Join today and have your say! It’s FREE!

Become a member today, It's free!

We will not release or resell your information to third parties without your permission.
Please Try Again
{{ error }}
By providing my email, I consent to receiving investment related electronic messages from Stockhouse.

or

Sign In

Please Try Again
{{ error }}
Password Hint : {{passwordHint}}
Forgot Password?

or

Please Try Again {{ error }}

Send my password

SUCCESS
An email was sent with password retrieval instructions. Please go to the link in the email message to retrieve your password.

Become a member today, It's free!

We will not release or resell your information to third parties without your permission.

From EVs to the Environment, the Time is Right for Platinum

Jon Brown Jon Brown, Stockhouse
10 Comments| February 18, 2021

{{labelSign}}  Favorites
{{errorMessage}}


(Image via Eastern Platinum Limited.)

A natural element rarer than gold, investors have been seriously engaged in the market performance behind platinum as of late, with prices for March 2021 delivery surging as much as 5% to its highest levels since 2014, with bets on a recovery in the industry, while stricter emissions rules will continue to tighten supply.



One of platinum’s key features is that it is used to ebb pollution from vehicle exhaust and the precious commodity has been making up for ground lost in the market last year by outclassing many of its peers throughout the early months of 2021.

For investors who want to know what is next, many, including the World Platinum Investment Council, believe that the market will continue to sit in deficit for the rest of the year, following disruptions at a major refinery in the Republic of South Africa. As demand, especially on the investment side, continues to grow, many are looking for the right play to get in on this action.

Located near that key South African refinery lies an operation run by Eastern Platinum Limited (TSX: ELR, OTC: ELRFF, Forum), who owns, both directly and indirectly, a number of platinum group metals (PGMs) and chrome assets in the region. All the Company’s properties are situated on the western and eastern limbs of the Bushveld Complex, the geological environment that hosts approximately 80% of the world's PGM-bearing ore.

ELR’s flagship operation is its Crocodile River Mine (CRM), a PGM mine located 70 kilometres north-northwest of Johannesburg. The Bushveld complex hosts an area of known structural complexity, the Brits Graben, the current mine lease area includes two operating mining sections and two development sections. Operations at CRM currently include re-mining and processing its tailings resource, with an offtake of the chrome concentrate from the Barplats Zandfontein UG2 tailings facility and the processing and extraction of PGMs.

Eastplats just recently revised its 2021 capital budget, following the closing of its rights offering which saw gross proceeds of $11.8 million (CAD) in January 2021. The Company’s subsidiary, Barplats Mines (Pty) Ltd. has now reserved an additional $6.3 million (CAD) in capital funding for PGM expansions, resource, and environmental assessments, as well as legal compliance and site investment to expand its revenue base and advance projects targeted, based on expected value.
Barplats will use part of the proceeds from the Eastplats rights offering to upgrade and repair the CRM Zandfontein underground shaft and rock winder, to ensure they are available for PGM operations, as well as reconfigure and optimize the small-scale PGM circuit, which also includes funding for some of the initial work required to restart the main PGM plant circuit. This news worked to support a current rally in ELR’s share price which has spiked as of the beginning of this month.


(Eastern Platinum Limited stock chart – Jan 2021 – Feb 2021. Click to enlarge.)

Up until recently, platinum had been trading at a discount to its sister-metal palladium, which is also chiefly used in catalytic converters. Now many are expecting that platinum will see even more use as the price disparity between the two continues to widen as emission regulations tighten.

Global specialist materials company Johnson Matthey reported in February 2021 that the platinum market was undersupplied by 390,000 ounces in 2020, its second consecutive annual deficit.

Taking in to account the combined optimism for EV fuel cell demand, tighter emission regulations, and a weakening US dollar which have pushed platinum prices higher, there are even more potential implications around the roughly 7-million ounce a year platinum market that are yet to be fully explored.

Platinum for immediate delivery gained as much as 6% to $1,252.84 an ounce, the highest since February 6th, 2015. This week, prices were up 5% at $1,245.00 an ounce. Futures for April 2021 delivery on the New York Mercantile Exchange rose 4.4% to settle at $1,246.90 an ounce.

To learn more about this opportunity and its operations, visit eastplats.com.



FULL DISCLOSURE: This is a paid article produced by Stockhouse Publishing.



{{labelSign}}  Favorites
{{errorMessage}}

Get the latest news and updates from Stockhouse on social media

Follow STOCKHOUSE Today