Dual-listed Southern Palladium is poised to accelerate the development of its Bengwenyama Platinum Group Metals (PGM) Project in South Africa after an Optimised Pre-Feasibility Study (OPFS) outlined a staged development plan that cuts upfront capital costs by 38%, while retaining strong economics and long-term project value.
Located on the Eastern Limb of South Africa’s Bushveld Complex, the Bengwenyama Project is strategically positioned near established mining infrastructure. Southern Palladium holds a 70% interest, with the remaining 30% owned by the Bengwenyama-ya-Maswazi community.
The OPFS values the project at R15.7 billion (US$857 million) on a 100% post-tax basis, with a projected internal rate of return of 26.4%. It proposes a staged development approach with lower capital expenditure estimates, significantly derisking the project and improving the project’s funding attractiveness.
“A staged development approach for Bengwenyama, reducing peak funding requirements by US$173 million (38%) to US$279 million compared to the original PFS, presents a highly attractive option for shareholders. Importantly, the staged approach also improves our ability to further de-risk key geological, technical, and operational assumptions,” said Southern Palladium’s Managing Director Johan Odendaal.
The proposed two-stage production plan proposes an initial stage that begins with PGM production of 100,000 ounces and ramps-up to 200,000 ounces per year. The second stage is designed to deliver production of 400,000 ounces per year after four years for an aggregate mine life of over 20 years.
With the first stage expected to deliver a strongly cash generative project in its own right, the option to phase the development of the mine provides a balance between unlocking project value and funding project development with minimal future dilution for shareholders. It also allows Southern Palladium to align project development with infrastructure roll-out and community readiness, ensuring a more sustainable and inclusive growth trajectory.
Southern Palladium has also outlined several key next steps, including:
- The anticipated award of the Mining Right
- Fully funded infill drilling and metallurgical test work
- Integration of OPFS outcomes into a Definitive Feasibility Study (DFS)
The Company is also evaluating the use of third-party mineral processing infrastructure in the region. If viable, this option could reduce initial capital costs further and accelerate the timeline to first production.