NORTHAM Platinum today reported a 13% increase in refined production from its own operations of 809,775 ounces for its 2023 financial year owing to a strong performance from its Booysdendal mine. Including third party purchases, year-on-year refined output totalled 930,182 ounces – a fifth higher.
Booysendal, located on the eastern Bushveld, produced 21.5% more platinum group metal (PGM) concentrate, equal to 452,903 ounces for the 12-months ended June. The Eland mine reported concentrate of 48,400 oz – a 47.5% increase year-on-year. Concentrate production from Zondereinde, the firm’s founding mine, was flat year-on-year.
Paul Dunne, CEO of Northam said the production performance proved the company’s growth strategy was delivering but he also warned that “challenges remain”, citing inflation and the possibility of “more severe Eskom load curtailment events”.
In the last few days, Eskom has increased ‘loadshedding’ (cuts) for consumers to stage 6, equal to about 6,000MW, whereas energy intensive users such as Northam are asked to throttle back on consumption.
Dunne added: “However, our growth and operational diversification programmes remain on-track and continue to demonstrate the value of our counter cyclical investments and execution capacity across the group, as well as our flexibility in dealing with these challenges”.
Northam controversially withdrew a takeover offer for Royal Bafokeng Platinum (RBPlat) in April saying the deterioration in the basket price of PGMs was material adverse condition skewering the deal. The decision ended a near two-year contest with Impala Platinum for RBPlat which had issued its takeover offer in January, 2022.
However, Northam has a 34.5% stake in RBPlat for R17bn after earlier buying the shares from RBPlat’s then largest single shareholder, Royal Bafokeng Holdings. Dunne said the purchase would see Northam participate in the multi-generational development of RBPlat’s 68 million ounces in PGM resources.
Shares in Northam improved shortly after withdrawing its offer suggesting it was unpopular with the market but it has since fallen in line with declining PGM prices.
Another PGM miner Tharisa said earlier this week that PGM prices had fallen to a 52 week low. Commenting on the PGM market, Tharisa CEO Phoevos Pouroulis said market pressure had manifested itself in “some unusual and often aggressive selling patterns” amid renewed fears of macro-economic slowdown driven by China and the US. Customers were clearing pipelines which had fed into higher car sales.
“We maintain that while prices are trading near 52-week lows, in the medium to long-term prices should rise, driven by supply complexities in the major producing regions with current pricing pressures leading to increased chllanges faced by some higher cost producers,” Pouroulis said.
