Zim op­er­a­tions part of port­fo­lio

The Star Early Edition - - BUSINESS REPORT - Tawanda Karombo

AM­PLATS an­nounced that it is keep­ing faith with its Zim­babwe op­er­a­tion, which it now deems as in­te­gral to its port­fo­lio af­ter dis­pos­ing of some as­sets in South Africa, with the com­pany say­ing yes­ter­day that the Unki mine had re­duced costs and raised pro­duc­tion.

AN­GLO Amer­i­can Plat­inum (Am­plats) is keep­ing faith with its Zim­babwe op­er­a­tion, which it now deems as in­te­gral to its port­fo­lio af­ter dis­pos­ing of some as­sets in South Africa, with the com­pany say­ing yes­ter­day that the Unki mine had re­duced costs and raised pro­duc­tion.

Am­plats is the global num­ber one miner of the me­tal, while Im­pala Plat­inum and Sibanye Gold are the other plat­inum op­er­a­tors in Zim­babwe – which has the sec­ond largest re­serves of plat­inum in the world.

Unki mine’s rev­enues for the in­terim pe­riod to June 30 had, how­ever, slightly fallen from R1.103 bil­lion to R1.038bn.

The de­ci­sion by Am­plats to re­tain Unki as an in­te­gral op­er­a­tion comes against the back­drop of re­lax­ation of Zim­babwe’s in­di­geni­sa­tion pol­icy by Pres­i­dent Robert Mu­gabe.

An­glo Plat­inum said af­ter di­vest­ing out of some of its op­er­a­tions in South Africa, its “re­tained port­fo­lio” would con­sist of Unki, Aman­del­bult, Mo­galak­wena and other joint ven­ture and as­so­ci­ate op­er­a­tions in South Africa.

Zim­babwe now re­quires that ex­ist­ing for­eign min­ing groups spend 75 per­cent of their earn­ings in Zim­babwe in­stead of manda­to­rily ced­ing 51 per­cent shares to black lo­cal groups.

The new port­fo­lio for Am­plats, which in­cludes the Unki mine, is ear­marked to yield low costs for the plat­inum giant.

Unki has been de­liv­er­ing a low cost pro­file. An­glo said yes­ter­day: “Cash op­er­at­ing costs at Unki de­creased 6 per­cent to R881 mil­lion. The de­crease was driven pri­mar­ily by the rand strength­en­ing against the dol­lar by 14 per­cent as Unki is a dol­lar de­nom­i­nated op­er­a­tion.”

The cash op­er­at­ing cost base for the Zim­bab­wean mine de­clined by as much as 12 per­cent to R22 848 per ounce owing to “im­proved pro­duc­tion and lower” rand costs.

In terms of pro­duc­tion, out­put from the Unki mine for the half year pe­riod in­creased by 5 per­cent to a high of 38 400 ounces. This was driven by a 3 per­cent surge in tons milled and a 2 per­cent rise in the head grade to 3.48 grams per ton.

The higher grade per ton was achieved from a “bet­ter min­ing reef cut, which re­duced waste min­ing, re­sult­ing in higher grade ore be­ing de­liv­ered to the con­cen­tra­tor”.

It is ex­pected that Unki will pro­duce 75 000 ounces of plat­inum this year.

Plat­inum min­ers in Zim­babwe have been en­hanc­ing pro­duc­tion even de­spite mod­er­ate im­prove­ments in the global plat­inum price, al­though an­a­lysts say min­ers con­tinue to ra­tio­nalise cap­i­tal in­vest­ment.

Min­ers have also been de­mand­ing that the govern­ment re­store cer­tainty to the op­er­at­ing frame­work.

De­spite this, plat­inum ex­port earn­ings by South African plat­inum min­ing groups in Zim­babwe surged to $333.5m (R4.3bn) for the pe­riod Jan­uary to May 12, 2017, sig­nif­i­cantly up from the $282m recorded for the same pe­riod in 2016.

PHOTO: SUP­PLIED

Zim­plats’s Unki mine in Zim­babwe. The cash op­er­at­ing cost base for the mine has de­clined by as much as 12 per­cent to R22 848 per ounce of plat­inum re­cov­ered.

Newspapers in English

Newspapers from South Africa

© PressReader. All rights reserved.