Sylvania Platinum Regulatory News (SLP)

SYLVANIA PLATINUM LIMITED

 ("Sylvania Platinum", "Sylvania" or the "Company"

(ASX: SLP, AIM: SLP)

Quarterly Report to 30 September 2011

Sylvania Platinum, the low cost Platinum Group Metal ("PGM") processor and developertoday announces quarterly results for the three month period ended 30 September 2011 from its PGM production and development operations in the Bushveld region of South Africa.

HIGHLIGHTS

·; EBITDA increased by 57% from R26.5 million (US$4 million) to R41.6 million (US$6 million);

·; Revenue increased by 10% from R87 million to R96 million;

o Heavy Media Separation ("HMS") plant at Mooinooi now commissioned and capable of processing increased tonnages;

·; 13,253 PGM ounces from tailings retreatment plants (12% improvement on previous quarter);

·; R172 million (US$22 million) cash available at 30 September 2011;

·; Volspruit Mining Right Application ("MRA") submitted for near surface open pit development;

·; Drilling commenced on magnetite iron ore projects.

Commenting on the quarterly results Terry McConnachie, Sylvania CEO, said  "I am extremely happy with the excellent performance of the dump operations and well satisfied with the progress that is being made on the Northern limb operation. The final construction on Mooinooi and Tweefontein is progressing according to plan and all credit for this must go to our team's good work. The disposal of the Iron ore assets is an exciting benefit to shareholders and we look forward to the year ahead knowing we are well placed with a profitable company."

OVERVIEW

Sylvania Dump Operations ("SDO") have continued to deliver on operational forecasts with record breaking production of 13,253 ounces during the period, a 12% increase on the previous quarter, from the Company's five PGM tailings processing plants. This production figure includes 164 ounces from the Chrome Tailings Retreatment Plant ("CTRP"), a joint venture with Aquarius Platinum (SA) (Pty) Ltd in which Sylvania holds 25% stake. Revenue for the quarter increased 10% in Rand terms from R87 million to R96 million due to the increased ounce production. Although the commodity price fell during the current quarter, the impact on revenue was largely offset by the weakening of the Rand. Operating costs increased from R3,740/oz to R3,953/oz due to one off commissioning costs at Mooinooi relating to the Heavy Media Separation ("HMS") plant. This cost is expected to reduce dramatically as soon as the second duplication plant at Mooinooi is commissioned. The Company had R172 million (US$22 million) cash available at 30 September 2011.

On 8 July 2011 Sylvania announced its decision to dispose of its magnetite iron ore assets, subject to shareholder and regulatory approvals. Exploration drilling commenced in September 2011 and will continue through to the end of December 2011. Core samples have been submitted for analysis with results expected during the following quarter. The Company has appointed external consultants to set up an appropriate structure in order to dispose of the iron ore assets whilst achieving the best possible return for Sylvania shareholders.

Summary Sylvania Platinum Performance

A. SYLVANIA DUMP OPERATIONS

Health, safety and environment

Sylvania had no lost time injuries during the quarter ended 30 September 2011. The Company remains committed to reducing the incident frequency rate to zero through continued education, improving safety procedures and working to the highest possible standards.

Millsell

The Millsell operation completed the processing of the first pass treatment of the primary dump and produced 1,999 ounces for the quarter ended 30 September 2011, against 2,014 ounces in the previous quarter. During the latter part of the current quarter a decision was taken to transport material from the old Mooinooi dump to Millsell for retreatment in addition to the material from Waterkloof as well as the smaller tailings dumps in the plant vicinity. This material has assisted in reducing the chrome content in the final concentrate and consequently reduced penalties incurred at the smelters. Current arisings from the Millsell mine will continue to be fed through the plant from the host mine for many years and the second pass on the plus one million ton primary dump is scheduled to commence in 2013. The real benefit of the Mooinooi dump material being processed at Millsell will be seen in the following quarter. Cost of production was R3,462/oz (US$459/oz).

Steelpoort

The Steelpoort operation produced an impressive total of 4,103 ounces for the quarter to 30 September 2011, a 1,269 ounce increase on the previous quarter. Solid, steady plant operations and high availability contributed to the outstanding performance at Steelpoort. Dump feed was supplemented with material from the Montrose dump which will extend the life of the current primary feed resources at Steelpoort into the foreseeable future. Current arisings from the Steelpoort mine are also now being processed through the plant and will continue for an indeterminable period. A second pass on the large plus one million ton primary dump is not planned to commence before 2013. The cost per ounce was reduced to R2,233/oz (US$296/oz), compared to R2,654/oz (US$391/oz) in the previous quarter.

Lannex

Operations at Lannex produced 2,450 ounces for the quarter to 30 September 2011; 8% down on the previous quarter's record 2,727 ounces. As part of the continuous improvement programme, a new feeder was installed during the current quarter and it is expected that this will improve plant feed rates with the benefits seen in the following quarter.

