Johannesburg — In January 2013, Anglo American Platinum Limited (“Anglo American Platinum” or “the Company”) announced its proposals to create a sustainable, competitive and profitable platinum business for the long term benefit of all its stakeholders.
Following the announcement of its proposals, Anglo American Platinum and its recognised unions agreed to suspend the section 189 consultations to allow for engagement to take place with the Department of Mineral Resources (DMR) and the unions.
At the request of the DMR, such engagement became a bilateral engagement between Anglo American Platinum and the DMR. The bilateral engagements with the DMR have now been completed. Anglo American Platinum has formulated revised proposals which remain focused on improving the profitability and sustainability of its business, while taking cognisance of the local and national socio economic challenges.
The Company’s review of the business was in response to its revised expectations for platinum demand growth and a number of structural challenges that have eroded profitability in recent years, including capital intensity, mine depths, lower ore grades, higher than inflation unit cost increases, jewellery demand elasticity and increasing secondary supply of platinum.
Anglo American Platinum’s revised proposals continue to address the objective of aligning the business with its expectations of long term demand and are an extension of the steps taken to reposition the business in recent years.
The revised proposals include:
* Revising baseline production to 2.2 -2.4 million ounces per annum in the short to medium term * Consolidating Rustenburg into three operating mines through the integration and optimisation of Khuseleka 2 and Khomanani 1 and 2 mines into the surrounding mines.Khuseleka1 remains operational which is the principal revision to the previous proposal.
This will result in a reduction of production capacity ofapproximately 250,000 ounces per annum in 2013 and by an additional approximately 100,000 ounces per annum in the medium term * Reducing overhead costs and improving efficiencies * Exploring opportunities for further joint venture business improvement and portfolio rationalisation
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