No. 3 Mining Research 17 May 2007 Mirabaud Mining Weekly
Everest North Sylvania has an interest in approximately one-third of the platinum deposit found at Everest North (Eastern Bushveld, SA), with the remaining two-thirds under the control of Eastern Platinum. A letter of intent has been signed between the two parties. Importantly, the deposit outcrops on Sylvania’s farm and therefore we expect that should the two companies be able to strike a deal to develop the project, Sylvania’s economic interest might be somewhat higher than one-third. However, it is too early in the deposits development to suggest a full-scale mine is a certainty. What is clear is that with or without Eastern Platinum’s ground, Sylvania has an asset which should be brought to account in some shape or form. The company is currently drilling the resource and has targeted a Measured resource by end-June 2007. This week’s update showed an Indicated in-situ resource of 5.3Mt grading 4.92g/t (combined main and leader zone of the UG2 reef), which accounts for expected geological losses. This is both a good grade and, as is typical of UG2 reef, it possesses a high 11% rhodium content, offering an extremely rich basket price at current prices. The current mineralisation stands at 833Koz. If we value those 833Koz at US$75/oz, we derive a value of 20.7p per share. We will look to review this figure when a final Measured resource is announced in the next 6-8 weeks. A full bankable feasibility study is expected by August 2007.
SLV Price at posting:
0.0¢ Sentiment: Buy Disclosure: Held
