Vancouver, Canada — MININGREVIEW.COM — 12 February 2009 – Platinum Group Metals Limited (PGM) – a Canadian-listed company committed to pursuing its goal of becoming a platinum producer and mine operator in South Africa – is considering selling itself or restarting a search for the financing needed to develop a US$400 million (R4 billion) mine project on the western limb of the Bushveld Complex.
“Bankers have started calling the company again after a hiatus of more than two months, which may signal that the company will be able to raise the necessary funding,” CEO Mike Jones told Bloomberg News.
Newmont Mining Corporation and Silver Wheaton Resources Corporation are among the precious-metal producers that have raised more than US$2.5 billion (R25 billion) in equity in the past month. PGM’s talks over funding stalled last year when credit markets began to freeze. The task also was made harder by a drop of more than half in platinum prices as international demand for the metal slumped.
“Precious metals are getting attention,” Jones said in a telephone interview from the company’s headquarters in Vancouver. “We’re seeing revived activity from the banks and they’re coming back to us.”
“The company, advised by Royal Bank of Canada, will choose a strategy based purely on the numeric calculation of what will be most profitable,” he added. Jones declined to comment on whether any suitors had approached PGM, and said the review would take place over 90 days.
“The cost of developing the deposit may drop by US$50 million (R500 million) if the company gains access to South Africa’s electricity grid, instead of relying on its own diesel generators,” Jones concluded.