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Anglo American Platinum, the world's second-largest producer of platinum group metals, announced on Friday it has temporarily shut down its Rustenburg converter plant and declared force majeure.
"Anglo American Platinum announces the temporary shutdown of the entire Anglo Converter Plant (ACP), part of the chain of processing facilities, and the need to declare force majeure," it said in a statement.
The company's stock on the JSE was down 13% at R957.01 at 14:40.
Force majeure describes a clause which exempts companies from fulfilling contractual obligations in cases of unforeseen disruptions beyond their control.
Amplats on Friday said its ACP phase A converter plant at its Waterval smelter in Rustenburg was damaged following an explosion on February 10 this year. Nobody was injured in the incident.
Repair work has commenced, and is expected to be completed by the second quarter of 2021.
Amplats said phase B of the plant was set to take over from phase A. But water was detected in phase B's furnace which posed a high risk of explosion.
"Notwithstanding extensive testing being conducted to determine the source of the water, and a number of circuits being isolated, water continued to be observed in the furnace," it said.
As a result, the company had "no other option but to temporarily shut down the phase B unit, to ensure the safety of all employees, and avoid a catastrophic event."
It is anticipates that the repair work to fix the phase B unit will take approximately 80 days.
Amplats said that, as a result, the entire Anglo Converter Plant has been temporarily closed and it has declared force majeure.
It has revised its 2020 production guidance for platinum, palladium and rhodium.
Source: ANGLO AMERICAN PLATINUM STATEMENT
"Production from own mines will continue, and the concentrate from the mines will continue to be smelted at one of the four smelter complexes. However, production from own mines, as well as third party material will not be able to be converted to refined production while the ACP is undergoing repairs."
