Anglo American Platinum (Amplats) saw its total platinum group metals (PGM) decline by 6percent for the first quarter to end March. Supplied
DURBAN - Anglo American Platinum (Amplats) saw its total platinum group metals (PGM) decline by 6percent for the first quarter to end March, knocked by Eskom power disruptions and operational challenges across the portfolio.

As a result the production of the company, which is the world’s largest primary producer of platinum, declined to 998900 ounces, down from 1030.3 ounces reported at the end of the fourth quarter to December.

Load shedding by power utility Eskom during February and March disrupted the mining sector, which saw mining production down by 3.3percent year-on-year in January.

However, the group said its own managed mines PGM production increased by 4percent to 601000 ounces, due to the inclusion of Mototolo as own-mine production, while platinum production also increased by 4percent to 275000 ounces and palladium production was flat at 219700 ounces.

Amplats announced the acquisition of Mototolo at the beginning of November last year from Glencore for an upfront purchase consideration of R900million.

In the quarter Mototolo produced 57700 PGM ounces, while its platinum production was 26800 ounces and palladium production was 16300 ounces. Amplats is 80percent owned by Anglo American.

The group’s refined PGM production reported a bigger decline during the quarter, down by 14percent to 871200 ounces, with platinum production declining by 18percent to 411700 ounces.

“The first quarter of 2019 production was lower, following maintenance on Waterval Smelter, the Anglo Convertor Plant and the base metals refinery during the quarter as well as the impact from Eskom power disruptions,” the group said.

However, it added that there has been a further build-up in work-in-progress inventory following the impact of power disruptions and this should be refined in full by the end of 2019.

“However, if power disruptions persist, there could be an impact to the timing of refining the built-up work-in-progress inventory in full,” the group added.

Looking ahead the company said the PGM production outlook for 2019 was between 4.2million to 4.5million ounces, including platinum production of between 2million to 2.1million ounces, and palladium production guidance of between 1.3million to 1.4million ounces as guided at the 2018 annual results presentation in February.

Amplats shares closed 1.51percent lower at R749.59 on the JSE yesterday.

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