PLATFIELDS, a junior platinum and gold exploration company, plans to list on the JSE in the fourth quarter of 2008 and it is in talks with Canadian authorities about a secondary listing there, CEO Bongani Mbindwane said on Thursday.
The possible precedence set by the failure of another platinum explorer, Lesego Platinum, to meet its target of listing before the end of 2008 is not something the Platfields board is worried about, Mbindwane said.
He argued his company has shallow deposits that lend themselves to opencast mining, a sizeable shareholder register and R70m in cash, setting it apart from its peers.
He reckons the current environment is favourable for a junior like Platfields to bring a company to the market because investors would be able to get into a stock with plenty of upside potential.
The platinum price has halved from the $2,300 level set in March and platinum shares have pulled back. Around the world junior exploration and development companies have struggled to secure the funding they need.
“We are not going to pull this listing for reasons other than God’s issues,” Mbindwane told a media briefing.
“It would have been very difficult to come to the market when the metals prices were higher because investors want to be exposed to upside,” he said.
Matthew Jarvis from PriceWaterhouseCoopers, which is advising Platfields on its listing, said depending on market conditions and interest from investors, the listing could either raise the R200m the company plans to drum up, or just be an introductory listing with capital raising coming later.
Platfields might approach the Canadian bourse when it comes time to raise the second tranche of R250m it needs to full explore and bring its two platinum deposits and one gold asset into production. There is no time line on this listing.
The flagship project is the Berg platinum project on the southern portion of the Eastern Limb of the Bushveld Igneous Complex, where Platfields intends identifying 10.6 million ounces of the four platinum group elements in a three-phase, five year programme costing R285m.
The ambitious target is to have Berg in production during 2011. The Leeuwkop project, not to be confused with Impala Platinum’s project it bought from African Platinum, is on the northern portion of the Eastern Limb and this should be in production late 2011 going into 2012.
Both prospects will be designed to produce 50,000 tonnes of ore a month each, ramping up to 150,000 tonnes/month each, but the company’s officials declined to be drawn on how many ounces they will produce.
The listing will provide paper which Platfields will use to increase its 32% stake in Leeuwkop to 100%, buying out small black stakeholders in the project, Mbindwane said.
The Grootfonteinberg gold prospect in Mpumalanga province and neighbouring Simmer & Jack’s mines is forecast to be in production from 2012. This is a region where Simmers has battled for years with low recoveries from refractory ore.
Asked if Platfields will engage with Simmers, which is building a Biox plant to improve gold recoveries, operations director Joshua Hattingh said it was way too early to think about such things and drilling over a 30 month period at a cost of R17m is intended to outline a resource of up to 3.4 million oz.
“Obviously we will go forward with people in the area that have experience,” he said.
Platfields will take its story to investors in Europe and South Africa in an October road show.
Bongani Mbindwane
Chief Executive
E-mail: bongani@platfields.co.za
© 2010 Platfields Limited | Disclaimer