JOHANNESBURG (miningweekly.com) – In sharp contrast to South African mining’s deep dark and dangerous reputation, the JSE-listed Pallinghurst is rolling out a shallow, safe and sassy platinum alternative spiced with potentially game-changing technology.
The platinum division of the company founded by mining doyen Brian Gilbertson is on a mission to create a platinum-group metals (PGMs) producer for the twenty-first century, as Pallinghurst CEO Arne Frandsen outlines in the attached Mining Weekly Online interview.
It has a 100-million-ounce resource on the western limb of the Bushveld Complex to put into the platinum mix at a time when the Association of Mineworkers and Construction Union (AMCU) strike is throwing the industry into unpredictable turmoil.
“I have never seen an industry as ripe for restructuring. I am simply at a loss to explain that with all this metal going off the market the prices remain so weak,” was Gilbertson’s comment to Mining Weekly Online.
While the three major platinum companies continue to face uncertainty, the company's Sedibelo platinum business is currently moving up a gear on the production front.
“We’re in the happy position that our mine is running. So we’re getting on with our project and waiting for that sea-change to take place in the market and then we will harvest the platinum operation and return its full value to our shareholders,” says Gilbertson.
The diversified Pallinghurst group’s shallow, safe, mechanised and low-cost openpit platinum operation will be mining 1 500 m above the industry average for the next 30 to 40 years and, when it does eventually go underground, mining will remain above refrigeration level for decades.
The constellation of State-linked organisations that make up the company’s investor base are all investing for the long term, as is the Bakgatla Ba Kgafela community’s black economic empowerment 27% shareholding in the platinum company, which is fully paid-up and debt-free – “unencumbered, direct exposure at the shareholder level”.
The Kgosi Nyalala Pilane-led 350 000-strong Bakgatla Ba Kgafela invested R1-billion-plus cash, and South Africa’s State-owned Industrial Development Corporation (IDC), two years ago, committed R3.24-billion over five years to the new integrated miner and beneficiator vision, in return for a 16.2% stake.
Besides the South African government investing through the IDC, the Singaporean government has invested through its Temasek sovereign wealth fund and the Dutch government through the Dutch Algemene Pensioen Groep.
“Over the past three or four years we’ve attracted $1-billion to $1.5-billion foreign investment into South Africa, making us one of the largest investors,” Frandsen points out.
Last year the PGM business, which is in the black, produced 150 000 oz and expects to produce 1.1-million ounces a year as its expansion plans are realised.
“Our workers sit in air-conditioned Caterpillars listening to Classic FM,” Frandsen quips.
The company, which produces its own concentrate, intends introducing Kell technology, which is a low electricity user and which is insensitive to chrome content.
“It’s something that could potentially transform the market,” says Frandsen, describing it as one of the cylinders the company is firing on to create a PGM mining company for the twenty-first century.
The bankable feasibility study on the introduction of the Kell process is board approved and detailed engineering design is under way.
The process, developed by former Mintek researcher Keith Liddell, consumes 80% less electricity and the smelting of a ton of concentrate using the Kell hydrometallurgical process requires 140 kWh/t rather than the conventional 1 000 kWh/t and emits 400 kg/t of carbon dioxide rather than the conventional 1 400 kg/t.
“We think there are important improvements that can still be done in the metallurgical plant and we have bought the units for a new technology that will feed the higher-grade material into the process and remove the barren rock so that what has to be treated is of lower volume,” says Gilbertson.
If major sections of the platinum-mining industry are closed, a completely different future awaits the industry, in which well-founded emerging producers could take centre stage.