Bindura Nickel Corporation could turn its smelter and refinery into precious metals refinery with a few modifications and refurbishment, managing director Mr Batirai Manhando said.
Mr Manhando said the modifications and refurbishments would cost a few hundred millions, far less than the estimated $3 billion-plus required for a new facility.
“It is a base metals complex and PGMs (platinum group metals) come with base metals. We can use the (nickel smelter and refinery) plant to separate base metals from PGMs so that we can have concentrates of PGMs,” he said.
With reasonable investment into refurbishment, modification and capacity expansion the smelter and refinery can process the PGMs beyond concentrate and matte.
Zimbabwe has three platinum mines – Implats-owned Zimplats, Implats and Aquarius’ 50-50 joint venture Mimosa and Anglo American’s Unki Mine, but only Zimplats, which exports matte, processes beyond concentrates. Government wants the metal further beneficiated.
Already, the Government has identified mining, beneficiation and value addition as central to economic growth. A 15 percent levy was introduced this year to discourage raw platinum exports while a total ban is set for 2015.
Local platinum producers have cited numerous constraints that need to be cleared first before a precious metal refinery can be established and these include the need for a critical mass, huge capital outlay and adequate power supplies.
“The advantage of doing this with us is that you do not need a lot of investment to do the modification, for us it’s a couple of millions. The facility can be modified and expanded.”
Mr Manhando made the remarks while briefing African and European ambassadors to Zimbabwe during a tour of operations of Mwana Africa’s BNC and Freda Rebecca in Bindura ahead of the EU-Africa summit in Brussels next week.
Mwana Africa is listed on the Alternative Investment Market in the United Kingdom and considers dialogue among EU and African states on challenges and opportunities in Zimbabwe key to its capital raising initiatives on global markets.
BNC last used its smelter and refinery in 2008 when the facility was put on care and maintenance due to the impact of a drop in nickel prices and economic instability in Zimbabwe.
Mr Manhando said power is not an issue for BNC in relation to a precious metals refinery, as it has direct supply from Hydro Cahora Bassa (Mozambique). BNC is situated on a 33Kv line linking Zimbabwe and Mozambique.
It has already instituted feasibility studies into the requirements for refurbishing the smelter and refinery, which currently has a capacity to process 160 000 tonnes per annum.
This capacity can be expanded to process more than the 430 000 ounces of platinum Zimbabwe produces annually, but exports
in raw form for further processing in South Africa.
Zimbabwe has the world’s second biggest known deposits of platinum after South Africa and Government reckons a platinum refinery would optimise proceeds from the mineral.
Mines and Mining Development Minister Walter Chidhakwa has already toured BNC’s operations including the smelter and refinery plant in Bindura and has been apprised on the potential to turn the facility into a precious metals refinery.
Mr Manhando said Government could help in the upgrading of the nickel smelter and refinery to process PGMs by putting incentives to allow investors to partner in the project.
BNC’s Trojan Mine is producing 7 000 tonnes of nickel per month after coming out of care and maintenance in September 2012 and intends to raise output to 10 000 tonnes per month in four years.
Since BNC’s other nickel mine – Shangani – is dormant, it can only utilise 60 percent of the smelter and refinery’s capacity hence the need for more feed stock. As such, discussions are ongoing with third party producers for toll refining.
Refurbishing the smelter and refinery would enable BNC to upgrade the value of its nickel from 70 percent to 99,98 percent. Further, the refinery would reduce transport expenses.
Apart from the 114 000t of nickel resource at Trojan Mine, BNC also has the Hunters Road open cast nickel project in Kwekwe it considers key to regaining its status and reputation as Africa’s only integrated nickel smelting and refinery.