The Mineral Resource and Mineral Reserve Statement as at 30 June 2018 is collated at a time when the platinum industry continues to face significant external challenges. The prevailing depressed metal prices are reflected in the fact that capital investment has virtually dried up throughout the industry. At Implats, greenfields exploration has been terminated and shaft sinking operations at Impala’s 17 Shaft and Afplats’ Leeuwkop Shafts remain suspended. Against this background material changes in the Mineral Resource and Mineral Reserve estimates are detailed in this report. The material impact of the Impala strategic review is reflected in this Mineral Resource and Mineral Reserve Statement. Despite the difficult circumstances some operations continue to deliver stellar production performances at Zimplats, Marula, Mimosa and Two Rivers.

The Impala Rustenburg operation underwent a detailed scrutiny during the past year in view of a loss-making outlook. The objective of the strategic review was to create a sustainable investment case for Impala Rustenburg that secures long-term profitability through optimisation and restructuring of the operations. Key consideration of the review was the financial robust business case within the context of social responsibility to secure long-term employment. The review process concluded on the most viable option to achieve a sustainable future operation at Impala. This restructuring process provided for a focused, agile and profitable future state that safeguards the future of some 27 000 employees.

To this effect the Implats Board has approved the strategy to cease operations at unprofitable shafts at Impala. The older shafts such as 1, 4 and 9 Shafts with limited remaining Mineral Reserves are targeted for harvesting. The higher cost, mature shafts such as 12 and 14 Shafts will be optimised and operated under strict performance conditions ahead of their planned cessation towards the end of FY2020. This restructuring of Impala Rustenburg will yield a change from 11 operational shafts ramping up to 750Koz platinum, to six operational shafts producing approximately 520Koz platinum per annum. A direct outcome is a material reduction in the Impala Mineral Reserve estimate.

Zimplats announced on 6 June 2018 that the issue concerning the proposed compulsory acquisition of a portion of Zimplats’ mining lease area, as well as the issue of security of Zimplats’ mining tenure, has been resolved amicably between Zimplats and the Zimbabwean Government (GoZ) to the mutual benefit of the parties. Zimplats agreed to release to the GoZ land measuring 23 903 hectares within Zimplats’ mining lease area in support of the government’s efforts to enable participation by other investors in the platinum mining industry in Zimbabwe. Following this release of land, Zimplats now holds two separate and non-contiguous pieces of land and Zimplats was granted with effect from 31 May 2018, two separate mining leases over the two pieces of land measuring 6 605 hectares and 18 027 hectares respectively. These mining leases replaced the special mining lease, which was due for renewal in August 2019, thus securing the operating subsidiary’s mining tenure. The release of land does not impact on the 30-year mine plan, but resulted in a material reduction in the Zimplats Mineral Resource estimate.

The Implats structure remained largely unchanged during the past year with operations at Impala in the Rustenburg area of the North West province, the refinery at Springs in the Gauteng province, the Marula Mine in the Limpopo province, Zimplats and Mimosa Mines operating in Zimbabwe, the Two Rivers Mine near Burgersfort in the Limpopo province and the Afplats project near Brits in the North West province. During the past year Implats secured a minority 15% interest in the Waterberg Joint Venture project (Waterberg JV Resources (Pty) Ltd) in the Limpopo province with the option to increase the Implats stake to 50.01%. At year-end the Mineral Resource estimate for the Waterberg JV project was in progress and such attributable interest is not included in this report; the size of the attributable Mineral Resource is not material at the Implats Group level.