Royal Bafokeng Platinum has lowered the upper end of its 2018 production guidance. Photo: Reuters

JOHANNESBURG – Royal Bafokeng Platinum (RBPlat) has lowered the upper end of its 2018 production guidance and expects operational costs to fall below inflation.

The miner said unit cost increases would be below Consumer Price Index inflation. 

The group said the R2 billion capital injection earlier this year was paying off, with increases across all production aspects in the quarter to September 30.

In March, the group said it had made a 106 percent injection to  R2.16bn into its expansion capital expenditure for the year to December 2017 as part of the ramp up of its Styldrift project in North West.

The group said in the quarter to September that Styldrift-delivered tonnes increased by 138.9 percent to 356 000 tons (kt) in line with ramp-up requirements to achieve the 150ktpm milestone by year end, while Bafokeng Rasimone Platinum Mine (BRPM) delivered tons decreased by 9.5 percent to 583kt.

The decrease in BRPM delivered volumes is mainly attributable to production losses incurred as a result of fatal injury stoppages.

The group said total tons milled for the quarter increased by 18.9 percent to 981kt, supported by the higher delivered volumes, with BRPM contributing 611kt, 8.8 percent lower than the corresponding quarter in 2017, and Styldrift 370kt (a 138.7 percent increase compared with the corresponding quarter last year).

Royal Bafokeng commissioned the  Maseve concentrator in August and a total of 141kt of Styldrift ore was treated for the third quarter.

The BRPM concentrator processed 778kt, and 62kt of UG2 ore was toll treated.

The group said the 4E built-up head grade for the quarter reduced by 1.5 percent to 3.85g/t compared with 2017, despite overall built-up head grades at BRPM and Styldrift increasing by 0.2 percent and 12.8 percent.

The decrease in grades is attributable to the increased contribution of lower-grade development ore from Styldrift to the overall ore mix.

The group said year to date head grade remains within guidance limits. Overall concentrator recoveries decreased 1.9 percent to 84.5 percent, with the reduction being attributable to the lower overall head grade achieved and lower recovery potential of Maseve in current configuration.

The 18.9 percent increase in overall tons milled, 1.5 percent reduction in built-up head grade and lower overall recovery, yielded a respective 14.7 percent and 15.4 percent increase in 4E and platinum metals in concentrate to 102.4koz (4E) and 66.6koz (Pt) for the quarter.

Royal Bafokeng Platinum shares closed 2.32 percent lower at R27.35 on the JSE on Monday.