Output at South Africa’s Amplats hit by Eskom power cuts

Signage indicating the corporate offices of the Anglo American mining company.
Signage indicating the corporate offices of the Anglo American mining company.

South African miner Anglo American Platinum Ltd’s (Amplats) first-quarter production fell 6 percent, hit by problems at power supplier Eskom, operational challenges and ore stockpiling in the same period the year before.

Power cuts implemented by Eskom, which supplies more than 90 percent of electricity in Africa’s most advanced economy, pose a threat to miners which are among the biggest users of power in the country and are already grappling with weak profits.

Amplats’ total platinum group metal (PGM) production fell 6 percent to 998,900 ounces for the quarter ended March. 31, from 1,062,800 ounces in the same period a year ago.

Eskom cut power across the country in February and March as low coal supplies, a severe cash crunch, and multiple failures at its ageing fleet of power stations throttled supply.

Amplats said the power cuts hit PGM production at its Mogalakwena operations, which declined by 6 percent to 307,200 ounces, and at its Amandelbult operations, which decreased 7 percent to 192,800 ounces.

In February, Amplats said it lost 14,000 platinum ounces when Eskom implemented five straight days of power cuts and was considering building a 100 megawatt solar power plant at its Mogalakwena operations.

Amplats said if power disruptions persisted, there could be an impact on the timing of refining the built-up work-in-progress inventory in full, which it expects to have refined by the end of 2019.