[miningmx.com] – IMPALA Platinum (Implats) said it was seeking clarity on whether the Zimbabwe government would formally impose a 15% levy on unbeneficiated minerals in a potential development that could hurt its investment in its Mimosa platinum mine.
In December, Zimbabwe minister of finance, Patrick Chinamasa, said the government had deferred the export tax on un-beneficiated platinum until 1 January, 2017. However, the recently promulgated 2015 Finance Bill does not provide for the deferral of the levy, Implats said.
“It is not clear whether the export levy will be formally enforced and the group, in
consultation with the Chamber of Mines in Zimbabwe, is presently seeking clarity from the authorities,” Implats said.
Whilst Implats’ main investment in Zimbabwe, an 87% stake in Zimplats, is unaffected by the levy as it smelts concentrate from its facilities into a intermediate matte product, it would still have an effect on Mimosa in which it has a 50% share with Aquarius Platinum the owner of the balance.
The levy was introduced to the Zimbabwean parliament as early as 2013 and was intended to motivate the predominantly South African platinum miners in the country to build a local beneficiation plant. Since then, the platinum price has deteriorated.
Based on Mimosa’s second quarter production of 60,842 ounces of platinum group metals (PGMs), at an average basket price of $1,100 per PGM oz, the 15% levy would have grossed just over $10m for the Zimbabwean government.
Johan Theron, spokesman for Implats, said an obvious consequence were the levy to go through is that it would absorb cash flow that would have been used for stay-in-business capital or even production growth at Mimosa.
Aquarius Platinum has spoken in the past of spending $70m growing Mimosa’s production by 70,000 ounces, or about a third of total annual production. Mimosa accounted for 34% of Aquarius attributable PGM 4E production of 88,974 oz in the second quarter announced earlier this week.
“Implats and its Zimbabwean operations remain committed to securing a
conducive regulatory and fiscal framework for the mining industry in Zimbabwe,” Implats said in its announcement.
