TORONTO (miningweekly.com) – TSX-, JSE, and Aim-listed junior Platmin produced 14 177 oz of platinum-group metals (PGMs) in the first quarter from its Pilanesberg platinum mine (PPM) in South Africa, and expects output will rise as mining moves out of oxidised ore zone, CEO Tom Dale said on Friday.

The oxidised ore traditionally has lower recoveries, Platmin said.

Until the mine achieves commercial production, the company is offsetting revenue from mining against capitalised operating costs.

The total capital expenditure to develop the PPM so far now stands at $440,82-million, and the company expects to spend another $16,1-million to complete construction, for a total project cost of $456,9-million.Platmin recorded a first-quarter loss of $5,18-million.

The firm has recently changed its year-end from February 28 to December 31, so comparisons are difficult, but it posted a net loss of $12,49-million in the quarter ended February 28, 2009.

In March, Platmin entered into a $26-million short-term lending facility with Pallinghurst Resources, which has since been drawn down in full.

The company announced last month it would buy Barrick Gold's 10% interest in another platinum project, Sedibelo, for $15-million, or up to $45-million, including various long-lead items of equipment for the project.

This week, Platmin raised $385-million by issuing 205,7-million new shares and 135-million convertible debentures.

“These funds will be applied to complete the build-up to full production at PPM and to pursue our vision of becoming a significant producer of PGMs through the participation in the consolidation and cost-effective development of the shallow resource base on the western limb of the Bushveld Complex in South Africa,” Dale said in a statement.

By the end of the first quarter, the company had a run-of-mine stockpile of 883 535 t, including 70 609 t of Merensky and UG2 ore and 812 926 t of low-grade ore.

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