JOHANNESBURG (miningweekly.com) – Kumba Iron Ore’s third-quarter production decreased by 24% on the comparable prior year’s quarter to reach 9.5-million tons, as output from the company’s Sishen mine was hindered by ongoing pit constraints and a Section 54 regulatory stoppage in August.

The JSE-listed Anglo American subsidiary said in a production and sales report for the three months ended September 30, that Sishen’s production had decreased to 6.4-million tons – a 34% decrease compared with that produced in the third quarter of 2012 and a 25% drop on that produced in the quarter ended June 30.

“Production was mainly impacted by the availability of material supplied to the mine's plants, as well as Section 54 regulatory stoppages relating to the operation of trackless mobile machinery in August and the subsequent ramp-up of the mine,” said the miner.

The Sishen mine pit was currently operating at a quarterly run rate of about eight-million tons, while a plan to deal with the current pit constraints and a longer-term operational strategy were expected to be presented by the end of the year.

In contrast, Kumba’s Kolomela mine produced 2.8-million tons for the quarter, an increase of 12% compared with the prior year’s third quarter  and a 9% lift on that produced in the previous three months.

“Kolomela mine is anticipated to produce some ten-million tons in 2013, above its nine-million-ton-a-year design capacity,” Kumba noted.

Production at Kumba’s 74%-owned Sishen Iron Ore Company’s (SIOC’s) Thabazimbi mine decreased by 1% compared with the third quarter of 2012, but increased by 81% compared with the previous quarter to 200 000 t, in line with ArcelorMittal South Africa’s (AMSAs) offtake requirements.

However, the company said pit complexities and geotechnical challenges had continued as the mine approached the end of its life in terms of its current life-of-mine plan. 

“As previously announced, SIOC and AMSA are engaging with one another in relation to the possibility of a new supply agreement for iron-ore from SIOC’s mines; including the Sishen and Thabazimbi mines and shareholders will be informed of further developments as appropriate,” the company said.

Total export sales volumes for the quarter decreased by 5% compared with export volumes in the third quarter of 2012 and by 7% compared with the previous quarter to 9.4-million tons, mainly owing to the reduction in Sishen mine production, as well as the yearly maintenance shutdown of the rail line and port by Transnet.

This was partially offset by the Kolomela mine’s production gains.

Export sales volumes for 2013 were anticipated to be lower than the previously guided 40-million tons and were dependent on production levels. 

Domestic sales volumes increased by 13% compared with the prior year’s third quarter and by 16% on the previous quarter to 1.3-million tons, owing to increased offtake by AMSA. 

Total finished product stockpile levels amounted to 2.2-million tons on September 30, compared with 5.2-million tons at the end of the prior year’s third quarter.