JSE-listed platinum miner, Lonmin, on Monday said it had safely stopped its Number One Furnace after a leak of molten furnace matter was detected.
“An assessment of the furnace has shown that mechanical structure and refractories below the tap hole as well as the copper tap block need to be replaced. The life of this furnace has been extended through careful operation but during the five months strike it was impossible to operate the smelter on a consistent basis,” it said on Monday.
“In order to mitigate operational risk as we carry out these repairs we have decided to bring forward the planned hearth rebuild of the furnace which was originally scheduled and budgeted for October 2015. We expect the repairs to take around three months,” it added.
However, the company said it was not expecting its refined production for the next year to be negatively impacted.
It said its back-up facilities for such events had been put into operation. It added that the Number Two Furnace will continue to operate and the company has restarted the three smaller Pyromet furnaces.
“This has the potential to back-end load sales into the second half of the 2015 financial year and there will be a build-up of concentrate stocks which is expected to unwind by year end,” Lonmin said.
“We are looking at commercial ways to mitigate this. We are maintaining our overall sales and unit cost guidance for 2015 financial year. Although we expect our net borrowings to increase at the end of March 2015 as a direct result of the lower sales volume in H1 (First Half), they are expected to remain well within our borrowing facilities. The capital spend for the repairs will be absorbed into the guided capital spend for the year. We continue to focus on our cash conservation measures,” the company said. (VENTURES AFRICA)
