Zimplats invests US$27m in solar project
PLATINUM group metals (PGM) producer Zimplats has so far spent US$27 million on its 35 megawatt (MW) solar power plant project against a budget of US$37 million.
The project, aimed at augmenting electricity supply, is among several capital projects being executed by the company under a US$1,8 billion investment plan.
The company said the solar power plant was expected to start generating power by the end of May 2024.
“US$27 million has been spent on the implementation of the 35MW solar plant project to date, against a budget of US$37 million,” the company said in an update for the quarter ended March 31, 2024.
Zimplats plans phased implementation of the project until it reaches the target production of 185MW by around 2028 when ongoing projects, including the expansion of the smelter, concentrator and other mine extensions are expected to have been completed.
The solar plant sits on 109ha with over 10 000 PV solar panels, which have a yield of 550 watts per square metre, and six inverters.
Zimbabwe faces an acute shortage of power, managed through long hours of rationing that disrupts activity across the economy and forces enterprises and individuals alike to rely on more expensive alternatives such as fuel-powered generators.
However, in other projects, Zimplats said the Bimha and Mupani mine development and upgrade projects will replace production from Rukodzi Mine, which was depleted in FY2022, and Ngwarati and Mupfuti mines, which will be depleted in FY2025 and FY2028, respectively.
As of March 31, 2024, US$395 million was spent on these projects against a total project budget of US$468 million.
“A total of US$340 million has been spent to date on the smelter expansion and sulphur dioxide (SO2) abatement plant against a total project budget of US$521 million,” reads the report.
The group also spent a total of US$27 million on the execution of the Base Metal Refinery refurbishment project, against a budget of US$190 million.
Zimplats said that in light of the softer metal pricing environment, the group implemented various cash preservation measures, which include labour rationalisation and capital project re-scheduling.
Global mining companies are cutting back on expansion plans in the wake of the plunge in global prices of the metal.
The country’s largest platinum producer said in April 2024, 67 employees, or 1,6 percent of the total permanent workforce, were retrenched.
“Cost containment initiatives implemented in the prior quarter progressed in the period under review, resulting in a 2 percent reduction in total operating cash costs from the prior quarter,” reads the update.
Operating cash costs increased by 7 percent year-on-year, primarily due to the 9 percent and 7 percent increase in mining and milling volumes, respectively, benefiting from cost mitigation efforts that helped contain the impact of persistent input inflation.
Transfers from stocks to operating costs amounted to US$2,8 million during the period, in line with the movement in inventory across the value chain.
The group noted that cash costs for metal produced increased by 5 percent and 1 percent from the comparative and prior quarters, respectively.
“Operating cash unit cost of US$821 per 6E ounce was marginally below that of the prior quarter and declined by 6 percent year-on-year, benefiting from volume gains that offset inflationary pressures experienced on electricity,” Zimplats said.
During the quarter under review, mining volumes were unchanged from the prior quarter but increased by 9 percent year-on-year, benefiting from the pillar reclamation operations at Rukodzi Mine and the continued ramp-up of production at Mupani Mine, which is under development.
The group said pillar reclamation activities also benefited the 6E head grade, which was 2 percent higher year-on-year.
“The 1 percent reduction in grade from the prior quarter was due to an increased contribution of lower-grade Mupani Mine development ore and dilution from mining across geological structures,” reads the report.
Milled volumes during the period increased by 7 percent and 3 percent from the comparative and prior quarters, respectively.
The platinum miner said a scheduled reline of the mills at the Selous Metallurgical Complex (SMC) was deferred to the fourth quarter of FY2024, the volumes from which also benefited from improved milling rates and running time, in line with higher ore supply.
Zimplats said concentrate recoveries were stable compared to the prior quarter and increased by 5 percent from the comparative quarter, resulting in a 2 percent quarter-on-quarter and 14 percent yearon-year increase in the volume of 6E in concentrate produced.
However, 6E metal in the final product improved by 12 percent year-on-year and was 1 percent higher than the prior quarter.