In operational and mainte-nance terms, the cogenerated power is likely to cost IFM 
10c/kWh, compared with South Africa’s ruling average power prices of 25c/kWh to 26c/kWh.

“All we need to do is press the button and the equipment will be in South Africa,” Kovar-
sky said of the proposed cogen-eration plant that would be built to coincide with an improve-ment in global demand.

“It’s very low cost electricity and what’s equally important is that it allows us to get up to 100% production, because we can operate the cogen plant 
to give us 15% of our power requirements,” he said, refer-ring to the power reduction programme that Eskom has imposed on mines.


The IFM operation in the North West province has two 66-MVA furnaces each requir-ing up to 54 MW, or 108 MW, in total.


On Eskom’s proposed 34% tariff increase, Kovarsky said that the South African ferro-chrome industry, as a whole, had acknowledged that there had to be a significant increase in the power price to enable Eskom to continue with its current oper-ations and to accumulate funds to build new power stations.

“I’m not against the power price increase. Eskom needs it, and our customers are fully aware of the potential impact the Eskom price increase is going to have on the ferro-chrome industry,” he said.

IFM, which has R374-million in cash, reduced its inventory from 42 523 t in December to 
33 207 t in the March quarter.

“We’ve completed critical maintenance, upgraded the production facilities on time and within budget, and we’ve smoothly restarted one furnace to monetise our inventory,” Kovarsky reported, adding that there were signs of a bottoming out of ferrochrome’s down cycle.

He said that a cost reduction programme, which resulted in the retrenchment of 120 permanent IFM personnel, was saving the company R2-million a month and that further cost savings would be realised in the June quarter as a result of the 10% cut in salaries of all senior employees and board members.