Platina Resources Sells Scandium Project to Rio Tinto for up to US$14 million

THE BOURSE WHISPERER: Platina Resources (ASX: PGM) is set to bank up to US$14 million (approx. A$21 million) in cash from the sale of the company’s wholly-owned Platina scandium project after signing a binding sale agreement with a subsidiary of Rio Tinto (ASX: RIO).

Platina Resources’ Scandium project hosts one of the largest and highest-grade scandium deposits in the world and has the potential to be Australia’s first scandium producer of scandium oxide over a 30-year mine life.

The company views the sale of the scandium project to finalise its transitioning away from platinum and speciality metal projects allowing it to focusing on gold projects.

Platina said the sale unlocks value in the project where it has made a considerable investment advancing the project through exploration to the Definitive Feasibility Study stage.

“The transaction with Rio Tinto is congruent with Platina’s strategy of advancing projects along the value chain and monetising when a new combination of technical, market or financial capability is required,” Platina Resources managing director Corey Nolan said in the company’s ASX announcement.

“This enables projects to achieve optimal scale, minimises Platina’s capital outlay and accelerates returns to investors.

“Platina discovered the scandium resource in 2011 as part of an exploration program for platinum and nickel/cobalt.

“Platina has advanced the project over the last 12 years through geological, metallurgical and engineering studies to the point where its value has been recognised by one of the world’s largest and leading natural resource companies.

“This transaction with Rio Tinto will also allow Platina shareholders to benefit from an injection of new funding to advance its extensive gold portfolio and pursue other more advanced project opportunities without shareholder dilution.”