Drilling Report

SouthernEra Reports on Progress at Messina Platinum

 

    -   Successful First Blast on Mechanized Long-hole Stope

    -   Phase 2 Feasibility Study On Track

    -   Continuous Operations Implemented

    Shares Issued and Outstanding: 74,707,883

    TSX: SUF

    AIM: SRE

 

    TORONTO, June 17 /CNW/ - SouthernEra Resources Limited today reported on

progress at the Company's 73.1 percent subsidiary Messina Platinum where the

successful first blast on the new mechanized long-hole stope between the 350

and 370-meters occurred on June 14, 2004.

    This successful first blast represents the culmination of planning that

began almost two years ago to implement mechanized long-hole stoping as the

principle mining method on the new lower levels of the mine below the      

350-meter level. Prior to this, the primary mining method has been      

labour-intensive conventional down-dip stoping, which is currently being

practiced on the four upper levels of the mine above the 350-meter level.

    With the main 180,000 tonne per month shaft sunk to its current depth of

440 meters, a trackless workshop was built on the 350-meter level and

construction of the decline ramp from the 350-meter level commenced in     

mid-2003. The ramp is currently below 390 meters and development to depth is

progressing well. Development off ramp of the first two sublevels on the UG2

reef at 370 and 390 meters commenced in January and June 2004, respectively,

and has also progressed well.

    In support of this development and stoping, Messina has acquired its own

fleet of trackless equipment, which for primary development includes a DO6

twin-boom drill rig in conjunction with an Elphinstone R1600 LHD and an AD30

low profile 30-tonne truck; and for reef development includes two Quasar 1F

drill rigs in combination with an EJC116 LHD. The long-hole drill rig is a

Tamrock Solo CMAC.

    This first long-hole blast occurred on the 2-West stope of the UG2

between the 350 and 370-meter levels. In one single stope blast, which is

believed to be the largest blast ever on an underground platinum mine in South

Africa, approximately 600 tonnes of reef was broken between the two levels.

Both the hanging and footwalls held up very well and a very satisfactory reef

fragmentation was achieved.

    Commenting, Messina's Mine General Manager Glenn Baldwin said: 'The 

steep-dipping reefs at Messina Platinum appear ideal for the implementation of

long-hole stoping. Also, Messina's relatively wide reef structure lends itself

to mechanized mining. This makes Messina unique amongst South African platinum

producers in being able to support mechanized long-hole stoping.'

    Mr. Baldwin added: 'I am very satisfied with the results of this first

blast. It represents an important step forward for Messina Platinum,

confirming that the implementation of mechanized long-hole stoping should be

successful. This mining method is far superior to the conventional down-dip

stoping currently being practiced on the four upper levels of the mine.

Significant productivity and cost improvements can be expected from the

successful implementation of this new mining method.'

    As previously reported, the scoping study for Messina's Phase 2 Project

(Doornvlei and Dwaalkop Sections) has proposed mechanized long-hole stoping as

the primary mining method. The initial results at the Phase 1 Mine (Voorspoed

Section) have increased the level of confidence in this mining method for the

Phase 2 Project.

    SouthernEra also announced that the Phase 2 feasibility study is on track

for completion at the end of June when it will be presented to the Board of

Messina Platinum, which controls the Doornvlei Section, as well as the Board

of the SouthernEra/Mvelaphanda Joint Venture, which controls the Dwaalkop

Section. It is anticipated that the results will be released in the third

quarter once approved by the two boards.

    Messina Platinum has also completed the implementation of continuous

operations at the Phase 1 Mine. The implementation of continuous operations on

the shafts, engineering and support services occurred without incident during

May. However, the implementation of continuous operations on development and

stoping was met with some resistance at the beginning of June as a small rival

union to the main recognised union at Messina engaged in minor illegal

industrial action in opposition to its implementation. This action disrupted

development and production during the last week of May and the first week of

June and has resulted in disciplinary action being taken against approximately

90 of Messina's 1,900 employees. Forty-five of the 90 suspended employees have

so far been dismissed. Development and stoping returned to normal last week

and the benefits of continuous operations will become apparent in the months

ahead.

    Commenting on recent developments at Messina Platinum, SouthernEra's

President and CEO Patrick Evans said: 'Messina continues to make steady

progress towards operating profitability, despite the continuing strength of

the South African Rand. While labour performance remains below expectations

important progress has been made in recent months to improve the mine's

development rates, tighten cost controls and to implement mechanized long-hole

stoping. The implementation of continuous operations will also improve

operating efficiencies. This provides a strong foundation for the mine to

continue its build-up to full production during the third quarter'.

    Mr. Mike Cowell, Professional Geologist is the Qualified Person in

respect to the phase 1 project and Dr. Anthony Martin, Professional Geologist

is the Qualified Person in respect to the phase 2 project.

    SouthernEra Resources is an independent producer of platinum group metals

and diamonds. The company also has an extensive PGM, gold and diamond

exploration program. The common shares are listed on the Toronto Stock

Exchange and the London Stock Exchange's AIM market.

 

        For further information: SouthernEra Resources Limited, Mr. Patrick

Evans, President and CEO, Telephone: [phone], Fax: [phone],

E-mail: inbox(at)southernera.com, www.southernera.com

    (SUF. SRE)