Sylvania Platinum - Chrome ore and PGM treatment joint venture
Sylvania Platinum has announced a 50:50 joint venture (JV) with Limberg Mining Company to process platinum group metals (PGM) and chrome ores from Limberg’s historical tailings dumps and run-of-mine ore. The mine, located in the northern part of the western limb of the Bushveld Complex, will start producing from H225, could add to Sylvania’s production and will diversify its resource mix to include chrome concentrate. Sylvania is investing $32m in capital expenditure (of which 50% will be paid back by Limberg from JV cash flow after the start of production) and $5m in working capital from its large cash resources in exchange for c 6,500koz of forecast PGM and 200kt of chrome concentrate production. Management is forecasting an internal rate of return more than Sylvania’s minimum requirement of 20% pa and a three-year cash payback. Our forecasts and valuation are under review.
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