(Bloomberg) — Sometimes buried treasure can be hiding right under your nose. Just ask Alex Dorsch, whose company found what could be Australia’s first major palladium resource on the fringes of Perth, the nation’s mining hub.
“It’s a fascinating bit of serendipity,” said Dorsch, managing director of Chalice Mining Ltd., which has seen its shares rise more than eightfold since confirming the Julimar discovery just over 12 months ago. “It is quite amazing that it wasn’t found in the 1960s or 70s to be honest,” he said in a phone interview.
Chalice, whose shareholders include mining magnate Robert Friedland and Blackrock Inc., plans to add supply to a palladium market that’s been in deficit for years due to high demand for the metal, used in catalytic converters to curb emissions in gasoline-powered vehicles.
Prices surged to record highs this year and UBS Group AG has raised its forecasts on expectations of the largest deficit since 2014.
Julimar — just 70 kilometers (43 miles) north east of Perth, a city of two million people — could be big enough to support a large open pit operation producing around 340,000 ounces of palladium a year over a 12-year lifespan, Macquarie Group Ltd. said in a May 5 note. That compares to a market where annual demand runs close to 10 million ounces.
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