In addition the agreements give Implats (Impala Platinum) an option to acquire majority ownership of the project following completion of a definitive feasibility study (DFS).
Located in Limpopo on the northern limb of the Bushveld complex, Waterberg represents a large scale platinum group metal (PGM) resource with an attractive risk profile given its shallow nature.
This facilitates fully mechanised production with the potential for the project to have amongst the lowest operating costs in the PGM sector.
Under the terms of the relevant agreements Implats, subject to various conditions precedent, will pay US$30
million in cash to acquire a 15% shareholding in the project from Platinum Group Metals (PTM) and Japan Oil, Gas and Metals (JOGMEC).
Implats will then be closely involved with the DFS process, which is intended to examine alternative options to establish a preferred development path for the project.
Implats will have 90 business days following approval of the DFS to determine whether it wishes to exercise its option to acquire control of the project, and a further 90 business days to confirm acceptable financing
Subject to any necessary adjustments, Implats would obtain a 50.01% shareholding by purchasing an additional 12.195% equity interest from JOGMEC for $34.8 million and by contributing $130.0 million into Waterberg in return for an additional 22.815% equity interest.
This capital will be contributed as required in order to fund the development of the project, which would be managed by Implats.
The parties have also reached agreement to ensure there will be participation by appropriately broad‐based empowerment groupings in the Waterberg project.
“We have made it a priority to increase Implats’ strategic optionality and this investment represents an important step to create the potential to develop a significant, lower cost, lower risk resource," comments Implats CEO, Nico Muller.
"We look forward to working with PTM, JOGMEC and Mnombo on the feasibility study process.”
Feature image credit: Implats