| Mon 15 Nov 2010, 15:00 | | PLN - Platmin Limited - Press release |
|
PLN
PLN
PLN - Platmin Limited - Press release
Platmin Limited
Incorporated in the accordance with the laws of Canada
Registration number: 610178-0
Share code on TSX: PPN
Share code on AIM: PPN
Share code on JSE: PLN
ISIN: CA72765Y1097
CONTINUOUS IMPROVEMENTS TO METAL OUTPUT AT PLATMIN
NOT FOR DISSEMINATION IN THE UNITED STATES OR OVER UNITED STATES NEWSWIRE
SERVICES
November 15, 2010: TORONTO: Platmin Limited ("Platmin" or "the Company";
TSX/AIM: PPN; JSE: PLN) today announced its results for the third quarter of
2010 (Q3 FY2010) at its Pilanesberg Platinum Mines ("PPM") where the build up
of platinum group metals ("PGM`s") continues.
During this production build-up, as a company in the development phase,
Platmin capitalizes operating costs net of revenue from metal sales. This will
continue until such time as PPM is brought into commercial production, which
has not yet been declared. As is typical for a company in a build-up phase,
Platmin recorded a net loss in respect of corporate and other overheads for
the third quarter FY2010 of US$8.944 million. From an accounting point of
view, a non-cash unrealised foreign exchange loss of US$17.090 million,
relating principally to the revaluation of cash held in a currency other than
the functional currency of the group due to the strong appreciation of the
rand during the reporting period, increased the reportable loss for the
quarter to US$26.034 million.
A total of 17,041 4E ounces (3 PGM + Au) were produced during the third
quarter (compared to 14,392 4E ounces and 10,867 4E ounces produced,
dispatched and sold in Q1 and Q2 respectively). A total of 42,300 4E ounces
were produced and 39,051 4E ounces dispatched and sold for the nine months to
September 30, 2010. Due to the six week strike at the Northam Platinum Mine
("Northam") which commenced on September 6, 2010, dispatches during the month
were curtailed. As a result a total of 13,788 4E ounces were dispatched and
sold (realising US$18.543 million or ZAR128.758 million in revenue) during the
quarter under review. As an interim measure, a short term off-take agreement
was concluded with Impala Refining Services during the Northam strike, in
order to continue with the delivery of concentrate for smelting and refining.
At the end of September 2010, the project expenditure for the development of
PPM is almost complete, with outstanding development expenditure to completion
of the construction phase of the project of only US$14.284 million (ZAR99.182
million). This, excluding further capitalised pre-production costs and ongoing
capital expenditure, will bring the total project expenditure spent to
US$556.232 million (ZAR3.862 billion).
Commenting on the progress made during the quarter, Tom Dale, CEO, said, "The
principal production challenge remaining is to strip adequate volumes of waste
in the right areas and sequence in order to expose healthy volumes of the
silicate reefs and the high grade UG2 reef which lies at the bottom of the
reef succession. Progress in this regard is evident from the results for the
September quarter and the month of October, when 7,004 ounces were produced.
Our rate of future improvement depends upon:
- Implementing the revised plans of our new mine-based geological and
planning team;
- Improved availability and utilization of the mining contractor`s fleet,
based on more effective preventative maintenance, leading to increased
waste volumes stripped; and
- Further integration of the mine and contractor teams to deliver the
common plan of higher metal output."
"Ideally, we need two to three month`s ore on the run-of-mine ("ROM")
stockpiles, plus sufficient, mineable reef exposures in the pit. We are
making progress towards this. Important advances have been made in
debottlenecking the ROM feed arrangements. This, together with steadily
improving exposure of sulphide reef and higher metallurgical recoveries,
should now increase metal production."
Platmin currently anticipates total metal output for FY2010 of between 60,000
and 65,000 4E ounces.
Dale noted further that the current Environmental Management Plan (EMP) for
PPM envisages backfilling the pit at significant cost, with negligible
sustainable benefits for the community or the nation. The company is fast-
tracking an application to amend the current EMP, for submission to the
Department of Mineral Resources (DMR), to utilize the pit as a dam to capture,
store, purify and distribute large volumes of run-off water from rainfall in
the Pilanesberg area for the sustainable benefit of the 350,000-strong local
community and the nation. The project enjoys strong support from senior
representatives of the community. If this application is granted, the lock-up
of cash in rehabilitation guarantees (since the moratorium imposed in April
2009 by the DMR on insurance backed guarantees), would be materially
ameliorated.
Extension of loan facility
On April 22, 2010, a subsidiary of Platmin entered into a ZAR191 million (an
equivalent of US$26 million at an exchange rate of ZAR7.38 = USD1) short term
lending facility with Pallinghurst Resources Limited ("Pallinghurst"). This
facility was initially for a period of 3 months but as at 15 November 2010 the
subsidiary has extended the loan until the 31 December 2010.
The extension of the loan until 31 December 2010 constitutes a related party
transaction under the Alternative Investment Market ("AIM") Rules. The
independent directors of Platmin, having consulted with the Company`s
nominated advisor, Investec Bank plc, consider that the related party
transaction is fair and reasonable so far as the shareholders of Platmin are
concerned. In providing advice to the independent directors, Investec Bank plc
has taken into account the independent directors` commercial assessment.
