Northam Platinum, the JSE-listed platinum miner says the agreement with RPM, a wholly-owned subsidiary of platinum miner Anglo American Platinum (Amplats) includes the acquisition of a portion of the Amandelbult mining right contiguous with the north western boundary of Northam’s Zondereinde mine, as well as surface properties above and adjacent to the resource (Elandsfontein 386 KQ farm), in exchange for a portion of the Zondereinde mining right, located on the north western corner of the Zondereinde mining right.
The resource comprises an area of Merensky and UG2 resources containing approximately 16.7 million 4E ounces and bordering the west side of Northam’s Zondereinde mine, as well as an ancillary mineral resource within Northam’s Zondereinde mining right that borders Amandelbult’s mining right and which provides the company with flexibility for the placement of future mining infrastructure.
The area to be exchanged has never been mined and did not form part of the Zondereinde life of mine (LOM) plan, as it is above the minimum depth required for effective use of hydro-powered mining equipment.
Paul Dunne, Northam’s CEO, says: “The transaction adds flexibility and optionality to the mining operations at Zondereinde. The acquired resource is of high quality, is well understood by Northam and allows us to better leverage the existing Zondereinde infrastructure.
The additional resource also enables Northam to continue mining higher grade Merensky ore for a longer period, with relatively low incremental capital expenditure.
“Northam is confident that the transaction will add sustainable shareholder value, unlocking a large resource in a capital efficient manner,” says Dunne.
The transaction positions Zondereinde on a similar long-term footing as the company’s Booysendal operation.
Benefits of the acquisition
The acquisition of the resource by Northam will enable it to extend the economic LOM of Zondereinde to beyond 30 years, providing the operation with extensive mining flexibility associated with a high quality resource that is well understood by Northam.
The acquisition also provides early access to additional higher grade Merensky and UG2 reef on 10 and ultimately 16 mining level while reducing the overall average mining depth of the Zondereinde mine, with associated potential savings.
The acquired resource is contiguous with the north western boundary of Zondereinde, its resource characteristics and properties are similar to those of the Zondereinde orebody lying to the west of Zondereinde mine shaft.
A short lead time and limited capital expenditure is required to access the acquired resource from Zondereinde’s existing infrastructure.
It extends on dip from approximately 1 400 m below surface, corresponding to the Zondereinde 3 level, to the deepest extent of planned mining on 18 level. Laterally, it extends for approximately 3.6 km.
Chris Griffith, CEO of Amplats comments: “We are pleased to announce the disposal of certain long-dated mineral resources within the Amandelbult mining right to Northam.
The transaction is mutually beneficial and allows Amplats to exit resources for value which are outside of its life-of-mine plans and do not impact current mining or the future potential of Amandelbult.
“We have also secured an ancillary contiguous resource that provides us further flexibility for our future plans for the mine,” says Griffith.
The proceeds will be used to further reduce net debt and strengthen Amplats balance sheet.
The transaction is subject to the necessary consents being obtained from the Minister of Mineral Resources, including approval in terms of Section 102 of the Mineral and Petroleum Resources Development Act.