27th Mar 2020 08:17
(Alliance News) -Â Anglo American PLC on Friday warned of a hit to production due to the outbreak of Covid-19 as it complies with the South African government's 21-day national lockdown.
At Kumba Iron Ore Ltd, the Sishen and Kolomela mines continue to operate, but with half the workforce.
At Anglo American Platinum, the Mogalakwena mine and the mechanised Mototolo mine continue to operate with a reduced workforce and production. The Amandelbult, Modikwa and Kroondal underground mines, as well as the Mortimer and Waterfall smelters, are being placed onto care and maintenance.
Meanwhile, thermal coal operations continue with the workforce reduced by up to 70%.
"In South Africa, our operations play a vital role in many of our host communities, including in terms of jobs and the provision of a number of essential community services, including access to water, energy and accommodation. We are wholly committed to supporting the country's effort to combat Covid-19, including continuity of such services, and will continue to work with government and across the industry to provide all possible support," said Anglo American Chief Executive Mark Cutifani.
Based on South Africa's lockdown and allowing for a safe ramp-up of operations again, Anglo American expects a hit to 2020 production volumes between 2 million tonnes to 3 million tonnes at Kumba, due to the reduced workforce, and a 1.5 million to 2 million tonne hit to export thermal coal.
Elsewhere, Anglo America noted Peru has extended its national quarantine period by 13 days to April 12. As announced on earlier in March, Anglo American has temporarily withdrawn the majority of employees and contractors from its Quellaveco copper project and construction work is significantly reduced, with only critical areas of the project continuing as normal, until workers can return safely.
The firm has also paused most construction and development activity on its Woodsmith polyhalite project in the UK, which was recently purchased via the acquisition of Sirius Minerals PLC for just over GBP400 million.
"Production from Anglo American's major operations in other countries has not been impacted materially to date and we are taking all appropriate preventative measures to reduce the probability of the virus spreading, including by reducing the density of people on our sites," Anglo American said.
Shares in Anglo American were down 2.2% at 1,365.00 pence in London early Friday. In Johannesburg, the stock was up 2.8% at ZAR288.17.
Amplats was up 7.7% at ZAR782.45 and Kumba down 2.4% at ZAR291.73, both in Johannesburg.
By Lucy Heming;Â [email protected]
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