JOHANNESBURG (miningweekly.com) – Top of the list of the four focus areas of platinum group metals (PGM) mining company Anglo American Platinum (Amplats) to drive its next phase of value is operational efficiency.
Outlining this at the company’s presentation of record financial and safety achievements, outgoing Amplats CEO Chris Griffith said this operational efficiency would be achieved through the beating of world benchmark performances, as well as using modernisation and digitalisation to drive these efficiencies.
In 2019, Amplats generated operating free cash flow of R16.9-billion, further strengthening the balance sheet to a best-ever net cash position of R17.3-billion, Griffith revealed at the presentation covered by Mining Weekly.
The second focus area is on breakthrough opportunities that offer a step change in production through the deployment of new technology known as FutureSmart Mining.
The third focus is on fast-payback, high-margin, value-accretive projects as well as projects that offer potential for growth through expansion.
The last focus is on developing new applications for PGMs to grow demand.
An example of an operational efficiency initiative that is in execution at Mogalakwena platinum mine in Limpopo is a pit slope design that is based on double benching.
“This involves reducing the amount of waste tonnes mined and gaining a larger ore footprint,” said Griffith.
Another example is a rope shovel efficiency improvement at Mogalakwena that lowers costs through higher equipment utilisation with the help of digitisatioin.
At the Amandelbult mine, modernisation and digitisation are improving recoveries, productivity and costs.
A potential technological breakthrough under trial at Mogalakwena is bulk ore sorting, which aims to improve the grade of ore put through to obtain more ounces through an existing concentrator plant, with only additional mining being required.
A trial plant is to be built at Mogalakwena north concentrator to advance coarse particle rejection technology, which rejects coarse barren particles considerably earlier in the process. This unlocks downstream concentrator capacity and also reduces energy and water requirements.
Extra low profile mechanised mining equipment is being deployed at the Tumela 15E section of the Amandelbult mine, which promises greater safety through remote control away from the rockface in what is a steeper narrow-reef orebody.
Fast payback, high-margin projects include the Modikwa chrome recovery plant, a copper debottlenecking project at the Rustenburg Base Metal Refinery, a platinum debottlenecking project at Unki, the modernisation of Amandelbult and the Tumela 15E project, with payback ranging from two years to five years and internal rates of return ranging from 20% to 60%.
Project studies are under way on the expansion of Mogalakwena and the Der Brochen/Mototolo replacement growth project.
“We’re on track to deliver the project studies from the first half of 2021,” Griffith said.
The most advanced project study is on the replacement of Mototolo into the Der Brochen ground, which should be completed this year.
“That study is focused on establishing the new Der Brochen shaft to replace the lower shaft, which is now coming to the end of its life-of-mine,” he said.
“The Der Brochen/Mototolo expansion is also being studied to see what new technology can be introduced to help us get more volume through the existing plant, which has the potential to increase the volume of Der Brochen by about 33%.”
These expansions could lead to further growth in earnings margins.
A strategic priority of Amplats is to grow demand for PGMs through market activity, which is undertaken globally.
Last year, Amplats invested $25-million into jewellery development through Platinum Guild International (PGI) to create demand in China, where there has been a reduction in platinum jewellery demand over the last few years, and India.
PGI is working with the jewellery industry in China to change the look-and-feel to a more graphic product and increased demand is already apparent in India.
Amplats invested $5-million in investment demand creation through the world Platinum Investment Council.
“We’re promoting platinum as a viable alternative for investors and in the last couple of years that’s been spread globally and the team is focusing very heavily in China on retail investors and particularly working through the banks,” said Griffith.
The company spent $6-million on industrial demand generation last year, which includes the latest investment into Lion Battery Technologies, which is aiming at launching the next generation of PGM batteries for use in battery electric vehicles as part of the mix.
Amplats has committed $100-million over five years into AP Ventures, which has attracted another $130-million of additional investment, $100-million of it from South Africa’s Public Investment Corporation and from three other companies with an interest in hydrogen fuel cells and green energy.
“We believe 2019 was a year of unprecedented growth in the hydrogen economy and fuel cells,” Griffith said.
Amplats participates through its investment in AP Ventures, which has six portfolio companies that focus on the hydrogen economy value chain.
The Hydrogen Council has increased it members to 81 from 13 seven years ago.
“We’ve seen growing commitments of fuel cell electric vehicles at a national governmental level, with 30 countries now committed to the 10-10-10 project, which requires them to have 10-million vehicles with 10 000 refuelling stations over 10 years .
“This has been further backed up by the increasing availability of fuel cell vehicles. There are now 45 fuel cell models on the market,” he said.
The cost of hydrogen as a fuel is down 60% since 2010 and hydrogen refuelling stations are up 50% since 2015.
“Fuel cells that use platinum in particular are now starting to become a current day reality,” he said.