Anglo-Swiss mining group Xstrata on Thursday announced the permanent closure of Xstrata Alloys’ Vantech vanadium operation in South Africa, resulting in a write-down of R63,2-million.
”The decision to close Vantech follows a thorough assessment of the operation’s future prospects and of the financial viability of opening a new mining area at the site,” Xstrata said in a statement to the London Stock Exchange.
The Vantech operation in Mpumalanga, in South Africa’s north-east, was put into care and maintenance early this year.
Xstrata Alloys’ chief executive, Peet Nienaber, meanwhile said the sustained strength of the South African rand is one of the reasons why further investment to restart production at Vantech cannot be justified.
”We will now concentrate our efforts on a full rehabilitation programme at the site and will continue to honour all our responsibilities in managing the closure of the operation,” he said.
Project Lion, a new ferrochrome complex, will be developed on land adjacent to the Vantech site, Xstrata said.
It will use a large proportion of the existing infrastructure and equipment from the Vantech operation, while a number of Vantech’s employees have already transferred to the new ferrochrome project.
Vanadium is usually mixed with steels to produce a fine-grained material, resistant to wear and able to withstand high temperatures.
Ferrochrome is a finishing material containing about 70% chromium. — Sapa-AFP