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South African Platinum Miners Asked to Reduce Water Use by Half

Mines in South Africa’s main platinum producing area, run by companies such as Anglo American Platinum Ltd. (AMS), are being asked to cut water use in half after a drought.

Operations near Rustenburg in North West province “have been asked to cut their consumption,” Linda Page, a spokeswoman for the Department of Water Affairs, said today by phone. “Domestic users should get first preference obviously.”

The province, home to operations of the three biggest producers including Lonmin Plc, was declared a drought-stricken area by premier Thandi Modise last month. The companies have already seen profit margins shrink as prices declined and costs such as wages have grown faster than the rate of inflation.

Impala Platinum Holdings Ltd. (IMP), the second-largest producer, was asked to cut fresh water use by 10 percent, spokesman Johan Theron said. The shortage “is something that happens every summer and every summer it gets worse,” he said today by phone.

Impala’s consumption of fresh water makes up a quarter of its total usage and mining hasn’t been affected, Theron said.

The water shortage is exacerbated by supply-infrastructure that hasn’t kept up with growth in Rustenburg, he said.

Anglo American Platinum, Lonmin and Aquarius Platinum Ltd. weren’t immediately able to comment.

Northam Platinum Ltd. (NHM)’s Zondereinde mine isn’t within Rustenburg’s municipal borders, Charmane Russell, a spokeswoman for the company at Russell & Associates, said by e-mail.

To contact the reporter on this story: Andre Janse van Vuuren in Johannesburg at ajansevanvuu@bloomberg.net

To contact the editor responsible for this story: John Viljoen at jviljoen@bloomberg.net

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