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PAM - Palabora Mining Company Limited - Fourth Quarter 2011 - operations
overview and production statistics
PALABORA MINING COMPANY LIMITED
(Incorporated in the Republic of South Africa)
Registration number - 1956/002134/06
JSE Code: PAM ISIN: ZAE000005245
("Palabora" or "the Company")
FOURTH QUARTER 2011 - OPERATIONS OVERVIEW AND PRODUCTION STATISTICS
Palabora is pleased to announce its Fourth Quarter and Full Year 2011
operations overview and production statistics. New copper cathode produced
reached 59,000 tonnes for the year, a 1.7% increase over 2010 and production
of magnetite increased 14.6% to 3,429k tonnes in 2011 over 2, 993k tonnes in
2010. Tony Lennox, Managing Director, commented, " Palabora has produced
another solid year of operating results with copper production in-line with
expectations and the continued growth of the magnetite operations to meet
ever growing demand in Asia. As always safety of our people is our primary
objective and we will continue to strive to meet our goal of zero harm"
Copper production during the year was impacted by the successful replacement
of both winder drums at the mine and the planned closure of the smelter to
rebuild the reverb furnace during August. In addition, Palabora implemented
improvements to its underground vehicle maintenance program which will begin
to reflect positively on operations during 2012. Reflecting on copper
production, Tony said "lower output levels from the underground mine
following the consolidation of the Load Haul and Dump (LHD) maintenance
contracts have been resolved with production reaching expected levels during
December".
In an effort to meet the growing demand, Palabora commenced trucking of
magnetite during December to the Maputo port in addition to the normal
delivery of material by rail to Richards Bay and Maputo. Palabora will
continue to truck magnetite to Maputo at an expected rate of between 40k and
60k tonnes per month. Additional improvements at the magnetite operation
were put in place to debottleneck rail and truck loading capacity and to
increase drying capacity towards the end of 2012.
4Q 1Q 2Q 3Q 4Q Full Full
Year Year
2010 2011 2011 2011 2011 2010 2011
Palabora mine
Tonnes hoisted 2,838 2,601 2,715 3,024 2,403 11,236 10,743
(`000 tonnes)
Mined ore 2,452 2,523 2,623 2,969 2,434 10,549
treated (`000 11,003
tonnes)
Slag ore treated 386 322 341 164 411 654 1,238
(`000 tonnes)
Total Ore 3,126 2,845 2,964 3,133 2,845 11,657 11,787
treated (`000
tonnes)
Underground ore 0.63 0.65 0.63 0.63 0.64 0.64
grade: copper 0.66
(%)
Slag ore grade: 1.57 1.48 1.53 1.78 1.13 2.75 1.51
copper (%)
65.2 58.4 61.2 58.2 50.10 246.0 227.9
Copper
concentrates
produced (`000
tonnes)
Average 29.5 29.5 30.7 31.2 29.9 30.3 30.3
concentrate
grade: copper
(%)
Copper in 19.3 17.3 18.7 18.2 14.9 74.6 69.14
concentrates
(`000 tonnes)
Palabora
smelter/refinery
New concentrate 62.1 62.3 62.6 45.4 60.4 240.8 230.7
smelted on site
(`000 tonnes)
New copper 14.4 14.7 18.2 10.8 15.7 55.7 59.4
anodes produced
(`000 tonnes)
Refined new 17.5 14.8 17.3 10.2 16.7 58.0 59.0
copper produced
(`000 tonnes)
Joint product:
Magnetite 695 880 820 744 985 2,993 3,429
concentrate
(`000 tonnes)
By-products:
Nickel contained 24 27 28 23 9 72 87
in products
(tonnes)
4.3 1.3 0.4 3.0 0.6 9.9 5.3
Copper sold as
concentrate
(`000 tonnes)
Vermiculite
plant
Vermiculite 45 51 48 23 196 165
produced (`000 43
tonnes)
Palabora, a member of the Rio Tinto Group of Companies, situated in the Ba-
Phalaborwa area of Limpopo, operates a large block cave copper mine and
smelter complex, mines and exports magnetite and operates a vermiculite
mining and processing facility.
