TSX- and NYSE-listed Platinum Group Metals (PTM) says it is investigating opportunities to collaborate and co-invest with smaller furnace operators in South Africa who are interested in modifying and expanding their existing operations to process concentrate produced at the Waterberg project, on the northern limb of South Africa’s Bushveld Complex.

In such a scenario, the Waterberg project, which is owned by Waterberg JV Resources (Waterberg JV Co), could be developed in stages so that smelting capacity could also be developed in stages, PTM points out in a market update to shareholders.

PTM is the majority owner of Waterberg JV Co, which also includes Mnombo Wethu Consultants, HJ Platinum Metals Company and Impala Platinum as shareholders.

Over the past three years, PTM has studied and proposed the establishment of smelter and base metal refinery facilities in either Saudi Arabia or South Africa.

Before any processing of materials in Saudi Arabia could occur, South African government authorisation for the export of concentrate or matte would be required and such approval has been requested.

“Senior South African government officials have stated their preference for beneficiation to occur in South Africa,” PTM points out.

These considerations form part of Waterberg JV Co’s assessment of commercial alternatives for mine development financing and concentrate offtake.

As part of this, PTM has also been in discussions with all South African integrated platinum group metal producers about potential formal concentrate offtake arrangements for the Waterberg project, but no terms have been agreed to yet.

Meanwhile, PTM points out that the base case for mine development in an updated Waterberg definitive feasibility study is focused first on lower-cost, bulk mining of F-Zone material from the F-Central deposit, followed by later mining from the T-Zone.

PTM says that, although no decision has been made to alter the base case scenario, given the current price and outlook for gold, one concept being investigated is to begin staged development at the Waterberg project, first with decline development into the T-Zone, followed by smaller scale T-Zone mining and then later expansion into the F-Central deposit.

At current metal prices, PTM says, increased revenue per tonne from mining the T-Zone would more than offset higher mining costs, and may allow for a lower capital expenditure, staged development approach.

Internal studies are examining the financial impact of deferring capital for power lines, paste backfill, milling capacity, and underground conveyors, while first operating a T-Zone mine before using free cash flow to then develop a second stage F-Central mine.

T-Zone ore and waste can be trucked to surface for processing during initial mining stages, allowing for a shortened ore build-up period and a reduced capital footprint in both underground development and other underground infrastructure requirements.

The use of Jameson Cell high-intensity, compact flotation technology is also being investigated.

Meanwhile, PTM says it continues to advance an initiative through Lion Battery Technologies (Lion) using platinum and palladium in lithium battery technologies in collaboration with an affiliate of Valterra Platinum and Florida International University.

PTM says the investment in Lion creates a potential vertical integration with a broader industrial market development strategy to bring new technologies to market utilising the catalytic properties of platinum and palladium.

The company and Valterra are currently assessing progress to date and potential next steps towards the commercialisation and promulgation of the developed technology.