| Tue 15 Jun 2010, 17:12 | | NHM - Northam Platinum Limited - Northam advises revised operating parameters |
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NHM
NHM
NHM - Northam Platinum Limited - Northam advises revised operating parameters
for its Booysendal project
NORTHAM PLATINUM LIMITED
(Registration number 1977/003282/06
(Incorporated in the Republic of South Africa)
JSE Code: NHM ISIN: ZAE000030912
("Northam" or "the group")
Northam advises revised operating parameters for its Booysendal project
The management of Northam advises that it has completed an optimisation exercise
on the Booysendal feasibility study, released to the market in the fourth
quarter of the 2009 calendar year. Following approval by the board of directors
of Northam, preparatory work is proceeding on creating access and other
infrastructural installations at the company`s 100% owned Booysendal asset on
the eastern limb of the Bushveld Complex, which contains a resource of more than
100 million ounces (3PGM+AU).
The purpose of the optimisation study was to determine whether further value
could be extracted from the first phase of the Booysendal project. The results
indicate that:
- the start-up of production could be accelerated;
- the mining layout could support a higher rate of production; and
- this would result in lower unit operating costs.
On surface, the concentrator plant layout has been optimised to take account of
the higher run of mine (ROM) production, resulting in a more efficient process
flow and a smaller environmental footprint. Commenting on the results of the
optimisation process, Northam chief executive Glyn Lewis said today, "The value
engineering process has been a more than useful exercise, with results yielding
an enhanced return on a more robust project than we had initially envisaged."
The optimisation study included a review and update of initial capital
expenditure estimates. The total project capital expenditure has increased from
R3.1 billion (June 2009 money terms) to R3.6 billion (March 2010 money terms)
reflecting the effects of inflationary increases on the one hand, and on the
other, the firmer estimates for a larger operation. Overall, the total capital
expenditure estimate is slightly more efficient per unit of designed production
(both in terms of tonnes milled and production ounces per annum (3PGM+Au)).
The acceleration of production build-up follows on the rescheduling of
construction: preparatory work is currently in progress to start the
establishment of the on-reef boxcut in the first half of F2011. The remainder of
the work, including the reverse decline adit, bulk earthworks for the
concentrator and offices, permanent access ways and pipelines, will start as
soon as the environmental permitting is obtained.
Mill throughput to the plant will increase to 150 000 tonnes per month (187 500
ROM tonnes through the DMS), an increase of 25%. For a graphic representation
of the build-up of production see the Northam website - www.northam.co.za
Power supply and energy efficiency measures
The revised mine design and higher rate of production are, at full capacity,
expected to result in electricity consumption exceeding the ESKOM approved 20MVA
during peak demand periods.
These requirements will be fulfilled by self-generation of power on site (5MVA)
during peak demand times. This will continue until ESKOM is able to supply
additional power - currently estimated to be by 2015.
The revised design also makes provision for an energy management system and the
introduction of energy recovery strategies. Orepass capacity is being improved
which will minimise the requirement for decline conveyors to run during peak
shift times. In addition, cycle efficiencies and optimised equipment selection
will maximise output in each section, and at the same time reduce the number of
sections required to operate.
In summary
Optimisation case Feasibility case
Design capacity (ROM tpm) 187 500 150 000
PGM ounces per annum (3PGM+Au) 162 000 130 000
First concentrate Jan 2013 May 2013
Total cash costs (ROM R/t) 364 404
Total cash costs (milled R/t) 455 505
Capital expenditure
Establishment of mine (R million) 2 034 1 369
Concentrator (Rm) 1 125 1 009
Other (Rm) 465 668
Total (R million) 3 624 3 046
Funding
With capital expenditure requirements for Booysendal peaking in mid 2012,
Northam remains confident that the development of the Booysendal mine can be
funded from a combination of internal retentions and debt instruments. Progress
has been made in exploring various options in this regard.
Distributed by:
Russell & Associates, Johannesburg
Tel: +27 (0)11 880 3924
Fax: +27 (0)11 880 3788
Johannesburg
15 June 2010
Sponsor
Barnard Jacobs Mellet Corporate Finance (Pty) Limited
Date: 15/06/2010 17:12:02 Produced by the JSE SENS Department.
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