Tharisa Minerals is 74% owned by Tharisa and is uniquely positioned as the world’s only co-producer of both PGM and chrome concentrates. Tharisa Minerals’ core asset is the Tharisa Mine, which is situated on South Africa’s Western Limb of the Bushveld Complex – home to more than 70% of the world’s platinum and chrome resources.
Tharisa Minerals mines and processes five MG Chromitite Layers. Through innovative engineering, the mined reef is processed at two independent integrated plants extracting both PGMs and chrome concentrates, thereby reducing unit costs and positioning Tharisa Minerals in the lowest cost quartile of operating costs in South Africa for both PGMs and chrome.
Tharisa Minerals’ low unit costs and multiple polymetallic products have ensured that it was well placed to manage commodity price volatility and exchange rates.
Its dual revenue streams provide a natural hedge against different commodity cycles with the products being used in different applications. PGMs are primarily used in the automotive, technology and jewellery industries while chrome is primarily used in the manufacture of stainless steel.
Tharisa acknowledges that the safety of its people is critical to its success. The LTIFR for FY2019 was 0.27 (2018: 0.18) per 200 000 man hours worked. The mine achieved three million fatality-free shifts.
Tharisa Minerals holds a Mining Right over 5 475 ha of land near the town of Rustenburg in the North West province of South Africa. The Mining Right was granted on 19 September 2008 for an initial period of 30 years, providing access to MG Chromitite Layers which outcrop with a strike length of approximately 5 km.
The Tharisa Mine is a 14-year open pit operation with a projected 40-year underground life of mine extension. The mining operation, which is divided into the east pit and west pit, extracts reef from five MG Chromitite Layers.
The change in operating model from contractor to owner-operator mining was implemented in FY2018. This change represented a logical progression given the long life of the open pit, allowing Tharisa Minerals to take direct control of its mining operations, thereby controlling the reef grades and the delivery of improved quality ore to the processing plants and optimising the feed, throughout and within the plants. FY2019 saw Tharisa Minerals invest heavily in new equipment and machinery including a new Caterpillar 6050 face shovel.
Tharisa Minerals’ mining division mined 4.6 Mt of ROM for FY2019, a 5.1% decrease year on year. A total of 11.1 Mm3 of waste rock was mined for the year, as the stripping ratio improved to 8.3 on a m3:m3 basis, representing a 5.1% increase from the previous year. Mining for the year needs to be viewed in the context of Tharisa focusing on the development areas in its open pit; a redesign that saw over 1.7 Mm3 of previously mined material moved, with the aim of creating smoother benches and thus better drilling, blasting and hauling continuity. Hauling continuity was enhanced by access roads that previously ran north-south now running parallel to the pit as the pit advances. Capital investment into machinery increased to US$27.5 million as fleet replacement accelerated.
The PGMs in the MG ore mined by Tharisa Minerals occur in the silicates and are not associated with the chromite, thus enabling the process to extract chrome before PGMs without sacrificing PGM recovery.
This lowers the chrome content in the PGM circuit and results in much lower chrome content in the PGM concentrate compared to typical UG2 operations. Base metal content in the MGs is also significantly lower than Merensky and UG2 ores, resulting in a low matte fall during smelting, reducing base metal refining requirements.
Tharisa Minerals’ two independent processing plants are designed specifically to treat the MG Chromitite Layers of the Bushveld Complex. The smaller 1.2 Mtpa Genesis Plant, with the 100 ktpm chrome circuit, was commissioned in August 2011 with the PGM circuit being commissioned in December 2011. The larger 3.6 Mtpa Voyager Plant was commissioned in December 2012. Both plants operate at above nameplate capacity and milled collectively 4.8 Mt. The plants have a similar process flow that includes crushing and grinding, primary removal of chrome concentrate by spirals, followed by PGM flotation from the chrome tails and a second spiral recovery of chrome from the PGM tails.
Operating in parallel, the independent plants provide processing flexibility and production stability by allowing one plant to be shut down without hampering the production of the other. The modular design of the processing circuits allows sections of the plant to be stopped without affecting the rest of the operation (i.e. a crushing circuit can be stopped independently of the comminution, spiral and flotation circuits).
Using off the shelf technology, the processing circuits are uniquely engineered to deliver both PGM and chrome concentrates. This innovative approach to production has made Tharisa a world-class PGM and chrome co-producer.
