Toronto-based and Africa-focused Ivanplats said last week it had filed a mining right application with South Africa’s Department of Mineral Resources (DMR) for its Platreef project, located in the country’s Bushveld Igneous Complex platinum-producing region.

The application for a mining right on the tier-one discovery of platinum-group elements – nickel, copper and gold – which also includes the Flatreef underground deposit on the Bushveld Complex’s northern limb, represented a “significant” milestone for the Platreef project, executive chairperson Robert Friedland said.

“This marks the culmination of years of successful exploration and engineering to define high-grade resources that we believe are amenable to safe, efficient and large-scale mechanised underground mining methods.

“We’re looking forward to working with all our stakeholders to advance the Platreef project to production to create much-needed jobs and to contribute significantly to the socioeconomic development of our host communities, the surrounding Limpopo region and South Africa as a whole,” he said in a statement.

Ivanplats also announced that, in conjunction with the mining right application, and in compliance with South African ownership requirements under the Mining Charter, the Platreef ownership structure had been modified to include a broad-based black economic-empowerment (BBBEE) partner that would represent local communities, women, children and employees.

The BBBEE partner would acquire a 26% interest in the Platreef project through a private company incorporated in South Africa, namely BBBEE SPV, that would represent the interests of the Platreef Communities Umbrella Trust, the Platreef Women and Children’s Trust and the Platreef Equity Participation Trust. Host communities directly affected by the Platreef project would be the initial beneficiaries of the Platreef Communities Umbrella Trust.

Ivanplats said it would finance the transaction when it receives its Platreef mining right and would retain a 49% minority share in BBBEE SPV.

A South African mining right allows a company to mine and process minerals from a mining area for a maximum of 30 years, after which it could be extended on application.

Ivanplats had lodged applications for licences and authorisations under the National Water Act of 1998; the National Environmental Management Act of 1998; and the National Environmental Management: Waste Act of 2008.

Ivanplats said it would “soon” start negotiations for long-term surface lease agreements with affected landowners that would allow for its access and occupation for mining and related purposes. These negotiations would be undertaken in conjunction with the Department of Rural Development and Land Reform.

On receipt of the mining right, Ivanplats would own 64% of the Platreef project, the BBBEE SPV would own 26% and a Japanese consortium comprising Itochu Corporation, Japan Oil, Gas & Metals National Corporation (Jogmec) and JGC Corporation would own 10%.

The Japanese consortium’s interest in the Platreef project was bought in two tranches for a total investment of $290-million, which was being used to fund the project’s ongoing exploration and predevelopment work.

Meanwhile, on May 28, following the ratification of community compensation agreements, the DMR rescinded a Section 93 directive issued in the fourth quarter of 2012, which had temporarily suspended exploration activities, including drilling, at the Platreef project.

Drilling was expected to resume later this month and would focus on providing additional technical data that was required to advance studies on the project at prefeasibility level.

The planned exploration drilling programme would focus on delineating the exploration target that is believed to represent the southern continuation of the shallow Flatreef underground deposit.

In the March 2013 Platreef technical report, consulting engineering firm Amec provided an exploration target tonnage for this area and suggested it could contain between 31-million and 62-million tonnes grading 3.36 g/t to 5.03 g/t of platinum, palladium, gold and rhodium (4E), 0.26% to 0.38% nickel and 0.13% to 0.19% copper over an area of 2.5 km2.

Amec also identified a second exploration target area that surrounds the declared mineral resources and was estimated to contain an additional 50-million to 220-million tonnes, grading 2.9 g/t to 4.1 g/t 4E, 0.24% to 0.32% nickel and 0.12% to 0.16% copper over an area of 7.6 km2. The tonnage and grades were based on intersections of mineralisation in adjacent drill holes within the inferred mineral resources.

Ivanplats noted that it was considering sinking an exploration shaft in Flatreef Zone 1 to provide underground access to the Flatreef deposit to obtain a bulk sample for various types of testwork. The Platreef bulk sample application was lodged with the DMR in Polokwane in September 2012 and was awaiting approval.

At a 2 g/t cutoff grade for 4E, the Flatreef deposit contained an estimated indicated resource of 214-million tonnes grading 4.1 g/t 4E, 0.34% nickel and 0.17% copper, containing about 28.5-million ounces of 4E, 1.61-billion pounds of nickel and 794-million pounds of copper.

At the same cutoff grade, the inferred resource totalled 415-million tonnes grading 3.5 g/t 4E, 0.33% nickel and 0.16% copper, containing about 47.2-million ounces 4E, three-billion pounds of nickel and 1.5-billion pounds of copper.

However, at a higher cutoff grade of 3 g/t 4E, Flatreef was estimated to contain indicated resources totalling 137-million tonnes grading 5.09 g/t 4E, 0.38% nickel and 0.19% copper, containing an estimated 22.4-million ounces of 4E, 1.13-billion pounds of nickel and 558-million pounds of copper.

At the same cutoff grade, the inferred resources totalled 211-million tonnes grading 4.6 g/t 4E, 0.38% nickel and 0.18% copper, containing about 31.4-million ounces of 4E, 1.76-billion pounds of nickel and 855-million pounds of copper.

The Flatreef deposit averaged 24 m in true thickness at a 2 g/t cutoff grade for 4E and was potentially amenable to large-scale mechanised underground mining.

The thick Flatreef mineralisation remains open, with about 37.5 km2 of the property untested.