Platinum group metals (PGMs) have been in the news lately, as the market wakes up to their ongoing value in reducing vehicle emissions.
For those in the space, it’s a very good time to be working on a PGM project – and Podium Minerals (ASX:POD) is doing just that.
The company’s Parks Reef PGM project near Cue in WA made headlines in its own right recently, with some stunning drill hits in the central and eastern sectors.
These included a top intersection of 1m grading 25.74 grams per tonne 3E PGM – platinum, palladium and gold – from 91m within a broader intercept of 7m at 5.75g/t 3E PGM.
These hits fell within a broader intercept of 37m at 1.81g/t from 74m. Other holes delivered similarly promising hits, which come on top of an existing resource of 1.4 million ounces of 3 PGM.
Importantly, Podium has some serious records of rhodium at Parks Reef – a commodity which has seen dramatic price increases over the past few years and currently fetches around US$27,000 per ounce.
For executive chairman Clayton Dodd, the most recent drill hits have buoyed exploration efforts at the already-substantial project.
“We had a massive win there, for the first time along strike we ended up hitting a very high-grade zone, and not only was it high grade but it was significant in width,” he said.
“Normally we’ve looked at around 15m in width, but some of these intersections were up around 40m in width.
“That completely changed our overall focus at Parks Reef. Not that you’re going to move away from what you’ve already achieved but when you hit high-grade zones you really do need to go in and start infill drilling to determine how much high-grade material you’ve got.”
In totality, Parks Reef is a 15km reef, which has been drilled one end to the other by Podium at around 200m spacing.
And the project is very consistent from one end to the other, with the high-grade zone an exciting resource development which is likely to drive regular news flow moving forward.
Also on the agenda for Parks Reef is mine optimisation work. At present, Podium has focused on the top 100m of the orebody but intends to look down further.
“We think the orebody will keep going on underground, and we want to do mine optimisation studies to start looking at the economics 200, 300 and even 400m below,” Dodd said.
Mineralisation close to surface is a substantial plus – many of the other PGM mines around the world are underground operations but Podium believes the Parks Reef orebody lends itself to a combination of open-pit and underground mining.
Jurisdictional benefits
The significance of a project like Parks Reef is clear in any context, but the advantages of having such a project in a stable mining jurisdiction presents significant benefits and an immense opportunity.
“Predominantly, the supply of PGMs come out of Southern Africa, (including Zimbabwe), and Russia as a by-product to the Norilsk Nickel operations,” Dodd said.
“When you look at dominant world supply, you’re really looking at what I refer to as somewhat questionable jurisdictions compared to what we have here in WA.
“South African mines are very deep, and quite old – you can form your own view about sovereign risk as far as that neck of the woods is concerned. Russia is perhaps a different beast, it is hard to know what is going to happen there, which may have an impact on supply.
“The supply of PGMs unquestionably is dominated by these two jurisdictions which probably give end users cause for concern and the need to source product elsewhere.”
WA’s reputation as a safe and stable jurisdiction is well known, and a major plus for a project like Podium’s.
“I see Chalice emerging, I see us emerging – we may not change the world’s supply of PGM’s but all things being equal, we plan to develop a very good resource with reliable longevity going forward.”
Demand equation compelling
The need for PGMs does not appear to be going anywhere in a hurry, with their main use in autocatalysts to help improve automobile emissions a key focus for car manufacturers as they need to meet high global emission legislation standards set by governments.
Dodd said, “autocatalysts required a mix of the three main PGMs – platinum, palladium, and rhodium – with significant applications in other emerging technologies as well.
“That means manufacturers look at the combination of the three to determine the optimal combination in their vehicles.
“Rhodium is unquestionably the most efficient due to its chemical and physical properties, but it’s in very short supply.
“The rhodium price per ounce over the last 12 months has skyrocketed from US$3500 to US$27,000, so you don’t need a lot for it to have a significant impact on the PGM weighted average price per ounce. We have assayed for rhodium on selected samples and on average they are showing grades of around 4% of the 3PGM grade. Indicatively adding 30%+ percent to the current 3PGM metal prices.
“When you look at everything else going on, like the push towards zero emission hydrogen fuel cells and lithium-ion battery enhancement, you’re going to need PGMs as the catalyst.
“You’ve got demand in the electronics industry as well, in televisions, medicine – the demand is very high at the moment, and that’s driving what is a very compelling price.
“PGM’s traditional uses in jewellery manufacture and investment as a precious metal remain strong.”
This article was developed in collaboration with Podium Minerals, a Stockhead advertiser at the time of publishing.
This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.