The PGM rougher feed grade was marginally lower for the year at 1.47 g/t, while the Cr2O3 ROM feed grade was virtually unchanged at 18.1% for the year.
Tharisa targets recoveries of 80.0% for PGMs and 65.0% for chrome. In FY2019 PGM recoveries were 82.1% while chrome recoveries were 62.0%.
During the year, the Group produced PGM concentrates containing 139.7 koz of contained PGMs (5PGE + Au) and chrome concentrates of 1.29 Mt with 312.1 kt being speciality grade concentrates. Third-party chrome concentrate produced was 241.1 kt.
Speciality chrome recovery circuits are integrated into the feed circuit of the Genesis Plant, known as the Challenger Plant. The Challenger Plant, which is owned by fellow subsidiary Arxo Metals, was commissioned in July 2013 and produces chemical and foundry grade chrome concentrates.
Production of speciality grade concentrates accounted for 24.2% of Tharisa’s chrome production in FY2019, and will be maintained at current levels to ensure that it maintains a strategic market share.
The Vision 2020 projects are targeting an increase in Tharisa’s production to 200 kozpa of PGMs and 2.0 Mt of chrome concentrates in 2020 on an annualised basis. The FY2020 production guidance for the Tharisa Mine is 155 koz to 165 koz of PGMs and 1.45 Mt to 1.55 Mt of chrome concentrates.
Crusher circuit at the Genesis Plant
The additional crusher circuit at the Genesis Plant aims to increase the Genesis Plant throughput by 15% or about 180 ktpa, targeting an increase in the higher value speciality grade chrome concentrates by adding approximately 24 ktpa of chemical grade chrome concentrate, approximately 18 ktpa of foundry grade chrome concentrate, and approximately 19 ktpa of metallurgical grade chrome concentrate.
PGM optimisation at the Voyager Plant
The addition of flotation capacity and the installation of high-energy mechanisms at the Voyager Plant is aimed at improving the PGM recoveries and increasing PGM production. The project is being implemented via a staged approach.
Tharisa’s R&D team has developed the Vulcan process to extract the fine chrome from current in-line tailings from the combined feed of the Genesis and Voyager Plants. The primary aim of the Vulcan Plant is to increase chrome recovery from the current 65% target to 82% at the Tharisa Mine, capable of adding an additional 400 ktpa (ca. 30% of current production) of chrome concentrate output. Vulcan will use a proprietary process using existing technologies to improve chrome recoveries with the process having been rigorously tested and proven through pilot plant test work and the operation of a production scale demonstration plant. The total capital cost of US$54.2 million includes contingency and owner’s cost.
Sales and marketing
The Group’s market advantage is its exposure to both the PGM and chrome markets. This dual exposure gives the Group a hedge against volatility in either of the commodity prices.
Tharisa Minerals continues to supply the majority of its PGM concentrate to Impala Platinum in terms of its offtake agreement and is paid a variable percentage of the contained PGMs and base metals contained within each tonne of concentrate in terms of an agreed market formula.
The PGM basket price improved by 17.1% to US$1 081/oz in FY2019.
Chrome concentrate sales totalled 1.4 Mt, 314.7 kt of which was Tharisa’s higher margin speciality chemical and foundry grade chrome concentrates. The bulk of the Tharisa sales are derived from metallurgical grade chrome concentrate, sales of which included 207.5 kt of third-party chrome concentrates.
Speciality grade chrome concentrates produced within the Group are sold in terms of an agency and offtake agreement. The chemical grade chrome concentrate is jointly marketed with Tharisa and an independent third party.
Spot metallurgical chrome concentrate prices were volatile during the financial year, but overall lower than in the previous year, with prices received ranging between US$190/t and US$142/t with the average price for metallurgical grade chrome concentrate on a CIF main ports China basis decreasing in US dollar terms to US$162/t from US$186/t for the previous year.
The production of the higher value speciality chrome concentrates, which typically command a premium of greater than US$50/t provided additional margin.
The Group continued to deliver metallurgical grade chrome concentrate in terms of its five-year strategic cooperation agreement with Taiyuan Iron & Steel’s (‘Tisco’s’) joint venture company Shanxi Taigang Wanbang Furnace Charge Co. In terms of the agreement, which was effective as of September 2017, Arxo Resources will supply Tisco with a minimum of 240.0 ktpa of metallurgical grade chrome concentrate.
Metallurgical chrome production is shipped in bulk and containers via South African ports to major stainless steel and ferrochrome producers in China.