Johannesburg, South Africa — MININGREVIEW.COM — 02 June 2011 – Aquarius Platinum is putting its Blue Ridge mine on care and maintenance because of low rand platinum group metals prices, and will focus on developing low operating and capital cost projects instead, such as the expansion of its Everest mine into the adjacent Booysendal South property it has just bought for R1.2 billion.
Making this statement here, Aquarius CEO Stuart Murray said the company had also increased its stake in tailings retreatment operation Platinum Mile Resources from 50% to 91.7%, at a cost of R115.5 million payable either in cash or Aquarius equity.
He explained that the Platinum Mile investment had been based on the plant’s expected profitability at current rand PGM prices before any expansion initiatives.
Murray added that this would also allow Aquarius to develop a dedicated tailings division, and Aquarius and Platinum Mile were currently assessing a number of growth opportunities. “An expanded tailings retreatment arm for Aquarius could become an important source of low cost PGM ounces in an environment of ever-increasing mining costs,” he said.
Turning to Blue Ridge, Miningmx quoted Murray as saying that the decision to stop funding the mine had been based on the firm belief that it was in the interests of all stakeholders in the mine that it be placed on care and maintenance with immediate effect.
“The findings of Blue Ridge management during the redevelopment project “’ coupled with the current economic realities of the platinum industry in South Africa “’ strongly suggest the mine would be loss-making for some time to come,” he explained. “Under these circumstances, any other course of action would be financially irresponsible for the wider group.”
Murray went on to say that the initial assessment on developing Booysendal South was that it would cost about R850 million to extend the mine life of Everest from the current six years to more than 30 years. For that investment, Everest would be able to increase its planned steady state production of around 190,000ozpa by 25% to around 250,000oz from 2017 for the extended life of the mine.