Power Play

Dual-listed platinum group metals and chrome co-producer Tharisa Minerals is keen to unlock opportunities presented by strategic commodities, in particular battery minerals, CEO Phoevos Pouroulis told a media delegation during a site visit to the company’s PGM operation located on the south-western limb of the Bushveld Complex.

“We are always looking for new opportunities to add value to our project profile and not just in chrome and platinum. Currently, we are evaluating opportunities in commodities such as cobalt and lithium,” Pouroulis said.

Tharisa’s expansion strategy is focused on growth through value-accretive acquisitions of large-scale, low-cost projects that are in or close to production, in particular strategic minerals that are currently in supply deficit.

In response to a question on battery mineral opportunities in Zimbabwe, Pouroulis said South Africa’s close neighbour did offer attractive battery mineral opportunities, and that its new president Emmerson Mnangagwa’s business- and investor-friendly stance was expected to invigorate investment in the mining sector. Speaking to SA Mining on the sidelines of the media briefing, Pouroulis explained that the company had put together a new business development team which was already assessing a number of potential opportunities.

Vision 2020 strategy

In line with its Vision 2020 strategy, Tharisa continues to boost platinum group metals (PGMs) and chrome production from its existing PGM operation with the aim of delivering 5.9mtpa of run-of-mine (ROM) production which includes 200 000ozpa of PGMs and 2mtpa of chrome concentrates by 2020.

In the 2017 financial year (FY), the company achieved record operational results including 5mt of ROM, production that included 143.6koz of PGMs and 1.3mt of chrome concentrates. Tharisa’s FY2018 guidance remains at 5mt of ROM with 150 000oz PGMs and 1.4mt chrome concentrates, of which 350 000t will be specialty grade chrome concentrates.

The near-term focus will be on operational improvements and commencement of its Vision 2020 projects, which includes two optimisation projects and two new plants.

The first of the two optimisation projects involves a crusher upgrade at its Genesis Plant, with the aim to lift throughput by 15% (about 180 000tpa), and the opportunity to increase chemical grade chrome concentrate and foundry grade chrome concentrate production by 24 000tpa and 18 000tpa respectively. The project is scheduled for commissioning in July 2018.

The crusher upgrade is pegged at a capital cost of around R90m, with operating costs estimated at R10 per tonne – the payback period is expected to be less than 12 months.

The second project involves optimisation of Tharisa’s Voyager Plant which looks to improve PGM recoveries by an estimated 14 000ozpa. The project is scheduled for commissioning in October 2018. The projected capital cost associated with the Voyager Plant optimisation is set at an estimated R70m. Operating costs are expected to be negligible and the payback period is anticipated to be less than 12 months, the company said.

As part of its Vision 2020 strategy, Tharisa is also evaluating the construction of two new plants at a combined capital cost of about R600m. The first of these is the Vulcan Plant, which will facilitate additional recovery of fine chrome from tailings streams. The proprietary process is being developed by Tharisa – a demonstration scale plant is being constructed.

The full-scale Vulcan Plant is scheduled for commissioning by October 2019 with projected chrome concentrate production of 380 000tpa. The estimated capital cost is R300m. Operating costs are estimated at R50 per tonne.

The Apollo Plant, the second of the new plants, will be designed and built as an independent integrated PGM and chrome plant. Plant construction is expected to take around 12 months, with commissioning planned for March 2020. The Apollo Plant is projected to produce 6 000ozpa of PGMs and 180 000tpa of chrome concentrates. The capital cost is estimated to be R300m and operating costs, including mining, R225 per tonne.

Both the Vulcan and Apollo plants are subject to feasibility studies and, if approved, will be funded through a combination of cash flows and drawdown from debt facilities, the company said.

“Tharisa is entering an exciting growth phase. These Vision 2020 projects, combined with improvements in grades following the transition to the owner mining model, will ensure that we achieve our 2020 targets. The assets have already delivered significant cash flows and dividends for shareholders. By investing in our growth, we can continue to enhance shareholder returns,” said Pouroulis.