Local Platinum Producers Considering Constructing A Precious Metals Refinery

Local platinum producers are considering pooling resources to construct a precious metals refinery.

Mimosa Mining Company general manager, Mr Stephen Ndiyamba, told The Sunday Mail Business that it makes economic sense to collaborate with other platinum miners. Ndiyamba said:

As you might know, there are other organisations that are currently looking at setting up smelters, and the discussions are at various levels – board and shareholder levels – to see how we can combine forces and also send our concentrates for in-country processing.

What is left on the ground is 10 years on South Hill, and if we develop the North Hill shaft, we can get another 12 years. If you take a life of a mine of 22 years and invest US$100 million in a smelter, it’s not enough time for you to recover that investment.

So, from a business point of view, you don’t then recover that capital investment.

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Sending platinum concentrates to another company’s smelter, in which case the miner is only charged treatment fees, makes economic sense.

Chamber of Mines of Zimbabwe chief executive officer, Mr Isaac Kwesu, indicated that “the miners are already smelting some of their platinum and sending it out as matte, but with more production, they would need to reduce costs by pooling resources (to build a refinery)”.

Most platinum producers currently export platinum in concentrate form, with only Zimplats beneficiating it to matte.

Analysts say the establishment of a refinery would significantly increase revenue from platinum since the country hosts huge platinum deposits.

Zimbabwe has the second-largest platinum deposits in the world after South Africa and has been pushing mining firms operating in the country to build beneficiation facilities.

In 2015, the Government imposed a 15 per cent tax on raw platinum exports to encourage companies to beneficiate the mineral locally.

The levy was later suspended after the miners agreed to a timeline to build local facilities.

In 2020, Treasury announced a new tax that was supposed to be effective early this year, but it was deferred to January 2023.

Platinum miners currently export the mineral largely in the raw or semi-processed state to South Africa for refining.

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