Platinum Exploration (PGM)

[Ed Monton]

More platinum in South Africa

http://www.mineweb.net/sections/platinum/424128.htm

By: Rhona O'Connell


Posted: '13-MAR-05 19:36' GMT © Mineweb 1997-2004



LONDON (Mineweb.com) -- While some of the platinum majors, notably AngloPlat, are re-shaping their expansion plans in the face of narrow margins associated with the strength of the rand, the juniors are ploughing on relentlessly – one of them in association with AngloPlat. Two recent announcements highlight the level of activity in the sector, with Jubilee Platinum intersecting the Merensky Reef in South Africa and Platinum Group Metals (PTM) announcing the completion of its Competent Person’s Report on the same complex.

Jubilee Platinum was incorporated in June 2002, is listed on AIM and has a current market capitalisation of £26.8 million (US$52 million). The company has announced high-grade intersections from the first hole in its drilling programme on the Tjate project on the Merensky Reef, albeit at some depth. (Jubilee has a 25% stake in the project and can earn a further 10%). Hole DT1 on the Dsjate farm, which covers 2,162 hectares, has intersected 7.78g/t platinum group metals plus gold over a 1.0 metre reef. The Dsjate farm is one of three contiguous farms in the Tjate project, Dsjate 249KT; Fernkloof 539KS; and Quartzhill 542KS covering 5,143 hectares in total, lying on the eastern limb of the Bushveld Complex and immediately downdip of Anglo Platinum’s Twickenham and Impala Platinum’s Marula mines.

Although drilling is very early stage, there is an inferred resource of 282 million tonnes at an inferred grade of 7.25g/t (five PGM+Au) Merensky and UG2 weighted average, alhtough the directors believe that the grades will be higher than those currently inferred. The inferred metal content is 65.8 million ounces (five PGM+Au). Anglo Platinum is known to have drilled three diamond boreholes on the Dsjate property and intersected the Merensky and UG2 chromitite reefs.

The weighted average grades for the individual metals are 4.45g/t platinum, 2.49g/t palladium 0.22g/t rhodium and 0.62g/t gold with 0.33% nickel and 0.19% copper. The company believes the Tjate property to be on one of the “largest unmined blocks of PGMs in the world close to infrastructure and mature mining operations” and Jubilee intends to continue the drilling programme aggressively in order to advance the feasibility study. Jubilee, as project manager, elected to drill the first drill hole DT1 considerably downdip of and stepped out from the eastern boundary of the farm in order to establish continuity of the reef, which the directors believe subcrops at around the 650 metre contour at the eastern boundary.

The directors believe, as advised, that the three farms are all underlain by the Merensky and the UG2 chromitite reefs. Drilling of hole DT1 is continuing towards the projected UG2 chromitite reef, the second PGE bearing reef in the stratigraphic sequence. Intersection of this reef is expected in about two weeks, at some 350 metres below the Merensky reef, and the results will be reported as soon as they are received and Jubilee intends to wedge up to three deflection holes (about 100 metres) per reef to allow multiple intersections on the reef from the “mother” hole and so confirm the immediate reef extension, grade and thickness from the initial intersection.

Meanwhile PTM has announced that its in that its independent qualified person has now completed a review of the resource estimate for the south-eastern property area of the Western Bushveld Joint Venture, which is 1,000 metres to the northwest of AngloPlat’s Bafokeng Rasimone property, and reported an increase in grade from the earlier AngloPlat estimate. The resource estimate for the UG2 reef has, however, decreased. PTM and Anglo Platinum each hold a 37% interest in the joint venture, with BEE partner Africa Wide Mineral Prospecting and Exploration Company (Pty) Limited holding 26%.

The independent estimate, now gives an inferred resource as follows: Merensky Reef: 15.41 million tons at 7.92 g/t- 3PGM + gold with a metal content of 0.93 million ounces 4E; UG2 Reef: 10.05 million tons at 2.52 g/t- 3PGM + gold, inferred metal content 0.82 million ounces 4E. These estimates factor in a 30% geological loss. The resource includes mineralisation from approximately 100 metres to 600 metres deep.

The company reports also that Merensky and UG2 have been intercepted in holes to the north of the resource area that the independent report did not include in the resource estimate as a result of the drill intercept density in these areas. These results include drill hole FG34, which is about 1,500 metres from the nearest point of the declared resource area, with an average of 9.16 g/t three PGM+Au over 1.15 metres on the Merensky. The value for the UG2 Reef is still pending second PTM drill rig has commenced drill testing in this area with the objective of increasing the inferred resources as soon as possible.

The independent resource update results in a total of 4.74 million ounces 3PGM+Au for the project compared with 5.87 million ounces estimated by Anglo Platinum for the same area, although the company expects that the drilling currently underway will both increase the calculated resource and the confidence interval of the resulting estimate. Although the AngloPlat resource estimate did not specify the prill split of the resource, the independent person’s reports makes the following assessment. Merensky Reef: Pt 64.00%, Pd 27.45%, Rh 4.80% and Au 3.75%; UG2: Pt 59.15%, Pd 29.55%, Rh 10.50% and Au 0.80%.

PTM’s drilling programme on the Western Bushveld Joint Venture Project continues with three objectives: to increase the level of confidence on the known resources adjacent to the Bafokeng Rasimone platinum mine; to increase the calculated resources on the project and to explore along strike and up-dip of the Styldrift platinum project.

A number of analysts take the view that the platinum market is moving back towards balance from a period of deficit, notably as price considerations are stimulating a reversion to white gold from platinum in the Chinese jewellery sector.; with accelerating environmental legislation driving a continued increase in PGM usage in emission control catalysts and strong increases in offtake for glass production there should be ample space for new projects, be they from South Africa, Canada or Russia.