Anglo-American Platinum Limited’s wholly-owned subsidiary Unki Mines is scheduled to complete a smelter in the second half of 2018 while total production is expected to remain flat at 170 000 PGM ounces.
The smelter is being constructed at a total cost of R650 million (US$55 million) and R306 million (US$26 million) was spent in 2017.
The project began in August 2016 and is expected to be fully operational in 2019. It will see the company partially processing ore before sending it to South Africa for refining.
In a statement accompanying the company’s’ FY 2017 results, Angloplat said Unki Mines recorded a 2% increase in platinum produced to 165 900 PGM ounces, up from 162 000 ounces produced in the same period last year.
“Total PGM production from Unki in 2018 is expected to remain at similar levels of 170 000 PGM ounces (c.75 000 platinum ounces). The Unki smelter, a project in execution, is expected to be completed in H2 2018 at a total cost of R650 million (US$55,7 million), with R306 million (US$26,2 million) of the project capital incurred in 2017,” Angloplat noted.
Platinum production was relatively flat at 74 600 ounces compared to the same period in 2016 which was at 74 500 ounces while palladium production increased 5% to 64 400 ounces from 61 400 ounces in 2016.
Overal production increased due to an increase in tonnes milled, up 2% to 1,75 million due to improved underground productivity.
The 4E built-up head grade increased marginally to 3,47g/t from 3,46g/t in 2016 due to improved mining reef cut and reducing waste tonnes mined.
“Unki increased economic free cash flow to R600 million (US$51,5 million) from R61 million (US$5,2 million) due to improved performance, the sale of Treasury Bills of R228 million (US$19,5 million) and export incentives of R63 million (US$5,4 million). The mine delivered Ebitda of R0,8 billion (US$68,7 million) at a 33% margin, up from 12% in 2016. Return on capital employed increased to 10% from negative 3% in 2016,” Angloplat said.
Cash operating costs were flat at R1,8 billion (US$154,6 million) while the mine being a dollar-denominated operation benefitted from the strengthening of the rand which increased 9% to R13,33 (US$1,14) from R14,63 (US$1,25). Total PGM production from Unki in 2018 is expected to remain at similar levels of 170 000 PGM ounces (c.75 000 platinum ounces).