Alien Metals and Australia’s Platinum Group Metals potential

Australia’s history with platinum group metal (PGM) deposits is mixed, with numerous unsuccessful attempts to develop operations since the market’s initial excitement in 1985. However, current conditions might favour the resurgence of these metals. Rob Mosig, a veteran geologist involved in major Australian PGM deposits such as Fifield, Panton, and Munni Munni, remains optimistic about Australia’s potential to become a significant PGM producer alongside Russia and South Africa. Recently, Mosig joined UK-based Alien Metals as the technical director, focusing on the Pinderi Hills project surrounding Munni Munni.

Munni Munni has a resource of 24 million tonnes grading 2.9 grams per tonne for 2.2 million ounces of PGM, making it one of Australia’s most advanced PGM projects. Despite over A$20 million spent on it, largely by Lonmin, one of South Africa’s largest PGM producers, it has yet to fully realise its potential. As South Africa’s mining conditions become more complex, deposits like Munni Munni are receiving renewed attention.

Alien Metals plans to accelerate work at Pinderi Hills, covering a significant portion of the Munni Munni intrusion, identified by Geoscience Australia as a high-priority area for world-class nickel-copper-PGE sulphide deposits. The shallow PGM-bearing reef is believed to extend over 200sq.km and reach depths of 3.5km but has not been thoroughly drilled. Besides PGMs, there is potential for discovering a much larger, high-value multi-commodity resource.

A key factor in Mosig’s decision to join Alien Metals was its ownership of Elizabeth Hill, Australia’s highest-grade silver mine during its brief operational period. Elizabeth Hill, just 1km from Munni Munni, has a historical resource of 4.01Moz grading 2700gpt and remains largely unexplored. This site could potentially revitalise Munni Munni. Mosig aims to conduct more geochemical and geophysical work to better understand the connections between areas previously owned by different parties, with a new resource estimate possible within 6-12 months. Given the rising silver demand and shifting dynamics of platinum group metals, Mosig believes failing to capitalise on improved sentiment would be a missed opportunity.

Australia’s PGM sector has long been overshadowed by gold, as exploring and producing gold is easier. However, as PGMs become increasingly crucial for decarbonisation, Australia’s prospects could improve. Platinum has traded between US$588-1296/oz over the past five years, showing resilience, while palladium has been more volatile. Currently, platinum and palladium prices are around $988/oz and $943/oz, respectively, with analysts predicting platinum could rise to $1200/oz by year’s end and potentially reach $1472/oz by 2027.

South Africa’s mines, though rich, are deep and challenging, and Russia’s invasion of Ukraine has disrupted supplies. Demand for PGMs is rising, and the years-long surplus is diminishing as stockpiles are used up. Morgan Stanley suggests that platinum might have entered a structural deficit, potentially benefiting Australia’s PGM industry.

Several Australian explorers, including Alien’s fellow WA companies Future Metals and Podium Minerals, have large PGM deposits that are yet to be developed. Podium’s Parks Reef project holds Australia’s first 5E PGM resource of 7.6Moz, while Future’s Panton project has 6.9Moz at 1.66 grams per tonne palladium equivalent. Emerging discoveries like Galileo Mining’s Callisto and Chalice Mining’s Julimar-Gonneville deposits also hold promise.

With platinum listed as a critical mineral across major economies, Australia’s efforts to establish a PGM industry might finally succeed. Increased demand in hydrogen applications and catalytic converters, alongside advancements in processing technologies, could herald a new era for the platinum-palladium sector in Australia, realising Mosig’s long-held dream.

Alien Metals Ltd (LON:UFO) is a global minerals exploration and development company that will shortly make the transition to iron ore producer. The company was formed from Arian Silver in late 2018, retaining some of the companies more valuable Mexican projects before embarking on an acquisition led strategy, headed up by an excellent geological team and targeted entirely on Western Australia.

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