Tharisa reports higher interim production, revenue

26th May 2022 By: Darren Parker - Creamer Media Contributing Editor Online

JSE-listed integrated resources group Tharisa has reported a “cash-generative performance” and an increase in production for the six months ended March 31, despite material increases in one of the company’s major input costs – diesel – which continues to rise.

Tharisa has positioned itself in the energy transition and decarbonisation of economies. The group’s operations include mining, processing, exploration and the beneficiation, marketing, sales and logistics of platinum group metals (PGMs) and chrome concentrate.

The company’s principal operating asset is the Tharisa mine, in the south-western limb of the Bushveld Complex. The mechanised mine has a 20-year openpit life and the option to extend operations underground for an additional 40 years.

In addition, the company also owns the Karo PGMs mining project and Salene Chrome. Both projects are development-stage, low-cost, openpit assets located on the Great Dyke in Zimbabwe.

“Our flagship Tharisa mine increased its production of both PGMs and chrome, with significant progress delivered on our beneficiation strategy, which included the commissioning of chrome production from the self-funded Vulcan fine chrome recovery and beneficiation plant,” Tharisa CEO Phoevos Pouroulis said on May 26.

The company reported a 22% year-on-year increase in PGMs production, from 75 100 oz to 91 800 oz, while chrome production increased by 6.3%, from 730 700 t to 776 700 t at an average metallurgical grade chrome price of $175/t, up from $145/t in the first half of the 2021 financial year.

This resulted in a 6.5% year-on-year increase in revenue, from $313.6-million to $334-million, and a profit before tax of $124.3-million, up from $104.6-million in the prior comparable period.


Tharisa reported that its new Vulcan fine chrome recovery plant, which was the first large-scale plant to produce chrome concentrates from chrome ultra-fines, had been commissioned and was running at about 65% of output.

“The beneficiation plant will not only produce increased chrome output at a very low operating cost but will also ensure reduced waste to tailings and a reduced unit carbon output at the Tharisa mine,” the company said, adding that recovery of product from tailings was an established environmentally positive industry practice.

Tharisa’s approach was to front-load the tailings deposition by recovering live tailings before deposition. When fully commissioned later this year, the mine’s chrome recoveries will materially increase from about 65% to about 80%, resulting in a lower deposition footprint, while increasing chrome production by about 20%.

“Tharisa’s cash generation ability has delivered a solid balance sheet for continuous investment. We have reinvested into the company’s targeted and strategic initiatives such as Karo Platinum and the Arxo Metals Beneficiation Site (AMBS), as well as towards continued investment in the Tharisa mine,” Pouroulis said.

He added that the company had considerably advanced its research and development work at AMBS.

“We are confident that our pursuit of further downstream beneficiation and use of our resources will translate to lower costs, downstream beneficiation and more value for shareholders,” he said.

Pouroulis explained that the focus for the remainder of this financial year would be to maximise PGMs and chrome production, while curtailing above-inflationary costs.

He added that the financial close of a funding package for Karo Platinum was well under way, and that, with a controlling interest in Karo Platinum now in place, the company could clear a pathway to production within the next 24 months.

“These are volatile times and it goes without saying that having the best team to navigate the uncertainty is by far our greatest resource,” he said.


The PGM, market was driven by two forces during the period, the company said.

The first was structural, with solid demand resulting in strong prices for all metals as the market absorbed inventory overhanging from the past 12 months, owing to the growing global pipeline for automobiles, computer chips and overall buoyant economic activity.

The second driving force was geopolitical in nature, and included events such as sanctions being imposed on Russia – a major PGMs producing country – as well as economic slowdowns and uncertainty over economic growth and inflationary pressures.

Most major economic forecasts projected slower global demand in the face of a global recession, Tharisa said, balanced by lower output from the PGMs industry.

As such, supply deficits were forecast for rhodium and palladium. However, platinum supply remained in surplus. Tharisa noted, however, that this was forecast to swing into a deficit within the next 24 months.

Moreover, the company believed the impact of the supply disruptions and, therefore, pricing – especially on palladium, as a consequence of the economic sanctions on Russia – were still to be felt in the markets.

While current spot prices remained weaker than in 2021, owing to short-term inflationary pressures, increasing interest rates and concerns over economic activity slowing down, the long-term price outlook remained positive, Tharisa said.

The company reported a continued surge in chrome prices owing to logistical constraints impacting supply, although it believed that severe Covid-19 lockdowns and slowed economic growth in China could weigh on prices in the near term.

Tharisa noted that logistics were increasingly becoming an impediment to the supply chain. One of the most pertinent issues was that infrastructure, especially rail and ports, remained severely constrained in South Africa.

Tharisa said more focus was being placed on road transport and the use of multiple ports, including those in neighbouring countries, as a means of mitigating risk and safeguarding the company’s export products.

Similar problems currently plague China, where freight rates factor into increased oil prices, congestion and waiting time at all ports.

Despite the continued logistical challenges, however, Tharisa reported that it was able to deliver on its order book for the six months under review and that prices remained healthy for the time being.