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Zimbabwe’s Biggest Platinum Project At Risk As Russian Investor Quits

Zimbabwe’s Biggest Platinum Project At Risk As Russian Investor Quits

Russia’s Vi Holdings says it has exited from Great Dyke Investments, leaving the future of what is supposed to be Zimbabwe’s biggest platinum project at risk. 

Vi Holdings is surrendering its 47.8% stake to its local partners, Kuvimba Mining House and Fossil, according to Vi Holdings representative Igor Higer. 

Higer did not give reasons for the decision, according to Bloomberg.

However, industry officials say Russian involvement in Ukraine had made GDI’s already tough fundraising mission impossible. 

GDI had planned to mine the first ore in 2021 and at its peak produce 860 000 ounces of platinum. This would have made it the biggest mining venture in Zimbabwe. 

However, GDI saw a series of missed fundraising deadlines, and the collapse of funding proposals under sanctions on Russia put on a lid on the project.

In 2020, GDI announced that the African Export-Import Bank (Afreximbank), the lead arranger for project funding, had completed due diligence on the project, allowing the company to start raising capital.

But GDI Chief Executive Officer Alex Ivanov said coronavirus delayed project fundraising, which was originally due to be completed in 2021. Financing of a US$665 million first phase development was pushed to the first quarter of 2021. 

In December 2020, in a bid to raise capital, GDI sold a 4.4% stake for US$30 million to Fossil Mines as COVID-19 disrupted fundraising. 

That sale valued GDI at US$680 million.

Vi Holding, owned by Russia’s Vitaliy Machitskiy, has had to carry the burden of exploration alone, spending US$100 million on pre-development. 

Needing funding, GDI reportedly tried to sell the project to Implats, which runs Zimplats. But Implats turned down the offer over concerns about the ownership of GDI, especially the involvement of Kuvimba. 

Sanctions on Russian businesses over Ukraine made GDI’s efforts to raise capital even harder. Russian companies are no longer able to raise capital in London or New York, making Afreximbank’s task virtually impossible. 

Signs that funding was hard to get showed as work stalled at the site, and the company started to seek out cheaper ways to develop the mine. 

Kuvimba CEO Simba Chinyemba recently said the strategy for the project has had to change. Chinyemba said:

After further exploration and analysis common to projects such as this, it is now believed that the orebody may be more amenable to an open-pit project. GDI is thus remodelling the whole Darwendale project in order to take this into account.

The failure of GDI is a major knock for Zimbabwe, which has placed mining at the centre of efforts to end the economic crisis. 

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15 Comments

JENA GURU 2 weeks ago

KO SEYI MAPURISA VASIRI KUSUNGA AKAMBUNYIKIDZA NEKUROVA ZVAKARE MORE LESING SEZVO ARIKUZIKA WA NDIYE ANOZIVA KWAAKAVIGA MORE BLESSINGS MAPURISA BATAYI MUNHU


Vene Venyika 2 weeks ago

Zvimwe zvose mungataure henyu, nyika yedu yakaroyiwa. Ndosaka muchiona kuti dhora redu riri kuwa, apawo zvinhu zviri kukwira mutengo kudhora re America.

Dzimwe nyika dzose kuchamhembe kwe Sahara vari kushandisa mari dzavo uye ye America pasina dambudziko. Asi kwedu kuno ku Zimbabwe zviri kuramba.

Kuroyiwa chaiko uku hamuzvioni here nhai veduwee. Handeyi kun'anga nyika yedu iroyonorwe.

Vote ZANU PF


Tkt 2 weeks ago

@Jenerari... My friend as long as you wish good for your country never stop supporting local minds & locally bred solutions
Back to it, what are the primary causes of Inflation?
If it is broad money supply, then watch the space the US$ is now hearing for a collapse nemazi Mari Ari kungo pulejiwa newamunoti Bhidheni uyo towards Ukraine KKK zhet ringoripo kuwisa US economy nekuva printisa mazi Mari then otanga kurambwa Internationally.
Baba pepukai imi muone kuku venda zvinhu


Imwe Mbeu 3 weeks ago

Senyika takanokorwa tsoka chete


Haunyare Manje 3 weeks ago

Now we see the results of Russia's invasion to Ukraine but a full grown up ED didn't see anything bad about that war. But this was obvious and inevitable.


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Jenarari 3 weeks ago

Mega dhiri gone sour, raiki sawa racto miriki.

Hezvo @Tkt,(Chikiti), Blue 💙, @Blue Black🔵, Jamwanda @ Co. Gwautai tinzwe

Pamberi peZANU pane gomba ✊🏼✊🏼✊🏼


Chawabvunza 3 weeks ago

The collapse of this Russian/Zimbabwean deal does not surprise citizens who know that it was just fooling people. Since this administration came into power there are several deals which have collapsed. When Russia invaded Ukraine, I heard one senior member of the Old People's Home parroting that the West had met their match in the form of Russia. Today those sanctions which the West imposed on Russia have come back to haunt Zimbabwe. From its inception this deal has been suspiciously moving at a snail's pace. Therefore its collapse can not surprise those of us who were following it with verve.

NYIKA INOURAIWA NE MBAVHA DZAYO.

NGAAPINDE HAKE CHAMISA [NHC].

[VOTE CCC FOR REAL CHANGE].


zimboy 3 weeks ago

nyikaa ino yakaroyiwa🙌


Zim 1 3 weeks ago

hauna nyaya


Pinga the Great 3 weeks ago

some comments don't need concentration stop saying ED will deliver where could he get the money whilst those gigantic companies are pulling off ,banks are failing to fund the project then a dull dunderhead is busy bucking without knowledge why can't u takeover yourself pple are tired of u plzz use Twitter kna zvakakunakira


ZimCitizen 3 weeks ago

Kuvimba mining house = Queen B. Zvakatodhakwa.


student 3 weeks ago

Nyika inovakwa nevene vayo, ngazviyende our president ED will deliver us even without foreign investors or NGOs🇿🇼🥱✊

Trust ZANU PF trust ED


Purse 3 weeks ago

Trust ED ndochiii ichocho

youth 3 weeks ago

inogovakwa sei nevene vayo Imi muchidaidza vekunze kuzokuvakirai....😹😹this pindula is a CCC project

Zuze 3 weeks ago

Bamnini garai pasi.
If you still trustED, you have a vacuum between your ears


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