Operational Review

 

Mimosa

 

Business summary

  • Joint venture with Aquarius Platinum Limited
  • Mechanised shallow underground mine
  • Concentrator plant
  • Reserves: 0.9 million attributable ounces of platinum
  • Resources (including reserves) 4.0 million attributable ounces of platinum
  • Production: 104 900 ounces of platinum in concentrate
  • Employees and contractors: 1 796

 

 

Material sustainability review

SAFETY

Mimosa showed a deterioration in the FIFR due to a fatality during the year under review. The operation continues to focus on compliance to safety rules as well as maintaining all safety standards.

 

Operational review

Mimosa completed its second year of steady state production. Tonnes milled, headgrade and concentrator recoveries increased to 2.3 million (by 1%), 3.91g/t 6E and 77%, respectively. This resulted in a record platinum production in concentrate of 104 900 ounces.

Unit costs were adversely impacted by higher than anticipated labour costs, materials usage, consumable costs as well as the impact of the stronger Rand. The increase in labour costs were due to salary rate adjustments while materials costs were impacted by the need for additional materials usage in both production and support due to poor ground conditions experienced north of the Blore Shaft during the year under review. This resulted in unit costs per platinum ounce in concentrate rising by 15% to US$1 377.

Outlook

Mimosa is currently running at steady state production of 100 000 ounces of refined platinum per annum. This output level will be maintained for the next five years at a total capital cost of approximately US$35 million per annum.

Beyond this period expansion opportunities exist at both South and North Hill. A feasibility study is currently underway to investigate increased production from the southern portion of South Hill. In the case of North Hill, additional exploratory drilling of the resource is required.

 

Mimosa – key statistics  

      FY2011   FY2010  
REVENUE (Rm)  2 569   2 063  
Platinum      1 277   1 109  
Palladium      377   217  
Rhodium      128   114  
Nickel      495   390  
Other      292   233  
COST OF SALES    (1 139)  (1 072) 
Mining operations      (730)  (665) 
Concentrating operations      (196)  (183) 
Treatment charges      (118)  (114) 
Depreciation      (114)  (80) 
Change in inventory      19   (30) 
GROSS PROFIT    1 430   991  
Other operating costs      (90)  (65) 
Royalty expense     (87)  (47) 
PROFIT FROM OPERATIONS   1 253   879  
50% of gross profit attributable to Implats     717   495  
Intercompany adjustment*     (25)  (74) 
Adjusted gross profit*     692   421  
Other costs including royalties     (89)  (57) 
PROFIT FROM OPERATIONS IN IMPLATS GROUP   603   364  
Gross margin   (%)  55.7   48.0  
SALES VOLUMES IN CONCENTRATE      
Platinum   (000oz)  105.4   98.4  
Palladium     81.6   75.5  
Rhodium     8.4   7.8  
Nickel   (t)  3 037   2 819  
PRICES ACHIEVED IN CONCENTRATE       
Platinum   ($/oz)  1 722   1 491  
Palladium      657   380  
Rhodium      2 161   1 935  
Nickel   ($/t)  23 178   18 311  
EXCHANGE RATE ACHIEVED (R/$)  7.03   7.56  
PRODUCTION       
Tonnes milled ex-mine   (000t)  2 311   2 277  
Headgrade (6E)  (g/t)  3.91   3.86  
Platinum in concentrate   (000oz)  104.9   101.2  
Palladium in concentrate     80.4   76.6  
Rhodium in concentrate     8.4   8.1  
Nickel in concentrate   (t)  2 945   2 776  
PGM in concentrate   (000oz)  219.7   210.3  
TOTAL COST (Rm)  1 016   913  
   ($m)  144   121  
– per tonne milled   (R/t)  440   401  
   ($/t)  63   53  
– per PGM ounce in concentrate   (R/oz)  4 624   4 341  
     ($/oz)  658   575  
– per platinum ounce in concentrate   (R/oz)  9 685   9 018  
   ($/oz)  1 377   1 194  
– net of revenue received for other metals   (R/oz)  (2 631)  (405) 
   ($/oz)  (374)  (54) 
CAPITAL EXPENDITURE (Rm)  372   255  
   ($m)  53   34  
LABOUR INCLUDING CAPITAL AS AT 30 JUNE (number)  1 796   1 802  
Own employees     1 567   1 576  
Contractors     229   226  
Centares per panel man per month   (m2/man)  52.3   49.3  
* Adjustment note: The adjustment relates to sales from Mimosa to the Implats Group which at year-end were still in the pipeline.