| Thu 21 Jun 2012, 8:10 | | AQP - Aquarius Platinum Limited - Everest Mine |
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AQP
AQP
AQP - Aquarius Platinum Limited - Everest Mine
Aquarius Platinum Limited
(Incorporated in Bermuda)
Registration Number: EC26290
Share Code JSE: AQP
ISIN Code: BMG0440M1284
EVEREST MINE
Aquarius Platinum Limited ("Aquarius" or the "Company") advises that it has
placed its Everest mine on care and maintenance with effect from the close of
business on 21 June 2012.
The ramp-up at Everest has encountered challenges resulting from poor ground
conditions and on-going disruptive industrial relations over an extended period
and these issues, coupled with the present low PGM price environment, have
rendered the mine uneconomic. It has therefore been decided to place the mine
on care and maintenance, pending better prices and improved industrial
relations.
It is incumbent on the Board to monitor trading conditions and safeguard the
business and assets of the Company. The Board is of the view that the platinum
market is in an abiding surplus, with the industry generating nearly half a
million ounces of unneeded platinum each year due to the current European
economic crisis, among other factors. From an operating perspective, costs
continue to rise at above the rate of domestic South African inflation, while
labour productivity has declined. As a result PGM prices in both Rand and US
Dollar terms are likely to remain stagnant for some time, and margins will
remain under severe pressure across the industry.
Given the above, the Board of Aquarius has concluded that the only defensible
strategy for any platinum producer is to cut all non-essential capital
expenditure, and place all non-contributing assets on care and maintenance while
optimising profitable operations for maximum contribution in the current low
price environment.
In keeping with the policies of the Company, the business plan of the group is
focused on cash conservation and the preservation of the Company`s reserves and
resources until economic circumstances merit their extraction. Aquarius expects
that operating its remaining two mines and its two tailings operations will
maximise short and medium term cash flows, while the three mines currently not
producing will all be maintained in a state to enable their rapid ramp up when
PGM prices rise sufficiently to generate an economic return once again, and
labour relations are stabilised. No other mine closures are envisaged within the
Company.
Further updates will be released as appropriate.
For further information please contact:
In the United Kingdom
Gavin Mackay
+44 7909 547 042
In Australia: In South Africa:
Willi Boehm Stuart Murray
+61 8 9367 5211 +27 (0) 11 656 1140
21 June 2012
Sponsor
RAND MERCHANT BANK (A division of FirstRand Bank Limited)
Date: 21/06/2012 08:10:01 Produced by the JSE SENS Department.
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