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Great Dyke in Zimbabwe

Zimplats

Zimplats Holdings Limited (Zimplats) is 87% owned by Implats. Its Ngezi operation is located on the Hartley Geological Complex on the Zimbabwean Great Dyke approximately 150 kilometres south-west of Harare. In FY2013 the operation produced 198 100 ounces of platinum in matte.

Zimplats currently operates four shallow mechanised underground mines and a concentrator at Ngezi. The Selous Metallurgical Complex (SMC), located some 77 kilometres north of the mine, comprises a concentrator and a smelter. Zimplats currently employs 5 704 people, including contractors. The Phase 2 expansion project remains on schedule and will increase production to 270 000 ounces of platinum in matte in 2015.

 

Business summary

  • Four shallow mechanised underground mines
  • Concentrator and smelter plants at Selous Metallurgical Complex (SMC)
  • Concentrator plant at Ngezi
  • Reserves: 10.8 million attributable ounces of platinum
  • Resources (including reserves) 95.5 million attributable ounces of platinum
  • Production: 198 100 ounces of platinum in matte
  • Employees and contractors: 5 704
 

Operational review 2013

 

GEOLOGY

Although platinum was first discovered in the Great Dyke in1918, its exploration was overshadowed by that of the Bushveld Complex in South Africa. Focus has returned to the Great Dyke given that much of the shallow resources in the Bushveld Complex have been depleted.

The Great Dyke is a layered complex similar to that of the Bushveld Complex. It extends for 550 kilometres and has a maximum width of 11 kilometres. Within the Great Dyke four geological complexes are known to contain PGM and base metal deposits. These are the Wedza Complex (Mimosa – Aquarius and Implats), the Selukwe Complex (Unki – Anglo Platinum), the Hartley Geological Complex (Hartley and Ngezi Platinum Mines – Zimplats) and the Musengezi Complex. The Hartley Geological complex is the largest of the PGM bearing complex’s containing 80% of the known PGM resources in Zimbabwe, two-thirds of which is held by Zimplats.

The stratigraphy is broadly divided between a lower ultramafic and an overlying mafic sequence. The ultramafic sequence hosts the P1 pyroxenite, which in turn hosts the economic PGM-bearing Main Sulphide Zone (MSZ). The MSZ is generally 2 to 3 metres thick. Optimal mineralisation varies and, in contrast to the Bushveld Complex, is often difficult to follow visually. Peak values for the PGM and base metals are vertically offset, with palladium peaking at the base, platinum in the centre and nickel towards the top.

MINERAL RESOURCES AND MINERAL RESERVES (100%)

Mineral Resource and Mineral Reserve Statement 2013
View online 


MINING

Zimplats commenced opencast mining at Ngezi in December. The opencast operation was suspended in 2008 and all mining is currently conducted in underground sections accessing a shallow orebody. Mining commences at a depth of 50 metres below surface and currently extends to a depth of approximately 240 metres. The mine employs mechanised bord and pillar mining with stoping widths of an average of 2.5 metres at dips of less than 9 degrees. Each production team comprises a single boom face rig, a bolter, a 10 tonne load haul dump (LHD) and a 30 tonne dump truck, and mines 20 panels, each 7 meters wide.

CAPITAL PROJECTS

The Phase 2 expansion remains on schedule with the hot commissioning of the front-end crushing and milling circuits, the concentrator and associated tailings facility being completed in April 2013. Construction of the underground crusher at the portal is scheduled for commencement in January 2014 with anticipated completion by August 2014 and the mine will reach design production in March 2015.  

METALLURGY

The concentrator at Ngezi commwasissioned in July 2009 and reached full production capacity of 2 million tonnes per annum in October 2009. Around 6,000 tonnes of ore per day is also transported by road trains to SMC. Concentrate from both plants is then smelted in an arc furnace and converted to matte which is despatched to Impala’s refinery in terms of a life-of-mine agreement with Impala Refining Services (IRS).

SUSTAINABLE DEVELOPMENT

Zimplats remains committed to social development initiatives and engages in, develops and builds community relationships. It takes responsibility for economic, social and environmental issues that impact its people, communities and environments.

INDIGENISATION

On 11 January 2013 Zimplats concluded a non-binding termsheet in respect of proposed indigenisation implementation plans with the Government of Zimbabwe. In terms of this agreement, a collective 51% of the company’s equity would be sold to a community share ownership trust (10%), an employees’ share ownership trust (10%), and the National Indigenisation and Empowerment Fund (31%) for a total of US$971 million payable from future dividends due to the entities. Zimplats would provide vendor funding to the indigenous entities at an interest rate of 10% per annum repayable from 85% of the dividends declared by the operating subsidiary. Subsequently, the government has indicated that it wishes to revisit the terms of the plan and engagement in this regard continues.

HISTORY

Zimplats was established by Delta Gold Limited (Delta) in 1998 to take over its platinum interests. In May 1999 the company purchased BHP’s interests in the Hartley Platinum and the Mhondoro Platinum Joint Ventures which included a concentrator and smelter. Zimplats initiated the Ngezi/SMC project in 2001 and the first converter matte was exported in April 2002.

In 2001 Implats acquired a 30% stake in Zimplats from Delta in a joint venture with ABSA Bank Limited of South Africa (ABSA). Implats held pre-emptive rights over ABSA’s 15% stake as well as a 30% direct stake in the then Makwiro Platinum (Pvt) Limited. The remaining 70% was held by Zimplats. In August 2002, the group acquired a further 21% stake in Zimplats from Aurion Gold and in June 2003 purchased ABSA’s 15% stake. Implats subsequently made an unconditional cash offer to minority shareholders in Zimplats.

