CYPRIOT miner, Tharisa PLC, has delayed the commissioning of the Karo Platinum mining project by a year, owing to depressed international mineral prices, NewsDay Business reports.
Tharisa holds a 75% stake in Karo Mining Holdings, a firm operating the Karo Platinum Project in Zimbabwe which covers an area of 23 903 hectares located within the Great Dyke in Mashonaland West province.
The project is an open-pit platinum group metals (PGMs) asset currently under construction at a cost of US$391 million with an expected annual output of 194 000 ounces.
“Given the current PGM basket price weakness and uncertain global economic outlook, we have taken the measured decision to extend the Karo Platinum timeline out to commissioning by June 2025, with the opportunity to accelerate the timeline as markets become more favourable,” Tharisa chief executive officer Phoevos Pouroulis said in a statement yesterday.
“The Karo Platinum Project has progressed well, and the revised timeline is aligned to funding availability and provides flexibility to navigate volatile market conditions. Our growth strategy remains firmly intact, with continuous optimisation at the Tharisa Mine, investment in downstream beneficiation and our commitment to the development of the multi-generational Tier 1 Karo Platinum project.”
Tharisa’s announcement comes hard on the heels of the Chamber of Mines of Zimbabwe (CoMZ)’s warning last week that globally, international mineral prices were softening.
The low mineral prices are a result of a slower than expected growth in China’s economy and increasing geopolitical tensions that are affecting major commodity markets.
In the first eight months of the year, Zimbabwe exported platinum unwrought or in powder form worth US$88,66 million providing a significant portion of foreign currency to the country.
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“The divergence in commodity prices could not have been more visible than the past quarter which saw us touching 52-week highs in the chrome market based on solid fundamentals, but these fundamentals were distinctly lacking in the PGM market, which saw prices drop more rapidly and lower than the market anticipated, resulting in broad-based challenges for the PGM market on the supply side,” Pouroulis said.
“While current markets are volatile and unpredictable, we believe in the medium-term outlook for PGMs underpinned by a supply side constrained economy, supported by a robust chrome market driven by stable demand. At Tharisa, our co-product model showed its resilience once again, supported by a strong recovery in chrome production in the second half of the year and benefiting from a 26% increase in price.”
The Tharisa CEO said earlier operational mining challenges and resulting ore mix from the firm’s own ore and purchased ore had a negative impact on PGM recovery and thus production.
However, he added that this was supported by a strong focus and recovery in chrome in the second half of the year.
“The waste contractor is now firmly in place, and we see a recovery in waste mining volumes for FY2024 (financial year), however, we remain cautious on our production outlook as evidenced by our guidance for the coming year,” Pouroulis said.
The margins remained strong due to its mechanised low-cost operations, with a continued disciplined capital allocation strategy, ensuring investment in existing businesses, providing sustainable growth and return to shareholders.
Last week, the CoMZ reported that over the past 12 months, the mining industry had witnessed softening of prices for most key minerals and the most affected were rhodium down 74%, lithium (-69%), palladium (-41%), diamond (-60%) and nickel (-8%) .