New platinum junior Bauba intends raising R45-million in equity capital by the end of this year or in the first quarter of 2011 to allow for additional exploration drilling to take the inferred resource up the value curve and towards a bankable feasibility study.

The share price of the new platinum junior rose more than 11% late last month, when it was listed on the main board of the JSE.

After opening at R3 a share, the price rose to R3,35 and then closed at R3,10 a share.

“As we increase the confidence level and the mineralisation, I believe that the share price can double in the next six to nine months,” Bauba CEO Pine Pienaar told Mining Weekly in a video interview.

Currently, 92-million shares are in issue, with the market capitalisation moving towards the R300-million mark.

“We’re an explorer evolving into a miner. We intend to mine within the next seven years,” Pienaar said.

The mine depth is expected to be 1 km to 2 km.

“All the new platinum mines in the area are destined to be mining at that depth,” Pienaar said.

“We’re going to mine at between 1 000 m and 2 000 m and that is the future of platinum mining in South Africa.”

Bauba is expecting a prill split of 55% platinum-to-palladium ratio, which is the ratio at neighbouring mines.

“That’s the indication at the moment, but our drilling programme will firm up the exact ratio,” he said.

With Bapedi community head Victor Thulare at his side, Pienaar said that the Bapedi community had a 40% direct shareholding in the Bauba project at asset level.

In view of the community issues with other JSE-listed platinum juniors – where the early collateralisation of some shares for cash has split communities into fight- ing factions – Pienaar said that Bauba had taken note of community risk and that the legal agreements that Bauba had put in place engendered confidence.

He said that the three elements that made Bauba a good investment for shareholders were its geological location among four operating platinum mines and four developing platinum projects; the 138-million- ounce magnitude of the targeted resource; and the combination of experienced board members and the management team.

Directors include former AngloGold Ashanti CFO Jonathan Best as nonexecu- tive chairperson; former AngloGold Ashanti executive Ken Dicks; former Lonmin Platinum precious metals refinery research head Sholto Dolamo; and former Northam Platinum geo- logist Damian Smith. CEO Pienaar is the former Mvelaphanda Resources CEO and chief financial officer Mark Rosslee the former Braemore Resources chief financial officer.

Bauba was created through the reverse listing of a 60% interest in Bauba A Hlabirwa Mining Investments.

Its immediate business aim is the exploration, evaluation and development of the Bauba project, a platinum-group metals (PGMs) resource base located on the eastern limb of South Africa’s platinum- and chrome-rich Bushveld Complex.

The project extends over 12 700 ha downdip of producing mines, including Anglo Platinum’s Modikwa and Impala Platinum’s Marula.

The proceeds of an introductory R15-million capital raising earlier this year are funding the initial exploration drilling programme and scoping study, and providing the working capital.

The exploration programme, which began in April, will determine the nature and extent of the PGMs mineralisation.

Initial drill results have exceeded expectations, with the first two boreholes successfully intersecting the Merensky reef and confirming the anticipated mineralisation.

“We have achieved 5,2 g/t, compared with the estimated 4,6 g/t,” Pienaar said of the grade upside.

He said that the results provided a solid base from which the company could accelerate the drilling programme and evaluation.

He sees the platinum market as being poised for growth in the next five years and expects Bauba to be well positioned to take advantage of that growth.

To watch a video in which Bauba Platinum CEO Pine Pienaar tells Mining Weekly Online’s Martin Creamer that the company will be raising R45-million, click here.