Its operations are focused on the treatment of Samancor’s chrome tailings dumps on the Western and Eastern limbs of the Bushveld complex.
The Samancor dump operations contain about 500,000 ounces of PGMs at an estimated average non JORC compliant grade of 2.6 g/t. Sylvania director Zoran Marinkovic explains that it is not economically viable to convert its resource to a JORC compliant reserve as it would entail extensive drilling of the dumps. “The grades are very variable, and the key operational parameter is ensuring we blend correctly to achieve the right grade of feed material to our plants.”
Some of the material treated is Run of Mine (ROM) tailings and arisings, in addition to dumps which have been standing for long periods. In parts of some of these old tailings oxidation has taken place. Where this has occurred, the recovery of PGMs is lower. However, Marinkovic, who is a chemical engineer, says the oxidised material will still be processed and the response to this issue remains the same, that of blending to ensure the output concentrate grade is within the required range and that the chrome content is below a specified level. “There is a saying that what a chrome extraction process likes the PGM extraction process does not like.”
Nonetheless, the grade of platinum in the chrome dumps compares very favourably with the 0.7 g/t to 1 g/t of the traditional platinum dumps. It is because chromite sources such as the chromite-containing LG-6 reef are typically not mined for PGMs, which are discarded along with tailings.
Sylvania financial officer Louis Carroll says that the company will not limit itself to chrome tailings.
In fact the biggest challenge Sylvania faces, once it builds up from current levels of 10,000 ounces a year of PGMs to its target of 70,000 ounces a year, is that of finding the resources to sustain and increase output, to ensure a production plateau as opposed to a peak.
“We will be aggressive in the market to fill the gap to sustain production at 70,000 ounces a year, and will look all over to source material for our plants,” Carroll says. This is where the company’s interest in the North Everest surface mineable deposit could play a significant role in the future of the group.
Sylvania is exercising the option to acquire 100% of the project located on the Vygenhoek farm on the Eastern Limb, and which has a 5.1 million tonne resource with a grade of 4.7 g/t for 770,000 ounces of PGMs. It may develop the mine on its own though that is not the first prize. The optimum way forward would be to combine its project with the adjacent Eastern Platinum property if a deal can be done on the merger of the assets. This would result in a one million tonne per annum (mtpa) operation that would take between 18 months and two years to build. Water and power access still have to be resolved and, with a 1 MW power plant costing R2 million a month in diesel, this option has priced itself out as a contingency and grid supply is required. The operation would have a concentrator that takes the ore to 150 to 250 g/t. This concentrate would be sold to an off-taker and the operation would get a percentage of the LME price.
Sylvania is also in a joint venture with Great Australian Resources, which acts as the group’s platinum group metal exploration arm. Sylvania has a 16.5% stake in that company.
The key to Sylvania’s success is its ability to economically separate chrome content from platinum, something that not many people believed was economically achievable. Sylvania has proven it can be done, and though it has four patents, most of the technology used is conventional.
The particle size is important for chrome separation as anything less than 75 micrometres causes difficulty in separating the two. “We ensure the chrome content of the concentrate we deliver to the smelters is below a certain percentage. At our first plant, Millsell on the Western Limb on the property of Samancor’s Millsell mine, the target is less than 3% chrome content and the plant looks to achieve a figure of 2.8% chrome content. There are severe penalties if the grades of material and chrome content limits are not achieved,” Marinkovic says.
At Millsell the feed for the plant is blended from five different sources to produce a 180 g/t to 200 g/t concentrate that is sold to a smelter, in this case the off-taker being Anglo Platinum. The concentrate from Sylvania’s other currently existing plant, its Steelpoort facility on the Eastern Limb, is sold to Implats. The Millsell plant, located within a maximum six kilometres radius from the furthest tailings dump from which it obtains material, will complete the processing of old tailings in about three to four years. After that, it will continue processing of ROM material which will account for some 7,000 to 10,000 tonnes per month (tpm) over an expected Millsell life-of-mine of 25 years or longer. Sylvania aims to achieve about a 50% to 60% recovery rate, with 43% being achieved at Millsell.
Sylvania, which was formed in late 2005, processes the dumps through centralised chrome and PGM flotation plants, and its Millsell and Steelpoort plants have the capacity to each process 37,500 tpm. A larger 70,000 tpm plant, its Lannex plant is under construction. It is targeted to be operational at the end of 2008 and will process ROM and old tailings from the Broken Hill, Buffelsfontein and Spitzkop mine sites.
