DEVELOPING A LONG TERM FUTURE FOR ZIMBABWES PGM INDUSTRY A P R I - PowerPoint PPT Presentation

DEVELOPING A LONG TERM FUTURE FOR ZIMBABWE’S PGM INDUSTRY A P R I L 2 0 1 9

PROJECT OVERVIEW Snakes  Karo Mining Holdings’ project in Zimbabwe will Head establish a large‐scale vertically integrated Platinum Group Metals (‘PGMs’) mining complex, located in the Great Dyke in Zimbabwe  Karo Mining Holdings’ will design and construct Hartley Platinum Mine Harare Resource of 28.2 Moz (4E) Karo Platinum 4E grade of 4.03 gpt Estimated 96 Moz (4E) fully integrated facilities to ensure the maximum 4E grade of 3.2 gpt Ngezi Mine extraction of value from mining, through the Resource of 72.6 Moz (4E) 4E grade of 3.34 gpt value chain to final base metal and precious metal refining Unki Mine Resource of 30.5 Moz (4E)  Karo Mining Holdings’ will execute the project in 4E grade of 4.19 gpt partnership with the Government of Zimbabwe, Mimosa Mine Resource of 13.9 Moz (4E) under the Investment Project Framework 4E grade of 3.61 gpt Agreement signed on 22 March 2018 2

MANAGEMENT TEAM LOUCAS POUROULIS Chairman The management of Karo has overseen the building of SHAWN M C CORMICK some of the largest and most successful mines in the world, from Eland Platinum, Barplats and Tharisa in Director chrome and platinum projects, to Petra Diamonds, Keaton Energy, Toro Gold, Alufer and Rainbow Rare Earths MICHAEL JONES Director JOSEPHAT ZIMBA Country Manager 3

PROJECT STRUCTURE 4

KARO PROJECTS OVERVIEW 5

KARO PLATINUM  Karo Platinum has been awarded a Special Grant in the Great Dyke in the Mashonaland West District for an area of 23 903 ha  Karo Platinum will operate the open cast and underground mining of the platinum concession, with approximately 14.4 Mtpa of run of mine ore  Conceptual designs are based on the operation of four open pit mining operations that will transition to underground operations  Phased implementation of mining determined by feasibility studies TYPICAL PRILL SPLIT FOR MAIN SULPHIDE ZONE Ir Au  Team has +100 years of experience developing and delivering mines 2.4% 7.2% Ru 3.7% Rh throughout Africa 3.9% Pt 46.4% Pd 36.4% 6

KARO REFINING  Local downstream beneficiation of mineral products The refinery complex will comprise:   Karo Refining will include concentration, smelting and refining to produce PGM concentrators  Smelter complex PGMs, including a base metal refinery and precious metal refinery  Base metals refinery  At steady state, the platinum mining complex is expected to produce 1.4  Precious metal refinery Moz of refined PGMs per annum  Refineries will treat up to 2.0 Moz of PGMs per year, providing 0.6 Moz for toll‐refining capacity for other PGM producers in the country 7

KARO POWER GENERATION  Initial terms were that Karo Power would establish a thermal power plant with a capacity of 600 MW  It has subsequently been agreed, subject to the issue of an Independent Power Producers License and signed bankable PPA, that in place of a thermal power plant, Karo Power will initially construct 300 MW of renewable solar PV energy  Karo Power will establish a 300 MW solar PV renewable energy power plant, in 50 MW solar PV modules  Current Zimbabwe installed capacity is 2 000 MW, but the country requires 11 000 MW of electricity to achieve its vision of becoming a middle income country by 2030 8

RENEWABLE ENERGY  Energy generation is dominated by coal and hydro power  Vast renewable energy sources available in the country  Solar radiation averages 20 MJ/m 2 /day  The 300 MW capacity will be developed in 6 x 50 MW solar PV modules  After investigations, the Zimbabwean National Power Grid cannot accept the 300 MW solar PV supply at one single point  First 100 MW will be fed into the Selous substation, in the form of the first two 50 MW modules  Other substations have been identified for the remaining 200 MW supply  Estimated timeline is nine months for the construction and commissioning of a 50 MW module REN21, 2018. SADC Renewable Energy and Energy Efficiency Status Report (Paris: REN21 Secretariat) 9

