LON - Lonmin - Number One Furnace Update

LON - Lonmin - Number One Furnace Update                                        
Lonmin Plc                                                                      
(Incorporated in England and Wales)                                             
(Registered in the Republic of South Africa                                     
under registration number 1969/000015/10)                                       
JSE code:  LON                                                                  
Issuer Code:  LOLMI & ISIN: GB0031192486                                        
("Lonmin")                                                                      
Number One Furnace Update                                                       
Lonmin announces that it has completed a detailed design review and risk        
assessment of the Number 1 furnace following the leak which occurred in         
December 2006.                                                                  
Based on this review, we have decided that the best result can be achieved      
by completing a full rebuild of the Number 1 furnace to restore it to its       
original design condition. Our internal risk assessment has been validated      
by Hatch Engineering, who have indicated that the prior failures of the         
furnace have fundamentally compromised the structural integrity of the          
vessel and it is therefore not prudent to attempt to repair the furnace in      
its current condition. The rebuild of the furnace, including furnace warm       
up, will require around 80 days and should be complete around 11 March          
2007.  This complete rebuild will restore the integrity of the furnace and      
should allow for normal smelting operations going forwards with only            
scheduled maintenance shut downs.                                               
In order to minimise the production and financial impact of the smelter         
rebuild process we will run all three of our Pyromet furnaces for the           
balance of this financial year.  As a result of the decision to rebuild the     
Number 1 furnace we have had to slow down the completion and re-                
commissioning of the Merensky furnace.  We are investigating the                
possibility of running the Merensky furnace during the second half of the       
financial year to further minimise production losses.  The successful           
running of the Merensky furnace in parallel with the Number 1 furnace and       
Pyromet furnaces would depend on our ability both to mix an appropriate         
feed blend for all three sets of furnaces and to manage gas cleaning within     
the terms of our air quality permits.  An engineering assessment is             
currently underway to assess this option.                                       
Our forecast for mine production in concentrate remains at around 1.02 to       
1.04 million saleable ounces of Platinum.  Based on our revised production      
planning completed to date, we believe full year Platinum sales will be         
between 980,000 to 1,000,000 ounces.   These sales will consist of around       
880,000 ounces of refined Platinum from Lonmin`s own metallurgical              
facilities, around 90,000 ounces of toll refined Platinum and between           
10,000 and 30,000 ounces of additional concentrate or semi refined Platinum     
sales.  This plan minimises the amount of lower margin third party tolling      
that will occur during the year.                                                
Sales for the first half of the 2007 financial year are now expected to be      
between 300,000 to 310,000 Platinum ounces and between 680,000 to 690,000       
Platinum ounces in the second half of the financial year.  Upside to this       
forecast may be available if we are able to run the Merensky furnace in         
parallel with the Number 1 furnace during a portion of the second half of       
our financial year.                                                             
Our preliminary estimate for the repair and extra metallurgical division        
costs for the full year are US$6.5 million (R45 million).  This, coupled        
with the reduced level of throughput, has the impact of increasing our          
estimate of full year C1 costs for Marikana own production to around R2,650     
to R2,700 per PGM ounce sold.                                                   
Enquiries:                                                                      
Alex Shorland-Ball                           +44 (0)207 201 6060 or             
Vice President,                              +44 (0)7917 038 684                
Investor Relations & Communications                                             
Lonmin will be hosting an analyst conference call at 11.00 am UK time           
(13.00 pm SA time) later today.  Those wishing to take part should dial in      
on the following numbers: Access number: +44 (0)20 8609 0205, UK Freephone      
Number: 0800 358 2705, ZA Freephone Number: 0800 999 539 and Pin Code:          
621126#                                                                         
Date: 16/01/2007 09:00:02 Supplied by www.sharenet.co.za                     
Produced by the JSE SENS Department.