NORTHAM PLATINUM LIMITED - Northam acquires contiguous additional resources at Zondereinde mine from Anglo American Platinum Limited

Northam acquires contiguous additional resources at Zondereinde mine from Anglo American Platinum Limited

NORTHAM PLATINUM LIMITED
Incorporated in the Republic of South Africa
(Registration number 1977/003282/06)
Share code: NHM ISIN: ZAE000030912
Debt issuer code: NHMI
Bond code: NHM002 Bond ISIN: ZAG000129024
Bond code: NHM003 Bond ISIN: ZAG000129032
(“Northam”)




NORTHAM ACQUIRES CONTIGUOUS ADDITIONAL RESOURCES AT ZONDEREINDE MINE FROM ANGLO AMERICAN PLATINUM LIMITED



 1.   INTRODUCTION


      Northam is pleased to announce that it has entered into agreements with Rustenburg Platinum
      Mines Limited (“RPM”), a wholly owned subsidiary of Anglo American Platinum Limited, on
      10 October 2016, whereby Northam will:


          a) acquire a portion of the Amandelbult mining right contiguous with the north western
             boundary of Northam’s Zondereinde mine, including all of RPM’s rights and obligations
             thereto (“Acquired Resource”), for a cash consideration of R1 billion; and

          b) acquire a portion of the Elandsfontein 386 KQ farm overlying part of the Acquired
             Resource, in exchange for a portion of the Zondereinde mining right, located on the north
             western corner of the Zondereinde mining right including all of Northam’s rights and
             obligations thereto (“Sold Resource”), (collectively the “Transaction”).


      Paul Dunne, Northam’s Chief Executive Officer, said “the Transaction adds flexibility and
      optionality to the mining operations at Zondereinde. The Acquired Resource is of high quality, is
      well understood by Northam and allows us to better leverage the existing Zondereinde
      infrastructure. The additional resource also enables Northam to continue mining higher grade
      Merensky ore for a longer period, with relatively low incremental capital expenditure. Northam is
      confident that the Transaction will add sustainable shareholder value, unlocking a large resource in
      a capital efficient manner. The Transaction positions Zondereinde on a similar long-term footing as
      our Booysendal operation.”


 2.   BACKGROUND INFORMATION


      Acquired Resource


      The Acquired Resource is contiguous with the north western boundary of Zondereinde. Its
      resource characteristics and properties are similar to those of the Zondereinde orebody lying to the
      west of Zondereinde mine shaft. A short lead time and limited capital expenditure is required to
      access the Acquired Resource from Zondereinde’s existing infrastructure.

      It extends on dip from approximately 1 400 metres below surface, corresponding to the
      Zondereinde 3 level, to the deepest extent of planned mining on 18 level. Laterally, it extends for
      approximately 3.6 kilometres.


     Sold Resource


     The Sold Resource is located in the north western corner of the Zondereinde mining right. This
     area has never been mined and did not form part of the Zondereinde life of mine (“LOM”) plan, as
     it is above the minimum depth required for effective use of hydro-powered mining equipment.


3.   RATIONALE


     The acquisition of the Acquired Resource provides Northam with numerous benefits, such as it:


        -    Extends the Zondereinde economic LOM to beyond 30 years.
        -    Provides extensive mining flexibility associated with a high quality resource that is well
             understood by Northam.
        -    Provides early access to additional higher grade Merensky and UG2 reef on 10 and
             ultimately 16 mining levels.
        -    Reduces the overall average mining depth of the Zondereinde mine, with associated
             potential savings.
        -    Provides long-term optionality and reduces Zondereinde’s operational risk profile.


4.   CONDITIONS PRECEDENT


     The Transaction is subject to, inter alia, the consent by the Minister of Mineral Resources in terms
     of section 102 of the Mineral and Petroleum Resources Development Act, No. 28 of 2002.


5.   CATEGORISATION


     The Transaction falls below the threshold for categorisation in terms of the JSE Limited Listings
     Requirements and is provided for information purposes only.



Johannesburg
11 October 2016


Corporate Advisor, Sponsor and Debt Sponsor: One Capital


Attorneys: Cliffe Dekker Hofmeyr Inc.

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