TIDMPPN
RNS Number : 1847W
Platmin Limited
15 November 2010
NOT FOR DISSEMINATION IN THE UNITED STATES OR OVER UNITED STATES NEWSWIRE
SERVICES
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 "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.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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