Name of the Project
Bengwenyama platinum group metals (PGMs) project.

Location
Eastern Limb of the Bushveld Complex, in Limpopo, South Africa.

Project Owner/s
Southern Palladium 70% and Nurinox 30% (Bengwenyama Community).

Project Description
A scoping study has shown the project to have very attractive economics, with results justifying a prefeasibility study (PFS) already under way.

The project aims to extract PGMs from the upper group two (UG2) and Merensky reefs, which constitute one of the very few remaining areas within the Bushveld Complex where economically viable PGMs deposits remain unexploited.

The scoping study proposes a two-million-tonne-a-year UG2 reef underground mining operation using hybrid mining, with conventional stoping supported by on-reef mechanised development and ore clearance.

The life-of-mine for only the UG2 reef is estimated at 36 years, with a total of about 52-million tonnes mined – about 10.9-million ounces platinum, palladium, rhodium, ruthenium, iridium, osmium and gold (7E or 6E+gold), for an average production rate of 330 000 oz/y platinum, palladium, rhodium, ruthenium, iridium and gold (6E or 5E+gold) basis. This ignores residual value beyond modelled life or any exploration upside. 

The project includes:

• construction of a flotation and spiral plant to deliver PGM and chrome concentrates from a conventional plant, with an estimated 200 000-t-a-month ore feed design capacity. A 75 µm grind size is envisaged.
• construction of a dry-stack tailings storage facility conforming to Global Industry Standards on Tailings Management requirements.
• connection to the nearby national grid power substation and construction of a 132 kV overhead powerline to supply (based on initial indications) of about 43 MVA peak demand.
• connection to an existing licensed, bulk water supply pipeline, located at the entrance road to the project. Water supply will be supplemented with available ground- and surface water.
• comprehensive integration of all on-site infrastructure, encompassing site access roads, office and administrative buildings, engineering workshops, stores, a guardhouse, surface-water storage facilities and other supporting facilities.

Potential Job Creation
About 4 000 jobs will be created.

Net Present Value/Internal Rate of Return
The project has a pretax net present value, at an 8% discount rate of, $1.04-billion and an internal rate of return of 24% (pretax), with a payback from the start of plant production of 4.5 years.

Capital Expenditure
$408-million.

Planned Start/End Date
The completion of the PFS and associated resource drilling is planned to be completed during the second half of 2024. The PFS  is fully funded.

Latest Developments
Southern Palladium has released its a third mineral resource update for the UG2 reef to be used in the PFS.

The UG2 measured and indicated mineral resource has increased by 25% to 8.17-million ounces of 7E PGMs at a grade of 9.89 g/t over a reef width of 73 cm.

“Importantly, 28% of this UG2 M&I mineral resource is now classified as measured, further enhancing our confidence in the project’s potential,” MD Johan Odendaal has said.

Also, 2.3-million ounces at 10 g/t (7E), or 28% of the UG2 measured and indicated mineral resource, are now at measured status.

UG2 inferred mineral resources have increased by 81%.

The total UG2 mineral resource – at 24.81-million ounces across measured, indicated and inferred categories, combined with the Merensky reef resource – brings the total mineral resource to 35.32-million ounces, up 35% from previous estimates.

An update of the Merensky reef mineral resource is under way.

Southern Palladium has further reported that all UG2 exploration targets, including those within Nooitverwacht, have been successfully converted to inferred mineral resources, which increased by 81%.

The PFS is on schedule for release in the fourth quarter of this year.

Key Contracts, Suppliers and Consultants
SRK Consulting (PFS review); Minxcon (lead consultant, mining and resource estimation); Eco-Elementum (surface infrastructure, water management); ENTAIL (TSF); Bear GeoConsult (surface geotech); OHMS (mining geotech); and OMI Solutions (Independent EAP).

Contact Details for Project Information
Southern Palladium, email info@southernpalladium.com.