[miningmx.com] — PLATINUM explorer Platfields has moved to secure 100% ownership of the new order prospecting rights to its most important project in Limpopo Province.
That will cost the company up to R40m in cash, with R2m paid upfront and the rest to come from capital raisings by Platfields over the next two years.
Platfields described its Liger project in the pre-listing documentation as the “most attractive opportunity to significantly increase value for the company and its shareholders’.
Liger consists of two key farms – Leeuwkop and Tigerpoort – which contain a shallow ore resource of high grade platinum group metals (pgm) that could be mined as an open pit operation.
The most important farm is Leeuwkop. However, the pre-listing statement said “a third party may have the right to claim an interest in the Leeuwkop prospecting right, or to challenge its issue on the basis that it was a joint holder of the unused old order right’.
The statement added Platfields thought the chances of this happening were minimal and if it did, “the company should have some success in procuring a right in relation to at least 50% of the resources on the Leeuwkop property’.
That level of uncertainty on its top project – where there is also an outstanding land claim still to be resolved – is one of the reasons the Platfields share price has collapsed since it listed on the JSE on December 14.
The share price plunged from 140c to 15c before recovering to current levels of around 30c.
Platfields said on Wednesday that it had struck an agreement with Majestic Silver Trading to acquire its claim over 50% of the prospecting rights to Leeuwkop, with effect from January 18.
The company said: “The board of Platfields considered it in the company’s best interests to enter into this agreement to remove any doubt or uncertainties over Platfield’s ownership of 100% of the resources relating to this prospecting right.’
The balance of the R40m will be settled on terms dependent on the size of Platfields’ next capital raise.
If the company raises R100m, the full outstanding amount is payable. If only up to R25m is raised, Platfields must pay over 25% of the amount brought in.
This is by no means the end of the uncertainties facing Platfields’ proposed development at Liger as well as its other properties.
Concerning the land claim by the Mathabatha community, the company said in the pre-listing documentation that “the presence of a land claim on farm Leeuwkop 425KS should not pose a risk on the prospecting operations of Platfields, as the land claim is in respect of surface rights’.
The grant of the prospecting right over Tigerpoort to Platfields has been held up, because of an appeal against it by Anglo Platinum which has also launched a High Court review application to set the grant aside.
Platfields CEO Bongani Mbindwane told Miningmx when his company listed that he was negotiating with Anglo Platinum to resolve the dispute.
