Despite reaching production vein, PTM lowers guidance again as stoping delays weigh

VANCOUVER (miningweekly.com) – South Africa-focused miner Platinum Group Metals (PTM) has again lowered its production guidance for the first year of operations at its Maseve mine, in South Africa, citing a delay in ramping up stoping tonnes.

Despite monthly output at Maseve increasing to 1 893 oz of platinum, palladium, rhodium and gold (4E), as well as associated copper and nickel in concentrate, the Vancouver-based company lowered its guidance for concentrate production – on a 100% project basis from April 2016 to April 2017 – from 110 000 oz 4E to 91 500 oz 4E.

According to PTM, the Maseve mine is fully constructed and is in the ramp-up phase of production. Development at Maseve has established about 20 ends where the Merensky reef is exposed and, of these, 18 are currently working ends. Further, recent efforts have been focused on primary access development.

The mine accessed the main production vein at Maseve, Block 11, in mid-August. The block is host to some of the best grade thickness ore at the Maseve mine and is an important part of the next several years of scheduled mining. Block 11 is a large, well-drilled and stable mining block estimated to host more than 545 000 4E Merensky reef ounces, held in 3.07 t grading 5.53 g/t 4E in the indicated category.

The seam thickness, where accessed, is about 2 m, with a well-developed and near-flat dipping Merensky reef present as modelled. Vertical channel sampling has returned assays of 7.4 g/t 4E, over a true width of 193 cm. This block is amenable to board-and-pillar stoping, using mechanised mining methods.

PTM expects tonnes mined to increase, as key mining blocks are accessed, developed and stoped. Successful stoping in bord-and-pillar areas and long-hole areas has now started and is ramping up. The grade of material feed to the mill is increasing as the proportion of stoped tonnes increases relative to lower-grade development tonnes. Production is expected to double in September from August levels and then continue to increase monthly into 2017.

The company noted that it experienced difficulties and delays in certain areas of underground infrastructure, causing bottlenecks in the movement of waste and ore out of the mine. It expected that completing the first of three underground silos, as well as the addition of a belt loader at this silo and future top and bottom completions at silos two and three, is expected to increase output from the current month onwards into 2017.

PTM also advised that it had commissioned a conveyor from underground that feeds directly to the overland conveyor and into the primary crusher and mill. In the months ahead the plan is to install a final conveyor leg directly to Block 11, which will greatly improve the ability to move good grade tonnes out of the mine and directly into the mill.

Further, PTM has negotiated amendments and extensions with lenders Sprott Resource Lending Partnership and Liberty Metals & Mining Holdings (LMM), after they completed due diligence at the Maseve site during August.

Meanwhile, work at the company’s Waterberg project continues to be fully funded by joint venture partner Japan Oil, Gas and Metals National Corporation, allowing the project to proceed without PTM drawing on its working capital. Current work is focused on completing an ongoing prefeasibility study and it is planned that the results of this study will be published in the weeks ahead, the company advises. The company has also started preparations to undertake a feasibility-stage study on the Waterberg project.