JSE- and LSE-listed Tharisa is continuing discussions with the Leto Settlement Trust regarding the optimisation of certain aspects of the transaction structure for Tharisa’s 90% shareholding in the Zimbabwe-based Salene chrome project.
Tharisa envisages a successful outcome to the discussions, the company said on Tuesday, and believes the transaction will result in the economic benefits to Tharisa.
Leto will retain a 10% free-carried shareholding in Salene and will be entitled to a 3% royalty on the gross proceeds from the sale of the chrome concentrates produced.
The Salene project, a deposit along the Great Dyke, has the potential to produce about 100 000 t/m of concentrates at full capacity.
The terms of the acquisition agreement, requiring nominal upfront payment, provides Tharisa with a low-cost entry into a promising growth project in a new mineral-rich geography.
BACKGROUND
The Salene project forms part of Tharisa’s geographic diversification.
Salene has been awarded three special grants under the Zimbabwe Mines and Minerals Act, covering about 9 500 ha, which entitles it to mine the minerals thereon, including illuvial chrome.
Salene will, on obtaining the necessary environmental permits, embark on a trenching programme over the special grant areas to determine the extent of the mineralisation and the sampling thereof to determine the grade of the chrome content.
Tharisa will then undertake the geological testwork, at a cost of $3.2-million, over the next 12 months.
Thereafter, should everything go according to plan, Tharisa expects to effectively have its first pilot plant at Salene up and running within the next 12 months, after having started the exploration programme, Mining Weekly Online reported in May.
This is in order to optimise the plant design to maximise recoverability, form the basis for preparing the required process flow and quantify the capital estimates in relation to a production scale plant.