ANGLO AMERICAN PLATINUM LIMITED - Anglo American Platinum update on temporary shutdown of the Anglo Converter Plant (ACP) and impact of force majeure

Anglo American Platinum update on temporary shutdown of the Anglo Converter Plant (ACP) and impact of force majeure

ANGLO AMERICAN PLATINUM LIMITED
(Incorporated in the Republic of South Africa)
(Registration number: 1946/022452/06)
Share Code: AMS
ISIN: ZAE000013181
(“the Company" or "Anglo American Platinum")


Anglo American Platinum update on the temporary shutdown of the Anglo Converter Plant (ACP)
and impact of force majeure

Anglo American Platinum issued a SENS announcement on 6 March 2020 regarding the temporary
closure of the Anglo Converter Plant (ACP) and the declaration of force majeure to secure a safe
operating environment. Anglo American Platinum has since started the repair process and has been in
discussions with third parties from which it purchases concentrate and for which it toll-treats 4E material
and agreed in principle revised terms for the duration of the force majeure period. Anglo American
Platinum does not foresee any customer agreements being terminated as a result of this disruption.

The force majeure period is defined as starting on 6 March 2020 and remains ongoing for the time it takes
to repair ACP Phase B which is expected to be approximately 80 days, ending around 25 May 2020.

ACP repair process and capital expenditure update

The total repair time, including the time to procure all necessary spares and equipment, is estimated at
80 days. The repair team is on site executing the work, and a full investigation is under way to understand
the cause and nature of the water ingress into the furnace. The majority of the replacement equipment
(i.e. waffle coolers) can either be obtained from the undamaged waffle coolers in the Phase A unit or
spares available in inventory. All procurement of additional equipment is from within South Africa, so no
supply chain disruptions are anticipated.

A project team is also in place to execute the repairs to Phase A, and orders for the long lead items have
been placed. It is still estimated that repairs will be complete by Q2 2021.

The estimated capital expenditure for replacement equipment and repair of ACP Phase B is R150 to
R200 million, which will be incurred in 2020, while the estimated capital expenditure to rebuild Phase A
will be R500 to R600 million, of which R100 million is expected to be incurred in 2021. These are
incremental capital expenditure amounts to full year guidance previously provided but exclude any
potential insurance proceeds.

As a result of the activities under way at the ACP, the Company is reviewing its capital plans for 2020
and will provide a further update of the full year capex guidance in due course.

Force majeure agreement with Sibanye-Stillwater

Anglo American Platinum has agreed in principle revised processing agreements with Sibanye-Stillwater
at the different operations including:

1. Toll-treatment of 4E material from Rustenburg:

    PGM concentrate from Rustenburg that is processed at Anglo American Platinum’s processing
    facilities will continue to be smelted by Anglo American Platinum and will continue to receive a
    smelting fee. For the period of the force majeure, smelter matte will be returned to Sibanye-Stillwater
    for further treatment and refining.

2. Kroondal pool and share agreement (PSA classified as 50% purchase of concentrate and 50% JV
   mined production)

    The Kroondal joint venture operations operate under a PSA agreement, whereby Anglo American
    Platinum purchases 100% of the concentrate, with 50% accounted as own-mine production and 50%
    as purchase of concentrate from the Kroondal PSA.

    50% of the concentrate produced by the Kroondal PSA will be sold to and processed by Sibanye-
    Stillwater for the duration of the force majeure period under the same terms as the pre-existing
    purchase of concentrate terms with Anglo American Platinum. Sibanye-Stillwater will market and sell
    the material.

    The remaining 50% of concentrate produced will continue to be purchased by Anglo American
    Platinum and smelted at one of the Company’s smelter complexes. Together with Sibanye-Stillwater,
    we have established revised payment terms which allow for delays in payment during the force
    majeure period.

3. Platinum Mile (classified as third party purchase of concentrate)

    Platinum Mile concentrate will be sold to and processed by Sibanye-Stillwater, who will take
    ownership of the material for the duration of the force majeure period under the same terms as the
    pre-existing purchase of concentrate agreement with Anglo American Platinum. Sibanye-Stillwater
    will market and sell the material. In 2019, Platinum Mile produced 23,600 PGM ounces.

These revised terms will only be applicable during the force majeure period, which is the period it takes
to repair ACP Phase B.

Force majeure to purchase of concentrate suppliers

Anglo American Platinum purchases concentrate from Royal Bafokeng Platinum Limited (“RBPlats”), the
independently managed Modikwa joint-venture (“Modikwa JV”), Siyanda Resources (“Siyanda”) and
small volumes from other third parties. The Company can confirm that it has engaged with all parties and
agreed in principle temporarily revised terms which will allow concentrate to continue to be delivered to
the Company’s smelters during the force majeure period. Anglo American Platinum will continue to smelt
concentrate received at all its four smelter complexes. Together with our partners RBPlats, the Modikwa
JV and Siyanda, we have established temporarily revised payment terms which allow for delays in
payment during the force majeure period.

