Pilot mining starts at Karo platinum project

Tharisa Capital, a South African co-producer of platinum group metal (PGM) and chrome concentrates, says its Karo Mining platinum project in Zimbabwe remains on track, with the first plant concrete pour completed in June and pilot mining having commenced.

The first ore to the mill is targeted for the second half of 2024, as significant progress has been made.

The Karo PGMs project is one of the multi-million dollar signature projects that came through after the Second Republic, led by President Mnangagwa, came to power in November 2017.

Platinum mining is a key element of the Government's plans to grow mining into a US$12 billion economy by the end of 2023.

"The equity contribution by Tharisa of US$135 million is being drawn down to match capital requirements with cash flow as we finalize the senior debt portion for this globally strategic mine," said chief executive Mr Phoevos Pouroulis in an update for the quarter to June 30, 2023.

The US$4,2 billion project is a low-cost, open-pit platinum group metals (PGM) asset under development on Zimbabwe's Great Dyke mineral rich belt.

According to Mr Pouroulis, 540 people are on site, 99 of which are Karo employees and the balance being contractor employees.

He said the concrete foundation pouring was progressing well, with earthworks nearing completion for the pilot mining phase. Contractors and staff are onsite to commence operational tests.

"Long-lead item manufacturing is progressing as planned, with the first major deliveries scheduled for the fourth quarter of 2023," he said.

Mr Pouroulis said power line construction was expected to commence during this quarter.

Karo controls an indirect 85 percent shareholding in the Karo platinum project, while the Government holds the remainder on a free carry basis.

Overall, Mr Pouroulis said PGM output increased to 37 000 ounces (34 300 ounces) during the second quarter of financial year 2023, with yield maintained and recoveries improving.

"The unique co-product model was again highlighted, with the Company benefiting from continued favourable chrome pricing while dealing with PGM pricing pressures, resulting in strong free cash generation and ending the period with a further strengthened balance sheet with net cash of over US$140 million," he said.

He added that the quarter also allowed the company to review its in-pit mining plan with the appointment of a waste material contractor, helping to ensure sustainable access to the required reef horizons.

According to the World Platinum Investment Council (WPIC), the global platinum surplus is fragile amid supply risks and growing demand, a development set to benefit the country, which is a key player in the global platinum industry.

Already, there are three platinum-producing companies in the country, namely Zimplats, Mimosa, and Unki.

Zimbabwe is envisioning a US$12 billion mining industry by 2023. Of the US$12 billion, gold, platinum, and diamonds will contribute US$4 billion, US$3 billion, and US$1 billion, respectively.

Chrome, iron ore, and carbon steel will contribute US$1 billion, while coal and hydrocarbons will contribute the same. Lithium will cost US$500,000, while other minerals will cost US$1,5 billion.