Adelaide, Sep 7, 2006 AEST (ABN Newswire) - Strong world metal prices have further underpinned the outlook for a new platinum mine being developed by an Australian company in South Africa and due to commence first mining early in the New Year.
Addressing the Paydirt Media 2006 Africa Downunder Conference in Perth today, attended by a record more than 400 delegates, Platinum Australia's Managing Director, Mr John Lewins, said the strengthened metals prices had boosted projected cashflows for the Company's Smokey Hills PGM project to US$392 million over its seven year life.
"The strong pricing also means a payback period of just three months compared to a US$139 million cashflow and a 19 month payback on our former base case expectations prior to the price improvements," Mr Lewins told the Conference.
"This makes Smokey Hills a reasonably robust project and reinforces the opportunities available in South Africa to developer smaller scale deposits and mines ignored or sold off by more global corporates," Mr Lewins said.
"We as an Australian company, identified Smokey Hill and the Kalplats platinum project also in South Africa as the basis to evolve overseas operations complementary to our Australian endeavours - and are now on the verge of reaping the rewards."
The first stage open pit operation for the US$40 million Smokey Hill mine is due to commence ore production in early 2007 and produce ~ 40,000 4E PGM ounces in 2007 with PLA attributable production building to 230,000 ounces by 2009 - when Kalplats's first mining is due to be at full production.
Smokey Hill has an initial seven year mine life with latter stages being underground mining. The Company is viewing an ultimate extension at Smokey Hill to 20 years.
Mr Lewins said Platinum Australia was well advanced in discussions with Black Economic Empowerment (BEE) parties to acquire an interest in the project - as required under the country's revised mining legislation - and a Memorandum of Understanding is imminent.
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kevin@fieldpr.com.au
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