THARISA is in discussions to sell metals concentrate mined from its proposed $545m Karoo Platinum mine in Zimbabwe to Impala Platinum (Implats).
Discussions, which are not concluded, could potentially also see Implats buy an equity stake in the project that is not yet fully financed.
“We have huge inbound interest in our derisked Tier 1 asset on the great Dyke and are evaluating all options,” said a Tharisa spokesperson on Friday.
Implats CEO Nico Muller said at the firm’s interim results presentation on Thursday the company was considering investing in projects. “I think Karo is making some progress on the Great Dyke …. I think there is some opportunity for companies like ourselves to participate in one form or another,” he said.
Asked to clarify Muller’s comments, head of corporate affairs Johan Theron said it was “difficult to speculate”. He added, however, that historically Implats “had some equity in larger new projects that [where] we process” concentrate, preferably on a toll refining basis. Implats previously bought platinum group metal concentrate from Tharisa’s South African mine when it was in start-up mode.
“The trick would be to have partnerships in the best low cost new ventures that may become available as you simply can’t help everyone,” said Theron. “So one needs to be quite strategic when new contemplating these opportunities.”
The full cost of developing Karo, which is scoped to produce 226,000 ounces a year in PGMs in its first phase, is $545m. Of this amount, Tharisa has committed $190m in equity for Karo and has raised $37m through a bond issuance on the Victoria Falls Security Exchange of which it netted $26m. In addition, Tharisa is in advanced discussions to borrow $200m from a lender syndicate.
This leaves a $121m funding shortfall, earmarked by Tharisa in a February presentation as ‘strategic investment’.
Karo Platinum also requires a fiscal deal with the Zimbabwean government in terms of which Tharisa is seeking a package containing duty exemptions on certain goods, a 15% corporate tax, and to keep sales in dollars. Tharisa CEO Phoevos Pouroulis said in December he hoped to conclude discussions early this year.
