Aquarius Platinum is to buy the mineral rights to the southern part of Northam Platinum’s Booysendal project for R1.2 billion, it has been announced.
The mineral rights comprise several farms underlain by the UG2 and Merensky reef horizons, collectively called Booysendal South. Aquarius, which will acquire the platinum group metals and associated base metals mineral rights, said that after geological losses, the rights would increase its current resource base by approximately 24 per cent.
Northam said it plans to apply the funds from the transaction to the development of its Booysendal North UG2 mine, which is currently under construction. Faster development will reduce the operating risk attached to Northam’s single operating asset, while adding around 60 per cent to current metal output, the company said.
Commenting on the acquisition, Stuart Murray, CEO of Aquarius, said: “The transaction is a commercially sensible outcome for all parties in that it represents a sensible redefining of farm boundaries to optimise both companies’ current and future operations and we look forward to a continuing good relationship with our neighbours.
“This deal further underpins the implementation of our strategy to grow our resource, reserve and future production base by opportunistic acquisition and, together with the recent Afarak transaction announced last month, potentially increases Aquarius’ resource base by nearly 50 per cent.”
Under the terms of a separate agreement between Northam and Aquarius, Aquarius will also assist Northam with access to infrastructural services from Aquarius’s adjacent Everest mine, including power, water, road access and tailings disposal facilities—services which Northam says could help to speed up development of the second phase of its Booysendal expansion.
Northam plans to develop Booysendal on a modular basis, due to constraints associated with the availability of Eskom power, which precludes Northam from accessing Booysendal South by mining development from the north for some 30 years.
Based in Johannesburg, Northam acquired the Booysendal property in 2008 from Mvela Resources. It aims to bring the project into production by early 2013.
