New age for platinum production

AS WA-registered Aquarius Platinum makes final preparations to present its South African interests to the Alternative Investment Market in London, Perth-based Platinum Australia is nearly ready to start up a suburban pilot plant.

Platinum Australia intends to create history. Not only is it on track to establish Australia’s first platinum mine – it plans to do so despite being thousands of kilometres away from smelters in South Africa and Russia, and with ore described as comparatively challenging.

Thanks to an innovative solution, born of some rugged determination, Platinum Australia is set to replicate the reputation of major shareholder and technical services partner, Lonmin plc.

London-based Lonmin is renowned for its low cost platinum production in South Africa, where it has become the country’s third largest platinum producer.

With Lonmin, Platinum Australia has investigated an industry-unique hydrometall-urgical process to produce high-grade platinum group metals (PGM) concentrate suitable for bypassing a smelter and being sent direct to a refinery.

The standard flotation plus calcine-leach process, which also produces a base metal concentrate suitable for smelting, has demonstrated up to 80 per cent recovery to high grade concentrate.

Platinum Australia executive director John Lewins says low technical risk, comparatively high recoveries and reduced concentrate transport costs will enable the company to produce platinum for well below the average $US450 per tonne selling price.

PGM delivered to a refinery rather than a smelter attracts prices up to 10 per cent higher, while transport savings have been estimated at $7 million per annum.

Platinum Australia is also expecting a much quicker cash return on its product – high-grade PGM can be transported by air, as opposed to flotation concentrate, which must be shipped and takes two months to reach the smelter.

Therefore it is no surprise that Mr Lewins has been more than enthu-siastic in detailing the new process, under patent application, to the Australian investment community.

Work at Platinum Australia’s chromitite reef Panton project has boosted the independent resource estimate to 4.5 million ounces of PGM, and the company is keen to progress plans to mine the Kimberley ‘white gold’.

The bankable feasibility study is due for completion within four months, and an offtake agreement with 25 per cent stakeholder Lonmin, which last year commissioned a new smelter with excess capacity for chromitite reef material, is in place.

Lonmin, which has 10 days after board acceptance of the study to put up a finance proposal, can opt to boost its initial $12 million investment with a further $40 million, bringing its interest to 55 per cent.

The study thus far suggests a mine life of 10 years, with an initial open cut quickly followed by an underground operation, from which 90 per cent of the ore is expected to come.

With construction set to commence next year, production of an estimated one million tonnes – at five grams per tonne PGM plus gold – per annum is planned for 2004.