JOHANNESBURG (miningweekly.com) – While diesel demonisation continues to the detriment of platinum, several key steps that will benefit platinum are poised to be taken in the next 18 to 24 months.
The first of these key steps is the substitution of platinum for palladium in gasoline systems, against the backdrop of palladium being dubbed 'unobtainium' because of its growing scarcity.
"They're struggling with palladium availability and certainly, in our conversations with coaters and original equipment manufacturers (OEMs), the predominant conversation is can you secure increasing quantities of palladium and the short answer is 'no, not right now'," Impala Platinum (Implats) group executive: refining and marketing Paul Finney said in response to Mining Weekly Online during a media roundtable.
"We're already seeing platinum replacing palladium in the diesel market, and if platinum can achieve just a 10% penetration into the gasoline market, it'll be an 800 000 oz shift," said Finney, who revealed that Implats and a leading international coater are at an advanced stage of developing three-way gasoline catalysts that, if introduced, have the potential to bring the palladium market into balance, relieve OEM anxiety and work wonders for the platinum price.
"We're active in that programme right now," Finney divulged.
The second key step set to benefit platinum is Europe's real driving emissions (RDE) initiative, in which increased platinum loadings can play a role in meeting the demand for a reduction in the emission of nitrogen oxide (NOx).
The job of reducing NOx is currently done by rhodium but rhodium, in Finney's words, will become the "next palladium" if demand for it grows too high, as happened to it in the late 1990s and 2000s.
The recurrence of a rhodium price spike can be avoided by using platinum rather than rhodium to attenuate NOx - the third key platinum-benefitting step.
The fourth one will be the rise in demand for heavy duty diesel vehicles in China and India, which will more than offset that decline in Western Europe.
The promotion of platinum jewellery is seen as the way to improve demand for platinum in a relatively short time and the model that Platinum Guild International (PGI) promotes with its partners is regarded as being highly successful.
The partners that use this model of moving to sophisticated designs that can be piece priced, showed quarter-on-quarter growth throughout last year.
That model now needs to be migrated from the tier one cities to tier two cities in China, where the bulk of the PGI influence resides.
Last year, on top of standard contributions to the PGI, Implats put another $1-million into Chinese bridal jewellery and the feedback received is that retailers increased their sales on bridal pieces by between 8% and 20%.
"That tells us that if you put the money in to PGI, with the programmes they have, you'll get the returns," said Finney.
PGI CEO Huw Daniel outlined to Mining Weekly Online last year how additional marketing of jewellery could create demand for another 3.5-million ounces of platinum.
In India, demand growth of 25% to 30% a year is coming off a relatively low base of 200 000 oz a year, with 500 000 oz a year in sight by 2020.
"We're in about 900 jewellery stores in India at the moment. The potential there is at least 2 000 to 3 000 more stores," Daniel said at the time.
FUEL CELL STRATEGY
The longer-term strategy is with fuel cells. There Implats has a multi-faceted approach. It has already developed a stationary fuel cell at its refinery in Springs, for which it secured a grant from the Department of Trade and Industry.
Unfortunately, the French EDF utility company has withdrawn the South Africa risk adjusted returns to Implats, which has resulted in the company turning to the State-owned Industrial Development Corporation and the Public Investment Corporation to come on board as funders.
Implats is also strongly addressing the localisation element, both in developing a special economic zone (SEZ), through the Gauteng Industrial Development Zone initiative.
It is at the point of carrying out the environmental impact assessment on site.
Implats has invested R25-million in bus and load haul dumper niche applications where the mobile space is best served by a minimum number of refuelling points, the lowest infrastructure hurdle.
It is also working with a partner in developing fuel-cell componentry that includes power modules, storage systems and the very heart of the fuel cell, the stack, to ensure that there is a local feed into the SEZ in the manufacture of fuel cells.
"It's a multi-faceted development strategy, short-term and long-term," Finney pointed out to Mining Weekly Online.
South Africans last year visited Germany to update themselves on passenger carriers powered by platinum-catalysed fuel cells.
There is considerable interest in fuel cell buses and trains and a year ago, South African fuel cell protagonists and government officials also met their German counterparts in South Africa to discuss a pilot project involving the introduction of hydrogen fuel cell buses in cities in South Africa.
Fuel cells convert hydrogen into electricity through a chemical reaction that relies on platinum's catalytic role.