| |
Eastern Platinum mothballs growth projects
Allan Seccombe
Posted: Fri, 07 Nov 2008
[miningmx.com] -- EASTERN Platinum, feeling the squeeze of lower platinum prices, has frozen new developments to focus on existing operations until the storm has passed.
It’s not immediately clear what will happen to its target of 530,000 oz of platinum group metals output by 2012, but if low platinum prices remain intact for some time, this target will have to be pushed back.
The main producing asset within Eastplats is the Crocodile River Mine (CRM) on the Western Limb of the Bushveld Complex, projects on the Eastern Limb have been put on hold but planning will go ahead until completed.
“Eastplats forecasts 140,000 ounces of production from CRM in 2009, up 17% over 2008’s full-year estimate of 120,000 ounces,” Ian Rozier, CEO of Eastplats said in a statement.
This is slightly lower than a figure of 128,500 oz Miningmx wrote about in June.
The smaller
platinum developers and explorers have hit a wall with their projects, forcing them to revise the way they approach them or to hold off entirely.
The best example is Wesizwe Platinum, which has broken its R5.6bn twin-shaft mine and concentrator project into tiny bite-sized pieces. It will raise small amounts of capital is it progresses, slowly de-risking the project and building up investor confidence that there will indeed be a mine.
At the other end of the spectrum, exploration junior Lesego Platinum delayed its planned listing for this year indefinitely and is seeking innovative ways to raise up to $15m, a sum that companies in the past would have found easy to source early this year.
The platinum price fell out of bed because of concerns about demand as economies around the globe ground to a halt, raising fears that car sales would fall, dragging with it offtake for platinum used to make catalysts in vehicle exhausts.
Platinum fell from
nearly $2,300/oz in March to around $700. It has pulled back to $856/oz after Anglo Platinum said an incident at its Polokwane smelter would lose it between 150,000 and 200,000 oz of refined platinum output this year.
“The company will maintain near term focus on the optimisation of production from the Crocodile River Mine (CRM) complex and reschedule other project developments in order to preserve existing cash resources,” Rozier said.
Development work will be undertaken by Eastplats’ employees rather than more expensive contractors and the installation of electricity generators will continue, he said. Work on the chromite extraction plant will continue.
The output target above 500,000 oz was based on the commissioning of four new decline mines - Crocette, Mareesburg, Spitzkop UG2 and Spitzkop Merensky – as well as a new concentrator plant to be built at Kennedy’s Vale.
The primary focus now rests on optimising production at Zandfontein and
Maroelabult at CRM.
“The development of this section (Crocette) will be put on care and maintenance while the Company focuses on increasing production from existing mining areas,” Rozier said.
Turning to the three projects on the Eastern Limb, he said: “
Most of the development on the Eastern Limb will be rescheduled until the PGM market improves.”
However, design work for the Spitzkop mine and concentrator will continue in order to produce an updated cost estimate and schedule for the project in the first quarter of 2009.
The declines for the UG2 and Merensky reefs have been mothballed as has the civil work for the concentrator at Kennedy’s Vale.
The feasibility study for the Mareesburg open pit continues and is expected to be available by the same time, he added.
"These actions will allow Eastplats to continue to be a low cost producer and conserve cash,” Rozier said. “Our new development projects, now rescheduled, can be
maintained at very low cost and can be re-activated quickly when the PGM market recovers."
| |
0% 
