Statement re progress at Messina Platinum
SouthernEra Reports on Progress at Messina Platinum
Shares Issued and Outstanding: 61,674,459
TSX: SUF
AIM: SRE
TORONTO, Sept. 10 /CNW/ - SouthernEra today reported on developments
relating to the Company's subsidiary Messina Platinum. Highlights include:
- SouthernEra increases its shareholding in Messina Limited
- Messina Rights Offer receives regulatory approval and timetable set
- Guidance on 80,000 tonnes per month build-up restated
- Drilling program on Phases 2/3 and 4 progresses.
Over the period from May 22 to July 8, SouthernEra acquired an additional
167,841 shares in Messina Limited. These shares were purchased through a
series of market transactions on the Johannesburg Stock Exchange at prices
ranging from R41 to R60 per share. This represents approximately one percent
of the issued and outstanding shares of Messina Limited. Accordingly,
SouthernEra now owns 71.98 percent of Messina Limited, up from 70.91 percent
previously.
In addition, on September 4 SouthernEra's subsidiary Messina Limited
announced the final approved terms of the new rights offer, which is being
underwritten by SouthernEra. A total of R270,706,980 (approx. US$35.6 million)
will be raised through the issue of 4,511,783 new Messina shares at an issue
price of R60 per share. The Johannesburg Stock Exchange has approved the
listing of the rights from September 22 to October 3, and the listing of the
new Messinashares on October 13. The proceeds from the exercise of the rights
will be used by Messina to reduce its unsecured debt obligations to
SouthernEra, which as of June 30, 2003 totaled R313,740,000 (approx.
US$41.5M). SouthernEra advanced these funds to Messina to finance the
construction and development of the recently commissioned Phase 1 mine, as
well as feasibility and pre-feasibility studies currently underway at Phases
2/3 and 4.
By underwriting the rights offer, SouthernEra could increase its
ownership in Messina Limited to as much as 78.28 percent, assuming no other
shareholders elect to exercise. Alternatively, if the minority shareholders in
Messina elect to follow their rights, they will contribute as much as
R75.85 million (approx. US$10 million) to Messina's treasury. The results of
the rights issue will be announced on October 14.
At the Messina Project steady progress continues with the development of
the Phase 1 mine. In the 12 months since the successful commissioning of the
main shaft and main concentrator plant, Messina has been able to ramp up
production to well over 40,000 tonnes per month. This first production
build-up target was achieved on schedule at the end of the second quarter of
2003. Messina has now restated its guidance with respect to the next build-up
target of 80,000 tonnes per month, which will now be achieved during the
fourth quarter of 2003 rather than at the end of the third quarter. The full
production rate of 120,000 tonnes per month remains on track to be achieved
during the second quarter of 2004.
The two upper levels of the mine - the 150 and 200-meter levels - are
well established and are approaching steady state production. While progress
is being made with the build-up of production on the newly commissioned 275
and 350-meter levels, performance of the development contractor's mechanical
equipment has been less than satisfactory. To address this issue, Messina has
accelerated the switchover to track-bound haulage on these levels, resulting
in a modest delay in achieving the 80,000 tonnes per month production level.
Finally, the drilling program in support of the feasibility study at
Messina's Phases 2/3 and the pre-feasibility study at Phase 4 is progressing
well. There are currently seven drill rigs operating at Messina. To date,
8,335 meters of the planned 39,680 meters have been drilled. Eight of the
planned thirty-nine drill holes have been completed and a further six are in
progress. The general strike and dip continuity of the two platinum rich reefs
have been confirmed by the drilling already completed. The Phase 2/3
feasibility study is on track for completion at the beginning of 2004 and the
Phase 4 pre-feasibility study is on track for completion by year-end 2004. The
Company will be announcing drill results shortly.
SouthernEra Resources Limited is an independent producer of platinum
group metals and diamonds. The Company also has an extensive PGM and diamond
exploration program. The common shares of SouthernEra are traded on the
Toronto Stock Exchange (SUF) and the London Stock Exchange's AIM (SRE).
For further information: PLEASE CONTACT: SouthernEra Resources Limited,
Dr. Sally Eyre, Vice President, Corporate Affairs, Telephone: (416) 359-9282,
Fax: (416) 359-9141, E-mail: inbox(at)southernera.com, www.southernera.com
(SUF. SRE)
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