Mining ZimbabweLatest Mining News, Policy and Industry Updates

Invictus has revealed it is now completely self-funded after it raised AUD48,7 million (nearly US$32 million) in capital funding in the year ended June, which has gone into ongoing drilling activities in its Cabora Bassa project.

Following years of failing to secure funding to start the Cabora Bassa project in northern Zimbabwe, Invictus has managed to attract investors while also implementing several capital-raising initiatives.

With Europe desperately looking for new gas and oil sources as it will soon stop such purchases from Russia owing to Kremlin’s invasion of Ukraine, Zimbabwe has scaled up its support to Invictus to cash in on increasing demand for the commodity.

Invictus estimates that the country has oil reserves of around 5,5 billion barrels and significant natural gas reserves in the Cabora Bassa project.

“Further bolstering the company’s financial position is the AU$20 million (US$12,95 million, plus an additional AU$25 million, US$16,18 million, subsequent to the decision to solely fund the drilling campaign) raised through private placements to sophisticated and institutional investors, along with a further AUD3,7 million (US$2,39 million) raised through the conversion of options during the financial year,” Invictus said in its 2022 annual report for the year ended June it shared with the firm’s shareholders.

“The capital raises have been supported by a range of existing shareholders and new investors, placing the company in a strong position to self-fund the drilling of the Mukuyu-1 and Baobab-1 wells. A discovery at Mukuyu-1 or Baobab-1, could be transformational for not only Invictus and its shareholders, but Zimbabwe and the wider southern Africa energy market.”

Invictus said it got approval from the Depository Trust Company (DTC) in July to provide real-time electronic clearing and settlement for its ordinary shares traded on the OTCQB through the Depository Trust & Clearing Corporation in the United States.

DTC is an America-based corporation that performs the functions of a central securities depository as part of the US national market system.

“The approval for DTC eligibility simplifies the process of trading for North America-based investors and enhances the liquidity of the company’s shares on the OTCQB by broadening the pool of brokerage firms that will allow their clients to trade the stock,” Invictus added.

The OTCQB (over-the-counter QB), also referred to as a venture market, is a platform for entrepreneurial and developmental stages for US and international companies under the American financial securities firm, OTC Markets.

“To be eligible, companies must be current in their reporting, have a minimum bid price of US$0,01, may not be in bankruptcy and must undergo an annual verification and management certification process,” part of OTC Markets standards read.

“These standards provide a strong baseline of transparency to improve the information and trading experience for investors.”

Seeking such investment opportunities has helped the energy firm to carefully control expenditures and spending by utilising its own team to expedite the completion of high-quality work.

As of June 30, 2022, the carrying value of the capitalised exploration and evaluation properties of the consolidated entity was AUD28 228 960 (US$18,27 million) from a 2021 comparative of AUD8 821 190 (US$5,71 million).

Recovering these funds is dependent on several factors including the sale of the company’s assets. Other factors include the level of reserves and resources, future technological changes, cost of drilling and production, production rates, future legal changes (including changes to environmental restoration obligations) and changes to commodity prices.

The firm’s capital spending led to it increasing its total assets to AUD43,13 million (US$27,89 million) in the period under review from a 2021 comparative of AUD18,38 million (US$11,89 million).

IEL was in a very liquid form having AUD3,30 (US$2,13) to every dollar of debt, at the end of June.

Challenges facing Invictus include the impact of COVID-19 on supply chains and the Russia/Ukraine war’s effect on global energy prices.

Invictus is positioning itself to be a major gas and energy source in southern Africa.

“We remain ambitious with our plans to expand and build on our achievements to date, drilling two basin opening wells, building a carbon offset business and continuing to evaluate new ventures that fit within our strategy,” it said.

Newsday

An artisanal gold miner was killed, while four others escaped unhurt when a pit in which they were illegally prospecting for the precious mineral collapsed in Bulawayo.

Bulawayo police spokesperson, Assistant Inspector Nomalanga Msebele confirmed the incident, which occurred Wednesday morning.

“On Wednesday morning around 0715hrs a man from Cowdry Park received a call that there was an unknown deceased man trapped at the gravel pit whilst illegally mining gold,” she said.

Msebele added the now deceased’s left leg was trapped to knee level by a stone and loose soil.

“There were other unidentified illegal miners milling around who then assisted to retrieve the body of the deceased.

“After retrieving the body the other illegal miners fled the scene,” she said.

Police said the deceased is a male between the ages of 35 and 40, with no further particulars.

Members of the public have been warned against mining in undesignated areas.

“I can confirm that police in Bulawayo are investigating a case of an illegal miner who died at the (Bulawayo) City Council’s gravel pit in Khumalo, Bulawayo.

New Zimbabwe

Tharisa has announced the opening of a fixed-income note offer by Karo Mining Holdings, a subsidiary of Tharisa, to raise US$50 million to be listed on the Victoria Falls Stock Exchange (VFEX).

The proceeds from the Bond will be applied to part-fund the Karo Platinum Project.

The capital raise forms part of a broader capital strategy by Tharisa to develop the Karo Platinum Project in Zimbabwe on time and on budget. Tharisa is a 70% shareholder in the Issuer, a company incorporated in the Republic of Cyprus, which in turn indirectly owns 85% of the Karo Platinum Project, with the Government of Zimbabwe holding the remaining 15% of the Project, on a free carry basis.

