Southern Palladium's Bengwenyama PGM Project Set to Begin Production
Southern Palladium's Bengwenyama PGM project in South Africa is set to commence production, with an initial phase targeting 2.22 million ounces in a cup of 6E PGMs over a 23-year mine life. Strategically located near established infrastructure and skilled labor, the project covers approximately 5,280 hectares and benefits from high-grade PGM mineralization in the UG2 reef.
The project's initial phase, Stage 1, focuses on developing the South decline system. It is projected to produce 6E PGMs at a rate of 110,000 ounces per year. Approximately four years later, Stage 2 will introduce the North decline system, doubling production capacity to 220,000 ounces per year and extending the mine life to 33 years. This expansion is expected to yield a cumulative total of around 7.5 million ounces in a cup of 6E PGMs.
The project's economics are compelling, with a net present value (NPV) of $246 million and an internal rate of return (IRR) of 21.8% for Stage 1. The combined Stage 1 & 2 shows an NPV of $857 million and an IRR of 26.4%. Southern Palladium's optimized, phased approach reduces initial capital requirements while maintaining strong economic returns.
The Bengwenyama PGM project, with its high-grade mineralization and favorable metallurgical characteristics, is poised to make a significant contribution to Southern Palladium's portfolio. With a 70% stake, the company is well-positioned to benefit from the project's success, while the remaining 30% is owned by the local community through Nurinox Investments.
