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Promising Scandium Outlook Ups Platina Resources’ (ASX:PGM) Hopes for NSW Asset

Summary

  • The outlook for scandium, a rare earth metal, is extremely promising amid the growing EV demand.
  • Scandium is often produced as a by-product of other metals.
  • Platina Resources wholly owns one of the world’s leading undeveloped scandium projects in Australia.
  • The company is seeking production offtake agreements to enable financing options for the project development.

Scandium is a 'rare earth metal', a term coined by Johann Gadolin in 1794 for elements with atomic numbers between 57 and 71.

Earlier, these metals were believed to be rare and not in crustal abundance. However, studies have unveiled that these metals also have the same crustal abundance as nickel, silver, copper, lead and tin.   

Scandium Demand Heating up Across Industries 

Rare earth elements are needed to develop latest technologies like AI, EVs, smartphones, missile guidance systems and drones. Nothing can replace rare metals in modern technology, which is evolving fiercely to re-define the future. With technological advancements in these fields, demand for rare elements is expected to grow.

The metals also find their usage in critical applications like military weapons systems and high-performance aircraft.  

Scandium is studded with a unique mix of qualities: it is as light-weighted as aluminium, as robust as titanium and as hard as ceramic. The demand for this rare earth metal is expected to explode with its increasing use in solid oxide fuel cells and rising demand for scandium and aluminium alloys.

There are no mines dedicated purely to producing scandium, and it is often a by-product of other metals' refining or they are recovered from earlier processed tailings. In China, scandium has been produced as a by-product of iron ore, titanium, and zirconium. In Russia, Kazakhstan, and Ukraine, scandium is produced as a by-product of uranium, and in the Philippines, it is recovered as a by-product of nickel.

In Australia, various players are engaged in endeavours aimed at developing scandium deposits in New South Wales. One such company is Platina Resources Limited (ASX: PGM), which is focused on unlocking value from its scandium project.   

Platina Resources Well-Positioned to Capitalise on Scandium Tailwinds

Recently, there has been renewed interest in the scandium market, primarily owing to mining giant Rio Tinto Limited's (ASX:RIO) plan to build a commercial scandium oxide demonstration plant in Quebec.

In line with the market trend, Platina Resources has also strategically decided to sharpen its focus on the wholly owned Platina Scandium Project (PSP) in NSW. The asset is highly promising for the rare earth metal, scandium, as PSP hosts one of the world's leading undeveloped, top-grade scandium deposits.

Also read: Platina Resources' (ASX:PGM) Dynamic December Quarter Sets Stage For Excellent 2021

The Definitive Feasibility Study conducted in 2018 highlighted the economic and technical viability of developing the project. It suggested that the stage 1 annual production would be of 20 tonnes, with an expected initial expenditure of USD 50 million.

Source: Feb 2021 Investor Presentation

Platina Resources has planned to update this study to understand the new opportunities and market trends. The company is currently exploring options including offtake agreements for the asset to enable funding options. 

The infrastructure access to the project is excellent. Additionally, the project has the potential to produce cobalt and nickel as by-products which have also witnessed price surge in recent times.

To know more, read here: Why Platina Resources' (ASX:PGM) shares are on fire today

PGM traded at AUD 0.052 on 17 February 2021 (AEDT 11:02 AM), up by 4% from its previous close.


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