Bloomberg News

Wesizwe Platinum Sees Scope to Consolidate With Other Mines

July 14, 2011

(Updates with closing share price in final paragraph.)

July 14 (Bloomberg) -- Wesizwe Platinum Ltd., which sold a stake to China’s Jinchuan Group Ltd. this year, sees scope to consolidate with mines adjacent to its South African project, the company’s joint acting chief executive officer said.

Wesizwe can now look “seriously” at combinations after the Jinchuan transaction resolved a funding shortage, Arthur Mashiatshidi said in a speech near the northwestern South African town of Rustenburg today.

Jinchuan and China-Africa Development Fund acquired 45 percent of Wesizwe, gaining an asset in the country that is the world’s largest platinum producer. Johannesburg-based Wesizwe idled a plan to build Frischgewaagd-Ledig, its first mine, in 2008 when platinum prices plummeted as a six-year commodity rally ended.

There is room to cut the 7.4 billion rand ($1.08 billion) estimated cost of building the mine, Lester Napier, a consultant for Wesizwe, told reporters, and the company is studying the potential for using Chinese shaft-sinking services.

The venture will reach full production of 350,000 ounces of platinum group metals and gold in October 2021, Mashiatshidi said.

Wesizwe is also studying building a 400,000 metric-ton-a- month concentrator in a venture with Vancouver-based Platinum Group Metals Ltd. to cut costs, said Jacob Mothomogolo, a projects executive with Wesizwe.

Wesizwe shares were unchanged at 1.75 rand at the 5 p.m. close in Johannesburg.

--With assistance from Franz Wild in Johannesburg. Editors: John Viljoen, Alastair Reed

To contact the reporter on this story: Carli Lourens in Johannesburg at clourens@bloomberg.net

To contact the editor responsible for this story: John Viljoen at jviljoen@bloomberg.net


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