| Fri 30 Mar 2007, 8:49 | | WEZ - Wesizwe - Completion of the Pre-feasibility |
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WEZ
WEZ
WEZ - Wesizwe - Completion of the Pre-feasibility Study and Commissioning of
Bankable Feasibility Study
Wesizwe Platinum Limited
(Incorporated in the Republic of South Africa)
(Registration number 2003/020161/06)
JSE code: WEZ & ISIN: ZAE000075859
Completion of the Pre-feasibility Study and Commissioning of Bankable
Feasibility Study
Bankable Feasibility Study commissioned on strength of economic viability shown
in Pre-Feasibility Study for an underground mine producing 180,000 tons per
month 4E.
The Pre-feasibility Study confirms that the Wesizwe core Frisch-Ledig complex
remains firmly within commercial parameters and is an attractive prospect
because of its grade, prill split and relatively shallow depth.
Exploration drilling remains ongoing to progress the Inferred Mineral Resources
into the Indicated and Measured categories.
Results of the Bankable Feasibility Study expected to be released first quarter
2008
Wesizwe remains on schedule and well within all defined project technical and
commercial parameters.
Wesizwe Platinum Limited has concluded its Pre-Feasibility Study and
commissioned a Bankable Feasibility Study for a platinum mine on its core assets
on the farms Frishgewaagd portions 3, 4, and 11, and the farm Ledig. These core
properties are sandwiched between the Western Bushveld Joint Venture (Anglo
Platinum, Platinum Group Metals and Africa Wide) and the Styldrift BRPM joint
venture between the Royal Bafokeng and Anglo Platinum.
The Pre-feasibilty Study was conducted by the Mineral Corporation as the
Competent Person with TWP Consulting as the Independent Engineers.
Highlights from the Wesizwe Pre-Feasibility Study
Attractive post-tax returns justify the commissioning of the Bankable
Feasibility Study
Best mining practices suggest a hybrid mining method comprising conventional
drilling, blasting and cleaning with trackless transport of ore
The principal mining method will be conventional breast stoping with scraper
cleaning on faces, and strike and dip gullies. Main development will be carried
out using mechanised drilling, cleaning and trackless transportation
The optimal production scenario comprises the early mining of the Merensky Reef
with late UG2 at 180,000 tpm run of mine (ROM)
Possible extension to 240,000 tpm ore also to be investigated during Bankable
Feasibility Study
The Pre-feasbility Study returns a post-tax nominal IRR of 20% using
conservative long-term metal prices
The Mineral Reserves estimated to date (16.7M tonne) are insufficient to sustain
a mine life of 20 years thus in the financial modelling the Inferred Mineral
Resources have also been employed to value the project to a 20 year mine life.
Thus in terms of the SAMREC Code two values have to be presented, one value
based on the Probable Reserves only (14.0 M tonne scheduled) and one based on
the assumption that both the Probable Reserves and Inferred Mineral Resources
(an additional 42.5 M tonne) will be mined. The table below contains the
valuation results.
NPV5% in ZAR billions Probable Case Probable and
Inferred Case
Base Case Metal Prices R 0.000 R 3.439
Spot Metal Prices (27 March 2007) R 2.279 R 10.065
CAPEX will be R3,595 billion with peak cost funding of R866 million in Year 6
(2013)
Average Life of Mine (LOM) cash operating costs to produce concentrate is
R287.03/tonne with a total operating cost of R316/ton
Total run of mine (ROM) production of 2,1 million tons of ore per annum,
producing approximately 260,000 ounces of 4E (platinum, palladium, rhodium and
gold) in concentrate
Primary access will be by means of a twin vertical shaft system comprising a
main, men and materials shaft and ventilation shaft/second outlet
Underground ore will be transported using a combination of trackless equipment
and conveyor belts from the production areas to the shaft
Nearly all off-reef development will be completed by trackless equipment, and
all reef development and stoping will be using conventional hand-held drills
Plant design includes primary one-stage crushing into a SAG mill with
Mill-Float-
Mill-Float (MF2) circuit and ultra-fine grinding on the combined cleaner tail
streams.
Recovery of platinum group metals from Merensky estimated at 88% and UG2 at 78%.
Says Michael Solomon, CEO: "The Pre-Feasibility Study confirms the results of
the Independent Engineer`s Report and the project remains well within the
commercial, economic and technical parameters planned for at the outset of the
project. The results and the fact that the project is a full year ahead of
schedule in relation to the planning timeline published in our two annual
reports demonstrates the success of the reverse engineering approach that we
have taken.
"We will continue on our pro-active path towards capital construction on
completion of the Bankable Feasibility Study which we hope to deliver in the
first quarter of 2008.
"Once again we have exceeded our targets and remain within the originally
envisaged budget."
Another SENS announcement giving a more detailed summary of the results of the
Pre-feasibility Study will be published simultaneously.
Registered office: Second Floor, AMB Capital, 18 Fricker Road, Illovo
2196
Investor relations College Hill, Fred Cornet
enquiries: Telephone: +27 11 447 3030
Wesizwe Platinum Limited, Melanie Low
Telephone: +27 11 215 2375
Web site: http://www.wesizwe.com
Date: 30/03/2007 08:49:50 Produced by the JSE SENS Department.
