Name and Location
Waterberg Joint Venture platinum project, Limpopo, South Africa.

Client
The Waterberg Joint Venture, comprising Platinum Group Metals (49%); Japan Oil, Gas & Metals National Corporation (37%); with empowerment partner Mnombo Wethu Consultants completing the balance.

Project Description
The Waterberg deposit consists of discrete, layered and continuous platinum group metal- (PGM-) bearing layers, starting at 140 m from the surface with a consistent westerly dip. The deposit has so far been drilled for about 10.4 km northwards on strike. Geophysical surveys and drilling, to date, indicate that the deposit remains open down dip and on strike to the north-west.

The preliminary economic assessment (PEA) completed on the project in February 2014 was based on inferred resources, estimated at 167-million tonnes grading 3.26 g/t platinum, palladium and gold (3E) – 0.98 g/t platinum, 1.97 g/t palladium and 0.32 g/t gold – in the T and F layers.

The mine plan in the PEA uses three decline clusters for access, owing to the shallow depth of the deposit. The shallow edge of the T layer is at 130 m vertical and the shallow edge of the F layer is at 220 m.

The planned mining method is all mechanised, including a combination of room-and-pillar mining on mineralised layers 3 m to 10 m thick, and long-hole open stoping on layers 10 m to 60 m thick. The decline ramps for underground access are planned to be developed to the shallow edge of the T and F deposit layers. From there, development ramps are all to be within the deposit along an apparent dip angle. This development approach is possible because of the thickness of the deposit and because it lowers waste development tonnes and costs.

Using a standard flotation mill at steady state, the project is expected to produce 655 000 oz/y of 3E in concentrate, with copper and nickel as credits. The PEA relies on the previously reported preliminary metallurgical recovery estimates from testwork at SGS labs of 83% 3E on the F layer mineralisation and 88% 3E on the T layers. Other independent testwork has been completed, confirming either these recovery rates or higher rates, and indicating the ability to produce an attractive concentrate from the T and F mineralised material of more than 100 g/t 3E containing almost no chrome. Further work to confirm the concentrate recoveries and characteristics will be completed during the prefeasibility study stage. Co-mingling of the F and T materials does not appear to negatively affect recoveries in the initial testwork.

Value
Peak funding for the mine is estimated at R8.85-billion.

Duration
A two-year construction period from 2016 to 2018 is planned.

Latest Developments
PTM has revealed a 66% increase in the estimated inferred mineral resources of the Waterberg JV discovery and neighbouring Waterberg Extension, to 29-million ounces of platinum, palladium, rhodium and gold (4E).

The resource estimate includes the T1, T2 and F layers in a new, previously undiscovered extension of the Bushveld Complex. The updated mineral resource estimate incorporates the Waterberg JV and the Waterberg Extension areas to a cutoff depth of 1 250 m.

The total inferred mineral resources for the T and F layers have been estimated at 287-million tonnes grading 3.15 g/t 4E, including 0.94 g/t platinum, 1.92 g/t palladium, 0.04 g/t rhodium and 0.25 g/t gold, which comprises 30%, 61%, 1% and 8% of the resource respectively.

Included in the mineral resource estimate at Waterberg is the maiden inferred resource estimate on the Waterberg Extension property of 6.8-million ounces, comprising 68.04-million tonnes grading 3.11 g/t 4E, including 0.93 g/t platinum, 1.98 g/t palladium, 0.05 g/t rhodium and 0.15 g/t gold, in a ratio of 30%, 64%, 2% and 4% of the resource, respectively.

The updated deposit estimate also includes an estimated 1.107-billion pounds of nickel and 616-million pounds of copper.

According to PTM, the deposit has demonstrated “good continuity” and remains open along strike and at depth. Drilling is also planned several kilometres north of the current estimate.

The observed deposit layers are between 2.75 m and 60 m thick and have well-identified and modelled rock-unit and geochemical markers. Drilling is currently under way using about 20 rigs.

The expanded mineral resources are in the same geographical position and are similar in type and grade to those that formed the basis for mining methods and metallurgical recoveries in a February PEA by independent engineering firm WorleyParsons.

The PEA on the Waterberg JV deposit was based on the earlier, smaller 3E resource announced on September 3, 2013.

It is estimated that the Waterberg deposit will be one of the lowest-cost PGM mines in the world. The estimated cost of production, including base metal credits, is $438/oz of 3E.

Key Contracts and Suppliers
WorleyParsons (PEA).

On Budget and on Time?
Not stated.

Contact Details for Project Information
Platinum Group Metals, tel +27 11 782 2186, +27 11 782 4338 or
email info@platinumgroupmetals.net.
Japan Oil, Gas & Metals National Corporation public relations division, tel +81 3 6758 8106.
Worley Parsons, tel +27 11 218 3000 or fax +27 11 218 3100.