27th Jan 2009 12:26
Aquarius Platinum LimitedSecond Quarter 2009 Production Results (to 31 December 2008)
Highlights of the Quarter
Increase in Group production
Reductions in cash costs at Kroondal, Marikana, and CTRP and for the Group as a whole
Further falls in all PGM prices, with some respite from a weaker Rand
Commenting on the results, Stuart Murray, CEO of Aquarius Platinum said, "The operational turnaround which started in the previous quarter continued its momentum to deliver solid improvements in production and costs across the Group during the quarter, despite the subsidence event at Everest resulting in the temporary suspension of operations. This temporary suspension will allow us the time we need to engage with our insurers and develop a plan to ensure that Everest is brought back in the right manner for the long-term, rather than rushing into a short-term high-risk turnaround that could place strain on the business as a whole."
The dire global macro environment continues however to impact on profitability of the Group as PGM prices have weakened further during the quarter. Preliminary assessment of the half yearly result for the Group indicates a net after tax loss in the range of $75 million to $85 million after approximately $20m (pre tax) in writedowns associated with the temporary closure of the Everest mine. The deterioration in earnings has been attributable in the main to the continued decline in metal prices during the second quarter, particularly rhodium which fell 54% and nickel which fell 27%. This guidance is preliminary in nature, subject to finalisation within Aquarius as well as review by the company's external auditors. Additionally, the Company will be conducting impairment testing of the carrying value of certain assets as at 31 December 2008. As such, the actual results for the six months to 31 December 2008 may differ from the guidance given in this update. Given the ongoing turmoil in global markets and the impact this may have on operations, we believe it is appropriate to provide an early indication of half yearly results. Further detailed analysis will be covered in the results announcement to be released on 5th February 2008."
P&SA1 at Kroondal
PGM production up 8% to 109,707 PGM ounces (Aquarius attributable: 54,854 PGM ounces)
Cash cost fell 13% to R4,856 per PGM ounce
Effective cash margin of 15%, reduced to -78% after accounting for negative sales price adjustments
P&SA2 at Marikana
PGM production up 9% to 42,451 PGM ounces (Aquarius attributable: 21,226 PGM ounces)
Cash costs fell 20% to R6,279 per PGM ounce
Effective cash margin of -13%, reduced to -146% after accounting for negative sales price adjustments
Everest
Operations temporarily suspended following subsidence in decline area
PGM production down 2% to 31,703 PGM ounces (Aquarius attributable 31,703 PGM ounces)
Effective cash margin of -19%, reduced to -210% after accounting for negative sales price adjustments
Mimosa
PGM production marginally lower at 43,232 PGM ounces (Aquarius attributable 21,616 PGM ounces)
Cash costs increased 2% to $473 per PGM ounce
Cash margin for the quarter reduced to 56% following metal price reductions
CTRP
PGM production up marginally to 1,784 PGM ounces (Aquarius attributable: 892 PGM ounces)
Cash costs fell 11% to R3,361 per PGM ounce
Effective cash margin of reduced to -2% after accounting for negative sales price adjustments
Platinum Mile
PGM production down 48% to 3,103 PGM ounces (Aquarius attributable: 1,552 PGM ounces)
Cash costs increased to R5,500 per PGM ounce due to interruption during plant expansion
Cash margin for the quarter at 42%
Production by Mine Quarter Ended PGMs (4E) Mar 2008 Jun 2008 Sep 2008 Dec 2008 Kroondal 100,020 83,062 101,731 109,707 Marikana 24,223 28,416 38,883 42,451 Everest 31,107 31,327 32,365 31,703 Mimosa 34,283 38,517 43,638 43,232 CTRP 2,309 2,044 1,764 1,784 Platinum Mile 2,006 5,035 5,983 3,103 Total 193,948 188,401 224,364 231,980
Production by Mine Attributable to Aquarius
Quarter Ended PGMs (4E) Mar 2008 Jun 2008 Sep 2008 Dec 2008 Kroondal 50,010 41,531 50,866 54,854 Marikana 12,111 14,208 19,442 21,226 Everest 31,107 31,327 32,365 31,703 Mimosa 17,142 19,258 21,819 21,616 CTRP 1,154 1,022 882 892 Platinum Mile 1,003* 2,517 2,992 1,552 Total 112,527 109,863 128,366 131,843 Cash Costs
At operations in South Africa, cash costs have been reduced; primarily a reflection of increased volumes rather than the falling price of mine consumables. Restructuring initiatives were implemented across all operations to optimise labour complements and associated cost. Labour cost therefore reduced across the period. Although some consumable cost, such as steel, diesel and explosives showed a price decrease towards the latter half of the quarter on the basis of falling commodity prices the effect on cost was muted, with the cost benefit expected to be more substantive in the next quarter along with further efficiency initiatives.
