London - Troubled platinum miner Lonmin said on Monday
its chief operating officer (COO) has resigned for personal reasons.
After more than two years in the role of COO and
director, Ben Moolman will step down on April 5, Lonmin said, without naming a
successor.
The world's third largest platinum producer, which was
saved from collapse in 2015 with a $400 million deeply discounted rights issue,
reported weaker than expected production, saying that larger shafts, known as
generation 2 shafts, had disappointed. Lonmin also said initiatives to improve
production were taking longer than planned.
"It’s not ideal that their main technical person is
gone. It's another signal that Lonmin has some real problems," Peel Hunt
analyst Peter Mallin-Jones said.
"They are facing challenges in managing its
workforce, managing the local community and managing the age of its assets, all
at a time when platinum group metal pricing is relatively low and therefore
margins are very thin."
Platinum prices rose just 1 percent in 2016, failing to
join the rebound in the prices of some other metals and leaving Lonmin out of
the wider recovery in share prices in the mining sector that began last
government which threatened to take away its licence at the end of last year if
it did not build the houses it had promised for its employees.
However, some analysts said Moolman's resignation was not
a concern.
Momentum SP Reid Securities analyst Sibonginkosi Nkosi
said Lonmin's chief executive Ben Magara was a seasoned operations manager and
could handle major issues.
Magara, a mining engineer, was head of Anglo American
Platinum's engineering and capital projects and is the former CEO of Anglo
American's South African coal unit.
"I was questioning why Lonmin needed a COO when Ben
Magara is an operations guy. We know that he is Mr Fix-It. That function [of
COO] can easily be slotted in under Magara," Nkosi said.