Union Section (managed – 85% owned, with the Bakgatla-Ba-Kgafela Traditional
Community – 15%) |
| SAFETY |
| Union Section proudly reports the achievement of
3 million fatality-free shifts during 2007 with Richard
shaft achieving 2 million fatality-free shifts. The mine has
reduced lost-time injuries by 41% from 320 in 2006 to
189 in 2007, resulting in the LTIFR rate decreasing from
2.23 to 1.36. Union Section experienced one fatality in
2007. |
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| PRODUCTION |
Unsafe work standards led to contractor dismissals at
the declines in the first half of the year. The subsequent
re-organising of working arrangements and employment
of own employees to replace dismissed contractors
progressed slower than anticipated and impacted on
the mine's production. Safety stoppages, power and
labour disruptions further affected output for the year.
To alleviate the impact of the slower ramp-up at the
declines and other factors affecting production, the
mine treated low-grade surface stockpiled material.
Lower milling rates, coupled with a lower head grade
caused by the treatment of the low-grade material,
resulted in equivalent refined platinum ounces declining
by 2% or 7,300 ounces to 309,400 ounces.
The rehabilitation of the declines and increased primary
development resulted in the immediately available ore
reserves increasing by 23% to 19.7 months at the end
of 2007. UG2 ore milled comprised 64% of total Union
Section output compared to 56% in 2006. |
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| William Taylor |
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| COSTS |
| Total cash on-mine costs increased by R259 million or
13% to R2.2 billion. Cash on-mine cost per tonne milled
increased by 19% to R396 in 2007. Cash on-mine cost
per equivalent refined platinum ounce increased by
16% to R7,188. The increased costs were primarily a
function of significant inflationary pressures and above inflation labour cost increases. |
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| CAPITAL EXPENDITURE |
| Capital expenditure for the year was R0.4 billion, a 53%
increase from 2006. The increase is largely due to
replacement project capital at the declines. |
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| OUTLOOK |
| Current production of equivalent refined platinum
levels are expected to be maintained over the ensuing
years, while Union Section uses spare metallurgical
capacity to process remaining low-grade surface
stockpiles. |
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| Projects |
| Union Section replacement
projects |
The third phase of the 4B and 4 South
declines were approved by the Board in the
first quarter of 2007. The extensions will
maintain production capacity of 90,000 tonnes
per month, ensuring efficient use of Union Mine's
on-mine fixed cost base. Development of the
decline barrels is on schedule.
Mining development in the 3 South UG2 decline
project, which was seriously affected by falls of ground
in the first quarter of 2006, has resumed. The project
has been re-scheduled to reach steady-state production
capacity of 50,000 tonnes per month during the fourth
quarter of 2008.
The Spud UG2 conversion project was approved for
implementation in the first quarter of 2007. This
project was designed to exploit the UG2 orebody at
the existing Spud shaft via existing redundant Merensky
infrastructure. The latter will be used to establish the
necessary production half-levels to achieve the project's
steady-state UG2 production requirement of 80,000
tonnes per month. New access haulages will be
developed below the UG2 horizon, between the 14
and 19 levels at Spud shaft to access the UG2 orebody.
The capital development is on schedule.
The 5 South decline project concept study was
reviewed. Approval has been granted to proceed with
the pre-feasibility study, which has started.
A scoping study for the Union deep shaft project has
been commissioned and scheduled for completion in
the first quarter of 2008. A permitting process for a 3D
seismic survey in the targeted area of the proposed
deep shaft has also started. |
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