Although the metal markets will be risk off today of which will no doubt put pressure on platinum prices, the following news item brings attention to China as an eventual player in regards to Wellgreen imo. Of all the resources China has been accumulating in recent years, they lack platinum but are the worlds largest consumer of the same. Sooner or later, China is going to make a major push in regards to PGM's.
By Michelle Yun - Mar 20, 2012 3:54 AM ET
Platinum Australia Ltd. (PLA), operator of a mine in South Africa, is considering a Chinese partner to develop a $170 million project in Western Australia that may hold the biggest reserve of the precious metal in Asia-Pacific.
The Panton mine will be able to supply customers in Japan and China, Managing Director John Lewins said in an interview in Hong Kong yesterday. China, the largest consumer of platinum, barely produces any of the metal used in everything from jewelry to automobile catalytic converters, he said.
The Perth-based company is focusing on the home market as it joins Anglo American Platinum Ltd. (AAL), the largest producer of the metal, and Lonmin Plc (LMI) in facing mounting labor and power costs as well as supply disruptions because of labor strikes in South Africa. The nation produces as much as 75 percent of the world’s platinum, Lewins said.
The Panton project will generate net cash flow of as much as $136 million, the company said in a statement to the Australian stock exchange today. The mine would produce 83,000 ounces of platinum, palladium and gold a year, it said.
Platinum Australia’s shares rose 3.1 percent to close at 6.7 cents in Sydney.
The company’s payroll increased from 30 to 800 in January after it hired employees directly from its South African contractor, which failed to meet production targets, Lewins said. The company lost production last year when employees of JIC Mining Services Pty at its Smokey Hills mine in South Africa went on strike.
Impala Platinum Holdings Ltd. (IMP), the South African company to which Platinum Australia sells all its current output, also stopped production on Jan. 30 over a pay dispute.
“We’ll continue to see supply interruptions, there’s no doubt about that,” Lewins said, referring to the South African mining industry.
To contact the reporter on this story: Michelle Yun in Hong Kong at myun11@bloomberg.net
To contact the editor responsible for this story: Rebecca Keenan at rkeenan5@bloomberg.net