Tharisa says Karo, its subsidiary developing a platinum mine in Zimbabwe, has had a portion of its Selous grant declared a special economic zone, allowing tax breaks that make the project more viable.
The company says it is on course to deliver by year-end a resource statement, a report detailing estimated minerals. Mine development is planned for 2020.
The Zimbabwe Special Economic Zones Authority (ZimSeza) granted the status to 50 667 hectares covered by Karo’s special mining grants.
With the declaration of SEZ status, Karo will be entitled to several fiscal incentives that the company said on Tuesday will “further enhance the economics of the project including reduced tax rates, duty free importation of raw materials and equipment and exchange control rulings”.
Tharisa CEO Phoevos Pouroulis, said: “Zimseza’s award of the Special Economic Zone status to Karo’s license in Zimbabwe is a critical step in the development of what could become a world class vertically integrated PGM operation. The Karo mine could transform the Zimbabwean PGM sector, bringing significant economic benefits to all stakeholders and building a long-term sustainable mining industry.
“The SEZ status, as well as the completion of the initial resource classification, are key milestones prior to investing in the various phases that a project of this scale requires for it to succeed. We look forward to working closely with Zimseza and the government of Zimbabwe, together with the local, regional and national stakeholders, as well as our financial partners, to bringing this project to fruition.”
Karo resource estimate
In April, Tharisa acquired a 26.8% stake in Karo Resources, gaining access to 23,903 hectares of land on the Great Dyke. The transaction saw an injection of US$8 million for the initial geological and sampling work to confirm the resource.
The land has potential for 96 million ounces of platinum and palladium. Tharisa has an option to increase that stake, which would give it control of the project.
Karo said in April that its exploration drilling at the site, which began in February, was ahead of schedule. Karo has now completed a 238 exploration borehole and 32.4 km platinum group metal drilling programme on the property, which sits on the resource-rich Great Dyke. Drilling has been focused on the western boundary of the license to average depths of 50 metres to 150 metres.
“Karo Zimbabwe is on track to deliver a resource statement before the end of the 2019 calendar year,” the company announced.
Karo is targeting annual production of 200,000 ounces of PGMs and 2.0 Mt of chrome concentrates in 2020.