"Powering our massive Platreef mine with reliable electricity generated by ‘green power' options, such as solar and natural gas, offers a 24-hour-a-day alternative to the coal-fired national electrical grid and dramatically reduces Platreef's carbon emissions," Ivanhoe's executive co-chair Robert Friedland said. 

Platreef is situated in the resource-rich Bushveld Complex, some 280km northeast of the business capital Johannesburg, and is one of the largest metals developments in southern Africa.

The development will centre on the mining and treatment of palladium, rhodium, nickel, platinum, copper and gold.

The deal between the two companies - which is through a share placement - sees Ivanhoe's subsidiary, Ivanplats, acquire exclusive right to negotiate an offtake agreement with Renergen for electricity generated from the solar hybrid-facility.

The power-generating facility will be constructed at the Virginia gas project in South Africa's Witwatersrand Basin - about 600km from the mine. 

"Ivanhoe is confident that the electricity generated from Renergen's gas and solar hybrid-power facility could be combined with Ivanhoe's solar power facilities to provide Platreef with an uninterruptible power supply to meet the mine's base-load requirements," Ivanhoe said. 

Construction on the Platreef mine's 5MW solar plant will begin next month, with commissioning expected in early 2023. 

The placement in Renergen is for 5.63 million shares at R35.625/share (US$2.37/share), which is equal to a 5% discount to the 30-day volume-weighted average price. 

The deal also involves an option for Ivanhoe to increase its shareholding in Renergen to up to 55% by electing to provide equity funding of up to US$250 million at a market related price at a 10% discount to the 30-day VWAP. The funds would go towards further development and up-scaling of the Virginia gas project, Renergen said. 

Ivanhoe was quoted at C$10.09/share on March 15, having dropped 6% day-on-day. The company had a market capitalisation of C$12.21 billion.