Implats output set to drop

Brendan Ryan | Fri, 13 Nov 2009 14:07
[miningmx.com] -- PRODUCTION from Impala Platinum’s (Implats’)flagship Impala lease area at Rustenburg is expected to fall 10.5% to 850,000 ounces of platinum during its current financial year to end-June.

This is because of the two-week strike in September (which cost the group 50,000oz in lost production) and the consequences of safety problems at the No 14 shaft where 11 workers were killed during the September quarter.

Nine of those workers died in “a massive fall-of-ground incident in one of the mechanised sections at 14 shaft”.

As a result, Implats has decided to reduce bord widths ( the mining areas supported by adjacent pillars of ore left in place unmined) to 6 metres across all Rustenburg mechanised sections to bring about a significant reduction in operational risk.

According to the first-quarter production report Implats released on Friday, this change in the mining layout will drop production in the current financial year by another 25,000oz on top of the 25,000oz already lost due to safety stoppages during the September quarter.

Production from the Impala lease area has dropped from just over 1 million oz in financial 2008 to 950,000oz in financial 2009.

Implats management has maintained the forecast made by CEO David Brown in the 2009 annual report that production from the Impala lease will recover to 1moz “within the next five years”.

In his review, Brown revised Implats’ overall production growth target to 2.1moz by financial year 2014 from the previous target of 2.3moz by financial year 2012.

The quarterly report indicated that Implats’ cash position had continued to weaken. The group had a net debt position of R130m at the end of the September quarter, compared with a net cash balance of R1.36bn at the end of June.

Implats paid out R1.2bn during the September quarter in terms of its final dividend payment.

Production rose at both of the group’s Zimbabwe operations - Zimplats and Mimosa - where expansions were successfully commissioned and reached either design throughput or steady-state production capacity during the September quarter.