EASTERN Platinum (Eastplats) said a chrome tailings retreatment project at its Crocodile River mine near Brits in South Africa’s North West province would cost ($16m) R191.2m – an 16.6% escalation over a previous estimate. The company had contracted nearly 80% of the project’s first phase, it said in a report for the first quarter.
“The schedule remains on track and the company is targeting the third quarter for commissioning with revenue expected in the fall of 2018,” it said in the report, adding that construction of the project was “well underway”. “Construction teams are well advanced with the civil construction to build the structures for the chrome processing circuit,” it said. “Work is progressing well at the tailings facility to relocate and move the ore for initial production all within the existing facility.”
Eastplats said on March 5 that it would mine and treat chrome-bearing tailings from its Crocodile River mine following a finance and equipment supply agreement totalling $14m (R164m). This followed an agreement with Union Goal Offshore Solution, a chrome trading company, which would finance and supply to Eastplats subsidiary, Barplats, a processing circuit and technological know-how.
Barplats would supply into the unit chrome-bearing tailings from its Zandfontein UG2 tailings facility at Crocodile River which had been mothballed in 2012 amid a tumbling platinum price.
A construction phase of some seven months had been pencilled in. “Eastplats is very pleased to come to an agreement with Union Goal and begin construction immediately on the chrome recovery project which will again establish Barplats as an operator,” Diana Hu, CEO of Eastplats said at the time.
“Construction of the retreatment project has been the primary focus of Eastplats since the UG Agreement was signed,” it said. “The company anticipates that its updated Platinum Group Metals feasibility studies on its tailings resource at CRM (Crocodile River Mine) will be completed during the next few months.”
Eastplats reported a net loss of $1.2m, equal to a loss of 0.01 US cents per share in the first quarter compared to the $2.5m or 0.02 US cents per share loss in the corresponding quarter of the previous financial year. There was a 39% lift in net operating cash outflow of some $1.4m ($2.3m).
The company also said an upfront payment from Union Goal Offshore Solution had been paid in line with the joint venture agreement. Some $21.3m in cash and short term investments and working capital of $25.6m as of March 31 was available for the project.
