Atlatsa Resources has signed an agreement with joint venture (JV) partner Anglo American Platinum to place the Bokoni mine in South Africa on care and maintenance as part of a restructuring plan.
Under the agreement, Atlatsa will also acquire the Central Block and Kwanda North prospecting rights for $23m and will include them in its adjacent mining rights as part of Phase 2.
All costs associated with the care and maintenance process will be funded by Anglo American through a loan account until 31 December 2019.
Atlatsa and Anglo American will retain their respective 51% and 49% shareholdings in the Bokoni joint venture.
Bokoni mine is understood to have incurred a negative cash-flow of around $39m for the first half of this year.
Atlatsa has further plans to restructure its corporate head office and associated overhead costs to the appropriate size for a business that will hold a single asset on care and maintenance.
Anglo American will suspend servicing and repayment of all existing and future debt incurred by Atlatsa.
Upon implementation of Phase 2, all debt incurred during the standstill period will either be capitalised or written-off.
At the time of the care and maintenance, the Bokoni JV partners will continue to review various alternatives in respect of the mine’s future sustainability.
Both Anglo American and Atlatsa will continue to investigate opportunities for either or both parties to sell their interests in the JV.