eBusiness Weekly
Nelson Gahadza
Zimbabwe’s largest platinum group metal (PGMs) producer Zimplats Holdings, says implementation of its various projects under the US$1,8 billion investment strategy are progressing according to plan.
Zimplats as part of their overall capital investment strategy, last year approved a budget of US$1,8 billion to be implemented over a 10 year period.
In a trading update for the quarter ended June 30 2022, Zimplats said the development of Mupani Mine and upgrade of Bimha Mine to replace Rukodzi, Ngwarati, and Mupfuti mines, which will be depleted in FY2022, FY2025, and FY2028 respectively, progressed well during the quarter.
“A total of US$228 million had been spent on the project to date and US$81 million had been committed against a project budget of US$468 million,” the company said.
The group indicated that the Third Concentrator Plant which will increase milling capacity by 0.9 million tonnes per year is on course for commissioning in August 2022 and cumulative project expenditure as at the end of the quarter amounted to US$79 million with US$14 million committed against a project budget of US$94 million.
Zimplats noted that the implementation of the US$521 million smelter expansion and SO2 abatement plant project which commenced in the previous quarter is on course.
The project consists of the construction of a 38MW furnace and establishment of an acid plant for the abatement of sulphur dioxide generated by the smelter operations.
“A total of US$19 million had been spent on the project and US$218 million committed as at the end of the quarter.”
The platinum giant said that procurement processes for the US$37 million Phase 1 implementation of the 185 MW solar projects commenced during the quarter under review.
It said Phase 1 is a 35 MW plant at Selous Metallurgical Complex scheduled for completion in FY2024.
Zimplats said that overall, the project has four implementation phases with the last phase scheduled for completion in FY2027 at a total project cost estimate of US$201 million.
The group noted that a total of US$0.5 million was spent on exploration projects, with a further US$0,7 million committed as at June 30, 2022.
The exploration activities included mineral resource evaluation, comprising approximately 2 190 metres of surface diamond drilling over existing projects on the two mining leases and these activities increased geological and geotechnical confidence in production schedules.
Meanwhile, platinum production increased 2 percent to 68 911 ounces in the quarter to June 30, 2022 compared to 67 762 ounces in the previous quarter largely driven by increased milled volumes.
According to the quarterly update, Zimplats said 6E metal in the final product also increased by two percent to 151 125 ounces from the prior quarter’s 148 541 ounces, mainly due to the increase in mill volumes which was partly offset by negative inventory movement in the smelter.
“Production for the same period last year benefited from a release of smelter inventory. Resultantly, metal in the final product was two percent lower than the same period last year,” said the company.
The 6E are platinum, palladium, rhodium, ruthenium, iridium and gold. During the quarter under review, mined tonnage increased by 9 percent quarter-on-quarter and 4 percent year-on-year following the full recovery of Mupfuti Mine from the effects of lower trackless mining equipment availability.
The company said that 6E head grade improved by one percent to 3.44g/t from 3.40g/t in the previous quarter mainly driven by the increase in the contribution of high-grade ore from Mupfuti Mine.
Zimplats said the previous quarter’s head grade was adversely affected by processing low grade development ore from Mupani Mine stockpile.
Milled tonnes increased by 4 percent from 1 706 671 tonnes to 1 769 270 tonnes compared to the prior quarter due to an increase in the number of operating days and improvement in the milling rate.
The platinum giant said that during the period under review, total operating cash costs increased by three percent from the prior quarter, driven mainly by nine percent and four percent increase in tonnes mined and tonnes milled respectively.
It said that a total of US$1.1 million was transferred from operating costs to closing stocks due to the planned build-up of run-of-mine ore stocks in preparation for the commissioning of the Third Concentrator Plant in August 2022.
“This resulted in the cost of metal produced decreasing two percent compared to the previous quarter. The decrease in cash costs of metal produced together with the two percent increase in 6E ounces produced resulted in a three percent improvement in 6E unit costs from US$752/oz in the previous quarter, to US$726/oz.”
