Australian platinum developer Platinum Australia (PLAA-L, PLA-A) has received positive preliminary results from a feasibility study on the Smokey Hills platinum-group-element project in the eastern Bushveld area in South Africa.
The company, which is earning an 80% interest in the project from a private South African concern, is reviewing the results and expects to have a final feasibility study soon. It has started to seek financing and permits for production on the project.
A recent resource estimate by Snowden Mining Industry Consultants showed a measured and indicated resource of 5.5 million tonnes grading 2.5 grams platinum, 2.5 grams palladium, 0.5 gram rhodium, 0.8 gram ruthenium, 0.2 gram iridium and 0.08 gram gold per tonne, all on the UG2 reef of the Bushveld layered intrusive complex.
The study considered mining from open pits and decline-access underground mines, with initial contract milling while a flotation plant is built. The plant would then take over ore beneficiation, producing a single bulk concentrate. The mine would turn out about 96,000 oz. precious metals annually.
The capital cost of the project would be around US$42 million and cash production costs would clock in around US$228 per oz. of platinum-group metals. Cash flow analyses put the internal rate of return at 63% and a net present value of US$133 million, using a 10% discount rate and fairly conservative price assumptions.
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