HomeNewsAmplats continues to move production down the cost curve

Amplats continues to move production down the cost curve

Anglo American Platinum has made significant progress on the re-positioning of its portfolio, continuing to move its production down the cost curve and creating a more value enhancing portfolio.

Anglo American Platinum (Amplats) announced its intention to divest of assets which do not fit its long term strategy, including Rustenburg, Bokoni, Union, and the Pandora joint venture, as well as the sale of long-dated resources at Amandelbult.

Completion of the disposal of long-dated Amandelbult resources to Northam

Amplats announces the completion of the disposal of mineral resources within the Amandelbult mining right to Northam on 6 December 2017.

Amplats received a cash consideration of R1 billion which was used to reduce net debt.

Completion of the disposal of interest in Pandora joint venture

Amplats has announced the completion of the disposal of its loss-making 42.5% interest in Pandora to Lonmin for a deferred cash payment of a minimum of R400 million and a maximum of R1 billion, based on 20% of free cash flow over six years; and the use of and full operational control of Lonmin’s Baobab concentrator for a three year period commencing on 1 December 2017.

Taking over operational control of Baobab concentrator will allow Amplats to continue processing excess ore from Mogalakwena mine and pursue optimization initiatives at the Baobab concentrator.

Progress on the disposal of Union mine

As announced on 15 February 2017, the Sale and Purchase Agreement to dispose of Amplats’ 85% interest in Union mine and its 50.1% interest in MASA Chrome Company to a subsidiary of Siyanda Resources, was signed on 14 February 2017.

Significant progress has since been made on completing the conditions precedent, including approval from the South African competition authorities in accordance with the Competition Act on 13 September 2017 and consent in terms of section 11 of the Mineral and Petroleum Resources Development Act on 7 November 2017.

Amplats and Siyanda are working to ensure a smooth transition of Union and MASA to Siyanda.

“We have made significant progress in the re-positioning of our portfolio with the disposal of our 42.5% interest in Pandora to our joint venture partner Lonmin, completing the disposal of long-dated resources at Amandelbult to Northam and progressing the disposal of Union and MASA to Siyanda,” says Amplats CEO, Chris Griffith.

“We believe we have delivered transactions that are beneficial for all parties involved, enabling a sustainable future for the Pandora and Union mines.

“The benefits of operational control over the Baobab concentrator will enable us to continue to unlock value at Mogalakwena mine, and the cash proceeds received from Northam will allow us to further reduce our net debt position.

“We will continue to focus on completing the disposal of Union and MASA, which is expected to occur in early 2018.”

Feature image credit: Anglo American Platinum