Billions from Saudi Arabia to boost Limpopo’s economy | Review

POLOKWANE – Africa’s cabinet has welcomed the Kingdom of Saudi Arabia’s announcement that it will invest around R9.5b to help build a platinum group metals (PGM) smelter and base metals refinery (BMR) in the Waterberg region.

This project will have a considerable impact on the economy of the region and affect Polokwane, as the economic hub of the region, to a great effect.

Speaking to the media on December 5 about the outcomes of the recent cabinet meeting, Minister in the Presidency Khumbudzo Ntshavheni said that the new investment from its fellow Brics+ member “is a strong vote of confidence in our nation”.

Ntshavheni said that it “builds on the first phase of our investment mobilisation drive under the Sixth Administration that saw our nation surpassing its investment target by 26% to reach a total of R1.51t in investment pledges.”

“South Africa is now targeting R2t in new investments over another five-year period between 2023 and 2028,” she added.

The Kingdom of Saudi Arabia’s Ministry of Investment (Misa) and Ajlan & Bros Company for Mining (a subsidiary of the Saudi-based investment holding company Ajlan & Bros Holding), announced that a memorandum of understanding (MOU) had been signed to develop PGM smelters and base metals refineries.

According to the terms of the MOU, Misa will offer strategic guidance and financial support to the proposed PGM Smelter and BMR to be located in Saudi Arabia and the Waterberg project located in South Africa.

This would be alongside Platinum Group Metals Ltd, the operator and majority owner of the platinum-rich Waterberg Project, a bulk underground palladium and platinum deposit located in Limpopo.

Platinum has a total of three mining operations in the Bushveld Complex, namely Mogalakwena mine, Amandelbult complex which is made up of Dishaba and Tumela mines and Mototolo mine.

The smelter and refinery are not yet in development, but in terms of the latest financial model, construction is deemed to begin in December next year, with the first production expected in September 2029. An agreement was reached in 2023 between Misa and Ajlan & Bros which saw the plans divided into three phases: a global market study, a definitive feasibility study (Smelter DFS) for the smelter’s construction and operation, and an option to form a 50:50 joint venture after completing the Smelter DFS.

The Waterberg Project has a number of highly attractive characteristics as a low-cost, shallow, bulk mineable project with significant scale and growth potential.

Sixty three percent of Waterberg reserves and resources of PGMs are palladium and auto preferences recently have supported a robust palladium market.