Bokoni idled as JV partners Amplats, Atlatsa strike a deal

JOHANNESBURG (miningweekly.com) – Dual-listed Atlatsa Resources on Friday announced plans to implement a two-phase restructure plan that will see its joint venture (JV) Bokoni mine idled, with JV partner Anglo American Platinum (Amplats) acquiring the resources specified in the Central Block and Kwanda North prospecting rights.

A letter agreement between the JV partners outlined the Phase 1 care-and-maintenance strategy for the embattled mine, with Amplats funding all costs associated with the process up until December 31, 2019, and suspending the servicing and repayment of the current R4.2-billion and future debt owing by Atlatsa until then.

“Atlatsa will also, as a consequence, restructure its corporate head office and associated overhead costs in order to right-size for a business that will hold a single asset on care and maintenance, including reviewing the sustainability of its listings on various stock exchanges,” the company said.

During the care-and-maintenance period, the Bokoni JV partners will continue to review various alternatives for the mine’s future sustainability and revisit its care-and-maintenance status, depending on future circumstances.

In the agreed Phase 2, Amplats will acquire, and include into its adjacent mining rights, the resources specified in the Kwanda North and Central Block prospecting rights for R300-million.

Phase 2 will also result in the capitalisation or write-off of all debt incurred during the debt standstill period.

“Notwithstanding various attempts since 2014 to restructure the Bokoni mine through, inter alia, shaft closures and other measures to achieve profitability, Bokoni mine’s operations remain cash negative after capital expenditure,” Atlatsa said in an update to shareholders.

The mine had incurred some R500-million negative cash flow in the first six months of 2017.

Atlatsa and Amplats will retain their 51% and 49% respective shareholdings in the JV; however, both parties will continue to investigate opportunities for either or both to divest of their interests in the Bokoni JV.