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Due Diligence Report: Platinum Moves Quietly Higher and Miners Follow
Summary:
Platinum Group Metals Ltd. (Platinum Group) is a platinum-focused exploration and development company. Platinum Group conducts work on mineral properties it has staked or acquired by way of option agreements in the Republic of South Africa and in Canada. The Company’s business is focused on the construction of the Project 1 platinum mine and the exploration and initial engineering on the Waterberg Platinum deposit, where the Company is the operator of the 255 square kilometers Waterberg joint venture project (the Waterberg JV Project) with the Japan Oil, Gas and Metals National Corporation (JOGMEC) and Mnombo Wethu Consultants (Pty) Ltd. (Mnombo). The Company is the operator of the Waterberg Projects, consisting of the Waterberg JV Project and the Company’s exploration on prospecting rights on the Waterberg Extension Project.
Platinum Group Metals Ltd. has a current market capitalization of $316.63 M with 77.59 M outstanding shares. Its daily average volume traded is 0.45 M shares.
Financial Highlights (Q1 2016):
Revenue: Nil
Gross Profit: Nil
Net Income: -1.90 M
Cash and Cash Equivalents: 48.25 M
Total Debt: 76.76 M
Recent News and Analysis:
The company recently reported increased grade and a significant increase in indicated ounces in an updated independent resource estimate for platinum, palladium, rhodium and gold (“4E”) on the 58.65% owned Waterberg Joint Venture, located on the North Limb of the Bushveld Complex. R. Michael Jones, P.Eng, President, CEO and co-founder of Platinum Group Metals said “We have been very successful in almost doubling indicated resources to 24 million ounces. Waterberg is an extraordinary deposit that we have not yet found the limits to. Starting at 140 meters from surface, with zones 3 to 70 meters thick and an overall proven strike length of 13 km so far, Waterberg stands apart from conventional platinum mines in South Africa. The increased F zone grade combined with improved deposit definition allows for the targeting of best grade thickness in early mine scheduling, which is changing the project significantly from our earlier engineering work. We are looking at a series of adjacent mine plans, each at the scale of a typical stand-alone mine, to be prioritized and processed at a single central plant.”
The resource estimate includes sampling and data from 294 diamond drill boreholes with 459 deflections for a total of 584 intersections into the deposit from a total of approximately 293,538 meters of core drilling. The deposit model is a kriged estimate from Data Mine geological wireframes. The deposit is 13 km long, open along strike and begins from 140 meters deep. The deposit is known to continue down dip below the arbitrary 1,250 meter cut off depth applied to the deposit for resource estimation purposes. Minimum mineralized thickness is 3 meters and the maximum is 70 meters. Drilling is continuing at Waterberg and the deposit is still open for expansion. Assays for shallow Super F zones at 180 meters to 300 meters from surface are outstanding. Deeper “Super T” targets are being drilled now. The most recent intercept in the “Super T” zone is 7.76 meters grading 6.14 g/t 4E and the deposit in the area of this hole is open for expansion.
Conclusions:
Platinum Group Metals (NYSEMKT:PLG) shares were higher over 8% on Tuesday after the company reported increased grade and higher indicated ounces in a resource estimate for platinum, palladium, rhodium and gold on the 58.65% owned Waterberg joint venture, located on the North Limb of the Bushveld complex. PLG trades around the mid-point of the 52-week range between $0.96 and $5.00. The stock is up 18.25% or $0.48 after the news, hitting $3.11 per share. About 675,327 shares traded hands or 55.12% up from the average. Platinum Group Metals Limited (USA) (NYSEMKT: PLG) has risen 1.15% since September 11, 2015 and is uptrending. It has underperformed by 5.64% the S&P500.
Sources:
- http://www.reuters.com/finance/stocks/companyProfile?rpc=66&symbol=PLG
- https://www.google.ca/finance?q=NYSEMKT%3APLG&fstype=ii&hl=en&gl=ca&ei=fvkXV7HMC4aI2Aaa6JjgDw
- http://finance.yahoo.com/news/platinum-group-metals-reports-13-134538519.html
- http://finance.yahoo.com/q?s=PLG&ql=0
- http://sonoranweeklyreview.com/platinum-group-metals-shares-gain-8-reports-higher-grade-resources-at-waterberg-jv-nysemktplg/
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