Harare, Zimbabwe — MININGREVIEW.COM — 21 May 2010 – Zimplats Holdings “’ the Zimbabwe unit of Impala Platinum (Implats), the world’s second-largest producer of the metal “’ is considering setting up a metals refinery in the country, where it is planning a US$500 million (R3.75 billion) mine expansion.
Zimbabwe has the world’s second-largest platinum reserves after South Africa, but has no metals refinery.
In a statement issued here, Zimplats said it was committed to Zimbabwe despite uncertainty brought about by the government’s plan to transfer majority ownership in foreign firms, including mines, to local people. “Zimplats remains fully committed to the development of its resource base for the benefit of the country and all its stakeholders,” the company added.
“In addition, Zimplats is considering large-scale investment that will result in the establishment of the first refinery facilities in the country,” the company added.
The empowerment law seeks to transfer majority shareholding in foreign firms, including mines and banks, to local blacks. But sharp divisions have emerged in the power-sharing government Mugabe set up last year with long-time rival Morgan Tsvangirai, who is now prime minister.
Tsvangirai opposes the law, which he says scares away investors and threatens the economy’s fragile recovery.
Zimplats said reports suggesting it had put its US$500 million (R3.75 billion) Ngezi phase 2 expansion project on hold due to the empowerment laws were “erroneous.”
The company reiterated that the expansion would add 2 million tonnes per year to its production capacity. It said it was yet to conclude funding arrangements for the project, adding that some mandatory government approvals had not yet been secured.
“The company is going ahead with the Ngezi phase 2 expansion project based on existing agreements with the government, some elements of which are subject of ongoing discussions,” Zimplats said. The expansion of the mine will lift annual platinum output to 270 000 ounces from 180 000 ounces.
Zimplats said the Ngezi Phase 2 project would bring the company’s total investment in the country to over US$1 billion (R7.5 billion), the largest in Zimbabwe’s history. The project would also create 1 000 new jobs and see the construction of roads, schools and medical facilities “’ social investments that the government has said would earn firms empowerment credits.