Wrap Text
Quarterly Review and Production Report for the Period 1 January To 31 March 2019
ROYAL BAFOKENG PLATINUM LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 2008/015696/06)
JSE share code: RBP ISIN: ZAE000149936
JSE bond code: RBPCB ISIN: ZAE000243853
(“RBPlat” or the “Company”)
ROYAL BAFOKENG PLATINUM LIMITED QUARTERLY REVIEW AND PRODUCTION REPORT FOR THE PERIOD
1 JANUARY TO 31 MARCH 2019
OVERVIEW
- Zero fatalities and improvement in all key safety metrics
- 17.3% increase in tonnes delivered to concentrators
- 11.6% increase in tonnes milled
- 12.6% increase in 4E metals in concentrate
- 13.6% increase in platinum metal in concentrate
- Recommencement of UG2 mining at BRPM South shaft
- 53.0% reduction in capital expenditure
SAFETY
We are pleased to report notable improvement in our safety statistics with no fatal accidents during the quarter under
review. Our total injury (TIFR), lost time injury (LTIFR) and serious injury (SIFR) frequency rates reduced by 16.5%,
20.5% and 37.7% respectively compared to the first quarter of 2018.
Our safety strategy remains firmly based on the principle of achieving zero harm and we remain fully committed to
establishing a resilient safety culture. Various training initiatives aimed at improving team work, leadership skills,
systems, design and behaviour are being implemented.
Safety-related stoppages impacted production by 8.4kt or 1.0koz (4E) compared to the 1.2kt recorded in the first quarter
of 2018.
PRODUCTION
Total tonnes delivered to concentrators increased by 17.3% to 862kt with total tonnes milled increasing by 11.6% to
846kt compared to the corresponding 2018 quarter. Platinum production increased by 13.6% to 59.4koz and 4E metal
production increased by 12.6% to 91.3koz. Notwithstanding the increase in production volumes, production during the
quarter was impacted by:
- an increase in safety related stoppages at Bafokeng Rasimone Platinum Mine (BRPM) of 7.2kt compared to the
first quarter of 2018
- termination of the Styldrift mining contractor responsible for approximately 30% of current stoping production
due to non-compliance. The required contract teams have subsequently been enrolled and now form part of the
Styldrift operations
- change in the Styldrift operating shift cycle, from 11-day-fortnight to FULCO (full calendar operations)
- downtime on the BRPM concentrator secondary mill due to a mill motor resistor bank failure, impacting on
recovery and resulting in an estimated 1.2koz (4E) loss to tailings
- Eskom power generation constraints which culminated in a sustained period of stage 4 load shedding. During
this period our operational strategy involved load reduction by restricting certain mining and metallurgical
processes, specifically ore hoisting and crushing, in order to mitigate the impact on underground operations.
The sustained stage 4 load shedding period resulted in approximately 5 days suspension of all operations at
our Maseve concentrator in order to meet load curtailment requirements. This resulted in approximately 21kt of
ore not being processed in the quarter.
BRPM
BRPM delivered tonnes decreased by 10kt or 1.9% to 525kt primarily as a result of the increase in safety-related
stoppages. Total tonnes milled decreased by 35kt or 6.4% to 516kt compared to the corresponding 2018 reporting
period.
Page 1 of 5
The built-up head grade for the reporting period was 4.18g/t (4E) compared to 4.21g/t (4E) for the corresponding period
in 2018 equating to a 0.7% reduction. The reduction in head grade remains in line with expectations, considering
variability in ore mix and resource area grade fluctuations.
Personnel and equipment resourcing required for the initial re-establishment of UG2 mining at our South shaft operation
was completed during the quarter with production estimated to reach 20ktpm by the fourth quarter of 2019.
STYLDRIFT
Despite the Styldrift operational performance being impacted by the contractor termination and change in shift cycle,
delivered tonnes increased by 68.5% or 137kt to 337kt and milled tonnes increased by 59.4% to 330kt compared to the
first quarter of 2018.
The built-up head grade improved by 18.2% to 3.83g/t (4E), driven by the increase in higher grade stoping tonnage
contribution to overall delivered tonnes.
The mining contract termination, subsequent enrolment of the contract teams and FULCO shift cycle system were
successfully implemented and Styldrift remains on schedule to achieve the 230ktpm ramp-up by the third quarter of
2020.
