and enable early de-risking. Near-term development includes establishing the South Site, constructing the South box-cut, and developing the South decline to the first UG2 reef intersection. Once operational, Stage 1 is expected to produce more than 200 000 oz of PGMs in concentrate per year. Funds raised recently will be used to develop the box-cut and decline, as well as install provisional infrastructure required for early operations. Requests for quotations have already been issued, with contractor shortlisting expected before mid-year, followed by commencement of box-cut development shortly thereafter. “Box-cut development should take around three months, with the decline requiring approximately five months,” says Odendaal. “We expect to intersect the reef around February 2027, after which we will begin stockpiling ore.” During Stage 1, the processing plant will initially treat 20 000 t per month from the South decline, ramping up to 100 000 t per month. Ore stockpiling is expected to continue for approximately one year, with the processing plant scheduled to be operational in early 2028. Stage 2 is earmarked to commence around year four, if not sooner, increasing production to over 400 000 oz per year and extending total mine life beyond 30 years. Mining method and processing options The Bengwenyama project targets the high-grade UG2 reef and employs a staged development strategy to reduce peak funding requirements. Key mining considerations include: • A hybrid underground mining approach, combining mechanised development with conventional stoping. • Fast-tracked access via a Southern decline, enabling early ore access at depths of approximately 80m. • Optimised decline design, initially utilising a single decline to minimise capital, with a second decline added in later stages. Southern Palladium is also evaluating two processing pathways: • Toll treatment, partnering with neighbouring or third-party concentrators with spare capacity. • On-site processing, involving construction of a two-stage mill- and-float (MF2) plant with optimised chrome recovery. “In our push to become an early PGM producer, we are actively evaluating partnerships with local producers whose plants have available capacity,” says Odendaal. Chrome recovery is emerging as a meaningful revenue contributor. According to the Bengwenyama PFS, chrome could account for up to 12% of total revenue. “Chrome has the potential to materially enhance margins and add a valuable revenue stream to the operation,” Odendaal notes. Southern Palladium will oversee development operations in partnership with the contractor. The company has initiated recruitment for key roles, including a project manager and underground operations manager. In its Quarterly Activities Report for the period ended 31 December 2025, executive chairman Roger Baxter commented: “The successful A$20 million capital raising has materially strengthened our balance sheet and ensures we are fully funded to unlock the next phase of development, including
development programme in 2025, which was completed significantly under budget.” Key development milestones: • 2022–2024: Resource definition drilling and completion of the PFS • 2025: Optimised PFS and advancement of the DFS • 2026: Completion of the DFS and final investment decision (FID) The year 2025 marked a pivotal transition for Southern Palladium, as it evolved from an exploration company into a development-focused entity. “During 2025, we submitted all key regulatory documentation, including environmental guarantees, and progressed early-stage DFS and FID work,” says Odendaal. The DFS is targeted for completion by the third quarter of this year, with the FID expected by year-end. Given improved PGM fundamentals and robust prices, Odendaal believes the timing is ideal to advance Bengwenyama into development. “Our optimised pre-feasibility study supports a staged approach, allowing us to de-risk the project while managing capital efficiently.” Staged, lower-risk development approach Southern Palladium plans a two-stage development strategy. Stage 1 focuses on establishing essential infrastructure and achieving initial production, funded by a peak capital investment of approximately US$279 million. This will be followed by a Stage 2 expansion, funded largely from early cash flow. Stage 1 mine planning has been accelerated, with detailed optimisation of decline designs to access the shallow UG2 reef
March 2026 | www.modernminingmagazine.co.za MODERN MINING 15
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