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Nelson Gahadza-Senior Business Reporter

Platinum producer Zimplats says the combination of improved milling, better grades and recovery resulted in a 9 percent quarterly increase in six-element (6E) metal in final product volumes.

The six elements the company produces are platinum, palladium, rhodium, gold, ruthenium and iridium. Platinum is Zimbabwe’s second largest mineral export earner after gold.

Between them, platinum and gold generate more than 50 percent of mineral exports, which account for well over three-quarters of the country’s total shipments annually.

In its trading update for the quarter to June 30, 2023, Zimplats said metal volumes increased by 7 percent from the prior comparable quarter as the impact of higher milled throughput and the marginal improvement in process recoveries was offset by the decrease in 6E head grade.

Zimplats commissioned the third concentrator at Ngezi in September 2022 and increased milling capacity resulted in a 10 percent increase in milled throughput from the prior comparable quarter.

During the quarter under review, mined volumes increased by 4 percent from the prior comparable quarter which was negatively impacted by poor equipment availability at Mupfuti Mine.

Ore milled increased by 3 percent from the prior quarter to 1,94 million tonnes and benefited from the increase in operating days and improved availability of power during the period.

“A direct 50MW power import agreement was concluded with the Zambia Electricity Supply Company at the beginning of the period and resulted in improved power stability and availability in the quarter under review,” the company said.

The company’s mined tonnage rose 6 percent from the prior quarter, as the number of operating days increased from 90 in the prior quarter to 92 in the period under review and the availability of trackless mining machinery improved.

During the quarter under review, 6E head grade improved by 2 percent from the prior quarter due to improved ore mix but was 4 percent lower than the prior comparable quarter due to the higher volume of milled throughput sourced from low-grade stockpiles.

In terms of financial performance, higher mined and milled volumes resulted in a 6 percent increase in total operating cash costs from the prior quarter.

The company said a total of US$2,6 million was transferred from inventories to operating costs, a decrease of 43 percent from the previous quarter and in line with the changes in inventory movement in the value chain.

In total, the gross cash costs of metal produced increased by 5 percent compared to the prior quarter while unit costs per 6E ounce benefited from higher volumes and decreased by 4 percent to US$831/oz.

The company’s total operating costs increased by 19 percent from the prior comparable quarter with high prevailing inflation for consumables and utilities compounded by the 4 percent increase in mined volumes, the 10 percent increase in milled volumes and the cost of commissioning and operating the third concentrator.

“The benefit of higher final production volumes was largely offset by inflation and the lower milled head grade and unit costs increased by 14 percent from those in the June 2022 quarter,” the group said.

On exploration, the company said activities during the quarter related mainly to surface diamond drilling to upgrade the group’s mineral resources, geotechnical assessments of the rock mass properties and collecting samples for geo-metallurgical test work to support current and future mining operations in Ngezi (ML37) and the technical studies currently underway at Hartley (ML36).

The company said a total of 28 862 metres were drilled as part of the exploration work during the quarter at a total cost of US$3 million and an additional US$3 million was committed during the period under review.

In terms of projects, the development of Mupani mine and upgrade of Bimha Mine which will replace Rukodzi Mine, which was depleted in FY2022, and the Ngwarati and Mupfuti mines, which will be depleted in FY2025 and FY2028, respectively.

Zimplats said the Mupani and Bimha mine projects progressed as planned during the quarter and cumulatively, US$318,8 million has been spent on these projects, with an additional US$59,1 million committed, against a total project budget of US$468 million.

On the smelter expansion and the SO₂ (sulphur dioxide) abatement plant, the company said the project progressed as planned during the quarter with US$112,2 million spent to date and a further US$329,3 million committed.

In FY2022, Zimplats obtained a 185MW power generation licence and by the end of the quarter under review, a cumulative US$1,1 million had been spent on the first phase of its solar project, a 35MW solar plant at the Selous Metallurgical Complex, and US$35,4 million had been committed, against a budget of US$37 million.

“The first of the project’s four implementation phases is progressing as planned, with the final phase scheduled for completion in FY2027, at a total project cost estimate of US$201 million,” it said.

The group said implementation of the base metal refinery refurbishment project progressed well during the quarter with US$10,9 million spent to date, and a further US$18.4 million committed, against a total budget of US$189,9 million.