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Home > Our Business > Union

SAFETY

Union Mine had two fatalities during 2009, which brought to an end its record performance of 7.95 million fatality-free shifts. The mine excluding concentrators ended the year with an LTIFR of 1.21, down from 1.32 in 2008. The mine had achieved 870,000 fatalityfree shifts at the end of 2009.

PRODUCTION

Output of equivalent refined platinum ounces decreased by 5% or 16,255 ounces to 297,814 in 2009, compared with 314,069 ounces in 2008. Tonnes milled at 5.5 million tonnes, was marginally lower than 2008. However, 4E built-up head grade decreased by 4% to 3.50 g/t in 2009. Immediately available Ore Reserves were 8% higher than in 2008, at 19.7 months.

Cash on-mine costs increased by 3% to R2,641 million in 2009, compared with those for 2008. This rise followed above-inflation increases in labour costs and electricity, which were partly offset by lower underground production, asset optimisation initiatives and a reduction in contractor labour. Cash on-mine costs per tonne milled increased by 4% to R479, whereas cash operating costs per equivalent refined platinum ounce increased by 9% to R10,268.

COSTS

Total cash on-mine costs increased by R352 million or 16% to R2.6 billion for the year. The cash on-mine cost per equivalent refined platinum ounce increased by 14% to R8,201 as a direct result of the higher operating costs. The cost per tonne milled increased by 17% to R462.

CAPITAL EXPENDITURE

Total capital expenditure for 2009 was R361 million, 36% lower than in 2008.

PROJECTS

Union Mine declines projects

Major projects currently in execution comprise extensions of the existing 4B, 4 South and 3 South decline systems, providing ore replacement capacity to Union Mine:

• The 4B Phase 3 project was approved in the first quarter of 2007 and has proceeded well, with capital development completed ahead of schedule and final handover anticipated in the first half of 2010.
• The 4 South Phase 3 project was approved in the first quarter of 2007 and is at an advanced stage of execution, with capital development nearing completion and final project handover anticipated in the final quarter of 2010.
• The 3 South Phase 1 project was approved in 2005 and is nearing completion, with all capital development finalised and final project handover anticipated in the first half of 2010.
• The 4 South Phase 4 project was approved by the Board of Rustenburg Platinum Mines Limited’s and Union Joint Venture executive committee in August 2009, with the aim of exploiting the residual 4 South and 3 South resource areas down to the 10-level boundary with Spud shaft. This project represents a significant optimisation of capital infrastructure, based on primary extraction via the 4 South decline as opposed to the originally planned discreet phase extensions of 4 South and 3 South.

Spud shaft projects

The Spud UG2 replacement project was approved in the first quarter of 2007. It is based on accessing the UG2 ore body, with a UG2 production ramp-up to the full shaft capacity of 80,000 tonnes per month planned in concert with a Merensky withdrawal strategy. Most of the required infrastructure is now in place, with the final project handover anticipated in 2010.

Union Mine projects studies

A pre-feasibility study of the Union declines was concluded in 2008, indicating positive value for the implementation of a new decline system that would exploit the 5 South resource area. A feasibility study was initiated in the first quarter of 2009, to evaluate the further option of accessing the resource via 4B instead, and of realising significant infrastructural optimisation. The study is well advanced but has recently been curtailed to a technical sign-off requirement, based on the fact that the project’s execution is being delayed until the second half of 2011.

A concept study for the Union Deep project, the aim of which is to provide both UG2 and Merensky Ore Reserve replacement capacity, was completed and reviewed in the final quarter of 2008. The pre-feasibility study was approved by the Board of Rustenburg Platinum Mines Limited’s and Union Joint Venture executive committee in May 2009, and was followed by the conclusion of a benchmarking and selection process aimed at securing the best available resources and an efficient study process. The conclusion of the pre-feasibility study is anticipated in the final quarter of 2010, with project execution projected to begin in early 2013.

OUTLOOK

Union Mine is expected to maintain a similar level of equivalent refined ounce production in 2010 as was achieved in 2009 primarily from the UG2 Reef, with an increased focus on efficiency and cost performance. Capital expenditure is likely to remain at similar levels to 2009 until resolution of the viability of the Union Deep shaft project.

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