Southern Palladium has secured a 30-year mining right for the Bengwenyama PGM project in Limpopo, with additional renewal rights after the initial permit expires.
The mining right for Bengwenyama was awarded to Miracle Upon Miracle Investments (MUM), which is about 70% controlled by Southern Palladium and holds the rights to the PGM project.
Southern Palladium has focused on advancing the Bengwenyama project, located on the Eastern Limb of the Bushveld Complex in South Africa, towards production over the past year to June. It has completed the pre-feasibility study for Bengwenyama and has now progressed to the definitive feasibility study phase.
Over the period under review, operating losses from operations at Southern Palladium increased to A$10.4 million (R120.7m), from A$4.7m (R55.1 m) a year earlier. Headline losses per share for the period increased by 67.92% to about R1.03.
Southern Palladium said chromite recoveries for the period were estimated at 85.6%, at a concentrate grade of approximately 42.2%. This compares with the pre-feasibility study assumption of 30% recovery at approximately 42%.
It added that, at a Stage 2 processing rate of approximately 2.4 million tonnes per annum, there is potential to increase chrome concentrate production from approximately 350,000 tonnes per annum to about 1.05 million tonnes per annum.
“The improved recovery profile elevates chrome from a secondary by-product credit to a strategically important co-product and potential standalone revenue stream. This is expected to improve the project’s resilience across commodity price cycles,” said the company.
Overall PGM recovery was estimated at 87.6%, compared with the PFS assumption of 85.3%. Estimated full-plant PGM concentrate grades also improved materially to approximately 404 grams per tonne, with an estimated concentrate mass pull of approximately 1.2%.
The lower mass pull and higher concentrate grade are expected to support more attractive smelting, refining and offtake alternatives.
“The results support a conventional, low-risk processing route based on established technologies already used within the South African PGM industry,” said Southern Palladium.
The definitive feasibility study timetable for Bengwenyama has been extended to the first quarter of 2027 to allow the substantial value associated with the improved PGM and chromite recoveries to be fully incorporated into the plant design, capital estimate, operating cost model and execution schedule.
The suspension of drilling during the period due to safety concerns resulted in the loss of 29 drilling days. With the project transitioning from drilling and feasibility studies to early construction and underground development, Southern Palladium expects the nature and scale of Bengwenyama’s safety-risk profile to change materially.
It said the commencement of box-cut and decline development would introduce increased exposure to mobile equipment, ground-control risks, explosives, excavation, lifting operations, contractor interfaces, electrical installations and underground working environments.
In preparation for this, Southern Palladium was developing specific risk assessments and operating procedures and strengthening contractor prequalification and safety-management requirements.
The company has previously said that the UG2 reef at Bengwenyama has an estimated life of 29 years, with a total of approximately 45 million tonnes mined for an average annual steady-state saleable product of 400,000 ounces of 6E PGMs.
Cash costs are expected to be firmly at the low end of the global cost curve as a result of the high delivered grade and shallow mining depths.
Southern Palladium views the Bengwenyama project as strategically situated among other Tier 1 operations along the Eastern Limb of South Africa’s Bushveld Complex. The location has the necessary infrastructure and connectivity, including water, power and roads, as well as services such as a skilled labour force already in place.
The National