Metals Prices and Foreign Exchange
Metals price performance for our commodities was volatile over the quarter. Platinum closed the quarter down 10% to $865 per PGM ounce, though has subsequently picked up in to the new calendar year. Palladium closed the quarter up 4% to $191 per ounce. Rhodium fell significantly over the quarter, closing down 54% at $1,688 per ounce and has fallen further since. Gold was almost flat over the quarter, closing down just 1% at $866 per ounce.
Looking at the 4PGE basket prices for the quarter, the average basket for the operations in South Africa fell 57% to $744 per ounce and at Mimosa in Zimbabwe by 58% to $905 per ounce. The average 4PGE basket for the group for the quarter fell 54% to $770 per PGM ounce.
Average PGM basket prices achieved at Aquarius operations: US$ per PGM ounce(4E) Basket Prices (Quarter Ended) Mar 2008 Jun 2008 Sep 2008 Dec 2008 Kroondal 2,129 2,350 1,758 746 Marikana 2,041 2,311 1,693 744 Everest 2,112 2,266 1,692 746 Mimosa 1,237 1,607 1,549 905 CTRP 2,505 2,850 2,251 818 Platinum Mile - 1,989 1,085 596 Aquarius Group Average 1,981 2,187 1,684 770
The Rand weakened significantly over the quarter, closing 21% down at an exchange rate of 9.4 to the US Dollar. It should be noted, however, that the quarter average was weaker still at 9.9 due to a short period when the Rand was 11.6 to the US Dollar. The Rand has continued to weaken during 2009.
AQUARIUS PLATINUM (SOUTH AFRICA) (PTY) LTD (Aquarius Platinum 100%)
P&SA 1 at Kroondal
Safety
The 12-month rolling average DIIR for the quarter deteriorated from 0.54 in the previous quarter to 0.77. Seven lost-time injuries were reported during the quarter.
Regrettably a fatal accident occurred at the K5 Shaft on 18 September 2008, when Mr Castigo Machel, a load-haul-dumper (LHD) operator and employee of mining contractor Redpath Mining, was fatally injured when he was struck by an LHD vehicle in the underground operation.
AQPSA has concluded the internal investigation but was issued a Section 54 instruction under the Mine Health and Safety Act, 1996. The instruction resulted in a 2-day stoppage of LHD operations on all Kroondal shafts. The Department of Minerals and Energy (DME) has yet to complete the enquiry into the accident.
Mining
Production tons increased by 6% to 1,804,021 tons
Head grade increased from 2.54 g/t to 2.60 g/t
Processing
Tons processed increased by 7% to 1,673,563 tons
Recoveries remained consistent at 78%
PGM production increased by 8% to 109,707 PGM ounces
Revenue
The basket price for the quarter averaged $746 per PGM ounce, 58% lower than the previous quarter. The Rand Dollar exchange rate averaged 9.75 for the quarter. Revenue at Kroondal decreased by 45% to R299 million for the quarter (Aquarius attributable: R150 million).
The increase in production was offset by the significant reduction in the basket price. This was compounded by negative sales adjustments caused by weakening PGM prices at the close of the period compared to the close of the prior quarter.
Operations
Total production increased by 6% to 1,804,021 tons. Production from underground operations increased by 6% to 1,795,306 tons with only 8,715 tons produced from open pit operations. Open pit operations were completed during the quarter.
The relationship building exercise initiated during the previous quarter is ongoing, with no days lost as a result on industrial action. Production was, however, impacted by the Section 54 instruction issued by the DME following the fatal accident at K5 shaft.
Tons processed increased by 7% to 1,674,523 tons, comprising 1,673,563 tons from underground and 960 tons of opencast material. Stockpiles at the end of the quarter were 154,000 tons.
The head-grade increased to 2.60 g/t.
Recoveries increased remained at 78%.
