Name of the Project
Platreef palladium/platinum/rhodium/nickel/copper/gold project.

Location
Northern limb of South Africa's Bushveld Igneous Complex, in Limpopo.

Project Owner/s
Ivanhoe Mines indirectly owns 64% of the Platreef project through its subsidiary, Ivanplats, and is directing all mine development work.

The South African beneficiaries of the approved broad-based, black economic-empowerment structure have a 26% stake in the Platreef project. The remaining 10% is owned by a Japanese consortium comprising Itochu Corporation; Japan Oil, Gas and Metals National Corporation; Itochu affiliate ITC Platinum Development; and Japan Gas Corporation.

Project Description
Ivanhoe Mines has reported outstanding positive findings of an independent Platreef integrated development plan 2020 (Platreef IDP20) for the tier-one project. The project has total probable reserves estimated at 124.7-million tonnes as at November 30, 2020, for seven-million ounces of platinum, eight-million ounces of palladium, 1.2-million ounces of gold, 500 000 oz of rhodium, 457-million pounds of copper and 932-million pounds of nickel.

The Platreef IDP20 encompasses two devel­opment scenarios. 

The Platreef 2020 feasibility study – an update of the 2017 feasibility study –  evaluates the development of a 4.4-million-tonne-a-year under­ground mine, with two concentrators built in modules of 2.2-million tonnes a year. This updates the 2017 feasibility study by taking into account the development achieved since then, as well as updated costs, metal prices and foreign exchange assumptions, in addition to increased throughput from four-million tonnes a year to 4.4-million tonnes a year to use the full processing capacity of the two concentrators.

The feasibility study has an average production of 508 000 oz/y of platinum, palladium, rhodium and gold, plus 22-million pounds of nickel and 13-million pounds of copper.

The alternative Platreef 2020 preliminary eco­nomic assessment (PEA), or phased development plan, evaluates the phased development of an initial 700 000 t/y underground mine using the existing Shaft 1 and a new 770 000 t/y concentrator, targeting high-grade mining areas with significantly lower capital costs.

After first production is achieved, Shaft 2 sinking will start to coincide with the construction of two additional 2.2-million-tonne-a-year concentrator modules and the ramp-up of the initial concentrator to its full capacity of 770 000 t/y, increasing steady production to 5.2-million tonnes a year.

Shaft 2 development may be brought forward to accelerate this expansion.

The PEA envisages Phase 1 during years 1 to 6 at an average production 109 000 oz/y of plat­inum, palladium, rhodium and gold (3 PGE + Au), plus five-million pounds of nickel and three-million pounds of copper.

Average production for Phase 2 – years 7 to 30 – is 613 000 oz/y of 3 PGE + Au, plus 27-million pounds of nickel and 16-million pounds of copper.

Potential Job Creation
Not stated.

Net Present Value/Internal Rate of Return
The feasibility study yields an after-tax net present value (NPV), at an 8% discount rate, of $1.85-billion and an internal rate of return (IRR) of 19.8% at a long-term consensus metal price, with a payback of 4.4 years. At spot metal prices, the feasibility study estimates an after-tax NPV, at an 8% discount rate, of $3.74-billion and IRR of 28.4%, with a payback of 3.2 years.

The PEA yields an after-tax NPV, at an 8% discount rate, of $1.61-billion and IRR of 20% at long-term consensus metal prices, and an after-tax NPV, at an 8% discount rate, of $3.3-billion and IRR of 29.1% at spot metal prices. Payback at long-term consensus metal prices is estimated at 8.4 years and at spot metals prices at 7.3 years.

Capital Expenditure
The Platreef 2020 feasibility study estimates initial capital costs for the project at $1.4-billion.

The PEA estimates an initial capital cost of $390-million. Expansion capital is estimated at $1.27-billion.

Planned Start/End Date
The Platreef IDP20 envisages Shaft 2 equipped for hoisting in 2025, allowing for first concentrate production in the latter half of the year.

The PEA envisages first concentrate production for this option in 2024, with the sinking of Shaft 2 restarting in 2025 to coincide with the con­struction of two 2.2-million-tonne-a-year concentrators to be completed by 2029 and 2030.

Latest Developments
In December 2021, Ivanplats concluded stream financing agreements with Orion Mine Finance and Nomad Royalty Company for a $200-million gold streaming facility and a $100-million palladium and platinum streaming facility for its Platreef project.

The proceeds will be used to advance the first phase of Platreef’s mine development.

The definitive feasibility study for Platreef’s phased development plan, which will provide updated production forecasts for the initial mine and subsequent expansion, is nearing completion with its release expected in first quarter of 2022.

Ivanplats has also signed documents relating to offtake arrangements for 100% of Platreef's Phase 1 platinum group metals (PGMs) concentrate production, which is expected to exceed 40 000 t/y containing six payable metals – palladium, rhodium, platinum, nickel, copper and gold.

The offtake arrangements are with Northam Platinum and Heron Metals, in a joint venture in which Singapore-registered company Trafigura has a majority shareholding.

The terms of the proposed offtake with Heron Metals/Trafigura are based on a nonbinding indicative termsheet and are subject to negotiation and execution of definitive documentation for a concentrate sales agreement.

Further, Platreef has concluded a three-year collective agreement with its employees that “values and respects their expertise, their contributions during the pandemic and their role in building the world's next great mine”.

Key Contracts, Suppliers and Consultants
OreWin (Platreef IDP20); Epiroc (emissions-free, battery electric drill rigs and underground loaders).

Contact Details for Project Information
Ivanhoe Mines, tel +27 11 088 4300 or email info@ivanhoemines.com.