CONCENTRATING
Total tonnes milled for the reporting period increased by 11.6% to 846kt on the back of the increased mining volumes,
with BRPM concentrator treating 612kt and Maseve concentrator 234kt. No UG2 ore was toll treated during the quarter.
The overall built-up head grade increased by 2.3% to 4.04g/t (4E). Overall recoveries however, declined by 1.6%
quarter-on-quarter as a result of the BRPM secondary mill downtime and lower recovery potential of the Maseve plant
in its current MF1 configuration. BRPM recoveries normalised subsequent to the secondary mill being brought back on
line whilst Maseve recoveries, albeit within grade recovery parameters for the MF1 circuit, are only expected to improve
significantly once the MF2 upgrade has been completed in the fourth quarter of 2020.
The increase in milled volumes and lower recovery yielded a 13.6% and 12.6% respective increase in platinum and 4E
metals in concentrate quarter-on-quarter, with platinum production increasing to 59.4koz and 4E metal production
increasing to 91.3koz.
CASH OPERATING COSTS
Cash operating costs increased by R568 million to R1 223 million representing an 86.7% increase compared to the
corresponding 2018 period. The increase is mainly due to the inclusion of Styldrift which achieved commercial operation
status as of January 2019.
BRPM operating costs increased in line with annual labour inflation increases which were partially offset by ongoing
cost control initiatives by 2.7% to R673 million. Lower year-on-year production resulted in BRPM unit operating costs
per tonne milled, 4E ounce and platinum ounce increasing by 9.8%, 11.5% and 10.3% to R1 305/t, R11 497/oz and
R17 655/oz respectively.
Styldrift cash costs amounted to R550 million for the reporting period which with the operational disruptions experienced
during the quarter yielded unit operating costs per tonne milled, 4E ounce and platinum ounce of R1 667/t, R16 845/oz
and R25 881/oz respectively. Although the unit costs ended higher than initially anticipated at this stage of the Styldrift
ramp-up we remain confident that the operation will achieve its full year unit cost guidance of between R13 000 and
R13 500/oz (4E). Cash operating costs for Styldrift remain forecast to be 15% lower than that of BRPM once Styldrift
operates at a steady state of 230ktpm.
CAPITAL
Total capital expenditure decreased by R317.9 million to R281.4 million compared to the corresponding 2018 period,
with the key contributor to the lower expenditure being Styldrift expansion capital which decreased by R305.7 million to
R260.5 million with previously capitalised operating costs now being expensed. Replacement capital expenditure
decreased by R9.5 million to R1.1 million and stay-in-business (SIB) expenditure decreased by R2.7 million to
R19.8 million for the quarter.
Expansion capital expenditure remains aligned with the Styldrift mining, construction and equipping schedule required
to meet the 230ktpm ramp-up schedule. Replacement and SIB capital expenditure remains aligned with the BRPM
North shaft Phase III project and ongoing operational requirements.
Page 2 of 5
PROJECTS
BRPM NORTH SHAFT PHASE III PROJECT (REPLACEMENT)
Project expenditure for the quarter amounted to R1.1 million. Expenditure remains aligned with project progress and
construction schedule to finalise the scope of work by the first half of 2019. Estimated cost at completion is forecast at
R1.2 billion against a budget of R1.4 billion, indicating a potential saving of R200 million.
STYLDRIFT PROJECT (EXPANSION)
The focus for the quarter under review remained the securing of operational resources, ore reserve development and
establishing of infrastructure required to maintain operational ramp-up momentum and achieving the 230ktpm ramp-up
milestone by the third quarter of 2020.
Mining and construction activities continued to make steady progress with key items completed during the reporting
period being:
- 1.6km of footprint development
- Completion of ventilation shaft No.2 raiseboring
- Commissioning of a further two on-reef strike belt sections
- Commissioning of additional two trackless workshops
Capital expenditure for the reporting period amounted to R266.8 million bringing the total capital project expenditure to
date to R12.07 billion.
Page 3 of 5
Unaudited Unaudited Quarter 1 2018 vs.