PGM production increased by 8% to 109,707 PGM ounces (Aquarius attributable: 54,854 ounces) due to the increased underground production.
Primary development for the quarter was 1,724 metres.
Kroondal: Metal in concentrate produced (PGM ounces)
Quarter ended Pt Pd Rh Au PGMs Attributable to Aquarius Dec 2008 65,075 32,161 11,941 531 109,707 54,854 Sep 2008 60,634 29,573 11,068 456 101,731 50,866 Jun 2008 49,621 24,054 9,014 372 83,062 41,531 Mar 2008 59,834 28,966 10,759 461 100,020 50,010 Operating Cash Costs
Cash costs per ton decreased by 12% to R318 and costs per PGM ounce decreased by 13% to R4,856 as a result of increased production and successful cost reduction initiatives. Gross revenue decreased by 45% to R299m as a result of the significant decline in PGM prices and the negative sales adjustment. As a result, Kroondal Mine shows a negative cash margin for the period of -78%, however, the calculated cash margin for the quarter excluding the sales adjustments is 15% showing that the operation remains cash generative in terms of current operations.
Kroondal: Operating Cash Costs per Ounce
4E 6E 6E net of by-products (Pt+Pd+Rh+Au) (Pt+Pd+Rh+Ir+Ru+Au) (Ni&Cu) Kroondal R 4,856 R 3,979 R 3,907 Capital Expenditure
Capital expenditure for the quarter was R75,451 million, all ongoing capital. Major items included underground infrastructure, underground workshop upgrade, mobile mining equipment and the K5 rail link project.
P&SA2 at Marikana
Safety
The 12-month rolling average DIIR for the quarter deteriorated from 0.64 in the previous quarter to 0.70. Nine lost time injuries were reported during the quarter.
Mining
Production tons increased by 7% to 744,692 tons, comprising 378,641 tons from underground and 366,051 tons from open pit operations
Head grade increased by 4% to 2.92 g/t
Processing
Tons processed decreased by 1% to 679,111 tons
Recoveries increased by 5% to 66%
PGM production increased by 9% to 42,451 ounces (Aquarius attributable: 21,226 ounces)
Revenue
The basket price for the quarter averaged $744 per PGM ounce, 56% lower than the previous quarter. The Rand Dollar exchange rate averaged 9.75 for the quarter. Quarterly revenue at Marikana decreased by 44% to R108 million (Aquarius attributable: R54 million) due to a significant reduction in PGM prices and negative sales adjustments caused by weakening PGM prices at the close of the period compared to the close of the prior quarter as detailed.
Operations
Total production increased by 7% to 744,692 tons for the quarter.
The open pit operation performance improved, showing a quarter-on-quarter increase of 10% to 366,051 tons. The open pit shell was re-optimised during the quarter in line with the reduced PGM prices. A new shell with a lower strip ratio of 21:1 from 30:1 is now being mined resulting in a 24% quarter-on-quarter decrease in the stripping ratio.
Operations at Number 2 shaft were suspended at the end of the previous quarter on the basis of its financial viability at current metals prices. Despite the suspension, underground production increased by 5% to 378,641 tons for the quarter although face length was adversely affected by a high frequency of potholes. The focus remains on development to mitigate the impact of the geological losses.
The 'Areboleleng' (Tswana for "let's talk") safety initiatives that were implemented in the previous quarter and the new commercial arrangement with MRC have both had a positive effect on industrial relations, with no industrial action during the quarter.
Tons processed decreased by 1% to 679,111 tons, comprising 292,026 tons from underground and 387,085 tons of open pit material.
Stockpiles at the end of the quarter were 145,407 tons, consisting predominantly of open pit material.
The head-grade increased by 4% to 2.92 g/t, mainly as a result of the higher proportion of open pit tons processed. Recoveries improved from 63% to 66% quarter on quarter, in line with the increased head grades and competent open pit material processed.
The PGM production for the quarter increased by 9% to 42,451 PGM ounces (Aquarius attributable: 21,226).
