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NICKEL producer Mwana Africa plans to reopen its smelter in Bindura to refine platinum-group metals in a move that could ease pressure to build a new refinery in the country.
Mwana will aim to raise debt financing to restart the Bindura Nickel Corporation smelter and refinery mothballed in 2008, chief executive Kalaa Mpinga said on Wednesday.
He said it would take 12 months to modify the facility to handle 100,000 ounces to 200,000 ounces of platinum concentrates a year.
“We will finance this completely through debt,” Mpinga said. “Our focus is on creating more value and we think the best way is to restart the smelter.”
The government has said it wants locally mined platinum and associated minerals to be refined locally to increase earnings from mineral exports.
At present, platinum concentrate is transported to South Africa were it is refined. Government has said it would ban export of platinum concentrates by end of year as it presses with local beneficiation.
Zimbabwe has the second largest known platinum reserves after South Africa.
According to a study commissioned by local platinum producers, it will cost $2 billion to build the relevant smelting and base metal refining facilities.
Mwana resumed concentrate shipments from its Trojan nickel mine last April to meet a 7,000 tons-per-year off take contract with Glencore Xstrata.
Mpinga said while the company doesn’t produce enough nickel concentrates to justify restarting the smelter, securing a contract for processing platinum would make it viable.
“If we get an off take we can raise the funds for smelter modification,” he said. “We have an asset, infrastructure which could be used to process some of the concentrates being exported to South Africa.”
Zimbabwe produces 430,000 ounces of platinum a year and the industry needs as much as $5,3 billion to boost that to more than 500,000 ounces and construct refineries for processing output, according to producers. —Bloomberg News.
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