JUBILEE Platinum was confident it could secure the R190m in project funding to restart the Smokey Hills mine it would acquire once the takeover of Platinum Australia was completed, Jubilee CEO Leon Coetzer said on Monday.
Jubilee was searching for a mining operation to secure dedicated feed for its ConRoast smelting technology that treats platinum concentrate with high chrome content.
Smelters operated by major platinum companies cannot cope with high levels of chrome in concentrate and penalise junior miners heavily if they supply concentrate with chrome content over certain levels. ConRoast can cope with chrome.
The small Smokey Hills mine, north of Steelpoort in Limpopo, mines only the UG2 reef, which has a high level of chrome.
Mr Coetzer said talks with offtake companies would begin soon now that the implementation deed and supporting transactional documents had been agreed. He declined to say whether he was confident Smokey Hills could extricate itself from offtake agreements.
Platinum Australia stopped trading on the Australian exchange and was put into voluntary administration after operational problems at Smokey Hills, which was idled in June last year.
It is likely the combined entity will hedge up to 20% of its production, which is planned to reach 60,000oz of platinum group metals next year, below the design capacity of 80,000oz. Jubilee will issue shares to Platinum Australia shareholders as part of the takeover deal. Jubilee shareholders will ultimately own 54.5% of the enlarged group.