Southern Palladium barrels towards Bengwenyama PFS

Southern Palladium (ASX:SPD) has surpassed 30,000m of diamond drilling for a forthcoming Prefeasibility Study (PFS) at its 70% owned Bengwenyama PGM Project in South Africa. 

Bengwenyama sits on the Eastern Limb of the Bushveld Complex in the heart of a ‘significant’ underground mining region, leveraging existing infrastructure and knowledge for operations.  

Recent drilling has targeted the North Horst Block to get a better understanding of the area and potentially convert more of the inferred resource to indicated status. 

Results for the final drillholes are expected to be incorporated into an updated Mineral Resource Estimate (MRE), which is scheduled for completion early Q3 2024. 

The updated MRE, coupled with a maiden ore reserve, will form part of the PFS. 

Completion of the PFS, which is being reviewed by SRK Consulting, is set for early Q4 2024. 

Southern Palladium, which has a $29.61 million market capitalisation, says it is well funded to complete the PFS with an existing cash reserve of $8.34 million as of 31 December 2023. 

Managing Director Johan Odendaal says: “Notably, the initial target area in Eerstegeluk has been successfully converted to indicated mineral resources by the end of 2023, marking significant progress. 

“With assay results for the North Horst Block still pending, the project already boasts an existing indicated and inferred MRE of 26.22Moz. 

“The environmental impact assessment, a core component of the forthcoming mining right application, is also progressing well and remains on schedule to be submitted for review by mid-2024.”

In February 2024, an Scoping Study for Bengwenyama was completed by Johannesburg-based mining consultancy Minxcon. 

The Scoping Study outlined a life of mine for the UG2 reef of 36 years for an average annual production rate of 330,000 ounces of platinum group metals (PGM), with cash costs firmly at the lower end of the global cost curve. 

Other results of the study include an initial capital spend of US$408 million, a post-tax net present value of US$700 million a post-tax internal rate of return of 21% with post-tax capital payback of 4.5 years from first concentrate production, and a life of mine EBITDA of US$5.2 billion. 

Southern Palladium is a dual-listed PGM company focused on advancing the Bengwenyama Project in South Africa, which it says is a ‘compelling’ opportunity in the global PGM market.   

As of December 2023, the company had just over $8.34 million in cash and cash equivalents, according to its latest half yearly report. 

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Images: Southern Palladium
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Written By Adam Drought
Born and raised in the UK, Adam is a sports fanatic with an interest in Rugby League and UFC/MMA. When not training in Muay Thai and Brazilian Jiu Jitsu, Adam attends Griffith University where he is completing his final year of a Communication & Journalism degree.