Marikana: Metal in concentrate produced (PGM ounces)
Quarter ended Pt Pd Rh Au PGMs Attributable to Aquarius Dec 2008 26,193 11,733 4,256 268 42,451 21,226 Sep 2008 24,182 10,609 3,866 226 38,883 19,442 Jun 2008 17,843 7,649 2,769 155 28,416 14,208 Mar 2008 15,114 6,601 2,351 158 24,223 12,111 Operating Cash Costs
Cash costs per ton decreased by 12% to R392, whilst costs per PGM ounce decreased by 20% to R 6,279 as a result of higher production and ongoing improvement initiatives that are being implemented to counter the effect of falling metals prices. However, gross revenue decreased by 44% to R108m as a result of the significant decline in PGM prices and the negative sales adjustment. As a result, Marikana Mine shows a negative cash margin for the period of -146%.
Marikana: Operating Cash Costs per Ounce
4E 6E 6E net of by-products (Pt+Pd+Rh+Au) (Pt+Pd+Rh+Ir+Ru+Au) (Ni&Cu) Marikana R 6,279 R 5,148 R 5,002 Capital Expenditure
Ongoing capital expenditure totalled R29.9 million. (AQPSA share R14.95 million).
Contractor dispute with Moolman Mining
There have been no new developments during the quarter.
Everest Platinum Mine
On December 8 2008, Aquarius announced that operations at the Everest Platinum Mine were suspended owing to geotechnical issues.
Operations at the Everest Mine were suspended from night shift on Sunday 7 December 2008 after instability was detected in the upper areas of the mine. The instability was subsequently found to be a result of subsidence that has occurred over an upper area of the mine with the area affected by subsidence limited to a mined out area of the orebody which includes the upper levels of the decline shaft.
The extent of the subsidence was investigated by independent rock engineering specialists in conjunction with the Department of Minerals and Energy, who subsequently issued a Section 54 instruction in terms of the Mine Health and Safety Act stopping all mining operations. Following a comprehensive assessment of the options available to mine management, and primarily focussing on the future safety of the mine and its personnel, the decision has been made to suspend operations for a minimum of six months, a prudent time frame that will permit assessment of the best way forward for the long-term.
The nature of the suspension unfortunately resulted in the retrenchment of some 1,900 employees, and consultation with relevant unions were initiated in terms of Section 189 of the Labour Relations Act in December 2008.
The following report for the Everest Platinum Mine is for the three months to December 2008, however, it should be noted that the mine was only operating until December 7, therefore period-on-period comparables are not accurate.
Safety
The 12-month rolling average DIIR for the quarter improved from 0.65 in the previous quarter to 0.58. Four lost time injuries were reported during the quarter.
Mining
Mining operations were suspended on December 7 2008
Underground production was 408,342 tons
The head grade improved to 2.96 g/t.
Processing
The processing plant was stopped on December 8 2008
Plant processed 401,781 tons
Recoveries improved to 84%
PGM production was 31,703 PGM ounces
Revenue
The basket price for the quarter (or production period to December 7 2008) averaged $746 per PGM ounce with an average Rand Dollar exchange rate of 9.75. Revenue at Everest was R69 million for the quarter (Aquarius attributable: R69 million) due to the significant weakening of PGM prices and negative sales pipeline adjustments caused by weakening PGM prices.
Operations
Total production decreased by 8% to 408,345 tons.
Production showed a positive improvement throughout the quarter. The Northern panels were increased in length after all the panels were undercut, leaving the shear zone in the hanging wall. The increased panel length and the reduced stoping width resulted in improved productivity, a reduction in dilution and a resultant improved grade. This configuration also enabled better utilization of mobile mining equipment which showed satisfactory availability improvements. Face length availability remained a challenge at Everest.
Tons processed decreased by 8% to 401,806 tons in line with the production. There was no stockpile at the end of the quarter.
The head-grade improved to 2.96 g/t due to a reduction in dilution from underground.
Recoveries improved to 84% due to ongoing process optimisation.
PGM production decreased by 2% to 31,703 PGM ounces.
Primary development for the quarter decreased by 16% to 903.5 metres.
Everest: Metal in concentrate produced (PGM ounces)
Quarter ended Pt Pd Rh Au PGMs (4E) Dec 2008 18,340 9,900 3,174 288 31,703 Sep 2008 19,302 9,465 3,325 274 32,365 Jun 2008 18,777 9,060 3,236 254 31,327 Mar 2008 18,863 8,912 3,072 259 31,107 Operating Cash Costs
Cash costs per ton were R530 per ton, whilst costs per PGM ounce were R6,717 per ounce. Although unit cost showed a major improvement for the first two months of the quarter (for November, the cash cost R/oz was R4,967, an improvement of 25% on Q1 2009), unit cost was negatively impacted by the suspension of the operations and the continued overhead cost for December. The cash margin for the quarter was -210%. This variance is attributed to the negative pipeline sales adjustment that resulted from the significant decline in PGM prices during the quarter as detailed above. Gross revenue decreased to R69m.
