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Run-off election could hurt mining
Itayi Garande, The Zimbabwe Guardian
May 25, 2008

http://www.talkzimbabwe.com/news/117/ARTICLE/2520/2008-05-25.html

A disputed election will hurt production in the mining industry and could see Zimbabwe losing billions of dollars in mining revenue, according to mining industry experts.

Although platinum supplies from Zimbabwe rose 2,3% to 171 000 oz last year, a disputed run-off presidential election may damage output this year, metals refiner Johnson Matthey said last week.

Matthey said the dispute over the outcome of a run-off election, and further escalation of a power crisis in South Africa, the world's biggest platinum producer, could see platinum prices soar from current levels near $2 000.

"Any further substantial interruptions to South African supply will push the price higher. Political uncertainty in Zimbabwe could damage output there too," the metal refiner and platinum authority said.

"We therefore expect platinum to trade in a wide range from $1 775 to $2 500 during the next six months," Matthey's report said.

South Africa has seen output decline after mines were shut for five days in January after state utility Eskom failed to guarantee electricity supply, but the situation has normalized somewhat.

Zimbabwe, with the second largest reserves of platinum after South Africa, is well poised to benefit from the growth of platinum production.

Palladium and rhodium production stayed steady at 134 000 oz and 14 000 oz, respectively, for 2007, according to Matthey's report.

The world's biggest platinum miner Anglo Platinum and Rio Tinto have both said they will continue mining in Zimbabwe, even under the new nationalisation law guaranteeing 51 percent ownership to indigenous Zimbabweans.

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