5 Nov 2010 10:04
5 November 2010
International Ferro Metals Limited ("IFL" or the "Company")
Agreement signed with Phoenix Platinum Mining
The Company announces that it has, through its subsidiary, International Ferro Metals (SA) (Pty) Ltd, signed an agreement (the "Agreement") with Phoenix Platinum Mining (Pty) Ltd ('Phoenix'), a wholly owned subsidiary of Pan African Resources plc, to develop a Chrome Tailings Retreatment Plant (the 'CTRP') to treat the tailings and current tailings output at IFL's Lesedi operation. The CTRP will be built on IFL's Buffelsfontein property and utilise IFL's existing infrastructure.
The CTRP will extract primarily the residual Platinum Group Metals and other saleable minerals through the retreatment of the tailings dams and current arisings from IFL's existing chrome plant. It is expected to produce approximately 12,200 ounces per annum of Platinum Group Elements (Platinum (60.9%), Palladium (21.9%), Rhodium (16.9%), and also Gold (0.2%). The Company will provide certain utilities and services, primarily electricity and water, to Phoenix subject to there being no adverse impact to the Company's operations. The Agreement provides for no increase to IFL's environmental liabilities to result from Phoenix's operations at the Lesedi mine.
IFL's existing 25% Net Profit Interest ('NPI') in the tailings will be settled in cash once all conditions have been met. IFL will receive an aggregate consideration of ZAR80m under the Agreement, payable as follows:
·; ZAR25m on signature of the Agreement;
·; ZAR25m on commencement of the first bulk earthworks on the site to prepare for construction of the CTRP which is expected to be in the first quarter of calendar 2011;
·; ZAR0.5m on transfer of the CTRP site to Phoenix; and the balance of
·; ZAR29.5m on the earlier of commissioning of the CTRP (which is expected to be in calendar 2012), registration of transfer of the CTRP site to Phoenix and the 4th anniversary of the effective date. Payment of the ZAR29.5m balance of the consideration will be guaranteed by Phoenix's bankers.
David Kovarsky, Chief Executive Officer of IFL commented:
"Combined with our CoGen project and the chromite recovery partnership with Anglo Platinum, which aim to reduce our input costs, today's announcement further highlights management's continued focus on generating value for shareholders from each stage of the production process."
- ENDS-
About International Ferro Metals:
International Ferro Metals produces ferrochrome, the essential ingredient in stainless steel, from its integrated chromite mine and ferrochrome processing operations in South Africa. International Ferro Metals is listed on the London Stock Exchange under the symbol IFL.
Forward Looking Statements
This announcement contains certain forward looking statements which by nature, contain risk and uncertainty because they relate to future events and depend on circumstances that occur in the future. There are a number of factors that could cause actual results or developments to differ materially from those expressed or implied by these forward looking statements.
For more information please visit www.ifml.com or contact:
International Ferro Metals Limited
David Kovarsky, Chief Executive Officer
Mob: +27 82 650 1192
Brunswick Group
Carole Cable / Fiona Micallef-Eynaud
Tel: +44 (0) 20 7404 5959
Numis Securities Limited
John Harrison / James Black
Tel: +44 (0) 20 7260 1000