Chrome and platinum group metals (PGM) miner Tharisa on Wednesday reported lower quarterly output as a result of high rainfall, variable run-of-mine stockpiles and processing of oxidised ore.
PGM output for the three months to end-December fell 5.7% quarter on quarter to 42.7koz while chrome production was down 8% as a result of “unprecedented” rainfall, Tharisa said, adding that total reef mined fell 17.7% to 1,081.5kt and total reef tonnes milled was down slightly to 1,427.4kt.
“While the changes we have made to the pit layout provided significantly better drainage, access to the pit was nevertheless hampered due to the high-water level, directly resulting in pit flexibility being compromised,” CEO Phoevos Pouroulis said.
Tharisa, which is listed on the JSE and London Stock Exchange, operates a mine in SA near Brits in the North West. The mechanised mine has a 19-year open-pit life and the ability to extend operations underground for at least another four decades.
It also owns Karo Mining and Salene Chrome, which are development-stage, low-cost, open-pit PGM and chrome assets in Zimbabwe.
Despite these setbacks, the company, valued at about R6.3bn on the JSE, remains focused on cashing in on the move to renewable energy as countries and companies cut their carbon emissions to mitigate the effects of climate change.
PGMs are expected to underpin the future of the hydrogen economy, which forms part of the greater shift to green alternatives.
Platinum, iridium and ruthenium, which Tharisa also produces, are used in electrolysis to split water into its hydrogen and oxygen components, while PGM are used in the fuel cells of electric-vehicle engines.
“PGMs are by nature the best catalysts on the periodic table, so we don’t think we have even found the best applications for PGMs yet,” Pouroulis told Business Day last month.
PGMs rerating
He believes SA will ultimately be one of the biggest beneficiaries as the world’s largest platinum supplier, “so it’s a good place to be in”.
“As forecast, while palladium prices have rerated, ever-growing reduction of platinum surplus supplies will lead to a deficit over the next 12 to 18 months, according to consensus industry forecasts,” Tharisa said Wednesday’s trading update
PGM supplies have been stretched after sanctions were imposed on Russia, the world's second-biggest producer, over its invasion of Ukraine almost a year ago.
Chrome prices remain buoyant at $260/t as stockpiles in China fall.
“[The] Chinese New Year [holidays] will slow demand towards the end of January but with the economy in China opening post Covid-19 restrictions, we continue to foresee strong demand for the product heading into the northern hemisphere spring,” the company said.
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