16th Jul 2007 07:01
Lonmin PLC16 July 2007 Third Quarter Production Report and Trading Update Lonmin today announces its production report for the nine months to 30 June 2007(unaudited). Our Marikana smelting operations returned to normal during the third quarterwith the Number One furnace operating at full capacity during the last twomonths of the quarter. Marikana mined 9.6 million tonnes during the nine months,a small increase on the prior year period after stripping out the effect of theadditional seven days in the prior year. The Number One furnace was restarted on30 April 2007 and we have run this furnace side by side with the Merenskyfurnace allowing us to process around 63,000 tonnes of concentrate in the thirdquarter reducing by around two thirds our concentrate inventory stockpile. Totalsales for the nine months were 477,639 ounces of Platinum and 897,661 ounces oftotal PGMs. We are forecasting that our full year production will be between 920,000 and940,000 saleable ounces of Platinum in concentrate. We are continuing toexperience poorer recoveries at our concentrators principally due to the ongoingchange in the mix of ore types. This has principally been caused by an earlierthan anticipated shift in the mix of underground ores with a larger proportionof ore feed now coming from the Eastern side of our Marikana property. Theseores are proving to be more difficult to mill than planned. We have instigated adetailed plan to maximise recoveries but this ore mix effect is expected tocontinue to have an impact during the last quarter of this year and throughout2008 until our new K4 shaft comes into production in the 2009 financial year.Our operations have also been impacted by the continued shortage of, anddifficulty in retaining, high quality skilled labour in South Africa. While the Process Division has run extremely well since the restart of theNumber One furnace in April, we now believe we will be unable to process theentire inventory build up through our Base Metal and Precious Metal Refineriesbefore the end of our financial year. In order to retain the full margin onthese ounces we have decided not to sell or toll refine this material but todefer the sales of some 70,000 to 90,000 Platinum ounces into the 2008 financialyear. We estimate that the above issues will reduce our full year sales to between820,000 to 840,000 ounces of Platinum and 1,520,000 to 1,550,000 ounces of totalPGMs. We will however continue to meet all our contractual sales obligations.The reduction in production volumes will also impact our full year unit costsand we are revising our C1 cost guidance net of base metal credits to betweenR3,150 to R3,250 per PGM ounce sold for the Marikana operations and R3,450 toR3,550 per PGM ounce sold for Marikana and Limpopo combined. Enquiries: Alex Shorland-Ball +44 (0) 20 7201 6060 Vice President, Investor Relations & Communications Lonmin will be hosting an analyst conference call at 9.00 am UK time (10.00 am SA time) today. Those wishing to take part should dial in on the following numbers: Access number: +44 (0) 20 8609 0205 UK Freephone Number: 0800 358 2705 ZA Freephone Number: 0800 999 539Pin Code: 621126# Mining 9 months to 9 months to 30 June 30 June 2007 20061Tonnes mined Marikana Underground 000 8,460 8,497 Opencast 000 1,176 1,322 Total 000 9,636 9,818 Limpopo Underground 000 564 669 Opencast 000 0 14 Total 000 564 683 JV Underground 000 92 75 attributable2 Opencast 000 232 102 Total 000 324 178 Lonmin Platinum Underground 000 9,116 9,240 Opencast 000 1,408 1,438 Total 000 10,524 10,678 Tonnes milled3 Marikana Underground 000 8,415 8,463 Opencast 000 1,078 1,558 Total 000 9,492 10,021 Limpopo Underground 000 595 685 Opencast 000 0 14 Total 000 595 699 JV4 Underground 000 216 177 Opencast 000 530 218 Total 000 747 395 Ore purchases5 Underground 000 75 0 Opencast 000 20 18 Total 000 95 18 Lonmin Platinum Underground 000 9,301 9,324 Opencast 000 1,628 1,809 Total 000 10,930 11,133 9 months to 9 months to 30 June 30 June 2007 20061Metals in Marikana Platinum oz 596,908 