(Adds detail on pre-feasibility study, background on Robert Friedland)
March 26 (Reuters) - Ivanhoe Mines Ltd's Platreef project could add profitable, mechanized production to South Africa's strike-hobbled platinum belt, according to a study released on Wednesday by the company, Robert Friedland's latest venture.
The preliminary economic assessment found that the project could produce some 785,000 ounces of platinum, palladium, rhodium and gold a year and operate for 36 years. It would take about $1.7 billion in capital to bring the large, mechanized underground mine into production.
Friedland, an outspoken billionaire with a track record of picking winners, is one of very few investors looking seriously at building a new mine on South Africa's platinum belt.
While the country has a long history of mining, it has fallen out of favor with foreign investors amid ongoing labor strife. A nine-week strike on the platinum belt has hit 40 percent of global production and a vicious turf war between rival unions has killed dozens of people the past two years.
Geology makes it difficult to mechanize large swathes of the platinum belt but where it is possible, investors are keen because it could make for a smaller, more skilled labor force and potentially much better working conditions.
The study's focus is a scenario where the concentrator would process 8 million tonnes of ore per year by 2024, but it could start up with capacity of 4 million tonnes per year by 2020. A third phase could ramp up capacity to 12 million tonnes by 2028.
Cash costs would be about $341 per ounce of platinum, palladium, rhodium and gold, thanks in part to the revenue that could come from nickel and copper by-products.
The estimated project life is 36 years, according to the study, with the mill starting up after six years of pre-production.
Ivanhoe owns 90 percent of Platreef, and a Japanese consortium led by Itochu Corp has a 10 percent stake.
Preliminary economic assessments are an early milestone for new mining projects, which typically also go through pre-feasibility and feasibility studies and permitting before construction.
Mine plans, financial assumptions and cost estimates can change, and projects are sometimes suspended or canceled despite positive studies.
Ivanhoe said it is aiming to complete a pre-feasibility study in the second half of 2014.
Friedland, Ivanhoe's founder and chairman, made a name for himself in 1996 by selling a then-undeveloped Canadian nickel-copper project called Voisey's Bay for C$4.3 billion ($3.85 billion). The mine is now owned by Brazil's Vale SA .
He solidified his reputation with the earlier incarnation of Ivanhoe Mines, now called Turquoise Hill Resources, building the Oyu Tolgoi copper-gold mine in Mongolia. Global miner Rio Tinto now controls Turquoise Hill and operates the massive mine.
Ivanhoe shares rose 4.6 percent in early trading on the Toronto Stock Exchange to C$1.82. ($1 = 1.1176 Canadian dollars) (Reporting by Allison Martell in Toronto and Ed Stoddard in Johannesburg; Editing by Meredith Mazzilli)