Tharisa, the JSE-listed platinum and chrome producer, has acquired Salene Chrome Zimbabwe for US$3 million as part of its growth strategy in the country.
Salene Chrome is a low-lost property at development stage on the Great Dyke, which Tharisa believes can be brought to production quickly.
Salene has special grants on the Dyke; Salene Chrome East, which covers 11 900 hectares adjacent east of the Dyke, and Salene Chrome West, sitting over 12 400ha. The special grants have been renewed for an additional two years with effect from 25 February 2021.
“The transaction is in line with Tharisa’s growth strategy, including geographic diversification, operating low cost and open pit operations with access to a premium chrome product, replicating the Tharisa model in a different jurisdiction, and maximising value for Tharisa with a low entry cost, a short development timeline and limited capital requirements while exercising full control over the development,” Tharisa said on Wednesday.
Tharisa acquired the option on Salene in 2018, which it extended earlier this year to March. It will now take over 100% of Salene from Leto Settlement, a related party that is a shareholder in Tharisa.
Tharisa agreed to spend up to US$3.2 million on an initial exploration programme. Originally, the agreement included only Salene Chrome East, but will now include Salene Chrome West.
Salene: the project
Chrome concentrates produced by Salene would be supplied Arxo Resources, Tharisa’s chrome arm.
The Salene chrome project is in a Special Economic Zone, which allows the import and export of goods and capital without barriers, and grants tax breaks as well as duty-free importation of raw materials.
Salene has already spent US$2 million on trial mining and exploration on the site. The results of the exploration valued Salene Chrome East at US$6.9 million.
The Acquisition is subject to approval by the Reserve Bank of Zimbabwe.
Tharisa, separately, owns Karo Platinum, which is developing a platinum operation on the Great Dyke. That project, however, has been set back by a year due to COVID-19, the company said recently.
Tharisa said in its 2020 financial report: “In Zimbabwe, we have commenced the second phase of drilling which is progressing well. The original timelines for the Karo project have been negatively impacted by the constraints of COVID-19 and we anticipate that we have incurred a 12-month delay. We still are of the view that the Great Dyke of Zimbabwe presents a fantastic opportunity to mine high grade low cost PGMs and remains a focal area for our expansion strategy.”