JOHANNESBURG (miningweekly.com) – Platinum group metals (PGM) mining company Valterra Platinum has received board approval to conduct a feasibility study into the development of Sandsloot Underground at the well-endowed Mogalakwena opencast PGM mine in Limpopo.

This forms part of the approach of the former Anglo American Platinum to invest for maximum value, the Johannesburg Stock Exchange entity outlined when it released its maiden 2025 interim results on Monday, July 28.

Trial mining at this bulk mechanised underground mining opportunity will also be undertaken over the next 18 months as part of the feasibility study, followed by a ramp up to Phase 1 steady state towards the end of the decade.

Valterra CEO Craig Miller emphasised the company’s focus of value over volume when he reported the completion of the Sandsloot Underground prefeasibility study (PFS), which has been a key step in providing confidence to press ahead with the phased development of Sandsloot as it moves through feasibility.

“The first phase, if it meets our capital allocation criteria, is a trucking solution, which will support an initial production rate of roughly two-million tons to 2.5-million tons per annum.

“If Phase B meets our capital allocation hurdles, we’ll then expand the ore logistics infrastructure to include a conveyor system, allowing the mine to gradually ramp up to around five-million tons per annum but post-2030, unlocking the full potential from Sandsloot,” Miller outlined during the presentation covered by Mining Weekly.

The results of the project’s PFS confirmed reef grade of four to six grams per ton, significantly higher than other mechanised underground mines in Southern Africa, as well as a competent hanging wall and favourable mining width with 45-m reef height, characteristics which make the orebody amenable to bulk mechanised underground mining.

The feasibility study underway is targeted for completion in the first half of 2027, at which point an investment decision will be made.

In the six months to June 30, 12.8 km of underground exploration drilling and 1.6 km of decline development were completed at Sandsloot, bringing the cumulative total to 43 km drilled and 8 km developed.

The 31 000 t of ore stockpile accumulated by the end of June will be processed through the concentrator facilities as part of feasibility work.

“We've also reduced our current year capex guidance from R2-billion to R1.5-billion while guidance for 2026 and 2027 will be between R1.5-billion and R2.5-billion per annum,” Miller pointed out.

SECOND-HALF TAILWIND EXPECTATIONS

Miller said Valterra expected the second half of the year to benefit from several operational tailwinds.

Amandelbult is expected to be restored to normalised production during the quarter and produce between 450 000 and 480 000 PGM ounces.

“We're continuing to implement our operational excellence initiatives across both mining and processing assets, with improvements in productivity and concentrated recoveries as well as chrome yields.

“We will deliver on our cost savings target of R4-billion in 2025. Since we started the cost savings programme, our savings total R14.5-billion, of which R9.5-billion is from operational expenditure and the balance being from capital expenditure.

AMANDELBULT FLOODING SET BACK

Despite the Amandelbult mine flooding event, Valterra CFO Sayuri Naidoo was able to report a maiden first-half results that was sufficient to enable the board to pay out 40% headline earnings as a R500-million interim dividend, in addition in addition to the R16.5-billion paid out in the first half of the year as part of the final 2024 dividend.

Operating cost savings of R9.5-billion have been delivered since the launch of the 2024 action plan and stay-in-business capital has been further reduced by R5-billion.

Cash operating unit cost declined 2% from 2024, to R17 952 a PGM ounce.

The all-in sustaining cost (AISC) for the first half of the year, excluding the impact of the Amandelbult flooding, was $962 per three element (3E) ounce and the AISC for the year is expected to be between $970 a 3E ounce to $1 000 a 3E ounce, supported by targeted cost savings, sustaining capital optimisation and higher sales volumes.

Debt of R4.9-billion represented 0.3 times net debt to earnings ratio including the customer prepayment and liquidity of R27-billion reported.

PGM production (excluding tolling) declined 22% to 1.39-million ounces and sales volumes were 25% lower and earnings were 46% down at R6.6-billion.

FATALITIES

Felix Kore lost his life in a mobile machinery-related incident at Unki mine in Zimbabwe on April 20 and William Nkenke lost his life at Amandelbult’s Dishaba mine on July 22.