Southern Palladium Updated PFS Lifts NPV to US$1.96bn

Southern Palladium (ASX:SPD) updated the prefeasibility study for its 70%-owned Bengwenyama PGM-chrome project in South Africa to reflect DFS-level metallurgy, a new plant design, updated costs and a higher price deck.

The Updated PFS, prepared by Minxcon, estimates a post-tax NPV of US$1,961 million (8% real discount rate, 100% project basis), up from US$857 million in the July 2025 Optimised PFS, and a post-tax IRR of 39.1% against 26.4%. Payback from first production falls to 2.8 years from 3.8 years. The peak funding requirement rises to US$329 million from US$279 million, which the company attributes mainly to a stronger rand forecast. Chromite recovery rises to 85.6% from 30%, lifting life-of-mine chrome concentrate output to 17.2 Mt from 6.0 Mt, and life-of-mine 6E recovery is 87.5%, for 7.72 Moz 6E recovered over a 33-year life. AISC including by-product costs is US$943/6E oz, against a realised basket price of US$2,210/6E oz, up from US$1,406/6E oz. The life-of-mine plan of 41.9 Mt at 6.54 g/t 6E is unchanged. A 15% rise in the 6E basket price adds approximately US$454 million to post-tax NPV, and a 15% fall reduces it by approximately US$453 million.

About 30% of tonnes mined are Inferred Mineral Resources, the Ore Reserve has not been updated, and accuracy is ±15 to 25%. The project will require approximately US$329 million of funding, which the release does not say is arranged. The DFS is expected at the end of Q1 2027.