Platinum rights squabble at Absolute

[] — DENNIS Tucker’s new platinum exploration play Bauba A Hlabirwa Mining Investments (Bauba) already appears to be involved in a legal squabble.

According to the updated announcement published on the Stock Exchange news service (Sens) on Monday, Rustenburg Platinum – which is an operating subsidiary of Anglo Platinum – and ARM are contesting certain prospecting rights awarded to Bauba.

Bauba – the new name for Absolute Holdings – said in a statement that, “there is currently a review application pending in the North Gauteng High Court brought by Rustenburg Platinum Mines and ARM Mining Consortium against a decision by the Department of Mineral Resources (DMR) and citing certain other parties in respect of the refusal of the DMR of an application to grant prospecting rights in respect of certain farms’

The announcement continued that some of these properties, “are farms forming part of the southern cluster in respect of which the DMR has granted prospecting rights to Bauba on December 19, 2007 (the southern rights).’

According to the announcement Bauba has notarially executed these rights and, “is not a party to, nor has it been cited in the High Court application.

“Accordingly, the parties have no reason not to proceed with the transaction recorded in the acquisition agreement on the terms and conditions stipulated.’

Bauba CEO Pine Pienaar told Miningmx, “we don’t perceive this as a risk but it is something that we had to disclose.

“Those rights were granted in terms of section 104 of the Minerals and Resources Petroleum Development Act (MPRDA) which grants communities the preferential right to be awarded the prospecting rights subject to them inter alia having the necessary financial and technical resources to develop these for the benefit of the local community.

“In this case the local community is our partner and shareholder, the Bapedi Nation. Our legal opinion is that the Minister of Mineral Resources has no discretion in this matter and must award the rights to the Bapedi.’

Bauba intends raising up to R150m through placing shares for cash to fund a drilling programme on its prospecting rights.

That programme will focus initially on the southern rights which are viewed as the most promising held by Bauba.

Reasons are that is where the platinum reefs are the shallowest and where they also dip at a flatter rate than the reefs further north. That makes them easier to mine.

According to Bauba, the target resource on its ground has been independently verified and estimated at 138m ounces of platinum group metals (pgm) by Venmyn Rand.

The ground over which Bauba holds prospecting rights has been split into three geographic sections.

The southern cluster comprises the farms Genokakop 284KT and Grootvygenboom 285KT as well as a prospecting right over the farm Houtbosch which has not yet been notarially executed.

The central cluster consists of the farms Magneetsvlakte 541KS and Dingaanskop 543KT while the northern cluster takes in the farms Fisant Lagte 506KT, the remainder of Indie 474KS, Zwitzerland 473KS and Schoonoord 462KS.

Pienaar said plans were to have the southern rights upgraded through the drilling programme to a resource statement within nine months to a year.

After that Bauba would focus on negotiations aimed at bringing in a “senior, deep-level hard rock mining group’ as a partner in the project.