Vele unit to process zinc at old refinery
The old Zincor site comprises five resources with varying concentration of lead, silver, zinc, iron and gold
Vele Private Equity, a wholly owned subsidiary of Vele Investments, has launched a zinc processing plant that will process its two large tailing dumps at the old Zincor Refinery, east of Johannesburg.
The tailings dumps are on a 240ha site operated by EBM Projects, which is owned by Vele Private Equity. EBM Projects acquired the dumps and plant in 2011 after Exxaro Resources closed zinc production of about 105,000 tonnes a year. It was also an old plant with intensive labour, electricity and transport costs.
The old Zincor site comprises five resources with varying concentration of lead, silver, zinc, iron and gold. The pure metal stockpiles are estimated at R22bn at current spot prices for the metals.
In March 2018 EBM raised second-phase capital from international funders to restructure and rehabilitate the zinc from site. The targeted date of production is September 2018. Phase one had seen lead and silver processing.
"It required us to raise R160m," said Warren Thomson, CEO of alternative investment vehicle Summit Africa, which handled the fund raising. Of this amount, Vele Investments put in R20m of its own equity.
EBM Projects owned the land at the site, which was ultimately owned by Vele Investments. "We are working our way through each resource," Niel West, MD of EBM Projects, said. He said that all processed materials would be sent to a buyer in Singapore.
Robert Madzonga, group CEO of Vele Investments, said it had R40bn of investments across the property, banking, financial services, asset management and insurance sectors. He said the new plant was one of a few private equity projects that the group was involved in.