Jaco Prinsloo

GOOD news may materialise in 2023 for Sylvania Platinum and its shareholders. This year, Prinsloo intends to pursue – in typically careful, measured fashion – the initial potential shown by the Volspruit and Northern Limb exploration areas. Sylvania, which owns cash-generating platinum group metal (PGM) tailings dumps, commissioned studies on these mining prospects two years ago.

The latest drilling results contain two happy surprises. The first is that Volspruit could have rhodium mineralisation (a nice sweetener at a current rhodium price of about $12 000/oz). But the 5%-6% rhodium is merely an estimate at present, and the study only covered the northern pit, which is about 58% of the project area.

In the Northern Limb project, the pleasant surprise was the discovery of the T-zone, a very thick reef. Unlike the T-zone in neighbouring properties, it rises close to surface on the Sylvania property, which makes it mineable using open-cast. The Northern Limb area also contains the F-zone, which is deeper and would require underground mining. Next steps will be a feasibility study at Volspruit, hopefully to be completed by June/July 2023, including both the rhodium and the south pit. On the Northern Limb, Sylvania will extend the current study, which covered only 2km of the total 14km strike length, by another 2km.

Prinsloo says Sylvania won’t necessarily “jump into” these projects themselves but once it has these studies it will be able to decide whether to seek a strategic partner with mining skills to complement Sylvania’s own processing expertise, or to dispose of the projects. Prinsloo is not likely to bet the farm on a multiyear mine development. Sylvania’s appeal to investors is that it stays cash-rich and pays regular dividends, complemented by occasional windfall dividends when PGM prices surprise on the upside.