Platinum Australia is on the verge of landing an interest in the Kalahari Platinum pgm project in South Africa, it has emerged.

The group has signed a memorandum of understanding with African Rainbow Minerals Platinum (ARMplatinum) to acquire up to a 49 per cent interest in the resource.

Platinum Australia said it had already devised plans for a feasibility study on the mine, which boasts a resource of 3.4 million ounces of platinum, palladium and gold mineralization.

The firm also detailed plans to cut costs at the plant by using the Panton process - which is said to yield high-grade pgm concentrate that could potentially be fed directly to a refinery, thereby negating the need for smelting.

Platinum Australia said that, subject to completion of the bankable feasibility study sometime in mid-2006, the Kalplats project could generate as much as 150,000oz per year of platinum, palladium and gold.

ARMplatinum, is a wholly-owned subsidiary of African Rainbow Minerals, the largest black empowerment enterprise (BEE) mining company in South Africa.