KARO COAL MINES  Karo Coal will identify a prospective coal area with the intention to establish a metallurgical coal facility  Once an area has been identified, Karo Coal will apply for a special grant over an agreed coal rich area  A key focus would be the viable extraction of primary metallurgical coal products, which will be utilised for Karo Mining Holdings' value addition initiatives, with the surplus being supplied to the local Zimbabwean ferroalloy and steel industries 10

BENEFITS FOR ZIMBABWE  Creation of approximately 15 000 direct jobs throughout the project timeline, including the construction phase  3 000 jobs during peak construction  Potential for 75 000 indirect jobs through secondary and tertiary industries  Safety is a core value and the project will be developed in an environmentally responsible manner  Sustainable economic growth  Development of strong local supply chain and service industry  Create significant training opportunities and skills development  Execute upliftment projects in local communities  Support further downstream value addition and beneficiation initiatives  State of the art laboratory  Export of high value PGM finished products from Zimbabwe, generating significant foreign currency inflows 11

KARO PROJECTS DEVELOPMENT 12

KARO PLATINUM EXPLORATION PROGRAMME  Development permit awarded  DTM and geophysics completed  Two drilling contracts have mobilised  115 boreholes have been drilled, totalling over 18 000 m  Almost all holes have intersected the Main Sulphide Zone  Comprehensive QA/QC programme being run concurrently  Samples to be independently assayed  Competent Person has been appointed  Established a project team in Zimbabwe for the exploration phase, with four senior staff and four operations staff 13

TYPICAL PROJECT PHASES Exploration Studies ‐ Studies ‐ Development Production prefeasibility feasibility  Orientation  Metallurgical  Mining and  Construction  Monitor  Inspection and drilling testwork process design performance  Preliminary  Infrastructure  Benchmark and programme approvals  Valuation drilling  Commissioning mining and requirements analysis  Production rates programme process design  Resource  Infrastructure  Capital and declaration requirements operating costs  Preliminary and availability ±15%  Production rates  Financial and economic  Capital and assessment market analysis  Property  Logistics operating costs ownership ±25%  Equipment  Permitting / review selection authorisations  Off take requirements arrangements  Financial and  Social, labour market analysis plan  Trade off studies  HAZOP  Logistics  Execution plan  HAZOP 14

TYPICAL LARGE SCALE PROJECT DEVELOPMENT TIMELINE Ability to accelerate typical project timelines – reducing exploration and evaluation phases Exploration Evaluation Development Construction Production ↑Value ↑Confidence ↓Risk 15

KARO POWER PROJECT DEVELOPMENT  Appointed Atlantic Energy Partners as technical consultant, who will conduct the feasibility studies  Environmental consultant has been appointed to conduct the Environmental Impact Assessments on the identified sites  Grid impact studies have been commissioned with ZETDC for all the identified sites  Grid impact studies have been completed for the Selous and Alaska sites  EIA prospectus for the Selous site has been submitted to and approved by EMA  Geotechnical studies to be conducted  Feasibility study has started covering all identified sites  PPA negotiations with ZEDTC for 300 MW to start in the third quarter of 2019  IPP licence application and award from ZERA for 300 MW will follow signing of PPA 16

SUSTAINABLE DEVELOPMENT  Upholding principles of sustainable development of mining projects and creation of shared value  We adhere to the IFC Performance Standards on Environmental and Social Sustainability, a benchmark aligned with international best practice and responsible corporate citizenship  Extensive experience in mining operations and the safety and health of the team are paramount  Subscribe to culture of safety and zero harm  Develop and operate the project in an environmentally responsible manner  Community engagement and open communication  Comprehensive stakeholder engagement process conducted as part of the ESIA process  Extensive social development plan, skills development and training 17

KARO NEXT STEPS Post refinery value addition Regulatory approvals, A comprehensive exploration opportunities are also being including EIA programme explored PROJECT DEVELOPMENTS  Tharisa has taken a 26.8% holding in Karo Mining Holdings  Environmental prospectus has been submitted and approved by the EMA  EIA for the exploration programme is nearing completion  Initiated drilling programme  Metallurgical testwork to be conducted  Comprehensive stakeholder engagement undertaken 18