[miningmx.com] – Northam Platinum (Northam) intends completing the feasibility study for development of its Booysendal South property by May next year but a decision to start mining will depend on platinum market conditions.
That’s according to Northam CEO Paul Dunne who commented, “if the platinum price is sitting around $900/oz at that stage then we will be in no rush to develop Booysendal South. We would rather leave the ounces in the ground.’
Dunne remains optimistic on the future of platinum despite continuing grim market conditions that have kept the platinum price below $1,000/oz since early July although the metal has recovered slightly in the past two days moving back to just above the $1,000/oz mark.
He commented, “our view remains that the fundamentals will support the price. Demand for platinum is growing in line with the growth in world GDP but platinum supply is headed for a train smash. “
Following the completion of the BEE transaction with Zambezi Platinum and associated capital raise Northam had cash and cash equivalents on hand totalling R4.1 billion at end-June compared with R666m a year previously.
Dunne has indicated previously some of those funds may be used for merger and acquisition activity should the right opportunity arise.
He commented, “in bad times good assets get sold at reasonable prices but we are only interested in targeting shallow orebodies that can be mined using mechanised methods.’
Asked if he thought Lonmin presented an opportunity given the current depressed level of its share price Dunne replied, “not at this stage. We think we have better opportunities.’
Northam boosted its operating profit to R595.8m for the year to end-June (previous comparable year R61.5m) but reported a loss for the year of R1bn (R19.6m) because of one-off costs related to the Zambezi empowerment deal and impairment charges against non-core assets.