About Platmin
Platmin`s primary asset is the Pilanesberg Platinum Mine (PPM), which is
building up to full production. The focus of the company is on achieving the
metal production forecasts predicted in the Bankable Feasibility Study (BFS)
for the mine and participating in the considerable investment value creation
potential of the consolidation of the western limb of the Bushveld Complex.
Platmin also hold interests in projects on the eastern limb.
For further information:
Charmane Russell
Russell & Associates
+27 11 880 3924
+27 82372 5816
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This market release contains contains ``forward-looking information`` which
may include, but is not limited to, statements with respect to the future
financial and operating performance of Platmin Limited (the "Company" or
"Platmin"), its subsidiaries and affiliated companies, and its mineral
projects, the future price of platinum or other Platinum Group Elements
("PGEs"), PGE production levels, mining rates, the future price of other base
metals, future exchange rates, the estimation of mineral resources and
reserves, the realization of mineral resource estimates or their conversion
into reserves, costs and future costs of production, capital and exploration
expenditures, including remaining project development expenditure at the
Pilanesberg Platinum Mine ("PPM"), costs and timing of the development of new
deposits, costs and timing of the development of new mines, costs and timing
of future exploration, requirements for additional capital, government
regulation of mining operations and exploration operations, timing and receipt
of approvals, licenses, and conversions under South African mineral
legislation, environmental risks, title disputes or claims, limitations of
insurance coverage and the timing and outcome of regulatory matters. Often,
but not always, forward-looking statements can be identified by the use of
words such as ``plans``, ``expects``, ``is expected``, ``budget``,
``scheduled``, ``estimates``, ``forecasts``, ``intends``, ``anticipates``,
"targeted" or ``believes`` or variations (including negative variations) of
such words and phrases, or state that certain actions, events or results
``may``, ``could``, ``would``, ``might`` or ``will`` be taken, occur or be
achieved.
Forward-looking statements in this MD&A include, amongst others, forecast
production and sales for the 2010 financial year of between 60,000 and 65,000
ounces of 3PGE+Au, the Company`s forecasts of net cash expenses for the
balance of calendar 2010 of between US$25 million and US$30 million;
statements regarding 90% of net cash expenses being operationally incurred at
PPM, recovery rates and grade; targets, estimates and assumptions in respect
of platinum and other PGE prices and production; the quantum of PPM
development shortfalls; and the timing and completion of definitive
feasibility work at the Mphahlele, Grootboom and Loskop Projects.
Such forward-looking statements are based on a number of material factors and
assumptions, including, that contracted parties provide goods and/or services
on the agreed timeframes, that budgets and production forecasts are accurate,
that equipment necessary for construction and development is available as
scheduled and does not incur unforeseen break downs, that no labour shortages
or delays are incurred, that plant and equipment functions as specified, that
geological or financial parameters do not necessitate future mine plan
changes, that no unusual geological or technical problems occur, and that
grades and recovery rates are as anticipated in mine planning.
Forward-looking statements involve known and unknown risks, uncertainties and
other factors which may cause the actual results, performance or achievements
of Platmin and/or its subsidiaries and/or its affiliated companies to be
materially different from any future results, performance or achievements
expressed or implied by the forward-looking statements. Such factors include,
among others, general business, economic, competitive, political and social
uncertainties; the actual results of current exploration and mining
activities; development and operational risks; title risks; regulatory risks;
conclusions of economic evaluations and studies; fluctuations in the value of
the United States dollar relative to the Canadian dollar or South African
rand; changes in project parameters as plans continue to be refined; future
prices of platinum or other PGEs; possible variations of ore grade or recovery
rates (including the existence of potholes, faults and other geological
conditions that may affect the existence or recovery of resources and
reserves); failure of plant, equipment or processes to operate as anticipated;
accidents, labour disputes, industrial unrest and strikes and other risks of
the mining industry; political instability, insurrection or war; the effect of
HIV/AIDS on labour force availability and turnover; delays in obtaining
governmental approvals or financing or in the completion of development or
construction activities, as well as those factors communicated in the section
entitled ``Risk Factors`` of Platmin`s current annual information form ("AIF")
and its final short form prospectus dated May 5, 2010, which can both be
viewed at www.sedar.com. Although Platmin has attempted to identify important
factors that could cause actual actions, events or results to differ
materially from those described in forward-looking statements, there may be
other factors that cause actions, events or results to differ from those
anticipated, estimated or intended. Forward-looking statements contained
herein are made as of the date of this MD&A and Platmin disclaims any
obligation to update any forward-looking statements, whether as a result of
new information, future events or results or otherwise. There can be no
assurance that forward-looking statements will prove to be accurate, as actual
results and future events could differ materially from those anticipated in
such statements. Accordingly, readers should not place undue reliance on
forward-looking statements due to the inherent uncertainty therein.
Investment Bank and Sponsor:
Investec Bank Limited
15 November 2010
Date: 15/11/2010 15:00:01 Produced by the JSE SENS Department.
The SENS service is an information dissemination service administered by the
JSE Limited (`JSE`). The JSE does not, whether expressly, tacitly or
implicitly, represent, warrant or in any way guarantee the truth, accuracy or
completeness of the information published on SENS. The JSE, their officers,
employees and agents accept no liability for (or in respect of) any direct,
indirect, incidental or consequential loss or damage of any kind or nature,
howsoever arising, from the use of SENS or the use of, or reliance on,
information disseminated through SENS.
