John Lowell of Lowell Resources Fund Management tells AFL Hall of Fame gun Chris Judd why Southern Palladium (ASX:SPD) and its 70% owned Bwengwenyama Project in South Africa has come onto the radar in the PGM game – with hydrogen rapidly emerging as a key energy transition fuel.
Lowell did acknowledge that with the three main PGM metals, platinum, palladium and iridium, primarily used in conventional fossil fuel engines, notably for catalytic converters, “we need to take a view on how fast the EV rollout will happen alongside the demise of internal combustion engines”.
Nevertheless, with the energy transition accelerating apace, this could be offset by emerging uses for these metals, particularly with hydrogen molecules surfacing as a “potentially huge” transport fuel creating new demand for palladium electrolysers and fuel cells.
He said the Bwengwenyama Project had not only revealed excellent geology, but also “exceptional grades” with a resource grading of 6 grams per tonne and a forecast, alluded mine head grade of 5.5 grams.
“The fabled bushveld produces the lion’s share of the world’s platinum and palladium and the grades are double the average of existing producers,” Lowell said.
From a capital outlay of US$400m, the project is aiming at producing 330,000 ounces of PGM per annum, with current global demand approximately 7 million ounces a year and a basket of PGMs fetching about US$1500 an ounce.
Talk Ya Book was created by AFL football great, Chris Judd, in 2019 as a show where fund managers could share their highest conviction investment idea but more importantly showcase their investment framework to the public.
In 2023, Chris joined the people he interviews in the world of funds management by creating the Cerutty Macro Fund. Chris is the founder and portfolio manager of the fund which looks to invest in long term, secular, macro trends.
Juddcorp Pty Ltd ACN 635 629 631 is a corporate authorised representative (CAR) (CAR Number 1300536) of Boutique Capital Pty Ltd ACN 621 697 621 AFSL 508011.
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