Impala Platinum Completes Strategic Investment for 15% Stake in Waterberg PGM Project for US $30 Million
788 – 550 Burrard Street
Vancouver, BC V6C 2B5
P: 604-899-5450
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News Release No. 17-354
November 6, 2017
Impala Platinum Completes Strategic Investment for 15%
Stake in Waterberg PGM Project for US $30 Million
VANCOUVER, British Columbia and JOHANNESBURG, South Africa, (GLOBE
NEWSWIRE) -- Platinum Group Metals Ltd. (TSX:PTM) (NYSE American:PLG)
(“Platinum Group”, “PTM” or the “ Company”) is pleased to report the closing of
the first phase of the transaction involving the Waterberg platinum group metal
(“PGM”) Project (the “ Waterberg Project ”) announced on October 16, 2017
with Impala Platinum Holdings Ltd. (JSE:IMP) (“ Implats”), Jap an Oil, Gas
and Metals National Corporation (“JOGMEC”), Mnombo Wethu Consultants (Pty)
Ltd. (“Mnombo”), and Waterberg JV Resources Proprietary Ltd. (“Waterberg
Resources”). Platinum Group Metals has received consideration of US$17.2 million
from Implats for the sale of an 8.6% interest in the Waterberg Project and JOGMEC
has received US $12.8 million for the sale of a 6.4% interest in the Waterberg Project.
R. Michael Jones CEO of Platinum Group Metals said “We are very pleased to close
the first phase of this transaction and to welcome Imp lats to the Waterberg team.
We w ill immediately get to work on the Definitive Feasibility Study. Waterberg
represents a large-scale PGM resource with an attractive risk profile given its shallow
nature, which facilitates fully mechanized production with the potential for the project
to have amongst the lowest operating costs in the PGM sector . The deposit is
dominated by palladium at a time when prices and interest in this essential metal are
increasing.”
Transaction Summary:
1. Implats has purchased a 15.0% interest in Waterberg Resources, which holds
the Waterberg Project, for US$30.0 million (the “Initial Purchase”);
2. Implats has the option to increase its stake in Waterberg Resources (the “Call
Option”) to 50.01% through additional purchases and earn -in arrangements
totaling US $166.0 million following the completion of a Definitive Feasibility
Study; and
3. Implats has a right of first refusal to smelt and refine Waterberg concentrate.
If Implats exercises its Call Option to advance to a 50.01% interest in Waterberg
Resources, JOGMEC will retain a 5% interest and certain metal marketing rights to
final metal related to the project, while Platinum Group would retain a 31.96%
direct and indirect interest in Waterberg Resources. The transaction agreements
also provide for the transfer of equity and the issuance of additional equity to one
PLATINUM GROUP METALS LTD. …2
or more broad based black empowerment partners, at fair value. For full details of
the transaction please see the Company’s news release dated October 16, 2017.
The Waterberg Project has a numb er of highly attractive characteristics and is
designed to be a low-cost, shallow, bulk mineable project with significant scale and
growth potential. The participation of Implats, the world’s second largest platinum
producer with fully integrated mine to m arket operations, represents a significant
step in the advancement of the Waterberg Project towards potential development
and production.
The secured lenders to Platinum Group, Sprott Resource Lending Partnership, among
other lenders (“Sprott”), and Liberty Metals & Mining Holdings, LLC (“ LMM”), have
provided their consent to the Call Option , which consent is conditional on the
satisfaction of certain conditions by the Company. Sprott and LMM have also agreed
to terms and conditions upon completion of which they will provide their consent to
the sale of the Maseve Mine to Royal Bafokeng Platinum Limited (“ RBPlat”) (the
“Maseve Sale Transaction”) (see news release dated September 6, 2017).