Everest Operating Cash Costs per PGM Ounce
4E 6E 6E net of by-products (Pt+Pd+Rh+Au) (Pt+Pd+Rh+Ir+Ru+Au) (Ni&Cu) Everest R 6,717 R 5,523 R 5,393 Capital Expenditure
Capital expenditure for the quarter was R36 million, R10 million up from quarter 1. The major contributors were the chrome spiral plant at R17.5 million and mobile mining equipment at R8 million. The chrome spiral plant project has subsequently been suspended.
MIMOSA INVESTMENTS (Aquarius Platinum 50%)
Mimosa Platinum Mine
Safety
The 12-month rolling average DIIR for the quarter improved from 0.19 in the previous quarter to 0.17. Two lost time injuries were reported during the quarter.
Mining
Underground production increased by 9% to 547K tons
Head grade slightly increased 1% to 3.63 g/t
The surface stockpile increased to a total 530,000 tons at the end of the quarter, equivalent to over 82-days mill feed
Processing
Concentrator plant recoveries increased to 74.2% from 73.4%
Total mine production marginally decreased by 1% to 43,232 PGM ounces (Aquarius share: 21,616 PGM ounces)
A process optimisation programme was initiated in July 08 following the successful repairs to the No 2 Primary Ball Mill. Positive results have followed in the current quarter which demonstrate that the Phase V operations can achieve the design outputs both underground and on surface. The only outstanding major efficiency issues relate to PGM recoveries. Further improvements are expected as process stability and mill grinds improves.
Revenue
The average achieved PGM basket price for the quarter decreased by 42% to $905 per PGM ounce. The average achieved nickel price over the quarter decreased by 27% to $7.15 per pound from $9.79 per pound in the previous quarter. Revenue for the quarter decreased to $46.1 million, with base metals accounting for approximately 24% of revenue. The cash margin decreased to 56% from 69% in the previous quarter mainly due to falling metal prices.
Operations
During the quarter mining operations hoisted 546,891 tons compared to 499,590 tons in the previous quarter. Tons milled during the quarter totalled 499,331 tons, with 47,560 tons being transferred to the stockpile, which totalled 529,976 tons at the quarter end. In line with plan, the stockpile increased by 47,560 tons.
The average plant grade marginally increased to 3.63 g/t, compared to 3.59 g/t in the previous quarter.
Tons processed totalled 499,331, a 3% decrease compared to the previous quarter, due to a number of operational issues which included crushing plant stoppages, unplanned Phase V Primary Ball mill stoppage, planned maintenance challenges experienced on the tailings disposal lines and power failure.
Recoveries for the quarter slightly increased to 74.2% from 73.4%.
PGM production during the quarter decreased by 1% to 43,232 ounces (Aquarius attributable: 21,616 ounces).
Mimosa: PGMs in concentrate produced (ounces)
Quarter ended Pt Pd Rh Au PGMs Attributable to Aquarius Dec 2008 21,903 16,678 1,753 2,898 43,232 21,616 Sep 2008 22,113 16,863 1,770 2,892 43,638 21,819 Jun 2008 19,532 14,821 1,535 2,628 38,517 19,258 Mar 2008 17,392 13,234 1,351 2,306 34,283 17,142
Mimosa: Base Metals in concentrate produced (tons)
Mine Production Attributable to Aquarius Quarter ended Ni Cu Co Ni Cu Co Dec 2008 615 497 18 307.5 248.5 9 Sep 2008 602 498 17 301 249 8.5 Jun 2008 533 439 15 266 219 7 Mar 2008 475 392 14 237 196 7 Operating Cash Costs
Cash costs per ROM ton increased by 4% to $41, whilst costs per PGM ounce increased by 2% to $473. The increase in cash costs for the quarter was attributable to low production throughput recorded during the quarter. Consequently on mine cash costs were also higher at $403 per PGM ounce. The gross cash margin decreased to 56% from 69% in the previous quarter mainly due to falling metal prices.
