Aquarius Platinum Limited LSE:AQP ASX:AQP JSE:AQP

the Moolman story, as told in Johannesburg Press.
Note the counter claim for a smaller sum.
Moolman have the cash: turnover $13 Billion Rand.
Charlotte Mathews
Johannesburg

JUNIOR miner Aquarius Platinum SA had cancelled its contract with Aveng subsidiary Moolman Mining, and would sue it for R1bn in damages because of "an actionable misrepresentation" on the part of Moolman, it said yesterday.

If successful, the action would have a substantial effect on Aveng, which had operating income in the year to June of R327m on revenue of R13,5bn. Aveng's share price fell 40c, or 2,15%, to R18,20 on the JSE.

Aveng CE Carl Grim said yesterday there was no factual basis for the claim. Moolman Mining in turn had a claim against Aquarius for unexplained deductions from contract payments, and would take action for the cancellation of the contract.

Moolman Mining and Aquarius Platinum agreed to have KPMG conduct an audit earlier this year because of a dispute over the price-adjustment clause in the five-year contract under which Moolman undertook open-cast mining at the Marikana platinum mine. After the audit's findings, Aquarius decided to terminate the contract and sue.

Grim said he was surprised and disturbed that four years after the contract was signed Aquarius had raised the issue of a material misrepresentation. Moolman Mining was SA's biggest open-cast mining contractor, and in its 40 years of operation this was the first such litigation against it.

Moolman Mining had already sent Aquarius an invoice for R169m for arbitrary deductions from the contract payments, but this sum had escalated to more than R200m by the end of November, Grim said.

Moolman Mining is the principal contractor at the Marikana Mine.

Aquarius said the operational and financial implications of cancelling the contract would be short-term. It had begun discussions with another contractor, and expected to make an appointment in the near future.

Aveng said Moolman had ceased operations at Marikana yesterday, and would try to redeploy the large number of people and the equipment used on the project.

Aquarius Platinum, which has its primary listing on the Australian Stock Exchange, became the first foreign-listed company to list on the JSE a year ago. It was the first company to demonstrate that Australian mining techniques, involving mechanisation and contractors, could be viable on SA's platinum mines. It owns 50,5% of South African operating company Aquarius Platinum SA, with Impala Platinum and the Savannah black economic empowerment consortium as other major shareholders.

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Aquarius has pool-and-share agreements with Anglo Platinum on both its Kroondal and Marikana mines. A pool-and-share agreement involves mining adjacent lease areas, which makes it possible to pool assets and share profits while retaining individual ownership.

Aquarius said although Marikana reported a loss for the year to June of $18,6m the implementation of the Marikana pool-and-share agreement would produce a significantly improved financial result this year