TSX- and NYSE-listed Platinum Group Metals (PTM) says its near-term objective remains advancing the Waterberg platinum group metals (PGM) project, in South Africa, to a development and construction decision.

The company has been in financing and offtake discussions since the project’s definitive feasibility study (DFS) was updated in September last year.

The Waterberg project is planned as a fully mechanised, shallow, decline-access platinum, palladium, rhodium and gold mine. The mine will also produce copper and nickel as byproducts.

PTM, together with Anglo American Platinum and Florida International University, is advancing an initiative through Lion Battery Technologies using platinum and palladium in lithium battery technologies.

The Waterberg Joint Venture (JV) is owned 37.19% by PTM, 26% by Mnombo Wethu Consultants, 21.95% by HJ Platinum Metals Company and 14.86% by Impala Platinum Holdings. PTM holds a further 12.97% indirect interest in the JV through a 49.9% interest in Mnombo.

The Waterberg JV board in February approved a R42-million, or $2.2-million, interim budget to allow for the continuation of work programmes for the project until August 31, including pre-construction site work, engineering and preparation and a DFS on a PGM smelter and base metal refinery project in Saudi Arabia.

The company will also use proceeds from an equity distribution agreement with BMO Nesbit, BMO Capital Markets Corporation and Beacon Securities for the project. The agreement, which was signed in December last year, allows for new at-the-market PTM shares to be issued for up to $50-million from time to time.

In the three months ended February 28, PTM issued 842 561 common shares through BMO Capital Markets on the NYSE for gross proceeds of $1.1-million. The company subsequently sold and issued more shares worth $900 000 after the period.

Total expenditures on the Waterberg project, before partner reimbursements, for the six months ended February 28, were about $1-million and $90-million since the project’s inception.

BENEFICIATON STUDY

As far as the Saudi Arabia project is concerned, PTM in November last year signed a memorandum of understanding with Ajlan & Bros Company for Mining and the Ministry of Investment in Saudi Arabia for the setup of a proposed PGM smelter and base metal refinery.

All expenses related to the smelter DFS, which is expected to be $4-million, will be split equally between Ajlan and PTM.

A key requirement for the above proposal to establish a PGM smelter and base metals refinery in Saudi Arabia will be long-term South African government approval for the export of unrefined precious metals in concentrate.

In this regard, PTM has been working with the South African government to identify local beneficiation opportunities and to analyse the possible impact of exporting concentrate on the value chain.

Ajlan and PTM are also now studying the possibility of establishing a matte furnace in South Africa capable of smelting Waterberg project concentrate.

Such a facility would ideally be located near the Waterberg project with existing power, water and environmental authorisations. The converter matte produced would be shipped to Saudi Arabia for further processing through a base metals refinery, at which time spent auto catalysts and other PGM-bearing materials could be co-processed.

PTM and Ajlan are currently conducting a trade-off study and developing a scope of work and cost estimate for the engineering studies required to assess the above scenario, should it be chosen as the primary plan.

One noteworthy consideration would be the much lower volume of material to be shipped to Saudi Arabia. Rather than shipping up to 130 000 t/y of concentrate, or about 14 concentrate trucks a day, the volume of converter matte to be shipped would be reduced to about 8 000 t/y or one truck a day.