Net of by-products, cash costs were positive at $181 per PGM ounce, compared to $144 per PGM ounce in the previous quarter, primarily due to falling nickel prices.
Mimosa Operating Cash Costs per Ounce
4E 6E 4E net of by-products (Pt+Pd+Rh+Au) (Pt+Pd+Rh+Ir+Ru+Au) (Ni, Cu & Co) Mimosa $473 $450 $181
Update on Foreign Currency Regime in Zimbabwe
The Interbank foreign exchange market introduced in April 2008 is still operational. The Central Bank has also recently authorised approximately 1,000 retail and wholesale outlets nation-wide to sell products in United States dollars. Following this development, the economy has now almost dollarised as every retailer or service provider is demanding payment in foreign currency.
Update on Indigenisation Legislation in Zimbabwe
The Indigenisation and Economic Empowerment bill was enacted into law during the last quarter of the previous financial year. Specific details on the implementation of the act in various sectors are being awaited. The details on the mining sector are supposed to be incorporated into the amendments to the Mines and Minerals Act which are yet to be brought before parliament.
Wedza Phase 5.5 Expansion
The project is progressing well with some notable milestones,, namely: the civil construction of the silo, the installation of the 70m3 flotation cell, the laying of the tailing delivery line and the delivery to site of the crusher and the sizing screen. All of the major equipment and structural steel is now on site. Commissioning is planned for end March 2009.
AQUARIUS PLATINUM (SA) CORPORATE SERVICES (PTY) LTD
Chromite Tailings Retreatment Plant (CTRP) (Aquarius Platinum 50%)
Safety
The DIIR decreased from 5.69 to 4.80 from the previous quarter. No lost time accidents were recorded.
Processing
Material processed reduced to 50,000 tons
Grade decreased 14% to 2.27 g/t
Recoveries increased by 46% to 48%
Production marginally increased to 1,784 PGM ounces (Aquarius attributable: 892 PGM ounces)
Revenue
The basket price for the quarter averaged $818 per PGM ounce, 64% lower than the previous quarter, with average Rand Dollar exchange rate of 9.75. Revenue decreased by 2% to R6 million for the quarter (Aquarius attributable: R3 million) due to the lower production and negative sales pipeline adjustments caused by weakening PGM prices at the close of the period compared to the close of the prior quarter.
Operations
Material processed fell to 50,000 tons.
The head grade decreased 14% to 2.27 g/t as a result of grade variances within the chromite dump source material.
Recoveries, however, increased significantly, up 46% to 48% due to improvement in operational stability following the implementation of several initiatives.
This resulted in production increasing by 1% to 1,784 PGM ounces (Aquarius attributable: 892 ounces) this decrease in production was due to the lower feed grade.
CTRP: Metal in concentrate produced (PGM ounces)
Quarter ended Pt Pd Rh Au PGMs (4E) Dec 2008 1,078 404 297 4 1,784 Sep 2008 1,077 388 295 4 1,764 Jun 2008 1,254 452 333 5 2,044 Mar 2008 1,437 517 351 5 2,309 Operating Costs
Cash costs decreased by 11% to R3361 per PGM ounce. Cash margin for the period of -2%, however, the operation remains cash generative in terms of current operations.
CTRP Operating Cash Costs per Ounce
4E 6E 4E net of by-products (Pt+Pd+Rh+Au) (Pt+Pd+Rh+Ir+Ru+Au) (Ni, Cu& Co) CTRP R 3,361 R 2,325 R2,150
Platinum Mile (Aquarius Platinum 50%)
The effective date of the acquisition of the 50% interest in Platinum Mile was March 1 2008.
Safety
The DIIR was zero for the quarter. No lost time accidents were recorded.
Processing
Tailings processed decreased 22% compared to the previous quarter to 2,006 million tons
PGM grade was 0.67 g/t
Production was 3,103 PGM ounces (Aquarius attributable: 1,552 PGM ounces)
Revenue
Revenue as R32 million for the quarter (Aquarius attributable: R16 million). The basket price for the quarter averaged $596 per PGM ounce, at an average Rand Dollar exchange rate of R9.89. The cash margin for the quarter was 42%.
Operations
During the quarter the feed head grade decreased marginally to 0.67 g/t compared to 0.76 g/t the previous quarter.
Recoveries decreased to 7% compared to the 10% achieved the previous quarter.
