THE country’s second largest platinum miner, Mimosa Mining Company, is set to conclude a feasibility study for the expansion of its Zvishavane based mine next month.
Mimosa, jointly held by Aquarius and Impala Platinum, set aside US$40 million for the expansion project which is expected to be undertaken in the next five years.
But an official said much would also depend on the commodity prices, which would determine viability.
The project will ramp up capacity by 30 percent and extend the mine’s lifespan by 20 years.
Mimosa’s managing director, Fungai Makoni, told The Financial Gazette’s Companies & Markets that falling metal prices would inevitably affect the platinum mine’s expansion programme.
He said: “The metal prices environment makes it difficult to make an investment decision but we remain optimistic with the way prices are going to eventually turn out. We have been talking about expanding the business in terms of a 30 percent capacity increase.”
“We are in the process of finalising the feasibility study for the proposed expansion and once the studies have been finalised and everything concluded, we will then make a decision on whether to implement or not given the current metal price environment and in the next month we should be finished with that process,” said Makoni.
Platinum prices, which five years ago peaked at US$1 450 per ounce, have plummeted to about US$957 as at Tuesday this week per ounce, a situation that has forced the mine to embark on cost cutting measures to remain afloat.
The situation has been exacerbated by a raft of mining taxes being charged by government.
Low platinum prices saw Mimosa revenue dipping by 32 percent to US$99 million in the half year to December 2015.
This also saw the mine’s production decreasing by six percent to 1,238 million tonnes.
However, the Zvishavane-based miner’s production in the period under review went up two percent.
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