Mwana Africa Zimbabwe Nickel Unit to Upgrade Smelter to Platinum

Mwana Africa Plc (MWA)’s Zimbabwe unit will spend as much as $26 million upgrading its smelter to allow platinum to be processed as well as nickel as the government demands miners of the precious metal refine it in the country.

Bindura Nickel Corp. will proceed with the plan regardless of whether platinum miners take up its offer to smelt their ore, with the plant expected to be operational by the end of the year or early 2015, Managing Director Batirai Manhando said today.

“We’re still talking with them, the offer is still on the table, but with or without them, we’re going ahead with our plans,” Manhando told reporters in Harare. The nickel miner first made its offer to platinum producers on Feb. 12.

Zimbabwe is ready to impose penalties next year on miners including Anglo American Platinum Ltd. (AMS) and Impala Platinum Holdings Ltd. (IMP) if they export production that hasn’t already been smelted in the country. Producers of the metal have jointly pledged $100 million toward building a refinery from July, Zimplats Ltd. (ZIM) Chief Executive Officer Alex Mhembere said May 23.

About half the $25 million to $26 million cost of the modification will be paid for with debt finance, Manhando said.

Mwana closed the Bindura smelter and nickel mines during a period of hyperinflation from 2000 to 2008 before reopening the mines in the northeast in June 2012. The Trojan mine is “doing really well” because of the price of nickel, Manhando said.

Mwana owns nickel mines and smelters in Bindura in northeastern Zimbabwe and Shangani in the south. The company also owns the Hunter’s Road nickel mining license. Zimbabwe is the largest platinum producer after South Africa and Russia. It sits on the biggest known reserves after South Africa.

To contact the reporter on this story: Brian Latham in Harare at blatham@bloomberg.net

To contact the editors responsible for this story: Nasreen Seria at nseria@bloomberg.net Tony Barrett, Alex Devine

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