As a result, production decreased 48% to 3,103 PGM ounces (Aquarius attributable: 1,552 ounces). This was in part due to lower tonnages received from Anglo Platinum but also due to the planned commissioning of new milling capacity for the expansion project, due to be completed in the third quarter FY 2009.
Platinum Mile: Metal in concentrate produced (PGM ounces)
Quarter ended Pt Pd Rh Au PGMs (4E) Dec 2008 1799 962 279 63 3,103 Sep 2008 3,470 1,855 538 120 5,983 Jun 2008 2,920 1,561 453 101 5,035 Mar 2008 1,127 636 208 34 2,005 Operating Costs
Cash costs increased by 17% to R5,500 per PGM ounce. The increase is as a result of lower PGM production.
Platinum Mile Operating Cash Costs per Ounce
4E 6E 4E net of by-products (Pt+Pd+Rh+Au) (Pt+Pd+Rh+Ir+Ru+Au) (Ni, Cu& Co) Platinum Mile R 5,500 nm nm
Platinum Mile Milling Expansion Program
With the addition of additional grinding capacity in the third quarter, the expansion program to increase annual production to 28,000 PGM ounces from March 2009 is on track. Capital expenditure for the quarter was R15.3 million. Of a project budget of R59 million, this brings the total spent to date to R41 million, with R18 million remaining in the third quarter to March 2009.
CORPORATE MATTERS
Update on BEE
On October 27 2008, Aquarius announced the completion of the final phase of its South African BEE transaction with Savannah Consortium whereby SavCon exchanged its 32.5% shareholding in AQPSA into 65,042,856 new shares in Aquarius, comprising approximately 20% of the enlarged share capital of Aquarius. Subsequently, Aquarius increased its holding in AQPSA to 100% of AQPSA. Following the acquisition of Impala Platinum's Holdings Limited interests in Aquarius and AQPSA earlier in the year, Aquarius enjoys a 100% free-float and full access to cash flows and earnings from its operations.
New UK Corporate Broker
On November 25 2008, Aquarius announced that it had appointed Merrill Lynch International to act as joint UK corporate broker replacing Morgan Stanley & Co. International Limited.
More information on corporate matters may be found at www.aquariusplatinum.com
Aquarius Platinum LimitedIncorporated in BermudaExempt company number 26290 Board of DirectorsNicholas Sibley Non-executive Chairman Stuart Murray Chief Executive Officer David Dix Non-executive
Timothy Freshwater Non-executive
Edward Haslam Non-executive
Sir William Purves Non-executive
Kofi Morna Non-executive
Zwelakhe Mankazana Alternate to Kofi Morna
Audit/Risk Committee Sir William Purves (Chairman)David DixEdward HaslamNicholas Sibley
Remuneration/Succession Planning Committee
Edward Haslam (Chairman)Nicholas SibleyNomination Committee
The full Board comprises the Nomination Committee
Company SecretaryWilli Boehm AQPSA ManagementStuart Murray Executive Chairman Hugo H¶ll Managing Director H©l¨ne Nolte Director: Finance Hulme Scholes Commercial Director Anton Lubbe Operations Director: West Anton Wheeler Operations Director: East
Graham Ferreira General Manager: Group Admin & Company Secretary
Mkhululi Duka General Manager: Group Human Resources & Transformation Wessel Phumo General Manager: Marikana Jacques Pretorius General Manager: Everest Gabriel de Wet General Manager: Engineering ACS (SA) Management Paul Smith Director: New Business Mimosa Mine Management Winston Chitando Managing Director Herbert Mashanyare Technical Director Peter Chimboza Operations Director Fungai Makoni Finance Executive & Company Secretary Issued Capital
At 31 December 2008, the Company had in issue: 327,095,634 fully paid common shares and 1,680,305 unlisted options.
