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Zimplats splurges US$159m on capital projects

Zimplats splurges US$159m on capital projects

Zimbabwe’s largest platinum miner, Zimplats has spent US$159.1m on capital projects including mine expansion in the 12 months to June 30, 2021.

Zimplats said it has completed redeveloping Bimha Mine.

The development of Mupani Mine, the replacement production source for Rukodzi and Ngwarati mines which will deplete in 2022 and 2025, respectively, is progressing well and remains on schedule, the miner said.

“The project has a design capacity of 2.2 metric tonnes per annum (MTPA), which is expected to be achieved in September 2024 at a total estimated cost of US$264m,” Zimplats said.

The project to upgrade Mupani and Bimha mines as replacements for Mupfuti Mine, which depletes in 2027, was approved by the board this year.

Mupani Mine will be upgraded from the current design capacity of 2.2 metric tonnes per annum to 3.6 metric tonnes per annum at an additional cost of US$122.6m, thereby increasing the estimated total project cost from US$264m to US$386m.

About US$48.4m was spent during the year increasing the cumulative total project expenditure to US$146.6m at year-end. Full production capacity of the upgraded mine is expected to be achieved in August 2028.

Zimplats said the Bimha Mine upgrade was progressing well and is currently ramping up to achieve full production capacity in 2023.

About US$6.9m was spent during the year from an approved budget of US$81.7m.

During the year, the board approved the Phase 3A concentrator expansion, which will increase production capacity by 0.9MTPA.

The project comprises the third concentrator plant project at Ngezi which commenced in this year.

The plant will process the additional ore volumes from the early ramp up at Mupani Mine and Bimha mines and is expected to be commissioned in the first quarter of 2023.

Revenue for Zimplats increased 56% to US$1.4bn in the period under the review, largely due to the increase in the prevailing average metal prices during the year.

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Despite the 2% decline in volumes sold, cost of sales increased by 14% to US$546.7m primarily due to an increase in revenue indexed expenses resulting from the higher revenue achieved in the year.

Operating cash cost per 6E ounce increased by 8% to US$661 per ounce from US$613 per ounce in 2020.

The gross profit margin increased to 60% from 45% in 2020 primarily due to higher metal prices while income tax expense increased to US$237.4m on higher profitability.

As a result, profit after tax stood at US$563.1m while net cash generated from operating activities increased to US$453.1m.

 

Business Times

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