1 Mar 2012 07:00
International Ferro Metals Limited
("IFL" or the "Company")
Agreement with Eskom
1 March 2012
International Ferro Metals Limited, the integrated ferrochrome producer, announces that it has reached an agreement with Eskom to assist with the power utility's electricity supply requirements by participating in its electricity buy-back programme for an agreed period.
IFL has agreed to switch out the first furnace from 1 March until 31 May 2012, and the second from 1 April until 31 May 2012. IFL has the option, under this agreement, to switch back in the first furnace on 1 May, provided one month's notice is given by 31 March.
Under this agreement, Eskom will buy back the electricity which would have been consumed by the two furnaces, at a rate that results in a net financial benefit to the Company.
IFL's contractual commitments to customers will not be affected as these will be serviced from existing ferrochrome stock and production from the second furnace, which will be switched out on 1 April.
Both shutdowns will be executed in a safe and secure manner and we expect switching back in to be a quick and secure process as the furnace performances have been proven after the roof rebuild project.
No job losses will occur as a result of the buy-back programme and the furnace shut downs will not significantly impact our other mining and ore beneficiation operations, including the operation of the UG2 plant. Furthermore, Bank of China, IFL's lender, is agreeable to this decision.
Chris Jordaan, Chief Executive Officer of IFL commented:
"This agreement is value accretive for IFL shareholders, cash generative for the Company, helps our national power utility manage its maintenance programme before the winter period, and is agreeable to our lender."
For further information please visit www.ifml.com or contact:
International Ferro Metals Limited Tel: +27 14 574 6302
Chris Jordaan, Chief Executive Officer
Brunswick Group Tel: +44 (0) 20 7404 5959
Carole Cable / Kate Boothman-Meier
Numis Securities Limited Tel: +44 (0) 20 7260 1000
James Black / Stuart Skinner / Alastair Stratton
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 their 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.