Substantial Shareholders 31 December 2008 Number of Shares Percentage
HSBC Custody Nominess (Australia Limited) 20,811,259 6.36%
Nutraco Nominees Limited 16,530,643 5.05% Trading InformationISIN number BMG0440M1284ADR ISIN number US03840M2089 Broker (LSE) (Joint) Broker (ASX) Sponsor (JSE) Merrill Lynch Euroz Securities Investec Bank Limited International Level 14, The Quadrant 100 Grayston Drive 2 King Edward St 1 William Street, Perth Sandown, Sandton 2196 London, EC1A 1HQ WA 6000 Telephone: +27 (0)11 Telephone: +44 (0)20 Telephone: +61 (0)8 9488 286 7326 7628 1000 1400 Investec Securities Limited Investec Bank plc 2 Gresham St, London, EC2V 7QP Telephone: +44 (0)20 7597 5970
Aquarius Platinum (South Africa) (Proprietary) Ltd
100% Owned (At 31 December 2008)
(Incorporated in the Republic of South Africa)
Registration Number 2000/000341/07
Block A, 1st Floor, The Great Wall Group Building, 5 Skeen Boulevard, Bedfordview, South Africa 2007
Postal Address P O Box 1282, Bedfordview, 2008, South Africa.Telephone: +27 (0)11 455 2050Facsimile: +27 (0)11 455 2095
Aquarius Platinum Corporate Services Pty Ltd
100% Owned
(Incorporated in Australia)
ACN 094 425 555
Level 4, Suite 5, South Shore Centre, 85 The Esplanade, South Perth, WA 6151,AustraliaPostal Address PO Box 485, South Perth, WA 6151, AustraliaTelephone: +61 (0)8 9367 5211Facsimile: +61 (0)8 9367 5233Email: [email protected] Glossary
A$ Australian Dollar Aquarius Aquarius Platinum Limited
ABET Adult Basic Education Training programme APS Aquarius Platinum Corporate Services Pty Ltd AQPSA Aquarius Platinum (South Africa) Pty Ltd
ACS (SA) Aquarius Platinum (SA) (Corporate Services) (Pty) Limited
BEE Black Economic Empowerment CTRP Chromite Ore Tailings Retreatment Operation. Consortium comprising Aquarius Platinum (SA) (Corporate Services) (Pty) Limited (ASACS), Ivanhoe Nickel and Platinum Limited and Sylvania South Africa (Pty) Ltd (SLVSA). DIFR Disabling Injury Incidence Rate - being the number of lost-time injuries expressed as a rate per 1,000,000 man-hours worked DIIR Disabling Injury Incidence Rate - being the number of lost-time injuries expressed as a rate per 200,000 man-hours worked DME South African Government Department of Minerals and Energy Affairs
Dollar United States Dollar or $ EMPR Environmental Management Programme Report Everest Everest Platinum Mine
Great A PGE bearing layer within the Great Dyke Complex in Zimbabwe Dyke Reef g/t Grams per tonne, measurement unit of grade (1g/t = 1 part per million) JORC Australasian code for reporting of Mineral Resources and Ore Reserves code JSE JSE Securities Exchange South Africa
Kroondal Kroondal Platinum Mine or P&SA1 at Kroondal LHD Load Haul Dump machine Marikana Marikana Platinum Mine or P&SA2 at Marikana
Mimosa Mimosa Mining Company (Private) Limited MRC Murray & Roberts Cementation nm Not measured NOSA National Occupational Safety Association NUM South African National Union of Mineworkers PGE(s) Platinum Group Elements plus Gold. Five metallic elements commonly (6E) found together which constitute the platinoids (excluding Os (osmium)). These are Pt (platinum), Pd (palladium), Rh (rhodium), Ru (ruthenium), Ir (iridium) plus Au (gold) PGM(s) Platinum Group Metals plus Gold. Aquarius reports the PGMs as (4E) comprising Pt+Pd+Rh plus Au (gold) with the Pt, Pd and Rh being the most economic platinoids in the UG2 Reef P&SA1 Pooling & Sharing Agreement between AQPSA and RPM Ltd on Kroondal P&SA2 Pooling & Sharing Agreement between AQPSA and RPM Ltd on Marikana R South African Rand ROM Run of Mine. The ore from mining which is fed to the concentrator plant. This is usually a mixture of UG2 ore and waste. RPM Rustenburg Platinum Mines Limited SavCon The Savannah Consortium - the principal Black Empowerment Investor in Aquarius Platinum TKO TKO Investment Holdings Limited Ton 1 Metric tonne (1,000kg)
UG2 Reef A PGE bearing chromite layer within the Critical Zone of the Bushveld
Complex Z$ Zimbabwe Dollar
For further information please contact:
In Australia:Willi Boehm+61 (0)8 9367 5211
In the United Kingdom and South Africa
Nick Bias+ 44 (0)7887 920 [email protected]
vendorRelated Shares:
AQP.L