Implats reports on production for the Quarter ended 31 March 2023
Gross Group 6E production declined by 5% to 735 000 ounces. Tonnes milled at managed operations improved by 5% to 5.61 million tonnes during the quarter, with higher volumes at Impala Rustenburg, Zimplats and Impala Canada offsetting lower mill throughput at Marula.
A 2% improvement in milled grade to 3.62g/t 6E was partially offset by lower recoveries, resulting in 6E production at managed operations increasing by 2% to 562 000 ounces. 6E production from the joint ventures (JVs) at Mimosa and Two Rivers declined by 8% to 125 000 ounces. At Impala Refining Services (IRS), third-party 6E receipts of 47 000 ounces were 47% lower than the prior comparable quarter.
Refined 6E production, which includes saleable ounces from Impala Canada, declined by 10% to 662 000 ounces. Production in the quarter was impacted by lower Group production volumes and compounded by reduced available smelting capacity due to scheduled maintenance and the increased severity and frequency of load curtailment in the quarter.
The scheduled rebuild of the Number 4 furnace, which began in November 2022, was completed as planned at the beginning of April, but experienced some delays in recommissioning due to constrained power availability.
In addition to load curtailment at South African managed and JV operations, severe loadshedding was also experienced across the Zimbabwean national grid in March 2023 due to generation constraints at Hwange Power Stations and the curtailment of power imports following payment challenges.
Implats responds to load curtailment requirements through several operational interventions including reducing power to Group smelters and adjusting milling, hoisting and re-mining rates. The estimated impact of Eskom load curtailment on Group production in the quarter resulted in the deferral of circa 16 000 6E ounces. Implats finished the period with circa 190 000 6E ounces of excess inventory.
Implats’ Chief Executive Officer, Nico Muller, commented: “The increased severity of domestic and regional power constraints has been well documented and was a notable impediment to operational delivery in the quarter. Our suite of capital projects was progressed across the Group’s mining and processing assets and our team continued to engage with key stakeholders to secure the outstanding conditions precedent and conclude our offer for the remaining shares in Royal Bafokeng Platinum.
Given the constrained operating environment, FY2023 production is likely to be towards the lower end of the previously guided range, while unit costs are trending toward the top end of the provided guidance.
OUTLOOK AND GUIDANCE
Despite the challenging operating environment during the period under review, the elevated load curtailment requirements and the prevailing exchange rates, Implats remains on track to deliver within the guided Group parameters for FY2023, with volumes trending towards the lower and costs increasing towards the upper boundaries of the range, respectively.
The third quarter production report for the period 1 January to 31 March 2023 has not been reviewed and reported on by Implats’ external auditors.
