Anglo American Platinum (Amplats) has announced its much anticipated revised portfolio review proposal, aimed at creating a sustainable, competitive and profitable platinum business.In January 2013, the company revealed its portfolio review in an effort to turn Amplats into a profitable business for the long-term benefit of all its stakeholders. Following the announcement of its proposals, Amplats and its recognised unions agreed to suspend the section189 consultations to allow for engagement to take place with the Department of Mineral Resources (DMR) and the unions. As part of the announced review, the company said that there was a possibility it would shed about 14 000 jobs. Amplats has now revealed that its revised proposal will include revising baseline production to between 2.2 million and 2.4 million ounces yearly in the short- to medium-term, as well as consolidating Rustenburg into three operating mines through the integration and optimisation of Khuseleka 2 and Khomanani 1 and 2 into the surrounding mines. Further, Amplats said it would reduce overhead costs and improve efficiencies while exploring opportunities for further joint venture business improvement and portfolio rationalisation. The company noted that Khuseleka 1 would remain operational, which is the principal revision to the previous proposal, adding that this will result in a reduction of production capacity of approximately 250 000 oz per annum in 2013 and by an additional 100 000 oz per annum in the medium term.
Amplats explained that should these revised proposals be implemented, Amplats’ Rustenburg operations would be reconfigured as a sustainable 320 000 to 350 000 ounces per annum platinum producer in the medium term.Meanwhile, the company said that as originally proposed, Amplats’ Union mines would be divested at the right time and reconfigured in the interim to protect near term value, while the company’s review of its overheads, support structure and costs, as well as the review of its commercial and marketing strategy will also proceed as planned. Processing operations would be aligned to the revised long-term production plans, asserting that Amplats remains committed to delivering R3.8 billion of annual savings by 2015 from the indirect and direct cost savings. In a statement, Amplats advised that it expects that the revised proposals have the potential to reduce the number of mining and processing jobs affected to approximately 6 000, highlighting that it would comply with the Labour Relations Act (LRA) and the MPRDA obligations and these will include full consultation with unions and employee representatives which will commence in due course. “We have been working diligently to reach the shared objective of creating a competitive platinum business for the benefit of all stakeholders. These revised proposals reflect our commitment to South Africa and our role in addressing the socio economic challenges facing the country, while recognising that we need to take actions to return the company to profitability. “We are hopeful that the revised proposals will serve as a basis for meaningful consultation with our employees and their representative structures. The revised portfolio is one that retains flexibility, reduces complexity and will position us to achieve our goal of creating a sustainable and profitable platinum business,” concluded Amplats’ CEO Chris Griffith.