Mooinooi

The Mooinooi operation produced 1,363 ounces for the quarter to 30 September 2011, 580 ounces less than the previous quarter. This is due mainly to operating the Mooinooi plant while concurrently constructing the new expansion plant that will effectively double production. This new plant construction is two weeks away from mechanical completion. Commissioning is expected to take up to two months where after production is expected to increase dramatically. Production and unit costs were also impacted by the commissioning of the HMS plant. A new magnetic separator was installed to reduce the cost of FeSi in the HMS circuit. Further Mintek test work indicated good recovery improvements with the introduction of bead mills to the system. The bead mills are in the process of being acquired for the Mooinooi operation.

Doornbosch

The Doornbosch plant produced a record high 3,174 ounces for the quarter to 30 September 2011, a 45% increase on the previous quarter's 2,196 ounces. An increase in current arisings received from the host mine assisted in boosting production, as well as the material from the nearby Montrose/Onverwagt tailings dam which continued to be treated during the current quarter. Although Montrose/Onverwagt material has higher grades, operating costs at the plant increased due to the cost of transporting the material. Total operating cost for the current quarter was R2578/oz (US$342/oz) compared to R2,996/oz (US$441/oz) in the previous quarter.

Tweefontein

The planning process remains on track to commission the Tweefontein plant in Q4 FY2012. The engineering phase has been completed and tenders for civil works, structural steel and mechanical installations were issued in October 2011. Orders for all long lead capital items have been placed and construction of the Tweefontein plant is scheduled to commence in November 2011.

B. CTRP (Sylvania 25% attributable, managed by Aquarius Platinum)

CTRP production decreased from 172 attributable ounces to 164 ounces for the quarter ended 30 September 2011. The low ounce production is as a result of low recoveries.

For a graph showing the Sylvania Resources Quarterly production please click on the following web link (Graph 1):

http://www.rns-pdf.londonstockexchange.com/rns/9388Q_-2011-10-27.pdf 

C. NORTHERN LIMB OPERATIONS

Volspruit Project

The Volspruit Project is located at the Southern end of the Northern Limb of the Bushveld Igneous Complex in South Africa. This project has two main areas of focus, namely the development by Sylvania of the open-cast mine and the concentrator and the Sylvania JV development of a smelter and refinery complex.

The mining right application ("MRA") was submitted to the Department of Mineral Resources ("DMR") in September 2011 and the Environmental Scoping report will follow once the DMR has acknowledged receipt of the MRA. Specialist study reports which include, but are not limited to the noise impact assessment, avifaunal report, heritage impact assessment and bird impact assessment are currently in progress and the appointed specialists will commence with test pits in Q2 FY2012. Sylvania has applied for 50MVA of power from ESKOM for which application has been accepted by the power utility.

Northern Platreef Project

Drilling of Phase 1 of the program aimed at upgrading components of the JORC Inferred Resource to Indicated category commenced in September 2011.

Four areas of elevated grade were identified and these 4 "Hotspots" have been split into four drilling phases. Phases 1 and 2 are aimed at upgrading at least one of these areas to an Indicated category. Phases 3 and 4 will be aimed at upgrading a second area at a later stage.

D. SYLVANIA GROUP

Vygenhoek project (Everest North)

Sylvania and Aquarius Platinum (SA) (Pty) Ltd ("AQPSA") announced on 3 June 2011 that they had entered into an agreement on the PGM bearing ore on the Vygenhoek farm. Both parties plan to conclude the proof of economic viability on 1 December 2011 which will then lead to the submission of the Mining Right Application if approved by both parties. To match the latest legislation, the submission of the EIA should occur during January 2012. Since this is beyond the originally agreed timeframe given to the feasibility committee ("Committee"), the agreement conclusion date has been extended to March 2012. The project has been registered with the Mpumalanga Department of Economic Development, Environment and Tourism. Digby Wells has been appointed as the environmental assessment practitioner for the Environmental Impact Assessment. DRA Mining has been appointed to complete the Mining Works Program and the feasibility study for the mine. The results of this study will be presented to Sylvania and AQPSA during the following quarter. This information will enable the Committee to determine the viability of mining for PGMs and producing a saleable concentrate.

Upon approval of the mining right application by the Department of Mineral Resources in favour of AQPSA and AQPSA contributing the right to the unincorporated joint venture ("JV"), Sylvania will pay R6 million to AQPSA. Sylvania and AQPSA will share equally in the profits and have equal representation in the management of the JV that will be formed to manage and oversee the project.

Sale of magnetite iron ore assets

On 8 July 2011 Sylvania announced its decision to dispose of a significant portion of its magnetite iron ore assets, subject to shareholder and regulatory approvals. The iron ore assets currently owned by group companies are located on the Northern Limb of the Igneous Bushveld Complex.

