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TORONTO, ONTARIO--(Marketwired - Feb 22, 2016) - ABERDEEN INTERNATIONAL INC. ("Aberdeen", or the "Company") (TSX:AAB) is pleased to provide a corporate and operational update on African Thunder Platinum ("ATP").
African Thunder Platinum closed the acquisition of its platinum assets in early 2015 with the startup of the Smokey Hills mine occurring in January and the completion of mill commissioning on April 29, 2015. During the second half of 2015 (July to December), African Thunder continued to experience significant progress on increasing production from the mine, however the pace of the underground development and production ramp-up fell short of the Company's initial expectations due to several factors, including poor equipment availability, several senior management changes, and employee absenteeism that was at the root of low overall mining productivity. These issues are being addressed to the Company's satisfaction and production results in 2016 have shown significant improvement.
For 2015, the mine produced 234,000 tons of ore and development material at an average grade of 3.1 g/t 4E PGM (platinum, palladium, rhodium and gold) and total production of 16,381 oz 4E. As is typical in South African platinum mines, the material recovered in development of adits and raises is blended with the higher-grade ore from stopes, lowering the overall grade delivered to the mill, depending on the ratio of ore to development material. This ratio of ore to development material is lower during ramp-up and should stabilize as full production is achieved. The mill has been operating since April and has been delivering results as expected, with a weighted average recovery over the calendar year of 75%, which includes lower recovery over the first few months of operation. Overall PGM recoveries trended towards the design level of 80% and the mill has achieved a recovery rate of 79% over the first six weeks of 2016.
Production early in 2016 has improved over the fourth calendar quarter of 2015, with underground production so far in February achieving approximately 80% of the full production plan of 42,000 tpm. We are currently estimating that our year-to-date mining costs (on a per tonne basis) would place the mine in a very competitive position relative to the South African platinum mining sector. That being said, the mine is still ramping up production, and the ratio of development material to stoping ore is higher than it would be at steady-state production, so we are still seeing lower grade delivered to the mill, than what is required to achieve the full production rate of 60,000 oz/yr PGM.
2016 PLANNING AT SMOKEY HILLS
After experiencing a setback in production levels in the fourth calendar quarter of 2015, African Thunder has resumed growing production levels from the mine, and is on pace in February to achieve record monthly production from Smokey Hills. In reviewing the production and development plans in the context of the current PGM market it is clear that accelerated development would be required for several more months in order to achieve full production and steady profitability from the underground mine. Therefore African Thunder is reviewing its options, which include operating under the status quo with an effort to lower costs and improve efficiency, or commence an orderly care and maintenance (i.e. temporary shutdown) to prepare for restart of operations when platinum and palladium prices are higher in the future. African Thunder is currently engaged in a consultation process with its workforce and is expected to reach a decision on the 2016 plan later next month.
APPOINTMENT OF CHIEF OPERATING OFFICER
On December 3, 2015, African Thunder hired Rodney O'Reilly as Chief Operating Officer. For several months prior to the hiring; African Thunder employed a temporary consultant to manage the mining operations. Rodney is a Professional Certified Mining Engineer in South Africa, with more than 30 years experience in the mining industry. Immediately prior to joining African Thunder, Rodney was General Manager of Glencore's Eland Platinum Mine near Rustenburg, South Africa. Over seven years Rodney managed all facets of the operation, including an open pit, underground mine more than double the size and throughput of Smokey Hills, as well and the PGM concentrator plant. Production at Eland was suspended in 2015 due to low platinum-palladium prices. Since taking over operating duties at African Thunder, the Company has achieved improved production levels and efficiency at Smokey Hills.
APPOINTMENT OF DIRECTOR TO AFRICAN THUNDER PLATINUM
African Thunder has also appointed Sakhile Ngcobo, Ph.D candidate with a Masters Degree in Rural Resource Management, to the Board of Directors, and in addition he has taken on a consulting role with the Company helping manage community relations and permitting and government matters. Sakhile recently served as Executive Head of Corporate Affairs for DeBeers South Africa. Sakhile is an expert in managing stakeholder relations in the mining sector and serves on several other corporate boards in South Africa.
OTHER OPERATIONAL HIGHLIGHTS
During the year, our African Thunder team unlocked several positive developments that bode well for optimizing production and costs in the future, including:
UPDATED CAPITAL STRUCTURE
Aberdeen and Pala have continued to financially support African Thunder during the production ramp up period. At the present time, Aberdeen owns approximately 47.5% of African Thunder (Pala also owns 47.5%) and has invested CAD $14,960,000 ($15,379,000 including transaction costs) to date.
Aberdeen's President and CEO David Stein commented, "While the past year has seen continued weakness in the mining sector, including lower platinum and palladium prices, we believe we are putting together an excellent PGM mining company. The longer-term fundaments of platinum and palladium continue to be strong as governments commit to tackling air pollution from vehicles. Investors have few choices when it comes to this exciting sector, and African Thunder has now demonstrated that it can achieve low-cost production, and it continues to have tremendous production growth opportunities from both the Smokey Hills mine and the Kalplats project".
Mike Hoffman P.Eng., a qualified person under National Instrument 43-101, has reviewed the scientific and technical aspects of this press release. As a former director of Aberdeen, Mr. Hoffman is not independent of Aberdeen.
ABOUT ABERDEEN INTERNATIONAL
Aberdeen International is a private equity investor and advisor focusing on the global mining and natural resources industry. African Thunder Platinum, Aberdeen's premiere investment, is a lower-cost platinum group metals producer in South Africa's well-known Bushveld Complex. Aberdeen has further enhanced its mineral investment holdings with the acquisition of the lucrative Diablillos lithium project in Argentina.
Except for statements of historical fact contained herein, the information in this press release constitutes "forward-looking information" within the meaning of Canadian securities law. Such forward-looking information may be identified by words such as "plans", "proposes", "estimates", "intends", "expects", "believes", "may", "will" and include without limitation, statements regarding, proceeds to be received on closing or subsequently, the ability of the Company to generate additional value for shareholders as a result of such transactions, past success as an indicator of future success; net asset value of the Company; the potential of investee companies and the appreciation of their share price; the Company's plan of business operations; industry opportunities and dynamics and anticipated returns. There can be no assurance that such statements will prove to be accurate; actual results and future events could differ materially from such statements. Factors that could cause actual results to differ materially include, among others, metal prices, competition, financing risks, acquisition risks, risks inherent in the mining industry, and regulatory risks. Most of these factors are beyond the control of the Company. Investors are cautioned not to put undue reliance on forward-looking information. Except as otherwise required by applicable securities statutes or regulation, the Company expressly disclaims any intent or obligation to update publicly forward-looking information, whether as a result of new information, future events or otherwise.
Aberdeen International Inc.
Manager, Investor Relations
Aberdeen International Inc.
President and Chief Executive Officer