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Amplats plans to nearly triple production at sole Zimbabwe mine

Platinum+ore+XXX+high+resHARARE — Anglo American Platinum (Amplats) plans to almost triple production at its sole mine in Zimbabwe even though it still has to be repaid money seized from its bank accounts by the central bank and is being forced to cede control of the operation.

The company plans to boost production of ore at its Unki mine to 350,000 tonnes a month from 130,000 tonnes, through an expansion that is expected to last from 2016 until 2020. That would equate to annual production of 180,000oz-200,000oz of platinum once it is shipped to SA and refined. Unki produced 63,000oz of the precious metal last year.

“Studies are still in progress to determine the actual cost of the ramp-up phase,” general mine manager Walter Nemasasi said last Friday. “By the end of the year, we’ll know how much it would cost.”

Unki’s expansion comes as Amplats plans to sell assets in SA after a five-month strike over pay earlier this year. Still, the mine in Zimbabwe has yet to complete an agreement to satisfy ownership laws that would see it ceding 51% control, and it is still owed $109m from when the government seized foreign exchange from bank accounts from 2006 to 2009.

Negotiations over the stake sale with the government are continuing even though a memorandum of understanding has been signed, said Mr Nemasasi. “That package has not yet moved,” he said. “Anglo American Platinum remains committed to complying with the legal requirements of indigenisation and, in its opinion, the heads of agreement remain valid.”

As part of the $143m sale agreement signed in November 2012, 21% would be sold to the state-run National Indigenisation and Economic Empowerment Board, 10% to the community around Shurugwi, 10% to employees and 10% to black Zimbabweans.

The company may also be paid back the money it is owed after the government assumed the central bank’s $1.3bn debt to local companies and foreign creditors in June.

Under the expansion plan, the mine would increase the number of sections it operates to 20 from 11 and its maximum depth to 1.8km from 1.5km. The mine’s life will also be cut to 50 years from 80.

Unki is Anglo American’s last mining operation in Zimbabwe, after assets ranging from gold mines to ferrochrome producers were sold as the country struggled through a decade-long recessio

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