Currently the group holds 87% as a result of the buyout of minority holders and the receipt of 14.9 million newly issued ordinary Zimplats shares on the sale of its 30% stake in Zimbabwe Platinum Mines (Pvt) Limited (formerly Makwiro Platinum (Pvt) Limited) to Zimplats.

 

Zimplats – key statistics

    2013   2012   2011   2010   2009  
Safety leading indicators              
Hazards for which internal STOP Notes have been issued   (no)  8   353   1 140   –   –  
Stoppage/instructions issued by State or DMR   (no)  1   15   –   –   –  
Leadership STOP Observations   (no)  22 027   18 942   –   –   –  
Safety representative training   (no)  74   183   30   –   –  
Safety lagging indicators              
Fatal injury frequency rate   (pmmhw)  0.000   0.000   0.000   0.000   0.000  
Lost-time injury frequency rate   (pmmhw)  0.70   0.21   0.75   0.69   0.45  
Total injury frequency rate   (pmmhw)  2.20   2.22   3.39   3.61   5.49  
Lost days rate   (pmmhw)  28   11   28   20   29  
Health              
Noise-induced hearing loss cases submitted   (no)  2   –   –   –   –  
On wellness programme   (no)  135   129   106   68   78  
On antiretroviral therapy   (no)  120   114   92   63   51  
Environmental              
Total water consumed   (Mℓ)  7 852   6 003   5 528   6 172   3 793  
Total water recycled   (%)  26   27   28   23   29  
CO2 emissions   (t)  410 356   427 713   416 598   397 658   250 121  
SO2 emitted   (t)  12 017   13 470   12 100   12 449   6 474  
People              
Own employees   (no)  2 929   2 791   2 757   2 418   2 136  
Contractors   (no)  2 775   6 412   2 610   1 262   3 323  
Literacy (ABET level (III))  (%)  99   99   99   99   99  
Labour turnover   (%)  4   4   4   5   11  
Social              
Community spend   (Rm)  37   41   9   2   7  
Sales   (Rm)  4 159   3 665   3 709   3 052   1 099  
Platinum     2 321   2 026   2 004   1 767   749  
Palladium     854   674   692   405   118  
Rhodium     133   145   211   252   (18) 
Nickel     411   410   465   366   135  
Other     440   410   337   262   115  
Cost of sales   (Rm)  (2 708)  (2 076)  (1 779)  (1 626)  (1 216) 
On-mine operations     (1 434)  (1 089)  (870)  (806)  (795) 
Processing operations     (627)  (494)  (446)  (373)  (224) 
Selling and administration     (222)  (212)  (183)  (145)  (108) 
Share-based payments     4   17   (20)     
Depreciation     (433)  (329)  (239)  (184)  (210) 
Change in metal inventories     4   31   (21)  (118)  121  
Gross profit/(loss)  (Rm)  1 451   1 589   1 930   1 426   (117) 
Intercompany adjustment*   (Rm)  (33)  43   (81)  (412)  406  
Adjusted gross profit   (Rm)  1 418   1 632   1 849   1 014   289  
Royalty expense   (Rm)  (303)  (262)  (113)  (69)  (20) 
Gross margin   (%)  34.9   43.4   52.0   46.7   (10.6) 
Sales volumes in matte              
Platinum   (000oz)  195.4   187.2   182.2   171.5   96.0  
Palladium   (000oz)  156.2   150.5   148.9   139.8   75.8  
Rhodium   (000oz)  17.8   16.7   16.3   15.1   8.2  
Nickel   (t)  3 908   3 769   3 481   3 131   1 613  
Prices achieved in matte              
Platinum   (US$/oz)  1 347   1 398   1 564   1 364   852  
Palladium   (US$/oz)  620   578   661   384   171  
Rhodium   (US$/oz)  849   1 124   1 841   2 204   (241) 
Nickel   (US$/t)  11 919   14 041   18 997   15 466   9 195  
Exchange rate achieved   (R/US$)  8.82   7.74   7.03   7.56   9.08  
Adjustment note: The adjustment relates to sales from Zimplats to the Implats Group which at year-end were still in the pipeline.

  
Production              
Tonnes milled ex mine   (000t)  4 683   4 393   4 223   4 095   2 167  
Headgrade (6E)  (g/t)  3.53   3.53   3.56   3.56   3.52  
Platinum in matte   (000oz)  198.1   187.1   182.1   173.9   96.0  
Palladium in matte   (000oz)  157.1   149.2   148.1   140.2   75.6  
Rhodium in matte   (000oz)  17.0   16.9   16.8   15.5   8.4  
Nickel in matte   (t)  3 909   3 787   3 519   3 105   1 608  
PGM in matte   (000oz)  416.2   396.4   388.8   368.9   201.7  
Cost              
Total cost   (Rm)  2 283   1 795   1 499   1 324   1 127  
  (US$m)  259   232   213   175   124  
Cost per tonne milled   (R/t)  487   409   355   323   520  
  (US$/t)  55   53   50   43   57  
Cost per PGM ounce in matte   (R/oz)  5 485   4 528   3 855   3 589   5 588  
  (US$/t)  622   585   548   475   615  
Cost per platinum ounce in matte   (R/oz)  11 524   9 594   8 232   7 614   11 740  
  (US$/t)  1 307   1 239   1 171   1 008   1 292  
Cost net of revenue received for other metals   (R/oz)  2 246   834   (1 131)  224   8 094  
  (US$/t)  255   108   (161)  30   891  
Capital expenditure   (Rm)  1 449   2 137   840   698   1 358  
  (US$m)  164   276   119   92   150  
Labour efficiency              
Tonnes milled per employee costed**   (t/man/annum)  1 159   1 128   1 166   1 317   901  
**Total employees excluding capital project employees.