Zimbabwe shortlists two firms for platinum refinery

Zimbabwe shortlists two firms for platinum refinery

Photo by Bloomberg

19th February 2014

By: Reuters


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HARARE – Zimbabwe has shortlisted two firms to build a new platinum refinery and is looking to resolve a dispute with miners over a 15% levy imposed on unrefined exports of the metal last month, the Mines Minister said on Tuesday.

The Southern African country had the world's largest platinum reserves after South Africa and President Robert Mugabe last year gave miners two years to establish a refinery.

Mines Minister Walter Chidhakwa told reporters nine companies had submitted refinery plans and two had been shortlisted. The government would conduct due diligence soon.

Anglo American Platinum and Impala Platinum Holdings, the world's two largest platinum producers, had mines in Zimbabwe, shipping platinum matte to South Africa for refining.

The Zimbabwe Chamber of Mines last month said the local mining industry broadly supported a government proposal to build a new platinum refinery by 2016 as part of efforts to make the mining sector a key driver of economic growth.

Platinum output in Zimbabwe rose to an all-time record of 430 000 oz in 2013, up from 340 000 oz the previous year. The industry was nearing the 500 000 oz of yearly output needed to make a refinery viable.

Chidhakwa has previously estimated the cost of the refinery and associated 600 MW power plant at $3.2-billion.

On Tuesday Chidhakwa said the government was in discussions with platinum miners who said a 15% tax imposed last month on unrefined platinum had increased the effective rate on royalties to 25% and made mining expensive.

"We will continue to discuss with the Minister of Finance and the industry to ensure that our platinum mines do not sink," he said.

Meanwhile, Zimbabwe planned to auction its Marange diamonds in Dubai next month and in Shangai between April and May, according to Chidhakwa.

Six mines were currently selling Marange diamonds in Antwerp, the second such sale since the European Union last year lifted sanctions on the State-owned Zimbabwe Mining Development Corporation, which owned shares in the six companies.

Edited by Reuters



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