Name of the Project
Waterberg platinum group metals (PGM) project.

Location
Limpopo, South Africa.

Client
Waterberg JV Resources is a collaboration between Platinum Group Metals (37.05%); Japan Oil, Gas and Metals National Corporation, or Jogmec (21.95%); black economic-empowered partner Mnombo Wethu Consultants (26%); and Impala Platinum Holdings, or Implats (15%). As a result of Platinum Group’s 49.9% ownership in Mnombo, the company has an effective interest in the Waterberg JV of 50.02%.

Project Description
The Waterberg project has a number of highly attractive characteristics, which indicate it will be a low-cost, shallow, bulk mineable project, with significant scale and growth potential.

On a 100% project basis using a 2.5 g/t cutoff grade, the 2016 prefeasibility study (PFS) estimates probable reserves at 12.32-million platinum, palladium, gold and rhodium (4E) ounces, comprising 61% palladium, 30% platinum, 8% gold and 1% rhodium plus 191-million and 333-million pounds of copper and nickel.

The independent PFS announced by PTM in October 2016 for the Waterberg project modelled a 744 000 oz/y 4E mine with an 18-year life.

The PFS envisages the Waterberg project producing a flotation concentrate from a processing plant to be sold or toll-treated for the local South African market.

The Waterberg is palladium-dominant and the PFS has estimated that Waterberg could produce 472 000 oz/y of palladium.

Potential Job Creation
It is estimated that the project will create an estimated 3 361 new primary jobs for highly trained people with transferable skills.

Net Present Value/Internal Rate of Return
The project has an estimated after-tax net present value (NPV), at an 8% discount rate, of $320-million using three-year trailing average metal prices.

At a discount rate of 8% using investment bank consensus average metal prices, the project has an NPV of $507-million.

The project has an after-tax internal rate of return (IRR) of 13.5% using a three-year trailing average price deck. Using investment bank consensus average metal prices, the project has an IRR of 16.3%.

Value
Peak funding has been estimated at $914-million.

Jogmec funding is in place to advance the project to the completion of a feasibility study.

Duration
The project is expected to have a 3.5-year construction period. It also includes a construction decision following the completion of the feasibility study and first production three years later.

Latest Developments
The ongoing definitive feasibility study (DFS) for the Waterberg project is being advanced under the direction of the technical committee appointed by Waterberg JV Resources.

Seventeen drill rigs are on site and have started drilling to define the shallowest areas of the current 102.7-million-tonne reserve for increased confidence and detailed mine planning and upgrade a portion of the indicated resources to measured resources for reserve consideration in the DFS.  Immediate areas for in-fill drilling include the Northern and Boundary Super F zones.

Stantec Consulting International and DRA Projects have been selected as the lead independent project engineers based on a detailed, professionally supervised tendering process.  Stantec will focus on underground mining engineering and design and reserve estimation.  DRA will focus on metallurgy, plant design, infrastructure and cost estimation.
The detailed scope of work for the DFS will investigate two options:
• Option 1 entails the construction of a 600 000 t/m (744 000 oz/y platinum group elements) mine as outlined in the PFS.
• Option 2 proposes a lower capital option at 250 000 t/m to 350 000 t/m.
Early optimisation work by the project team to detail the potential for Option 2 using the three decline mechanised mining modules in sequence are encouraging with the potential to optimise the mine plan.
Current drilling at Waterberg is focused on the higher-grade areas of the large-scale deposit.

Key Contracts and Suppliers
Worley Parsons (independent PFS).

On Budget and on Time?
Not stated.

Contact Details for Project Information
PTM VP corporate development Kris Begic, tel +1 604 899 5450.