Sylvania Platinum (LON: SLP) (OTCPK: SAPLF) shares are up 8% in London today. It’s possible to think that SLP shares should be up more than this but also, and on the other hand, that perhaps time will tell. The point is that Sylvania has a new technology which can be used to extract both chrome ore and platinum groups metals (pgms) from the wastes of previous attempts at chrome ore mining. This is not wholly unusual in mining if we’re to be honest about it. Extraction and processing tech does advance. And usually the best place to go apply it is on the wastes of the previous generation of mining of the same materials.
We used to mine gold at 6 and 10 grammes per tonne, the wastes were 2 gramme Au. Tech advances have meant that 2 ppm is regarded as rich gold ore - so those old slag and gangue piles are now gold mines again. This happens a lot, with many different metals and materials over the years and decades.
So, Sylvania Platinum: “ The JV will process PGM and chrome ores from historical tailings dumps and current arisings ("Mining Area") from the Limberg Chrome Mine, located on the northern part of the Western Limb of the Bushveld Complex, South Africa. The JV will trade and operate under the name Thaba Joint Venture ("Thaba JV"). The Thaba JV represents a major step in delivery of Sylvania's growth strategy and is a significant step forward for Sylvania Metals in expanding its operations and leveraging its expertise in the recovery of chrome and PGM concentrates, adding attributable production of approximately 6,500 4E PGM ounces and introduce 200,000 tons of chromite concentrate to Sylvania Metals' existing annual production profile.” Sylvania has developed a way to reprocess those wastes from older methods of chrome ore mining. Excellent.
Sylvania Platinum share price from Google Finance
The share price movement today reflects only the value of that one deal now announced. But there’s a possibility there that the reaction should be greater. How many more chrome ore dumps are there out there that can be so treated? Or, again and perhaps, we should wait to see whether it really works in action before thinking about that?
We have the same issue with Rainbow Rare Earths who are extracting rare earths from phosphogypsum. If it works then how much of the value of processing the Florida stacks should we ascribe to those who own the technology? We can even take a wider again view as with Enteq Technologies. Their new drilling tech for oil and gas means there’s the whole world to explore again for the right type of reservoir.
So, how much value should we put on the future uses of these technologies rather than just their current applications?