Force majeure to customers

Anglo American Platinum continues to work with its customers, within the provisions of the force majeure
clauses in their agreements, to minimise the impacts of the disruption. The force majeure protections are
such that the Company does not foresee any agreements being terminated as a result of this disruption,
including the customer prepayment which remains in place.

Guidance for 2020

Initial estimates of the impact on refined production guidance have not changed, and are reiterated below
(which excludes toll treated material):
 Guidance            M&C Production                                Refined Production

 (‘000 ounces)        Previous FY2020            New H1 2020         Revised FY2020         Previous FY2020
                       M&C production       Refined production     Refined production      Refined production
                             guidance                guidance               guidance                guidance

 Platinum                 2,000 – 2,200              400 – 450           1,500 – 1,700           2,000 – 2,200
 Palladium                       c.1,400             300 – 350           1,100 – 1,200           1,400 – 1,500

 Rhodium                               --               65 – 75              250 – 350                          --

 Total PGMs
                          4,200 – 4,600            850 – 1,050           3,300 – 3,800           4,200 – 4,700
 (5E + gold)



As a result of the changes in the agreements with third parties, in particular the sale of concentrate from
Platinum Mile and 50% of the Kroondal PSA to Sibanye-Stillwater, and not due to production reductions,
we revise our production guidance (metal in concentrate basis) to be at the lower end of previously
provided guidance of between 4.2 - 4.6 million PGM ounces, and we maintain our revised refined
production of 3.3 - 3.8 million PGM ounces.

Unit cost of production guidance remains between R10,600 - R11,000 per PGM ounce.

Forward looking Statements

Certain statements made in this announcement constitute forward-looking statements. Forward-looking
statements are typically identified by the use of forward-looking terminology such as “believes”, “expects”,
“may”, “will”, “could”, “should”, “intends”, “estimates”, “plans”, “assumes” or “anticipates” or the negative
thereof, or other variations thereon, or comparable terminology, or by discussions of, for example, future
production, present or future events, or strategy that involves risks and uncertainties. Such forward-
looking statements are subject to a number of risks and uncertainties, many of which are beyond the
Company’s control and all of which are based on the Company’s current beliefs and expectations about
future events. Such statements are based on current expectations and, by their nature, are subject to a
number of risks and uncertainties that could cause actual production and performance to differ materially
from any expected future production or performance, expressed or implied, by the forward-looking
statement. The forward-looking statements contained in this report speak only as of the date of this report
and the Company undertakes no duty to update any of them and will not necessarily do so, in light of new
information or future events, except to the extent required by applicable law or regulation.

19 March 2020

Sponsor
Merrill Lynch South Africa Proprietary Limited


For further information, please contact:


Investors:                                         Media:
Emma Chapman                                       Jana Marais
(SA) +27 (0) 11 373 6239                           (SA) +27 (0)79 932 1586
emma.chapman@angloamerican.com                     jana.marais@angloamerican.com
Notes to editors:

The ACP plant is a key part of Anglo American Platinum’s PGM production process, treating furnace
matte from the company’s smelters. At the ACP plant, sulphur and iron contained in the furnace matte
from the smelters are converted to sulphur dioxide and slag. The resulting converter matte is then slow-
cooled to concentrate PGMs into a metallic fraction. From the ACP, material moves to the Magnetic
Concentration Plant (MCP), where the converter matte is milled and the PGM fraction is separated
magnetically. The PGM-bearing material then moves from the MCP to the Precious Metals Refinery
(PMR), where the PGMs are separated and purified to yield platinum, palladium, iridium, rhodium,
ruthenium and gold.

Anglo American Platinum Limited is a member of the Anglo American plc Group and is a leading primary
producer of platinum group metals. The company is listed on the Johannesburg Securities Exchange
(JSE). Its mining, smelting and refining operations are based in South Africa, as well as its two joint
venture operations. Elsewhere in the world, the Group owns Unki Platinum Mine in Zimbabwe. Anglo
American Platinum is committed to the highest standards of safety and continues to make a meaningful
and sustainable difference in the development of the communities around its operations.

www.angloamericanplatinum.com

Anglo American is a leading global mining company and our products are the essential ingredients in
almost every aspect of modern life. Our portfolio of world-class competitive mining operations and
undeveloped resources provides the metals and minerals that enable a cleaner, greener, more
sustainable world and that meet the fast growing consumer-driven demands of the world’s developed and
maturing economies. With our people at the heart of our business, we use innovative practices and the
latest technologies to discover new resources and mine, process, move and market our products to our
customers around the world – safely, responsibly and sustainably.

As a responsible miner – of diamonds (through De Beers), copper, platinum group metals, iron ore, coal
and nickel – we are the custodians of what are precious natural resources. We work together with our
business partners and diverse stakeholders to unlock the sustainable value that those resources
represent for our shareholders, the communities and countries in which we operate, and for society as a
whole. Anglo American is re-imagining mining to improve people’s lives.

www.angloamerican.com

Date: 19-03-2020 04:03:00
Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE'). 
The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of
 the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct, 
indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on,
 information disseminated through SENS.