Description Unit quarter ended 31 quarter ended 31 Quarter 1 2019
March 2019 March 2018 % Change
Safety
TIFR (/1 000 000 hrs) rate 8.39 10.05 16.5
SIFR (/1 000 000 hrs) rate 1.60 2.57 37.7
LTIFR (/1 000 000 hrs) rate 2.60 3.27 20.5
Production
Tonnes delivered to concentrators kt 862 735 17.3
BRPM kt 525 535 (1.9)
Styldrift kt 337 200 68.5
Total tonnes milled kt 846 758 11.6
BRPM kt 516 551 (6.4)
Styldrift kt 330 207 59.4
Merensky kt 742 645 15.0
UG2 kt 103 113 (8.8)
% UG2 of total tonnes milled % 12% 15% (20.0)
4E built-up head grade g/t 4.04 3.95 2.3
BRPM g/t 4.18 4.21 (0.7)
Styldrift g/t 3.83 3.24 18.2
Merensky g/t 4.04 3.90 3.6
UG2 g/t 4.06 4.21 (3.6)
Recovery (4E) total concentrating % 82.97 84.33 (1.6)
BRPM concentrator % 84.58 84.63 (0.1)
Maseve concentrator % 78.70 - -
Metals in concentrate produced
RBPlat
4E koz 91.3 81.1 12.6
Platinum koz 59.4 52.3 13.6
Palladium koz 24.2 21.7 11.5
Rhodium koz 4.8 4.6 4.3
Gold koz 2.9 2.5 16.0
Iridium koz 1.5 1.5 0.0
Ruthenium koz 7.9 7.8 1.3
Nickel kt 0.597 0.534 11.8
Copper kt 0.368 0.329 11.9
BRPM
4E koz 58.5 63.5 (7.9)
Platinum koz 38.1 40.9 (6.8)
Palladium koz 15.5 17.0 (8.8)
Rhodium koz 3.0 3.7 (18.9)
Gold koz 1.9 1.9 0.0
Iridium koz 0.9 1.2 (25.0)
Ruthenium koz 5.0 6.2 (19.4)
Nickel kt 0.366 0.389 (5.9)
Copper kt 0.247 0.246 0.4
Styldrift
4E koz 32.8 17.6 86.4
Platinum koz 21.3 11.4 86.8
Palladium koz 8.7 4.7 85.1
Rhodium koz 1.8 0.9 100.0
Gold koz 1.0 0.6 66.7
Iridium koz 0.6 0.3 100.0
Ruthenium koz 2.9 1.6 81.3
Nickel kt 0.231 0.145 59.3
Copper kt 0.121 0.083 45.8
Page 4 of 5
Unaudited Unaudited Quarter 1 2018 vs.
Description Unit quarter ended 31 quarter ended 31 Quarter 1 2019
March 2019 March 2018 % Change
Cash operating costs
RBPlat cash operating cost R’m 1 223 655 (86.7)
BRPM R’m 673 655 (2.7)
Styldrift R’m 550 - -
RBPlat cash operating cost / tonne milled R/t 1 446 1 189 (21.6)
BRPM R/t 1 305 1 189 (9.8)
Styldrift R/t 1 677 - -
RBPlat cash operating cost / 4E ounce R/oz 13 413 10 310 (30.1)
BRPM R/oz 11 497 10 310 (11.5)
Styldrift R/oz 16 845 - -
RBPlat cash operating cost / Pt ounce R/oz 20 600 16 004 (28.7)
BRPM R/oz 17 655 16 004 (10.3)
Styldrift R/oz 25 881 - -
Capital expenditure
Total capital R'm 281.4 599.3 53.0
Expansion R'm 260.5 566.2 54.0
Replacement R'm 1.1 10.6 89.6
Stay-in-business (SIB) R'm 19.8 22.5 12.0
BRPM R'm 12.6 11.3 (11.5)
Styldrift R'm 6.3 6.0 (5.0)
Concentrators R'm 0.9 5.2 82.7
BRPM SIB as a % of operating cost % 1.9 1.7 (11.8)
Styldrift SIB as a % of operating cost % 1.2 - -
The information set out in this announcement has not been reviewed and reported on by the Company’s external
auditors.
Johannesburg
17 April 2019
JSE Sponsor:
Merrill Lynch South Africa (Pty) Ltd
For further information, please contact:
Investors:
Lindiwe Montshiwagae
Executive: Investor Relations
+27 (0) 10 590 4510
lindiwe@bafokengplatinum.co.za
Media:
Mpueleng Pooe
Executive: Corporate Affairs
+27 (0) 10 590 4515
mpueleng@bafokengplatinum.co.za
Page 5 of 5
Date: 17/04/2019 02:30:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of
the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct,
indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on,
information disseminated through SENS.