Platinum Group Metals Ltd T.PTM

sell it all

[greener12345]

$0$0$0$0$0$0$0$0SA's Wesizwe delays Frischgewaagd mine development$0$0$00 COMMENTS | $0 ADD A COMMENTPRINT EMAIL |$0 $0$0$0 $0$0$0$0$0$0By: Mariaan Webb$0$030th September 2009 $0$0Updated 24 minutes ago$0$0$0$0$0TEXT SIZE$0$0$0$0 $0$0$0$0$0JOHANNESBURG (miningweekly.com) - South African platinum junior Wesizwe has delayed the construction of its 350 000 oz/y Frischgewaagd-Ledig project, until market conditions improve and it could obtain sufficient funding for construction.$0$0The JSE-listed company initially planned to start production ramp-up in 2011, reaching steady state production by 2016.$0$0Wesizwe said on Wednesday that nine months of negotiations with its lead financial advisers, Absa Bank and the Development Bank of Southern Africa, had faltered, after project finance evaporated with the onset of the economic meltdown.$0$0The platinum junior is now in negotiations with a number of parties to obtain financing, some of which were said to be at an "advanced stage".$0$0In April, Wesizwe signed a three-year, R550-million facility with YA Global Investments, which entitled it to subscribe for shares in Wesizwe in tranches of R50-million.$0$0This move was aligned with a revised capital construction strategy announced in November. The group had planned to develop Frischgewaagd-Ledig in a number of phases, with funding to be raised incrementally.$0$0The first phase would have taken two years to complete, and would have involved the shaft sinking operation at a cost of R1,8-billion.$0$0"The company was caught between scarce project finance which, where it was available, was extremely expensive and came with very onerous terms and conditions for lending, and low share prices, which made equity finance highly dilutive. With this conundrum of wishing to advance the project on the one hand, but to conserve cash resources and shareholder value on the other, management was forced to review the entire approach to funding the project," said CEO Michael Solomon on Wednesday.$0$0Wesizwe said that it would have sufficient cash resources, amounting to R119,5-million, to fund the activities of the company for at least a year.$0$0While project construction has now been deferred, the company would continue with negotiations with South Africa's power utility Eskom and the Magalies Water Board for permanent water supply, Solomon noted.$0$0Wesizwe would also continue with activities relating to the environmental impact assessment (EIA).$0$0Late last year, Sun International, Legacy Hotels and the North West Eco Forum appealed a record of decision issued by the North West Provincial Department of Agriculture, Conservation and Environment in respect of the Frischgewaagd-Ledig project's EIA. The appeals were rejected, but Wesizwe undertook to involve concerned parties in the environmental planning aspects of the project.$0$0Wesizwe posted a headline loss a share of 2,56c a share in the six months ended June 30, compared with 3,66c a share a year earlier.$0$0 $0$0$0$0$0