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Zimplats to go ahead with $447m expansion project

Feb 02 2016 20:10

Harare- Zimplats says it is going ahead with its Zimbabwe based projects despite continued threats on a portion of its mining lease area.

In a statement accompanying its results for the quarter ended 31 December 2015 the company said the Ngezi Phase 2 expansion project implementation is progressing well.

"A total of $447m of the project budget had been spent as at 31 December 2015," said the company adding that implementation of the outstanding components of the Phase 2 expansion project remains on schedule for overall project completion in 2016.

The company is also going ahead with refurbishment of the Selous Metallurgical Complex base metal refinery project.

"A total of $12.2m was spent on the refurbishment of the Selous Metallurgical Complex base metal refinery project and US$9.9m was committed as at 31 December 2015," said Zimplats.

The decision to refurbish the base metal refinery is in line with government's push for local beneficiation and value addition.

The company however said the impact of the declining metal prices on cash flows has resulted in the reprioritisation of capital projects with some projects being deferred to future periods.

The capital projects also come at a time the Zimbabwean government has requested the company to release land measuring 27 948 hectares for compulsory acquisition.

“On 28 December 2015 the Government of Zimbabwe wrote to the operating subsidiary requesting the release of the 27 948 hectares of ground referred to in the preliminary notice that was issued on 1 March 2013,” said Zimplats.

Zimplats has since lodged a formal objection to the preliminary notice to compulsorily acquire the land and is also seeking constructive dialogue in an endeavour to resolve the matter amicably.

Meanwhile revenue for the miner decreased by 11% from the previous quarter mainly due to the drop in metal prices compounded by a 2% decrease in 4E sales volume.

A loss from operations after royalties of $1.8m was recorded for the quarter ended 31 December 2015.

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zimplats  |  mining  |  companies

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