THE world’s top ranking platinum producer Anglo Platinum said on Wednesday the capital cost for its jointly owned Unki project in Zimbabwe had more than doubled to US$200 million, but planned production would also increase.
>”The revised capital cost of the project is now $200 million,” Trevor Raymond, Angloplat senior manager for investor relations, said in written response to questions from Reuters.
South Africa’s Angloplat also said the planned mine’s next phase depended on talks with the government.
Angloplat and Anglo American Zimbabwe (Amzim) are jointly developing the country’s third platinum mine situated in central Zimbabwe.
Officials had initially budgeted US$90 million for Unki’s capital cost but an additional feasibility study showed the mine could ramp up output to 120 000 tonnes a month from 85 000 tonnes at the higher cost. Initial production was now expected in 2008 instead of 2007.
“The decline shafts currently being developed are able to produce at the increased rate of 120 000 tonnes a month,” Raymond said, adding that US$21 million had so far been spent on developing the mine.
Angloplat and Amzim had previously said they planned to sell a 20% stake in Unki to local investors but President Robert Mugabe’s government in March said it planned to amend the mining law to give the state a 51% stake in all foreign-owned mining companies.
This has raised concerns on future foreign investment in a sector that has become a top foreign currency earner in the southern African nation, which is battling its worst economic crisis since independence in 1980.
The mining sector has already been hit by mine closures in the last five years, including dozens of small mines, as operating costs spiralled in a recession marked by triple-digit inflation and shortages of fuel and foreign currency.
“Anglo Platinum is currently in discussions with the Zimbabwean government on various matters including indigenous shareholding requirements, fiscal dispensations, regulatory approvals to address the security of its mineral rights and foreign currency accounts,” said Raymond.
“Once these issues are satisfactorily resolved the next phase of development will continue,” he added.
The other two platinum mines in the country are Ngezi, which is run by Zimbabwe Platinum Mines, itself majority owned by South Africa’s Impala Platinum Holdings (Implats) and Mimosa, jointly owned by Implats and Aquarius Platinum.
The three are situated on Zimbabwe’s Great Dyke region which has the second largest platinum ore reserves in the world after South Africa. — Reuter.