The Project is scheduled to commence production with first ore milled in July 2024. Ground-breaking is expected to take place in December 2022. A local earthworks contractor has been appointed and is expected to start onsite activities in December 2022, marking the beginning of the Karo construction phase.

The proceeds from the Bond issue, net of costs, will be used to part fund the development of the Karo Platinum Project, which has a total capital cost for phase one of US$391 million and is set to be the second world-class asset in Tharisa’s portfolio.

The Bond is US dollar denominated and will be issued in minimum denominations of US$2 500 by way of a private placement. The Bond is not rated and will be guaranteed by Tharisa. The minimum amount to be raised from the Bond is US$25 million. Should applications for less than this amount be received the Bond issue will not proceed. The Issuer reserves the right to increase the total aggregate issue amount, subject to approval by its Board and the guarantor, by delivering notice thereof to Note Holders.

The VFEX has approved the listing of the Bond on the VFEX, a subsidiary of the Zimbabwe Stock Exchange and established in a Special Economic Zone. Participation in the Bond will be by way of private placement and is not restricted to Zimbabwean financial institutions or residents.

Arxo Finance plc, a wholly owned subsidiary of Tharisa, which was established to provide funding to Tharisa group companies, has committed to subscribe for US$10 million of the Notes.

Phoevos Pouroulis, CEO of Tharisa, commented:

“This is a historic moment for Tharisa and our tier-one Karo Platinum Project on the Great Dyke in Zimbabwe. From our discussions to date with potential investors, both in Zimbabwe and abroad, we have received extremely positive feedback for this robust investment opportunity, boasting highly attractive returns. We expect strong participation from Zimbabwean investors.

“This interest stems from Tharisa’s strong track record in developing projects on time and on budget, as well as the outstanding fundamentals of the Karo Platinum Project. Zimbabwe has indicated it is open for business and through our interactions with all levels of Government, it is clear there is strong commitment to support Tharisa as we develop the Karo Platinum Project into a fully producing PGM mine.

“We look forward to welcoming investors on this exciting journey into a new operating jurisdiction. Our investment commitment by guaranteeing the Bond and investing US$10 million in the Notes demonstrates Tharisa’s support for not only the project but the economics of the Bond, benefitting from the protections afforded to investors by the Special Economic Zone.”

Bernard Pryor, MD of Karo Mining Holdings, commented:

“Developing a tier-one project in this unique geological setting comes once in a lifetime. Funding for any mining project remains key and I am delighted that we have not only received support from Tharisa in the form of early equity, but that Tharisa has committed to anchor this proposed bond raise. I look forward to engaging with stakeholders in Zimbabwe and beyond to ensure this Bond raise is completed successfully.”

Source: MRA

Tullow Oil and The Metals Company non-executive director Sheila Khama, during her keynote address at the 2022 Council for Geoscience Summit on Wednesday, commented on her unease with the phrase ‘Africa is very rich in minerals’.

She described it as a “dangerous statement” that perpetuated the idea that Africa did not have to compete with the rest of the world for mineral exploration investment.

“While Africa is rich in certain minerals, Africa is not rich in all minerals.” Moreover, other countries on other continents also have these minerals and have fewer drawbacks, in terms of political stability, legislative certainty, and ease of doing business.

However, she stressed that the more people repeated the phrase, “the more we give the sense that the investors coming onto our shores need us more than we need them.”

And yet, over the last 20 years, the African share of exploration expenditure has declined significantly from what it was. Further, Khama noted that the vast majority of this spend had instead been reallocated to countries and regions where the environment, from an investment policy perspective, was considered more conducive.

“If you look at the perception of Africa’s mineral endowment, and the level of the exploration budgets, African countries underperform, not relative to other countries, but to its potential.”

She noted that Africa should, at the least, be attracting the same level of exploration spend as it had in previous years. “We should be seeing a spike now that there is a greater demand for minerals for transition to clean energy. But, believe it or not, when looking at Africa’s capacity to attract investment, the trend is downward.”

Khama also cited a PWC report on exploration expenditure, commenting that even a country as well-endowed as the Democratic Republic of the Congo, had in the last two years seen a drop in expenditure, owing to a perception of risk caused by political instability.

She implored the African geoscientific community to advocate for policies that complement mineral endowment – ones that were not indifferent to market trends, but that helped create an environment that attracted finance and appetite to fund exploration, scientific research, and project development.

Mining Weekly

A South African man with three names, Peter Coetzee, Van Tinder Vikus, and Johannes Jacobus Cornelius Naude yesterday appeared at the Harare Magistrates Court facing charges of duping local gold dealers of US$154 000.

Naude (54) of Pretoria, who was represented by lawyer Lucky Mauwa, was arraigned before magistrate Taurai Manuwere.

It is alleged that in the first count Naude approached one of the complainants, Gift Kudakwashe Mineji who is a miner at Pisto Mine, Kwekwe claiming that he was an investor and swindled them of money.

He later approached another complainant, Simba Dumbura, a gold miner at S and J Mining Syndicate, Penhalonga, Mutare, and duped him of some money using the same modus operandi.

The complainants lost US$154 000 to Naude and his accomplices only identified as Tanaka and Ruth, who are still at large.

On October 19, detectives heard that Naude was in Harare and they lured him to Glen Lorne, Harare under the pretext that they wanted to carry out a gold-buying transaction.

He was then arrested, but his accomplices, Tanaka and Ruth fled. – (Newsday)