HARARE – Karo Platinum has secured a five-year offtake agreement for platinum group metals and base-metal concentrate from its planned Great Dyke mine, strengthening the project’s bankability as it advances towards first production.
Karo Platinum, which is developing one of the largest undeveloped PGM assets on Zimbabwe’s Great Dyke, signed a binding purchase-of-concentrate term sheet with a subsidiary of Valterra Platinum Limited on customary terms for concentrate purchases in the PGM industry.
The agreement provides Karo with greater certainty over the sale of future concentrate as it works towards bringing the project into production.
The deal follows Karo Platinum’s signing of a Special Mining Lease Agreement with the Zimbabwean government, securing the mining tenure and fiscal certainty required to advance the project towards first production.
Karo Platinum is 85% owned by Karo Mining Holdings plc in which LSE- and JSE-listed Tharisa Plc holds a controlling stake, while the Government of Zimbabwe holds a 15% interest through Generation Minerals Private Limited on an unencumbered free-carried basis.
The project has an open-pit mineral reserve of 2.1 million ounces of PGMs on a 4E basis and a mineral resource of 11.2 million ounces on the same basis. Together with potential underground mining, Karo has a potential mine life of more than 50 years.
Tharisa chief executive Phoevos Pouroulis said securing the concentrate purchase agreement with Valterra provided offtake certainty as Karo advances towards first production.
“Securing a concentrate purchase agreement with a partner of Valterra’s standing and high-quality downstream processing footprint is a significant milestone for Karo Platinum, providing offtake certainty as we advance the project towards first production,” He said.
The agreement, he said, underpins the project’s bankability, reflects the quality of the asset and reinforces Tharisa’s partnership-led approach to developing the project.
“This agreement underpins the bankability of Karo, reflects the quality of the asset and reinforces the partnership-led approach that has been central to Tharisa’s development since inception. We view Valterra as an ideal partner for the next phase of our growth and look forward to deepening our cooperation as Karo progresses,” Pouroulis said.
Valterra chief executive Craig Miller said the agreement reflected the company’s confidence in the fundamentals of the PGM market and Tharisa’s ability to develop Karo within the mineralised zone of Zimbabwe’s Great Dyke.
“We are pleased to enter into this agreement with Tharisa for the concentrate produced at Karo Platinum. The agreement reflects our confidence in the fundamentals of the PGM market and Tharisa’s ability to develop this project on the high-quality mineralised zone of Zimbabwe’s Great Dyke,” said Miller.
For Valterra, the agreement will also expand its third-party processing portfolio, while establishing a longer-term partnership with Tharisa around Karo’s development.
“This agreement contributes to the enhancing of Valterra’s third-party processing portfolio. We welcome the opportunity to build a constructive and enduring partnership between Valterra and Tharisa, founded on operational excellence, reliability and shared value creation,” Miller said.
The offtake agreement adds another key component to Karo’s development following the securing of its Special Mining Lease, giving the project greater certainty around both its operating tenure and future concentrate sales as it moves towards production.
