Chalice Mining Ltd. advanced its Gonneville platinum group metals project toward a final investment decision Thursday, describing the Western Australia deposit as the largest and lowest-cost of its kind in the world.
Speaking at the Resources Rising Stars Gold Coast Conference, CEO Tim Goyder called the project "bulletproof" at bottom-of-cycle prices, pointing to a low strip ratio of 1.2x sustained over more than two decades, a simplified processing flowsheet and a polymetallic revenue stream spanning precious and base metals.
Gonneville, discovered in 2020 roughly 70 kilometers from Perth, is slated to become Australia's first dedicated PGM mine. Development will proceed in two stages, beginning with an open-pit operation expected to run for at least 23 years before potentially transitioning to underground mining.
The company reported a resource base of 17 million ounces of precious metals alongside nickel and copper deposits. Proven and probable reserves stand at 7 million ounces of precious metals, 400,000 tonnes of nickel and 260,000 tonnes of copper. Expected annual production centres on approximately 220,000 ounces of precious metals and roughly 16,000 tonnes of base metals.
Financial metrics quoted by the company show a net present value at an 8% discount rate of AUD 1.4 billion based on conservative bottom-of-cycle pricing, rising to about AUD 2 billion at current metal prices. The internal rate of return is 23% at conservative pricing, with a payback period of 2.7 years. All-in sustaining cost is estimated at USD 370 per ounce of precious metals. Chalice noted that every USD 100 increase in the palladium price adds AUD 250 million to the NPV8 figure.
Chalice has invested AUD 250 million to date in the project and requires approximately AUD 25 million additional capital to reach a bankable feasibility study. The company carries no debt and holds about AUD 60 million in cash and listed investments. Financing is targeted at 50% to 60% senior debt covering pre-production capital expenditure.
On the timeline, Chalice completed an eight-week full-flowsheet pilot plant program by the end of 2024. The company is targeting completion of the bankable feasibility study in the third quarter of 2027, with a final investment decision and construction start targeted for the first half of 2028 and operations commencing in 2030. Environmental approvals are estimated to require 18 to 24 months.
Palladium currently trades in the range of USD 1,300 to USD 1,400 per ounce. About 90% of global supply originates from aging operations in Russia and South Africa. Goyder said prices would need to exceed USD 2,500 per ounce to incentivize significant supply growth from existing producers. Demand is expected to receive a boost from AI data centres, which could add between 0.5 million and 1.5 million ounces annually against a total market of roughly 9 million ounces. The transition away from internal combustion engines is projected to take approximately 20 years, sustaining demand for hybrids and petrol vehicles that use palladium in catalytic converters.
Copper prices are trading just below USD 15,000 per tonne and rising, providing additional support to the project's polymetallic economics.
Chalice's market capitalization stands at approximately AUD 500 million, or about USD 379 million. Shares traded at USD 0.97 on the day, down roughly 29% over the past six months and 39% year to date. Consensus analyst coverage rates the stock a Buy, with price targets ranging from USD 0.87 to USD 2.89.
Beyond Gonneville, the company disclosed progress at its Goomalling project northeast of Perth, where a newly drilled 30-kilometre strike-length belt has returned coherent soil anomalies containing copper, molybdenum, silver, gold and heavy rare earths. At the Warrego project in the Northern Territory, 10 to 15 kilometres west of the historical mine that produced 1.4 million ounces of gold and 130,000 tonnes of copper, recent reverse-circulation drilling intersected eight metres grading 1.7% copper and 0.4% gold. Additional RC drilling rounds are planned within weeks.
