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Xstrata Alloys NKWE Platinum and Genorah Resources sign option agreement to develop Eastern Limb PGM Properties (PDF)
Johannesburg and Rustenburg, 6 August 2008
Genorah Resources (“Genorah”), Nkwe Platinum Limited (“Nkwe”) and Xstrata South Africa (“Xstrata”) have signed a binding heads of agreement granting Xstrata an exclusive option (the “Option”) to acquire a 50% interest in five PGM properties (collectively the farms Hoepekrantz, Nooitverwacht, Eerste Geluk, Garatouw and De Kom) situated on the Eastern Limb of the Bushveld Igneous Complex (“the Properties”). A valid New Order Prospecting Right has been granted over the Properties by the Department of Minerals and Energy.
Nkwe and Genorah are currently conducting a Bankable Feasibility Study (“BFS”) over the Properties and have already delineated a significant resource base of over 20 million PGM ounces, with an independently assessed target mineralisation base of approximately 100 million PGM ounces. The Properties have the potential to achieve an annualised production of one million PGM ounces.
The Option is exercisable following the completion of the Bankable Feasibility Study, expected to be completed by the end of 2009, and is subject to the grant of the necessary regulatory approvals. Simultaneously with the BFS, the parties have undertaken to jointly investigate the feasibility of establishing a downstream smelting and refining business on the Eastern Limb of the Bushveld Igneous Complex. On exercise of the Option, Xstrata will acquire a 50% participation interest in the Properties from Nkwe and Genorah. The parties will form a joint venture, in which Xstrata’s interest will be 50%, while Nkwe and Genorah will collectively have an interest in the remaining 50%. Following the exercise of the Option, Xstrata will fund the total development costs of the Properties from mining through to concentrating. The joint venture will extend to any contiguous properties currently (or in the future) under the control of any of the Parties, (over and above the Properties referred to above).
“Nkwe is pleased to have reached this equitable arrangement with Xstrata, in terms of which Xstrata secures potential access to quality assets in the highly prospective Eastern Limb held by Genorah, while Nkwe stands to benefit from Xstrata’s technical and commercial expertise to realise its strategy of developing its substantial resource base to produce one million PGM ounces per annum and access the entire value chain from mining through to processing” said Nkwe Chief Executive Officer Maredi Mphahlele.”
Xstrata Alloys Chief Executive Peet Nienaber commented;
“This transaction provides Xstrata with entry into the prospective Eastern Limb region and access to a significant, continuous PGM block. The joint development of these properties with Nkwe and Genorah, together with a downstream processing operation, will provide significant growth in mined production and refining for all partners, helping to establish Nkwe/Genorah as an independent, integrated producer of scale and adding further growth potential to our rapidly developing platinum business.”
Ends
Contacts
Xstrata
Songezo Zibi
Telephone +27 11 250 0064
Mobile +27 82 303 8176
Email szibi@xstrata.co.za
Claire Divver
Telephone +44 20 7968 2871
Mobile +44 7785 964340
Email cdivver@xstrata.com
Nkwe Platinum
Staff Sithole
Telephone +27 11 445 2161
Mobile +27 79 498 9505
Email ssithole@nkweplatinum.co.za
Shammy Luvhengo
Telephone +27 11 445 2161
Mobile +27 84 580 9868
Email sluvhengo@nkweplatinum.co.za
Peter Landau
Telephone +44 20 7389 8193
Mobile +44 774 75 77 815
Email plandau@nkweplatinum.com
Notes to editors
Xstrata Alloys
Xstrata Alloys is a business unit of Xstrata plc, listed on the London and Swiss stock exchanges. Headquartered in Rustenburg, Xstrata Alloys is one of the largest South African producers of ferrochrome and vanadium and a growing platinum group metals (PGM) business.
Genorah Resources
Genorah is a mineral resources company with a portfolio of mineral rights and a platinum mining subsidiary, Nkwe Platinum (Pty) Ltd.
Nkwe Platinum Limited
Nkwe Platinum Limited (“NKP”) is an emerging platinum company targeting mid-level projects incorporated and domiciled in Bermuda and listed on the Australian Stock Exchange (“ASX”)