Following on from the Company's previous announcement relating to the switching in of both its furnaces on 1 June 2012, International Ferro Metals is pleased to announce that the ramp-up is progressing smoothly and is on track to achieve full load by mid-June. This succeeds the conclusion of the electricity buyback agreement with Eskom. Once full load has been achieved, the Company intends to reduce load during the specific expensive peak winter tariff hours which is expected to reduce ferrochrome production volumes by an estimated 10% over this period. The winter tariffs are effective from June to August every year.
The electricity co-generation ("Co-gen") plant modifications are complete and the plant is being ramped up in line with the ramp up of the furnaces. In March 2012, the Co-gen plant produced a record 8.5% of the Company's total power demand. This is expected to progress to 11% of the total power demand from July this year, at a significantly lower cost than bought in power from Eskom. In addition, it is important to note that the Co-gen plant is a key part of IFL's commitment to Health, Safety and the Environment by harnessing off-gases to generate power.
The Anglo Platinum Chrome Recovery Plant ("CRP") has been supplying the contractual 15,000 tonnes of UG2 per month from April 2012, with 10,000 tonnes received in March 2012. The CRP provides 30% of the Company's beneficiated ore requirement, at a delivered cost per tonne significantly below IFL's in-house cost of chrome concentrate production. There are no additional costs other than the cost of transporting the concentrate to the Company's facilities at Buffelsfontein, which is about 50km from the CRP, and any government royalties that may be payable. It is planned that the UG2 will be blended and pelletised in the sinter plant. The CRP contract will continue for a period of approximately nine years.
Sky Chrome has been ramped up to 50,000 tonnes run-of-mine from April 2012. The increased mining depth on the open pit is resulting in improved quality ore as less weathered ore is mined. The box cut at Sky Chrome is progressing to schedule and the plan is to ramp up further, to 70,000 tonnes run-of-mine in Q3 pending favourable market conditions. Sky Chrome, which is currently mined as an open pit mine only, will replace the production from Lesedi open pit mine which is expected to reach its end of life in June 2012.
Ferrochrome sales have progressed to plan during the shutdowns and the Company successfully fulfilled its obligations to customers during the quarter.
For further information please visit www.ifml.com or contact:
International Ferro Metals Limited
Chris Jordaan, Chief Executive Officer
+27 (0) 82 653 1463
Carole Cable / Fiona Micallef-Eynaud
+44 (0) 20 7404 5959
Numis Securities Limited
James Black / Alastair Stratton / Stuart Skinner
+44 (0) 20 7260 1000
About International Ferro Metals:
International Ferro Metals produces ferrochrome, the essential ingredient in stainless steel, from its integrated chromite mine and ferrochrome processing operations in South Africa. International Ferro Metals is listed on the London Stock Exchange under the symbol IFL.
Forward Looking Statements
This announcement contains certain forward looking statements which by nature, contain risk and uncertainty because they relate to future events and depend on circumstances that occur in the future. There are a number of factors that could cause actual results or developments to differ materially from those expressed or implied by these forward looking statements.
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