JOHANNESBURG - Mining company Tharisa said on Tuesday the parties involved in its acquisition of a stake in Salene Chrome Zimbabwe had agreed to restructure the deal, granting it a call option to acquire a 90 percent shareholding at the par value of USD90, exercisable upon completion of an initial exploration programme.
In May Tharisa, a low cost producer of platinum group metals and chrome concentrate, said it had acquired the shareholding from Leto Settlement Trust. It said Salene had been awarded three special grants covering approximately 9,500 hectares (95 square kilometres) on the eastern side of the Great Dyke in Zimbabwe, entitling it to mine commodities including illuvial chrome.
"In consideration of the call option, Tharisa will undertake the initial exploration programme over the special grant areas held by Salene with a spend of USD3.2 million," the company said on Tuesday.
It said the amended deal structure should provide Tharisa with certainty on the extent of the mineralisation and the necessary techno-economic information on which to base an investment decision whilst retaining the economic benefits of the transaction.
The transaction is in line with the approved growth strategy of Tharisa, including increasing geographic diversification, operating low cost and open pit operations with access to a higher grade chrome product.
Leto will retain a 10 percent free carried shareholding in Salene and will be entitled to a three percent commission on the cost, insurance and freight sales value of the chrome concentrates and any other commodities sold.
Salene intends to apply for the consolidation of the special grant areas into a mining lease valid for the life of mine. The nature of the special grant areas allows for a project that is a scalable open pit operation which can be brought into production on a low risk and relatively low cost basis in a short time horizon.
The Great Dyke of Zimbabwe contains the world’s largest known platinum group metals and high grade chrome deposits outside of South Africa. The region is known to contain illuvial chrome concentrations of up to 30 percent Cr2O3 at surface.
"Based on available geological information and similar illuvial chrome mining activities in the region, Tharisa considers this to be a highly prospective opportunity to meaningfully expand its chrome mining interests," said the company, which operates the Tharisa mine on the south-western limb of South Africa’s Bushveld Complex.