【Industry News】 South African platinum group metals production continues to be under pressure due to

Tharisa CEO Phoevos Pouroulis said the recovery of platinum group metals will become critical to the fate of the precious metal as primary supply is difficult to increase.

At its recent year-end results presentation, Tharisa declared a final dividend of 4 South African cents per share, and Pouroulis said that new platinum group metals projects in South Africa would not lead to supply growth.

Pouroulis said, "Any new projects are just replacement ounces of production, not new supply entering the market." He added that the recovery of platinum group metals "remains the most important factor in determining supply and demand fundamentals.

According to the World Platinum Investment Council (WPIC), there will be a shortfall of 303,000 ounces of platinum supply next year due to production disruptions in South Africa. This implies a 1.1 million ounce change in the platinum market balance year-on-year.

Pouroulis said, "The more complex operating environment in the main producing region of South Africa, having to deal with inflationary pressures and erratic power supplies, means that the supply side will be constrained for some time."

South Africa's national power utility (Eskom) has implemented unprecedented load shedding and record levels of power restrictions this year, leading the country's three largest producers, Impala Platinum, Anglo American Platinum and Sibanye-Stillwater, to stockpile about 100,000 ounces of platinum group metals.

Tharisa declared a dividend of 17.5 percent of net profit after tax, exceeding its 15 percent profit-sharing policy. For the full 12 months to September 30, this dividend amounted to 7 South African cents per share, equivalent to $21 million (R362 million).

This was achieved on the back of increased production of platinum group metals and chrome. This, combined with the weaker rand against the US dollar and increased production at the Tharisa mine in the North West Province, helped to offset the impact of lower platinum group metal prices. However, chrome is more expensive.

Tharisa is targeting platinum group metal production of 175,000 to 185,000 ounces in fiscal 2023, compared to 179,200 ounces in the current reporting year, an increase of 13.6% over 2021. Chromium production this year is expected to be 1.75 to 1.85 million tons (2022: 1.56 million tons).

Pouroulis said in a presentation that the company owns 85% of Karo Platinum in Zimbabwe, a $391 million Karo Platinum platinum project, and that a schedule spanning 24 months has been established and the project is in order. He added: "We have 21 months to go and construction has started."

The project aims to produce 194,000 ounces of platinum group metals per year, up from a previous estimate of 150,000 ounces per year.In an interview with Miningmx, Pouroulis said that Tharisa decided to increase production and shorten the life of the open pit by three years to 17 years, given the "considerable investment" in the hydroelectric infrastructure, which is designed to "maximize the cost per unit of production Maximize the cost per unit of production." It was a relatively simple decision."

Part of the funding will come from a $25 million to $50 million bond that will be listed on the Zambezi Stock Exchange on Dec. 16. The bonds are expected to close on Dec. 9. Pouroulis said the deadline has been delayed while the offer will be given a "prescribed asset profile" that will increase its probability of success.

Once completed, the project will double Tharisa's platinum group metals production to nearly 400,000 ounces a year, while the company also focuses on producing 2 million tons of chromium from its South African mines.

This target will in part affect the performance of the company's R800 million Vulcan smelter, which aims to increase metal recovery from 65% to around 82%. Recovery of chromium for the year was 68.3%, up from 63.3% the previous year, an improvement of almost 8%. (Source: miningmx)

Translation：World Platinum Investment Association