De Beers buys Canadian company for R1bn

ANGLO American yesterday said that its subsidiary De Beers had bought a Canadian company for about $81 million (R1.07 billion).

Anglo on the same day reported a 12 percent hike in copper production to 158 000 tons in the second quarter of 2018, while its subsidiary De Beers’ increased its diamond production by 3 percent to 9 million carats.

De Beers Canada agreed to purchase 100 percent of the outstanding securities of Peregrine Diamonds, the owner of the high quality Chidliak diamond resource located in Canada’s Nunavut Territory, giving it control of the Chidliak diamond resource.

Anglo in a production update said that metallurgical coal production increased by 33 percent to 5.3 million tons, mainly as a result of strong performance at Moranbah and Grosvenor mines, both in Australia.

Thermal coal export production slipped 1 percent to 7.2 million tons.

Anglo American said the production update excluded the Minas-Rio iron ore operation in Brazil, whose operations were suspended in March, following two leaks in the iron ore slurry pipeline.

Chief executive Mark Cutifani said the strong performance was driven mainly by copper and metallurgical coal production, which rose 6 percent.

“This reflects our consistent and relentless focus on driving efficiency and productivity from our existing world class asset base,” said Cutifani.

Anglo American also announced that it had hiked production guidance for its platinum business (Amplats) following improved performance from its Mogalakwena platinum mine in Limpopo, whose production soared 17 percent to 133 400 ounces.

Mogalakwena increased overall platinum group metals (PGM) production by 11 percent to 586 300 ounces during the quarter to end June.

Anglo American has also revised full-year PGM production guidance to between 4.85 million ounces and 5.10 million ounces, up from the previous range of 4.75 million ounces to 5 million ounces.

The previous forecast for platinum production was between 2.3 million and 2.4 million ounces.

Mogalakwena PGM production increased by 15 percent to 313 800 ounces, driven by higher grade, an increase in concentrator throughput and higher recoveries. Platinum production increased by 17 percent to 133 400 ounces and palladium production increased by 14 percent to 145 100 ounces.

An analyst, who declined to be named, yesterday said the price of platinum had remained at levels unprofitable for most producers. In the past five years, the price of platinum has fallen from more than $1 500 an ounce to around $800 an ounce.

Amplats shares declined by 1.84 percent on the JSE yesterday to close at R346.50.