6th Mar 2020 11:32
(Alliance News) - Anglo American Platinum Ltd cut annual production guidance on Friday following an explosion at a plant in South Africa.
Amplats is the platinum group metals business of blue-chip miner Anglo American PLC, which has a majority stake.
Amplats said the phase A converter plant at the Waterval smelter in Rustenberg, North West province, was damaged after an explosion in the converter on February 10. No employees were injured.
As well as the smelter in Waterval, Amplats also has a smelter at Polokwane in Limpopo province, to the north-east of Rustenberg. Amplats has three producing mines in Limpopo: Mogalakwena, Tumela, and Dishaba. It also has the Unki mine in Zimbabwe.
The miner said work has already begun to repair the phase A plant, but will not be completed until at least the second quarter of 2021.
Amplats, as per "normal business procedure", began to commission the phase B plant to take over, but detected water in the furnace. This poses a "high risk" of explosion, Amplats explained, meaning it has also been shut down.
Repair work on the phase B part of the plant should take around 80 days, Amplats said.
"As a result of the temporary closure of the entire Anglo converter plant, Anglo American Platinum has had to declare force majeure to customers, suppliers of third-party purchase of concentrate and suppliers of tolling material, as we are unable to complete the processing of material during the converter repair," said Amplats.
"Production from own mines will continue, and the concentrate from the mines will continue to be smelted at one of the four smelter complexes. However, production from own mines, as well as third party material will not be able to be converted to refined production while the Anglo converter plant is undergoing repairs."
As a result, Amplats has cut annual PGM production guidance to between 3.3 million to 3.8 million ounces. Previous guidance was for production of 4.2 million to 4.7 million ounces.
Amplats shares were 8.8% lower on Friday in Johannesburg at ZAR1,009.12. Anglo American was 5.4% lower in London at 1,742.90 pence and down 2.7% in Johannesburg at ZAR358.20.
By George Collard; [email protected]
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