JOHANNESBURG (miningweekly.com) – Beleagured platinum miner Anglo American Platinum (Amplats) has posted an unsurprising narrowing of production for the first quarter ended March 31, as a strike that has forced the temporary closure of several of its mines enters its third month.

The South African producer’s total equivalent refined platinum production decreased by 39% to 357 000 oz for the three months, falling from 583 000 oz in the first quarter of 2013.

Production from own operations and the Western Limb tailings retreatment plant followed this downward trend, narrowing by 57% to 167 000 oz, owing to continued industrial action by the Association of Mineworkers and Construction Union (AMCU).

The Rustenburg mine, in the North West, as well as the Amandelbult and Union mines, both in Limpopo, were most affected by the industrial action, with production from these operations decreasing by 84%, 75% and 86% respectively.

“An estimated 185 000 oz of platinum production has been lost as a result of the strike from all operations,” the company said in a quarterly report on Thursday.

In addition, the impact of placing the Khomanani mine, in the North West, the Khuseleka 2 shaft, near Carletonville, and the Union North mine, on the border of Limpopo and the North West, declines on long-term care and maintenance in August last year resulted in a production decrease of 43 000 oz.

However, industrial action did not impact production at Mogalakwena, in Limpopo, and Unki, in Zimbabwe, both of which lifted platinum output over the period.

Production at Mogalakwena increased by 3% owing to higher achieved built-up head grade and the mining productivity improvement programmes introduced last year, while Unki improved its production performance by 4% as a result of higher volumes delivered to the concentrator and throughput at the mills.

Amplats’ joint venture (JV) operations, meanwhile, were also largely unaffected by the industrial action, with the exception of Modikwa, on the Mpumalanga and Limpopo border, which experienced a one-week strike before a new wage agreement was signed with labour union the National Union of Mineworkers.

Production from JVs and associates increased by 5% to 183 000 oz, with good performance from Kroondal, in the North West, owing to what Amplats described as “operational efficiencies”.

Bokoni, located on the eastern limb of the Bushveld Complex, also performed well, with production up by 25% compared with the first quarter of last year as a result of the mining starting at the openpit in June last year.

Processing operations were not affected by the industrial action and refined platinum production totalled 435 000 oz for the quarter, in line with production in the prior year’s comparable period.

“However, as mined production reduced, total refined production was supplemented by a drawdown of pipeline inventory. As a result, sales to customers have continued at normal levels, supplemented by refined platinum stock,” said Amplats.

Meanwhile, Amplats' refined production of rhodium over the three months increased by 7%, while refined palladium output dropped 3%.

This variance was owing to a different source of feed as certain mines’ supply was impacted by the industrial action and the different processing times of the metals.

Nickel production increased by 48% as production in the first quarter of last year was impacted by technical challenges and good progress had been made in the ramp-up of production in the nickel tank house.

Looking to the remainder of 2014, full-year production was expected to reduce from the previous guidance of between 2.3-million ounces and 2.4-million ounces to around 2.1-million ounces, with potential for further downside revisions as a result of the ongoing industrial action.

Sales expectations remained unchanged, while cost indications would be reviewed only once the industrial action had been resolved.

Amplats and fellow platinum heavyweights Lonmin and Impala Platinum, which had also been impacted by the ongoing strike by AMCU, had recently revised their wage offer to the union and were currently engaged in a fresh round of talks with AMCU in the hope of ending the crippling labour impasse.