In the face of declining metal prices and the simultaneous weakening of the rand, Northam Platinum chief executive Paul Dunne says the company will continue to focus on containing the unit costs of producing each platinum group metal ounce.
The company is at the same time continuing the ramp up at its Booysendal mine and developing the Booysendal South property over the next five years.
Booysendal continued the ramp-up to its annual steady-state platinum group metals (PGMs) production target of 160 000 oz, planned to be reached in the first half of 2016.
For the year as a whole Booysendal’s run-of-mine production totalled 1 670 437 t, compared with 1 233 089 t in 2014. The tonnage milled increasing to 1 786 375 t from 1 517 109 t in 2014 at a head grade of 2.6g/t. The concentrator performed well above its nameplate capacity in the last three months of the year, achieving an average recovery of 86%.
Underground the last two production sections are being equipped, thereby completing the original capital footprint. There have been significant advances in planning to exploit the Merensky reef, with bulk sampling work in progress. A decision to develop a Merensky mining module will be taken in the second half of 2016.
Meanwhile, conceptual design work on exploiting the Booysendal South orebody (including the former Everest mine infrastructure) will be progressed to a feasibility study. The decision to begin construction of new mining modules will be informed by market conditions and the potential return on investment. The feasibility is expected to cost R22.0 million and will be completed by May 2016.
With the progression towards steady-state levels, costs are approaching more realistic levels.
Booysendal’s total operating costs were R1 192.2 million against R806.8 million in 2014 with unit operating costs 0.9% lower at R358 554/k, compared with R361 902/kg in 2014 and cash costs 11.3% higher at R308 719/kg, compared to R277 308/kg in 2014.
As Booysendal reaches its design capacity, capital expenditure levels have declined accordingly. Total capital expenditure since the start of the phase 1 Booysendal mine development is expected to close out at R4.5 billion.