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Tharisa taps into Zimbabwe platinum belt with Salene purchase

Tharisa announced a maiden interim dividend of 2c even though earnings were affected by lower chrome prices and a higher rand
chrome pipes
Chrome prices have been dropping

Tharisa PLC (LON:THS) has made a first move into Zimbabwe with the acquisition of 90% of Salene Chrome, located on the country’s Great Dyke platinum belt.

Salene has three special grants covering an area of approximately 95sq km on the eastern side of the Great Dyke, which entitles it to mine illuvial chrome at surface.

WATCH: Tharisa makes move into Zimbabwe with Salene Chrome acquisition

Tharisa is acquiring the stake from Leto Settlement Trust, a related party.

Leto will retain a 10% free carried shareholding in Salene and be entitled to a 3% gross royalty from chrome concentrate sales.

The Great Dyke of Zimbabwe contains the world's largest known platinum group metals and high-grade chrome deposits outside of South Africa, said Tharisa with illuvial chrome concentrations of up to 30% Cr2O3 at surface.

Production rises as does rand

Upfront costs will be nominal said Tharisa, though exploration so far has been insufficient accurately to quantify the value of the net assets. 

Salene will carry out trenching to determine the grade and build a pilot plant to test the deposits. 

Tharisa increased production of both platinum and chrome in the six months to March, but earnings were hit by a sharp rally in the value in the rand and a drop in chrome prices.

Platinum production rose 11% to 77,000 ounces, helped by higher recoveries while the quantity of chrome rose 15% to 732,500 tonnes.

Net profits fell 44% to US$28.5mln, though cash generated rose to US$57.1mln.

Tharisa announced a maiden dividend of 2c.

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