Another plant is to be established at Mooinooi. It will also have a 70,000 tpm capacity and is also scheduled to be operational by year end. The Lannex plant complex, which will comprise one plant and three sites will be modular, with two 35,000 tpm modules.
The plant at Millsell had a capital cost of R52 million, and the Steelpoort plant a similar R53 million while the Lannex plant will cost R130 million.
Marinkovic says the plant size is in part determined by the availability and access to standard equipment, while another key factor is water availability.
Unlike most juniors, Sylvania, whose headoffice team comprises 22 people, is doing the design and project engineering of its plant in-house, and one of its core strengths is its technical competence. “We worked with a project engineering company when building our initial plant, but took the process in-house to better control costs,” Carroll says.
Sylvania’s groundbreaking Millsell plant is SCADA controlled and Marinkovic says that Sylvania has optimised its successive plants based on its experience with Millsell. One modification is that while Millsell is a widely spread out plant, later plants are more compact. Sylvania’s Millsell plant manager works for Sylvania, but for the most part it is operated by contractors.
Millsell, though Sylvania’s first project as operator, is not Sylvania’s first project overall. The company’s first project, which gave it entry to the sector, is a 25% interest in Aquarius’s Chrome Tailings Retreatment Project (CTRP) located on the Western Limb near Rustenburg. The consortium constructed a purpose built plant at the Kroondal mine to extract PGMs from the tailings of the nearby Xstrata and LanXess chrome mines. The CTRP plant is managed by Aquarius Platinum and has been in production since January 2005.
The process at Millsell involves six stages, the first of which is the obviously the mining that produces the tailings. The mines, in upgrading the chromite content of their ore, produce a tailings stream that contains the majority of the PGMs of the ROM chrome ores. It is these chrome ores with elevated levels of PGMs that are treated.
This is followed by classification with material larger than 10 cm rejected. The milling stage, which features a ball mill, grinds the material to +0.63 mm with the fines bypassing the mill and reporting directly the next stage. The tailings and dump material, due to their fine particle size, mean that the coarse material accounts for only some 28% of the total with the rest being free issue. The material contains about 28% chrome content at this stage. The plant at Millsell processes some 60 to 70 tonnes per hour of material.
The material proceeds in slurry to the gravity separation stage, where the coarser material is separated from the fines by spirals. This stage is followed by thickening where all the thickener underflow proceeds to the flotation stage while the water is reclaimed for re-use. The process uses 360 litres of water per tonne, and this water is recycled, the end result being that less water finds its way to the final tailings site. Evaporation accounts for about 30% of the total water used and has to be replaced.
Then follows a conventional flotation stage, where the banks totalling 20 rougher cells achieve typically a 32% PGM recovery. This is followed by flotation banks comprising 10 cleaner and five recleaner cells that take the concentrate recovery level of about 44% of the contained PGMs. Collector reagents are used to make the PGMs aerophilic, depressors are used to make the chrome hydrophilic, in addition to the frother. The optimal use of reagents is determined by the initial blend of material entering the plant. If too much chrome is present then a great deal more depressor needs to be added to ensure the end product meets the smelter parameters.
The tailings are taken to a live tailings dam. “In the future even these tailings may be reprocessed, since it all comes down to a matter of economics when determining what percentage of recovery is optimal,” Marinkovic says. With its current retreatment of chrome tailings for platinum group metals, the AIM and ASX listed company is looking at a cost profile of US$300/oz, which will give it margins of between 70% and 80%.
An interesting feature of Sylvania’s PGM mix is that during the second quarter of 2008, while its production split was 58% platinum to 26% palladium and 15% rhodium, more than half its revenue came from rhodium.
Sylvania is considering a listing on the JSE, but this would not be to raise cash in the near term as the company has R300 million on its balance sheet to invest in projects. More ounces could come from shallow mining at Everest North, additional tailings, and mergers and acquisitions. Apart from sourcing future resources to maintain production of PGMs at its planned elevated output, probably the biggest risk Sylvania faces is of becoming an acquisition target. Management may hope that the higher profile a JSE listing will provide will raise its valuation to discourage this, but more importantly a listing would be desirable to ensure that BEE transaction parties can achieve the tradability of their investment.