Commodities baron Kudakwashe Tagwirei’s Landela Mining Ventures has emerged as the new joint venture partner in the Russian-led Darwendale platinum mine project, which has also roped in former Impala Platinum chief executive David Brown.
A statement issued on Tuesday by Great Dyke Investments (GDI), the company developing the mine, announced that Landela and Afromet JSC now have equal 50% stakes in the project. Afromet JSC is 100%-owned by Russia’s investment and industrial group Vi Holding, which has spearheaded the Darwendale project since its inception in 2013.
“The 2019 year is marked for the project and GDI by the arrival of a new strong Zimbabwean shareholder — Landela Mining Venture, which is a part of the bigger experienced multinational commodity trading group Sotic International Ltd with business interests in minerals and oil trade across the Sadc region and Zimbabwe in particular,” GDI said in a project update.
In May, Bloomberg reported that a Zimbabwe army investment vehicle’s shareholding in the project was putting off potential financiers.
But President Emmerson Mnangagwa said the military had been bought out by a private company, now identified as Landela, which now owns 50% of the mining venture.
Tagwirei’s interest in GDI marks further expansion from the petroleum industry where his Sakunda Holdings is a dominant player, into mining.
The businessman, who is also a shareholder in African Chrome Fields, has been linked with bids for ferrochrome producer Zimbabwe Alloys, as well as Bindura Nickel Corporation and gold miner Freda Rebecca gold mine.
Obey Chimuka, managing director of Fossil Contracting, a company associated with Tagwirei, now sits on the GDI board. Chimuka has in the past sat on the boards of the ZMDC and Marange Resources. He also sat on the board of Sakunda Supplies, according to his company’s website.
Darwendale project’s first phase is expected to cost US$500 million, targeting annual output of 280 000 ounces of platinum group metals and gold.
Mine construction is expected after the financial close, which is expected by March 31, 2020.
The African Export-Import Bank was last year appointed as the main financial partner and lead arranger for the project. The continental bank has put up US$192 million towards the project.
“According to the agreement, Afreximbank’s mandate covers both debt (project) financing and equity raising portion in the amount sufficient for the successful implementation of phase 1 of the project. The target financial close date for the transaction is set up to March 31, 2020,” GDI says.
The company is negotiating with Zimbabwean, South African and Russian funders to raise cash for equipment, machinery and services procurement, the company said.
The Darwendale project will be implemented in three phases and is expected to produce860 000 ounces of PGM and gold per year at full capacity. To put the scale of the mine’s potential into perspective, annual output for Zimbabwe — from the country’s three PGM mines — was 978 692 ounces in 2018.
Seasoned mining industry hand Brown has been appointed to lead a reconstituted GDI board, taking over from the previous chairperson, Hesphina Rukato. She had been on the board to represent Pen East Mining Company, through which the military held an interest.
“The project team has covered much ground with respect to the technical viability of the project and has provided sufficient confidence for all stakeholders to ensure a successful delivery of both the development and operational phases of the project,” Brown said.
“The progress achieved so far is substantial and sufficient for transitioning to the next stage which will include detailed design, contracting for major equipment elements as well as the start of construction, all of which will be subject to the successful financing stage of the project being completed.”
Zimbabwe currently has three major platinum mines – Impala’s Zimplats, Anglo Platinum’s Unki and Mimosa, a joint venture between Impala and Sibanye Stillwater.
Karo Mining Resources, driven by Tharisa Plc founder Loucas Pouroulis and his son Phoevos, was last year granted a platinum concession on the Great Dyke and expects to start developing a mine next year.