Tharisa CEO Phoevos Pouroulis
Platinum group metals (PGMs) and chrome producer Tharisa has exercised its farm-in option to acquire a controlling interest in Karo Mining Holdings for $27-million in shares.
Tharisa will issue 13.69-million shares to The Leto Settlement and now holds a 66.3% interest in Karo – compared with the 26.8% it previously owned. Leto will retain the remaining 33.7% interest in Karo.
The transaction increases Tharisa's exposure to highly sought-after platinum and palladium resources through Karo's 85% ownership of the Karo platinum project, in Zimbabwe. The Zimbabwe government has a 15% interest in the project.
The Karo project is a long-life asset with an initial 20-year life-of-mine (LoM) and a post-tax net present value of $770.4-million at spot PGM prices.
It has initial probable reserves of 35.5-million tonnes at 2.31 g/t and 2.6-million ounces of platinum, palladium, rhodium, ruthenium, iridium and gold and a platinum, palladium, rhodium and gold resource sprill favouring platinum (45%), palladium (42%), rhodium (4%) and gold (9%).
Phase 1 openpit operations are expected to deliver 150 000 oz/y of PGMs in concentrate.
The project is situated in a designated special economic zone and is supported by good infrastructure, including road and power access.
“The development of a strategically significant tier one, high-grade, high-return, low-cost PGM resource is a natural evolution for Tharisa as it fulfils its strategy of becoming an integrated diversified developer of new metal assets.
"Tharisa will develop and deliver its next PGM mine, Karo Platinum, in a world-class geological district that is supported by a pro-mining environment.," comments Tharisa CEO Phoevos Pouroulis.
He adds that the investment in, and development of, the Karo project will create noteworthy employment and upliftment opportunities for the communities within the project area, as well as create an economic hub with significant multiplier effects.
"The long-life Karo project, when added to the more than 60-year LoM of the Tharisa PGM and chrome operations in South Africa, sets the foundation for Tharisa's growth, particularly in the downstream value enhancing beneficiation sector.
"The development of the Karo project will significantly consolidate Tharisa as one of the world’s most forward-thinking and low-cost producers of PGMs in Africa," Pouroulis notes.