The Company and R BPlat are in the process of obtaining regulatory approvals and
completing the negotiation of agreements required for the closing of the Maseve Sale
Transaction. RBPlat paid a deposit of Rand 41.37 million (US $3.0 million) into
escrow on October 9, 2017. The Maseve Mine is on care and maintenance and the
Company does not plan an y further investment at Maseve. In the event that the
Maseve Sale Transaction did not complete for any reason, the Company would pursue
other expressions of interest to purchase the mine. Based on t he Company’s
intended sale of the Maseve Mine and the above facts, the Company has determined
that the Maseve Mine is no longer a material property of the Company in the context
of National Instrument 43-101 Standards of Disclosure for Mineral Projects (“NI 43-
101”).
About Impala Platinum Holdings Limited
Impala Platinum Holdings Limited is one of the world’s foremost fully integrated
producers of platinum and associated PGEs. The group produces approximately a
quarter of the world's supply of primary platinum. Implats produced 1.53 million
ounces of platinum and 3.1 million ounces of PGEs in FY201 7. Implats’ operations
are located on the Bushveld Complex in South Africa and the Great Dyke in
Zimbabwe, the two most significant PGE-bearing ore bodies in the world. In Southern
Africa Implats is structured around five main operations namely Impala, Zimplats,
Marula, Mimosa and Two Rivers with headquarters based in Johannesburg, South
Africa.
About Platinum Group Metals Ltd.
Platinum Group, based in Johannesburg, Sout h Africa and Vancouver, Canada.
Platinum Group and its partners JOGMEC and Mnombo originated the grass -roots
exploration that discovered the Waterberg deposit and a new portion of the Bushveld
PGM complex in 2011.
PLATINUM GROUP METALS LTD. …3
Formed in 2002, Platinum Group holds sig nificant mineral rights and large -scale
reserves of platinum and palladium in the Bushveld Igneous Complex of South Africa,
which is host to over seventy percent of the world's primary platinum production.
Qualified Person
R. Michael Jones, P.Eng., the Co mpany’s President, Chief Executive Officer and a
shareholder of the Company, is a non-independent qualified person as defined in NI
43-101 and is responsible for preparing technical information contained in this news
release. He has verified the data by re viewing the detailed information of the
geological and engineering staff and the Independent Qualified Person reports as well
as visiting the site regularly.
On behalf of the Board of
Platinum Group Metals Ltd.
For further information contact:
R. Michael Jones, President
or Kris Begic, VP, Corporate Development
Platinum Group Metals Ltd., Vancouver
Tel: (604) 899-5450 / Toll Free: (866) 899-5450
www.platinumgroupmetals.net
Disclosure
The Toronto Stock Exchange and the NYSE American LLC have not reviewed and do
not accept responsibility for the accuracy or adequacy of this news release, which
has been prepared by management.
This press release contains forward -looking information within the mea ning of
Canadian securities laws and forward-looking statements within the meaning of U.S.
securities laws (collectively “forward -looking statements”). Forward -looking
statements are typically identified by words such as: believe, expect, anticipate,
intend, estimate, plans, postulate and similar expressions, or are those, which, by
their nature, refer to future events. All statements that are not statements of
historical fact are forward -looking statements. Forward -looking statements in this
press release include, without limitation, statements regarding the Call Option, the
Maseve Sale Transaction , potential alternative transactions involving the Maseve
Mine and amendments to the Company’s agreements with its lenders, including the
potential to satisfy conditions precedent and consummate all or any part of such
transactions as described herein; changes to black economic empowerment
participation in the Waterb erg Project; the anticipated benefits of the Implats
transactions and Implats’ participation in the Waterberg Project; the Company’s
intended use of proceeds derived from the Initial Purchase ; potential offtake
agreements; the Company’s plans for the Waterberg Project and the Maseve Mine ;
cost estimates; the Waterberg Project’s scale and growth potential; the advancement
of the Waterberg Project towards potential development and production ; the
PLATINUM GROUP METALS LTD. …4
Company’s key objectives; and the Company’s plans and estimates regarding
exploration, studies, development, construction, production, cash flows and other
activities and developments. Statements of mineral resources and mineral reserves
also constitute forward-looking statements to the extent they represent estimates of
mineralization that will be encountered on a property and/or estimates regarding
future costs, revenues and other matters. Although the Company believes the