664,875concentrate6 Palladium oz 271,967 296,840 Gold oz 16,562 18,201 Rhodium oz 78,723 86,440 Ruthenium oz 126,419 138,795 Iridium oz 26,344 28,293 Total PGMs oz 1,116,922 1,233,443 Nickel7 MT 2,900 3,098 Copper7 MT 1,719 1,849 Limpopo Platinum oz 27,372 38,594 Palladium oz 18,867 29,192 Gold oz 2,231 2,655 Rhodium oz 2,908 4,460 Ruthenium oz 4,569 6,702 Iridium oz 1,049 1,433 Total PGMs oz 56,996 83,037 Nickel7 MT 596 642 Copper7 MT 404 432 JV4 Platinum oz 41,399 21,458 Palladium oz 19,219 9,753 Gold oz 368 197 Rhodium oz 5,817 3,134 Ruthenium oz 8,523 4,766 Iridium oz 1,893 1,007 Total PGMs oz 77,219 40,314 Nickel7 MT 48 13 Copper7 MT 26 11 Ore purchases5 Platinum oz 3,693 520 Palladium oz 1,709 147 Gold oz 46 26 Rhodium oz 526 19 Ruthenium oz 798 45 Iridium oz 177 9 Total PGMs oz 6,949 766 Nickel7 MT 18 1 Copper7 MT 9 0 Lonmin Platinum Platinum oz 669,372 725,447 Palladium oz 311,762 335,932 Gold oz 19,206 21,079 Rhodium oz 87,974 94,052 Ruthenium oz 140,308 150,308 Iridium oz 29,464 30,742 Total PGMs oz 1,258,087 1,357,561 Nickel7 MT 3,562 3,755 Copper7 MT 2,159 2,293 Metallurgy 9 months to 9 months to 30 June 30 June 2007 20061Metallurgy Lonmin refined Platinum oz 433,562 536,096 Metal Palladium oz 193,983 244,894 Production Gold oz 13,275 13,357 Rhodium oz 52,991 80,359 Ruthenium oz 83,442 122,497 Iridium oz 19,533 25,781 Total PGMs oz 796,787 1,022,985 Toll refined Platinum oz 84,782 0 metal Palladium oz 35,657 0 production Gold oz 0 0 Rhodium oz 11,485 0 Ruthenium oz 18,740 0 Iridium oz 3,700 0 Total PGMs oz 154,365 0 Total Platinum oz 518,343 536,096 refined Palladium oz 229,641 244,894 PGMs Gold oz 13,275 13,357 Rhodium oz 64,476 80,359 Ruthenium oz 102,183 122,497 Iridium oz 23,234 25,781 Total PGMs oz 951,152 1,022,985 Base metals Nickel8 MT 3,106 3,091 Copper8 MT 1,574 1,612 Lonmin Group Metal Sales Sales Refined Platinum oz 475,287 530,706 Metal Palladium oz 208,320 243,103 Sales Gold oz 14,880 15,617 Rhodium oz 66,259 84,213 Ruthenium oz 103,176 131,642 Iridium oz 25,537 24,855 Total PGMs oz 893,460 1,030,136 Concentrate and Platinum oz 2,352 46,481 other9 Palladium oz 1,109 20,511 Gold oz 125 1,777 Rhodium oz 203 5,275 Ruthenium oz 348 8,661 Iridium oz 64 1,701 Total PGMs oz 4,201 84,407 Lonmin Platinum Platinum oz 477,639 577,186 Palladium oz 209,429 263,614 Gold oz 15,005 17,395 Rhodium oz 66,462 89,489 Ruthenium oz 103,524 140,303 Iridium oz 25,601 26,556 Total PGMs oz 897,661 1,114,543 Nickel8 MT 3,096 3,203 Copper8 MT 1,400 1,905 9 months to 9 months to 30 June 30 June 2007 20061Prices Average Platinum $/oz 1,171 1,030 Palladium $/oz 340 290 Gold $/oz 624 549 Rhodium $/oz 5,631 3,638 Ruthenium $/oz 420 104 Iridium $/oz 402 225 Basket price of $/oz 1,190 928 PGMs Nickel8 $/MT 27,706 11,974 Copper8 $/MT 6,883 5,310 Exchange Average rate for period R/$ 7.20 6.42Rates Closing rate R/$ 7.01 7.15 Notes: 1 The nine months to June 2006 comprised an additional 7 days mining performance for WPL and EPL arising on the change of basis to report on a calendar month. 2 JV attributable tonnes mined includes Lonmin's share (42.5%) of the total tonnes mined on the Pandora joint venture. 3 Tonnes milled excludes slag milling. 4 Lonmin purchases 100% of the ore produced by the Pandora joint venture for onward processing which is included in downstream operating statistics. 5 Relates to the tonnes milled and derived metal in concentrate from third-party ore purchases. 6 Metals in concentrate has been changed from the previously reported definition of full contained metal to adjust for industry standard downstream processing losses. 7 Corresponds to contained base metals in concentrate. 8 Nickel is produced and sold as nickel sulphate crystals or solution and the volumes shown correspond to contained metal. Copper is produced as refined product but typically at LME grade C. 9 Concentrate and other sales have been adjusted to a saleable ounces basis using standard industry recovery rates. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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