The mothballed base metal refinery was set up by BHP, but failed to work because of technical difficulties. The platinum producer said it has to date spent around $23 million for the BMR project, which had been put on hold early last year on the back of a significant drop in international metal prices.
Zimplats head of corporate affairs, Busi Chindove said the acquisition of the new equipment had been necessitated by the depleted state of the existing equipment and antiquated technology at the plant.
“The existing plant is now obsolete; it has outdated equipment and technology. This means we have got to purchase everything,” she said during a tour of the plant.
Chindove said some of the equipment is bespoke and had to be manufactured outside the country. She noted however that some of it, for example the boilers, were manufactured locally and have since been delivered.
Zimplats metallurgical manager Stanley Matutu added, “We believe the way the plant had been set up was a bit complex, which made the operation of the plant difficult. What we have done is we have simplified the process to ensure that we produce a PGM cake. We will also produce a final copper cathode, which is sellable and other base metals. We have spent $23 million on this project, out of the budgeted $134 million.”
Government’s latest deadline in respect of platinum producers operating in the country to set up base metal refineries is early next year, failure of which platinum ore exports will attract a 15% levy.
Zimplats said they are in “constant engagement with the Government” over the issue of deadlines, but is unlikely to meet the 2018 deadline. Chindove said metal prices have been weak for several years hence the company’s cash-flow performance will determine how fast the project is implemented.
“Unfortunately, we are out of those timelines because when we committed to those timelines in 2014 when we started the project, the metal prices were still reasonable and we were able to project and say looking at these metal prices, we believe that by such and such a date we will be finished.
But unfortunately since the crash of the metal prices and Bimha mine collapsed, we really cannot predict a date at the moment simply because we have no control over the metal prices. That is the fundamental issue that we are dealing with,” she said.