forward-looking statements in this press release are reasonable, it can give no
assurance that the expectations and assumptions in such statements will prove to be
correct. The Company cautions investors that any forward-looking statements by the
Company are not guarantees of future results or performance and that actual results
may differ materially from those in forward-looking statements as a result of various
factors, including risks related to indebtedness; the Company may not obtain
required lender consents on terms favorable to it, or at all; the anticipated benefits
of the Initial Purchase and Implats’ participation in the Waterberg Project may not be
realized; the Call Option may not be exercised, the Company may be unable to satisfy
the related closing conditions or black economic empowerment dilu tion may affect
the economics thereof; the C ompany may not be able to finalize definitive
agreements relating to the Maseve Sale Transaction on favorable terms , or at all,
satisfy the related closing conditions and complete such transaction; the Company
may be unable to complete an alternative sale of the Maseve Mine if the Maseve Sale
Transaction does not complete; the Company’s capital requirements may exceed its
current expectations; the uncertainty of cost, operational and economic projections;
the ability of the Company to negotiate and complete future funding transactions and
successfully settlement or restructure of debt; variations in market conditions; the
nature, quality and quantity of any mineral deposits that may be located; metal
prices; other prices and costs; currency exchange rates; t he Company’s ability to
obtain any necessary permits, consents or authorizations required for its activities
and to effect the relevant transactions and to otherwise comply with all applicable
regulatory requirements; the Company’s ability to produce miner als from its
properties successfully or profitably, to continue its projected growth, or to be fully
able to implement its business strategies; risks related to contractor performance
and labor disruptions; and other risk factors described in the Company’s Form 40-F
annual report, annual information form and other filings with the Securities and
Exchange Commission and Canadian securities regulators, which may be viewed at
www.sec.gov and www.sedar.com, respectively. Proposed changes in the mineral law
in South Africa if implemented as proposed would have a material adverse effect on
the Company business and potential interest in projects.
Cautionary Note to U.S. and other Investors
Estimates of mineralization and other technical information included or referenced in
this press release have been prepared in accordance with NI 43-101. The definitions
of proven and probable reserves used in NI 43-101 differ from the definitions in SEC
Industry Guide 7. Under SEC Industry Guide 7 standards, a "final" or "ban kable"
PLATINUM GROUP METALS LTD. …5
feasibility study is required to report reserves, the three-year historical average price
is used in any reserve or cash -flow analysis to designate reserves and the primary
environmental analysis or the report must be filed with the appropriate governmental
authority. As a result, the reserves reported by the Company in accordance with NI
43-101 may not qualify as "reserves" under SEC standards. In addition, the terms
"mineral resource", "measured mineral resource", "indicated mineral resource" and
"inferred mineral resource" are defined in and required to be disclosed by NI 43-101;
however, these terms are not defined terms under SEC Industry Guide 7 and normally
are not permitted to be used in reports and registration statements filed with the
SEC. Mineral resources that are not mineral reserves do not have demonstrated
economic viability. Investors are cautioned not to assume that any part or all of the
mineral deposits in these categories will ever be converted into reserves; "inferred
mineral resources" have a great amount of uncertainty as to their existence, and
great uncertainty as to their economic and legal feasibility. It cannot be assumed that
all or any part of an inferred mineral resource will ever be upgraded to a higher
category. Under C anadian securities laws, estimates of inferred mineral resources
may not form the basis of feasibility or pre -feasibility studies, except in rare cases.
Additionally, disclosure of "contained ounces" in a resource is permitted disclosure
under Canadian securities laws; however, the SEC normally only permits issuers to
report mineralization that does not constitute "reserves" by SEC standards as in place
tonnage and grade without reference to unit measurements. Accordingly, information
contained or referenced in this press release containing descriptions of the Company's
mineral deposits may not be comparable to similar information made public by U.S.
companies subject to the reporting and disclosure requirements of United States
federal securities laws and the rules and regulations thereunder.