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Harare - Mimosa platinum mine, a joint venture between Aquarius Platinum [JSE:AQP] and Impala Platinum [JSE:IMP], is on a strong footing after production for the quarter to end-June rose by 5% to 60 000 ounces, according to Aquarius chief executive officer Jean Nel.
Nel said Mimosa reduced its cost overheads in a difficult environment. Most companies in Zimbabwe are severing ties with employees in a bid to cut costs, with the courts also ruling on Monday that payment of workers’ allowances is not a must for employers.
"Mimosa again improved safety, delivered all-time fourth quarter production records and reduced costs, in what remains a challenging operating environment,” Nel said on Tuesday.
Revenues for the period marginally declined by 2% to $62m, underlining continued softer commodity prices on global markets. Mining cash costs for Mimosa decreased by 4% to $72 per tonne while costs per platinum group metal ounce decreased slightly to $797.
There has been subdued demand for precious metals across major global markets, while demand for platinum from major consumers such as Chinese automobile manufacturers has also been softer. Platinum is mainly used for jewellery and in auto catalytic convertors.
Mimosa mined 666 170 tonnes of ore during the review period, about 9% more compared to the previous quarter, with the head grade at 3.67 grammes per tonne only marginally improving by 1%. Processed volumes lifted by 7% to 662 787 tonnes.
“The total capital expenditure for the quarter was $7.2m. Expenditure was incurred mainly on mobile equipment, drill rigs, the conveyor belt extension and down dip development,” Aquarius said on Tuesday.
Aquarius and Implats are carrying out a bankable feasibility study for expansion of the Mimosa mine. The two companies also decided against sinking a second shaft at the mine, preferring on-reef development for its current expansion programme.
Zimbabwe has the world’s second-largest reserves of platinum after South Africa. These have attracted Implats (which also wholly owns the country’s biggest mining investment, Zimplats) and Aquarius as well as Anglo American Platinum [JSE:AMS], which runs the Unki mine.
The country also boasts other vast mineral deposits encompassing gold, chrome, nickel and coal among others, although investors have complained of uncertainty and a difficult operating and regulatory framework worsened by policies such as indigenisation.
However, despite a perceived high country risk profile, mining investors such as Impala, Rio Tinto and Toronto-listed Caledonia Mining Corporation have maintained their investments there.