Total ore hoisted was 21% lower than the previous quarter and 15% lower than
the corresponding period in 2010 due to lower LHD availability following the
consolidation of the two LHD maintenance contracts. The LHD availability was
resolved in December with production returning to expected levels. Total ore
hoisted was 4% lower for 2011 compared to 2010 at 10.7mt mainly due to the
replacement of the winder drums during the first and second quarter of 2011
and unplanned maintenance on a crusher during the second quarter.
Total ore treated decreased 9% from the previous quarter and corresponding
period in 2010 due to lower underground throughput partly offset by increased
quantities of slag material and surface copper stockpile material processed
to compensate for the lower ore mined. Full year ore treated was 1% lower
compared to 2010 mainly due to previously reported delays experienced on the
scheduled girth gear replacement during the second quarter and the impact of
the lower hoisting rates during the last quarter of 2011. Slag treated
increased by 89% to 1.2mt to compensate for the lower underground ore supply.
Copper concentrate produced was 23% and 14% lower than the corresponding
period in 2010 and the previous quarter, respectively. Production was
affected by lower underground throughput and the impact of lower recoveries
from increased slag material processed. Full year copper concentrate was 7%
lower compared to 2010 due to lower mined ore milled and the impact of lower
recoveries from minor equipment failures and increased lower grade slag
material.
Copper in concentrate produced was 23% lower than the corresponding period in
2010 and 18% lower than the previous quarter and in line with underground
supply. Full year copper in concentrate was 7% lower compared to 2010 and in
line with copper concentrate production.
New concentrate smelted was 33% higher compared to the previous quarter due
to the scheduled month long shutdown in August to rebuild the reverb furnace
which occurs every five years. Concentrate inventory accumulated during the
reverb rebuild project mitigated the impact of lower concentrate production.
New anode production was 45% higher than the previous quarter following the
reverb furnace rebuild during the previous quarter. Production increased 9%
compared to the corresponding period in 2010 following improvements in
operational efficiencies at the smelter implemented during the course of the
year. Full year production was 7% higher than the previous year due to
improvements in operational efficiencies and recovery rates at the smelter
following initiatives undertaken from the end of 2010 and utilisation of
prior period inventory.
Refined copper production was higher than the previous quarter due to
utilisation of anode inventory and in line with new anode production during
the quarter. Production for Q4 2010 was above anode production due to
inventory utilisation. Full year refined copper production was 2% higher than
the previous year and in line with new anode supply.
Magnetite fourth quarter production was aligned with improved logistical
constraints on train availability as well as road trucking of magnetite to
Maputo port which commenced in December. Full year magnetite production was
15% higher than the previous year reflecting the easing of logistical
constraints and the continued export demand. Palabora will continue
to match production with sales demand given the new transport initiatives.
Vermiculite production was 51% lower and 48% lower than the previous quarter
and the corresponding period of 2010 respectively as a result of a two-and-a-
half week shutdown to repair the furnace refractory, a reduction in ore feed
grades and excessive ore moisture due to rain. The production performance in
the first quarter of 2012 is expected to improve as a result of the furnace
refractory maintenance. Full year production was 16% lower than the previous
year due to operational maintenance performed to improve safety, the impact
of wet weather on ore feed in the first quarter and the impact of the furnace
refractory maintenance in the fourth quarter.
The above information has not been reviewed or reported on by the Company`s
auditors.
Phalaborwa
12 January 2012
Investor Relations Contact: Dikeledi Nakene, Palabora +27 15 780 2277
Media Contact: Mike Mabasa, Palabora +27 15 780 2019
Gugulakhe Lourie, Rio Tinto South Africa +27 11 911 9700
Sponsor: One Capital
Date: 12/01/2012 16:24:01 Supplied by www.sharenet.co.za
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