The prefeasibility study (PFS) of TSX-listed Ivanhoe Mines’ Platreef project demonstrates the robust nature of the latest major new mechanised underground platinum mine, near Mokopane, in Limpopo, Ivanhoe executive chairperson Robert Friedland stated last month.
Ivanhoe aims to develop the Platreef platinum, palladium, rhodium, gold, nickel and copper mine in three phases, with an initial production rate of four-million tonnes a year to establish an operating platform to support future expansions.
The latest study confirms the “excellent” economics and technical viability of the low-cost operation, Friedland says of the mine that will eventually expand production to eight-million tonnes a year, before reaching a steady-state 12-million tonnes a year in the third phase.
The PFS – an important milestone in Ivanhoe’s planned transformation of the Platreef discovery into one of the pre-eminent South African platinum-group metals producers – covers the first phase of development, including the construction of an underground mine, concentrator and other associated infrastructure to support initial concentrate production by 2019.
Ivanhoe estimates a preproduction capital cost of $1.2-billion, including $114-million in contingencies, to deliver the first phase operation of 433 000 oz of platinum, palladium, rhodium and gold (3PE+Au), in addition to 19-million pounds of nickel and 12-million pounds of copper a year.
The PFS, which shows Platreef ranked at the bottom of the cash-cost curve, at an estimated $322/oz of 3PE+Au, net of by-products, indicates that the project would deliver an after-tax internal rate of return of 13% and a payback period of less than seven years.
The expected after-tax net present value is $972-million, at an 8% discount rate.
The group will kick off a feasibility study on the four-million-tonne-a-year Phase 1 and a PFS on the eight-million-tonne-a-year Phase 2 in the near future.
Ivanhoe notes that, as Phase 1 is developed and commissioned, there will be opportunities to refine the timing and scope of subsequent phases of expanded production.
Skills Training
Over the next five years, Ivanhoe plans to inject R160-million into its social and labour plan, with R67.2-million allocated for the development of job skills among local residents and R87.7-million set aside for local economic development projects.
The planned Platreef mine will require about 2 200 workers over the first four years of operations.
“We will run training programmes to prepare young people to qualify for jobs in what will be a world-scale, mechanised mine,” the company states, adding that Ivanhoe will build a R26-million community skills development and training facility in Mokopane to establish a base of qualified, local candidates for jobs at the mine and its associated minerals processing plant.
The Mining Qualifications Authority of South Africa will accredit the facility, which will also equip learners with portable skills to help enable them to become self-employed or to be productively employed in sectors other than mining, such as construction or agriculture.
There are also plans to launch five local economic development projects, which will result in the creation of 820 jobs – 660 of which are for unskilled and semiskilled candidates.