Tharisa advances $8m for Karo in Zim

RESOURCES group Tharisa has advanced a $8 million (R105.72m) debt-financing facility to Karo Holdings, enabling it to start work on the 24 000 hectare mining title that contains 96 million ounces of platinum.

Karo entered into an investment agreement with Zimbabwe’s government in March in which it undertook to establish a platinum group minerals (PGM) mine, concentrators, smelters, a base metal and precious metals refinery, as well as power generation capacity.

The acquisition will give Tharisa the right but not the obligation to fund further development at the project level, allowing it a measured approach to developing the projects in line with its financial and strategic objectives, thereby creating further low-cost diversified PGM and chrome operations, the company said.

The investment comes at a time when Zimbabwe is desperate for fresh investment in the mining sector.

Tharisa, which is also listed on the JSE, has become a significant investor in Zimbabwe’s mining industry after paying $4.5m for a 26.8 percent shareholding stake in Karo.

This gives it additional exposure to mineral deposits as it already holds a 90 percent stake in the 9 500ha Salene Chrome.

Chief operations officer Michelle Taylor said the acquisition would provide Tharisa with a low-cost, low-risk entry into a new market.

Apart from Karo, other platinum producers in Zimbabwe include Anglo Platinum, Impala Platinum and Sibanye-Stillwater.

The platinum miners are expected to build refinery facilities inside Zimbabwe or risk a levy on exports of a semi-procession version of the metal.

They are also saddled with requirements for them to cede majority shareholding to black groups under a contentious empowerment policy.