wesizwe Platinum’s Bakubung platinum mine development has been delayed, with the hot commissioning date now set for October 2021.
Additionally, delays in public consultations required for the company’s integrated water-use licence application and environmental-impact assessment have led to the start of tailings and stockpad commissioning being delayed to June and March next year, respectively.
Wesizwe could only progress 1.1 km of development for the six months to June 30, against a proposed target of 3.6 km for the year.
During the six months under review, Wesizwe spent R1.4-billion on construction works.
The company has posted a headline loss a share of 61.90c for the six months ended June 30, down 1 018% from the headline earnings a share of 6.74c posted in the prior corresponding period.
Earnings a share decreased by almost 1 000% to a loss of 62.14c apiece, from earnings of 6.91c apiece reported in the prior six months.
Wesizwe reported a loss of R1-billion for the six months under review, compared with comprehensive income of R112-million for the same period in 2019.
The mine’s operating unit cost per metre and per tonne ended up being 251% and 216% higher, respectively, in the six months under review, owing to lower efficiencies in production and the overhead costs remaining flat. Some additional Covid-19 compliance costs also added to the variance.
Wesizwe completed a revision of the mine’s definitive feasibility study based on the latest business case, which was approved by the technical committee and board in September.
The company advised in its results statement that its cash resources of R1.7-billion are sufficient to conduct operations and develop the Bakubung mine up to the end of the year.
However, the ability of the company to continue as a going concern is dependent on a number of factors, including the support of the majority shareholder.
The company says its majority shareholder has provided a letter of comfort, supporting any shortfall in funding and guaranteed repayment of the China Development Bank loan.