Tonnes milled and headgrade were virtually unchanged at 1.54 million and 4.39g/t 6E, respectively, resulting in platinum production remaining constant at 70 600 ounces despite an increase in financial, labour and equipment resources. This was below our ramp-up plan of 85 000 platinum ounces. Higher staffing levels without the requisite improvement in production ounces resulted in a 19% rise in unit costs to R16 884 per platinum ounce (R6 419 per PGM ounce).
Marula has experienced a series of operational difficulties since FY2002 and has been unable to achieve its production targets. The original mine plan, based on a trackless mechanised bord and pillar mining method, proved inappropriate due to geological conditions, primarily the rolling nature of the reef which hampered mechanised machine efficiencies and aggravated the extent of waste dilution.
A new hybrid mine plan incorporating conventional stoping and mechanised strike development was developed in FY2004 and implemented the following year. This plan envisaged simultaneous infrastructure development for the conversion to conventional mining and ongoing stoping from the hybrid sections.
The conversion project fell behind schedule due to the fact that production parameters were premised on drill-jig technology and double-shift blasting.
In light of these operational difficulties, the mine plan was reassessed in FY2010. The review revealed that the complexities of changing to a conventional mining layout resulted in a number of logistical constraints and consequently the production target was amended to a steady-state level of 100 000 ounces of platinum per annum by FY2013.
Despite the initiatives put in place to address these constraints, Marula has continued to fall short against plan. A detailed strategic review undertaken during the last quarter of 2011 evaluated mine planning parameters and the project status. As a consequence production at Marula will be maintained at the current rate of 70 000 ounces of platinum per annum for the next two years to enable the completion of the conversion project. Marula is rightsizing its cost base to the current ounce profile, a process that has been successfully completed in July.
As part of the ongoing production profile, the Company was successful in securing an extension to the Driekop Shaft from the Modikwa JV. This extension is significant in that it supplements the underperformance at Clapham Shaft.
The revised plan will result in a smaller but more profitable operation. A further strategic review will be undertaken in FY2013 which will assess the status of the mine and examine the potential to expand it by exploiting the deeper UG2 and the yet untouched Merensky resources.
Marula – key statistics
|REVENUE||(Rm)||1 300||1 130|
|COST OF SALES||(1 341)||(1 141)|
|Mining operations||(1 034)||(876)|
|Adjusted gross profit||(31)||16|
|PROFIT FROM OPERATIONS IN IMPLATS GROUP||(72)||(7)|
|SALES VOLUMES IN CONCENTRATE|
|PRICES ACHIEVED IN CONCENTRATE|
|Platinum||($/oz)||1 481||1 244|
|Rhodium||1 782||2 025|
|Nickel||($/t)||16 216||13 496|
|EXCHANGE RATE ACHIEVED||(R/$)||6.91||7.51|
|Tonnes milled ex-mine||(000t)||1 542||1 545|
|Platinum in concentrate||(000oz)||70.6||70.1|
|Palladium in concentrate||72.9||72.6|
|Rhodium in concentrate||14.7||14.7|
|Nickel in concentrate||(t)||222.0||216.6|
|PGM in concentrate||(000oz)||185.7||184.6|
|TOTAL COST||(Rm)||1 186||1 022|
|– per tonne milled**||(R/t)||773||645|
|– per PGM ounce in concentrate**||(R/oz)||6 419||5 395|
|– per platinum ounce in concentrate**||(R/oz)||16 884||14 208|
|($/oz)||2 401||1 880|
|– net of revenue received for other metals**||(R/oz)||8 782||7 430|
|– per platinum ounce in concentrate||(R/oz)||16 799||14 579|
|($/oz)||2 389||1 930|
|LABOUR INCLUDING CAPITAL||(number)||4 209||3 968|
|Own employees||3 272||3 241|
|Centares per panel man per month||(m2/man)||20.1||25.0|
|*||Adjustment note: The adjustment relates to sales from Marula to the Implats Group which at year-end were still in the pipeline.|
|**||Excluding share-based compensation.|