A review of the Northern Limb assets has shown that magnetite layers are present across the entire northern limb properties held by Sylvania. In those areas where Sylvania does not hold prospecting rights for the iron ore, it has submitted applications which have since been accepted. Drilling commenced in September 2011 with six holes being drilled to date and drilling will continue until end December 2011. The core samples have been submitted to the SGS South Africa (Pty) Ltd laboratories for analysis. Six samples have been delivered to Mintek for ore dressing and magnetic separation test work. The magnetite concentrate will be submitted to Mintek Pyromet, a division of Mintek for smelting and characterisation test work.

Sylvania has appointed external experts to assist in the setting up of an appropriate structure for the iron ore assets in order obtain the best return for Sylvania shareholders when disposing of the aforementioned portion of the iron ore assets. The Sylvania Board is confident that by separating the iron ore assets from the existing SDO and the development of the Volspruit open cast mine, the Company will achieve its objective of consistent growth while remaining profitable. Sylvania also expects to make significant progress at its Northern Limb near surface PGM and base metal operations.

Cancellation of shares

As previously announced, Sylvania has implemented an on-market share buy-back of up to 10% of the Company's issued capital ("Buy-Back"). The following securities bought back by Sylvania Platinum to date have now been cancelled:

·; 10,000 fully paid common shares in Sylvania Platinum ("Shares") on ASX; and

·; 700,000 depositary interests representing beneficial interests in Shares on AIM ("DIs") (and the Shares represented by those DIs).

As a result of the cancellation, the Company has 301,251,805Shares on issue.

Subject to prevailing market conditions, Sylvania Platinum intends to purchase up to a further 29,486,181 Shares under the Buy-Back.

CORPORATE INFORMATION

Registered office: Sylvania Platinum Limited

Claredon House

2 Church Street

Hamilton HM 11

Bermuda

Postal address: PO Box 524

Wembley WA 6913

Australia

CONTACT DETAILS

South Africa: Terry McConnachie Louis Carroll

(CEO) (Finance Director/Joint Company Secretary)

Sylvania Platinum Limited Sylvania Platinum Limited

+27 (11) 673 1171 +44 (0) 7969 170 622

Australia: Richard Rossiter Grant Button

(Chairman) (Joint Company Secretary)

Sylvania Platinum Limited Sylvania Platinum Limited

+61 (8) 9226 4777 +61 (8) 9226 4777

United Kingdom: Anthony Rowland/Ben Wright Martin Eales/James Kelly

Ambrian Partners Limited RBC Capital Markets

Nominated Advisor and Joint Broker

Joint Broker

+44 (0) 20 7634 4700 +44 (0) 20 7653 4000

Laurence Read/Beth Harris

Threadneedle Communications

+44 (0) 20 7653 9855

Sylvania Website: www.sylvaniaplatinum.com

Rule 5.3

Appendix 5B

Mining exploration entity quarterly report

Introduced 1/7/96. Origin: Appendix 8. Amended 1/7/97, 1/7/98, 30/9/2001, 01/06/10.

Consolidated statement of cash flows

Payments to directors of the entity and associates of the directors

Payments to related entities of the entity and associates of the related entities

Non-cash financing and investing activities

Financing facilities available

Estimated cash outflows for next quarter

Reconciliation of cash

Changes in interests in mining tenements

Issued and quoted securities at end of current quarter

Description includes rate of interest and any redemption or conversion rights together with prices and dates.

Compliance statement

1 This statement has been prepared under accounting policies which comply with accounting standards as defined in the Corporations Act or other standards acceptable to ASX (see note 4).

2 This statement does give a true and fair view of the matters disclosed.

Sign here: Date: 29 July 2011

Louis Carroll

Finance Director

Notes

1 The quarterly report provides a basis for informing the market how the entity's activities have been financed for the past quarter and the effect on its cash position. An entity wanting to disclose additional information is encouraged to do so, in a note or notes attached to this report.

2 The "Nature of interest" (items 6.1 and 6.2) includes options in respect of interests in mining tenements acquired, exercised or lapsed during the reporting period. If the entity is involved in a joint venture agreement and there are conditions precedent which will change its percentage interest in a mining tenement, it should disclose the change of percentage interest and conditions precedent in the list required for items 6.1 and 6.2.

3 Issued and quoted securities The issue price and amount paid up is not required in items 7.1 and 7.3 for fully paid securities.

4 The definitions in, and provisions of, AASB 1022: Accounting for Extractive Industries and AASB 1026: Statement of Cash Flows apply to this report.

5 Accounting Standards ASX will accept, for example, the use of International Accounting Standards for foreign entities. If the standards used do not address a topic, the Australian standard on that topic (if any) must be complied with.

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