JOHANNESBURG (miningweekly.com) – Triple-listed Atlatsa Resources expects to complete the operational and financial restructure of its Bokoni mine, in Limpopo, by the second quarter of this year.

The company, which on Thursday reported a basic and diluted loss a share of C$0.30 for the year ended December 31, compared with a loss of C$0.05 in the prior year, noted that the primary objective of the restructure plan was to enable Bokoni to endure a prolonged period of depressed platinum group metals (PGM) prices by reducing the mine’s cost structure and increasing production of higher-grade ore from underground operations.

The restructure is expected to result in an improvement in Bokoni’s unit costs and cash flow, with the mine to operate from two shaft complexes, compared with the current four shafts, which would reduce logistics and support services costs.

The key Brakfontein Merensky and Middelpunt Hill underground development shafts remained in their ramp-up phase and on target to achieve planned steady-state production by the fourth quarters of 2016 and 2019 respectively.

During the year under review, Bokoni mine reduced its aggregate corporate office operating costs by at least R1-million a month on a sustainable basis, while the monthly management fee payable by Bokoni mine to Atlatsa was reduced by 11%.

The restructure plan targeted a total labour complement of about 3 500 employees for the Bokoni mine, with the reduction in labour force having resulted in a 15% a month reduction in operational costs.

During the 2015 financial year, the tons milled at Bokoni mine decreased by 3.8% to 1.6-million tons, resulting in relatively flat production of 190 740 4E PGM ounces, compared with the 194 036 4E PGM ounces produced during the previous year. 

Primary development decreased by 27.5% year-on-year to 7 778 m as planned, following a strategic decision to reduce development to a level sufficient to meet the Bokoni mine’s stoping flexibility requirements.

Mine management continued to focus on various initiatives to improve operational efficiencies, disciplined capital allocation and cost management, without comprising the ramp-up plan.

AMPLATS DIVESTS FROM BOKONI
In light of the negative cash flows at Bokoni, Anglo American Platinum (Amplats) had written off its equity interests in Atlatsa and Bokoni, leaving a carrying value of R1.4-billion.

Its 23% shareholding in Atlatsa and 49% shareholding in Bokoni were expected to remain cash negative for some time.

Various loans extended to Atlatsa and its shareholder had also been written off, leaving an aggregate carrying value of R2-billion.

Atlatsa remained in discussions with Amplats and the Department of Mineral Resources regarding Amplats’ stated intention to exit from Bokoni mine and Atlatsa.

Meanwhile, Atlatsa’s revenue for the financial year under review decreased 13% to C$205.7-million.

Cash operating costs were 2.4% lower, reflecting the 4% decrease in tons milled; however, underground tons from the two remaining shafts were up by 12%, which offset the decrease in cash operation costs.

Costs per ton milled were C$133, compared with C$131 in 2014, with cost per 4E ounce remaining relatively flat at C$1 169, compared with C$1 176 in 2014.

Total capital expenditure for the year ended December 31, 2015 was $25.7-million, compared to $31.1-million for the year ended December 31, 2014, comprising 35% sustaining capital and 65% project expansion capital associated with the two key ramp-up shaft operations.