Platinum Group Metals Ltd. · TSX:PTM
Platinum Group Metals — Investor Presentation (October 2011)
52 slides from Platinum Group Metals's investor presentation, October 2011
Slide 1: Platinum Group Metals Ltd. Corporate Presentation October 2011
Platinum Group Metals Ltd. Corporate Presentation October 2011
Slide 2: Disclosure
Disclosure This presentation has been prepared by Platinum Group Metals Ltd. (“Platinum Group” or the “Company”). Information included in this presentation regarding the Company’s mineral properties has been compiled by R. Michael Jones, P.Eng, the President and Chief Executive Officer of the Compan
Slide 3: Forward Looking Statements
Forward Looking Statements Certain of the statements made herein, including statements regarding the timing of future activities and achievements by the Company, future anticipated exploration and development programs, completion of a Feasibility Study in respect of the Western Bushveld Joint Ventur
Slide 4: Platinum vs Gold
Platinum vs Gold If all the platinum ever mined were melted and poured into an Olympic-sized pool, the platinum would barely reach your ankles. Gold, however, would fill three pools. — ; r PLATINUM REACHES ANKLES meee | | METALS PLG:AMEX PTM:TSX
Slide 5: Platinum vs Gold
Platinum vs Gold Current ratio between Pt and Au: 0.90 to 1 Historic range: 2.0/1.5 to 1
Slide 6: 70% of the World's Platinum Production
70% of the World’s Platinum Production Western Bushveld Complex South Africa 6
Slide 7: Investment Value
Investment Value • Independent Net Present Value of the main asset US$ 683M Platinum Group Share * - Current Market Cap US$ 220M • Large Scale Platinum Reserves, in construction at the heart of $4B of Mine Building • Decreasing risk = Re-rating • Corporate Activity in immediate area; - Hostile Take
Slide 8: Investment Value
Investment Value • Main Project WBJV Project 1 generates US$ 100M/year+ to Company at Base Case Assumptions, Steady State, Mine Life 20 Years + * • Management team has solid discovery and mine build/operations experience • Management team has generated $1.5 B in shareholder value over the past 6 yea
Slide 9: Project Banking Mandate
Project Banking Mandate • Barclays Capital, Standard Bank, CAT Financial and West LB • Global presence with direct platinum industry credentials • Preliminary approval subject to final due diligence, credit approval and loan agreement execution • Defined roles with closing expected in November 2011
Slide 10: Project Banking Mandate
Project Banking Mandate • $260M (USD) senior loan with nine year term • Additional working capital facility – up to $25M (USD) • Standby subordinate loan facility if required • Hedging emphasis on byproducts – palladium, gold, base metals • Platinum is 70% of projected revenue – minimal hedge 10
Slide 11: Wesizwe/Jinchuan - Frisch Ledig, RBP/Anglo Platinum - Styldrift Expansion
WesizwelJinchuan - Frisch Ledig RBP/Anglo Platinum - Styldrift Expansion ‘i Construction Start: 2009 ce Neca oa 2040 Hy Depth: 740+ metres P Projected Production: 400,000 ozs (BRPM combined) _ Projected Capital Cost: $1.5B (8R/USD) Projected Mine Life: 30+ years Status: 2017 Production Target Projec
Slide 12: Deep and Deeper
Deep and Deeper Shallow Declines – WBJV P1 DEPTH: 100m to 600m First Generation COST: $400M/$500M USD Vertical Shafts LEAD TIME: 3 Years Mined Out DEPTH: 600m to 1000m COST: $1B USD Second Generation LEAD TIME: 5 to 7 years Vertical Shafts Mostly Mined Out DEPTH: 1000m+ Third Generation COST: $1.5B
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Slide 18: Western Bushveld Joint Venture Project 1
Western Bushveld Joint Venture Project 1 • Steady state ounces - 275,000 per year 4E • 200,000 ounces/year - PLG/PTM share • 64% Platinum, 27% Palladium, 5% Rhodium, 4% Gold • 20 year plus mine life • 2013 Production start-up UFS, Oct 2009 www.sedar.com See Disclosure, Forward Statements and Risk Fa
Slide 19: Platinum Resources and Reserves
Platinum Resources and Reserves • 74% interest in the WBJV Projects 1 and 3 • Resources (PLG/PTM share) 7.5 million oz 4E (platinum, palladium, rhodium and gold) Measured and Indicated • Reserves (PLG/PTM share) 3.5 million oz 4E • US$ 1343 Platinum assumptions – upside • Exploration Exposure - Sout
Slide 20: Operating Costs – First Quartile
Operating Costs – First Quartile WORKING COSTS EXCLUDING US$/4E oz R/tonne SMELTER DISCOUNT* milled Life of Mine Average – 8R/$ $526 R528 Life of Mine Average – 7R/$ $601 R528 *October 2009 – Updated Feasibility Study See Disclosure, Forward Statements and Risk Factors 20
Slide 21: Margin Squeeze
Margin Squeeze WBJV P1 Producing Mines – US$ Cash costs plus capex per PGM oz – RBC Capital Markets – October 6, 2011 21
Slide 22: Construction Milestones
Construction Milestones Milestones Completed - January 2011 to October 2011 $100M project budget approved EPCM contract awarded – DRA Group Site infrastructure - power, water, road construction, offices Box cut excavation completed Mining right application submitted and accepted Undergro
Slide 23: Construction Milestones
Construction Milestones Milestones Ahead for 2011 Underground tunneling and decline development Completion of formal concentrate off-take arrangements Progress on mining right application and public input process Completion and advance of credit facility Ongoing engineering synergies with
Slide 24: WBJV – Project 1 (Maseve) Construction Timeline
WBJV – Project1 (Maseve) Construction Timeline Commercial Production Q4 2013 Social and Labour Plan Lead Arranger Selected Bulk Sample Application & Approval Mining Right Application & Approval Advance of Project Facility Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun 20
Slide 25: The Road Ahead
The Road Ahead • Full Project Construction with Project Finance $443M Capital Cost Estimate (UFS, Oct 2009, 8R/US$) Pricing has been in line or below estimates on major items • Project Level Finance Plan Guidance - $443M at 60/40 Debt Equity = US$ 266M/$177M $100M equity investment – In Prog
Slide 26: Share Capital Structure
Share Capital Structure Issued and Outstanding 177,584,542 Options 11,250,500 Fully Diluted 188,835,042 Market Capitalization $190M CDN Cash $110M CDN Research Coverage Index Membership RBC Capital Russell Global Stifel Nicolaus S&P/TSX Small Cap GMP Securities ISE Global Platinum Raymond James Hayw
Slide 27: Shareholders
Shareholders • JP Morgan Asset Management Ltd. (UK) • Franklin Advisers Inc. (US) • Chilton Investment Company LLC (US) • Genesis Investment Management LLP (UK) • Wellington Management Company LLP (US) • Jennison Associates LLC (US) • RBC Global Asset Management Inc. (CN) • Liberty Mutual Insurance
Slide 28: Platinum Price
Platinum Price 5 Year Platinum High 2252.68 Low 774,60 2400 2400 2200 2200 2000 2000 ® 1600 1800 5 1600 1600 & 1400 1400 & 4200 1200 i—| 8 1000 1000 B00 800 600 600 400 www, KitTCO,COM goo Oo la Ld ce] co oO oa 2 o | <a o > o o o > o ae <a | <a - i - (= - i - i - = 2 oO a oO a oO a Oo a Oo oQ o o <x
Slide 29: Conclusions
Conclusions • Large scale, high margin platinum development in progress • Infrastructure completed, contractors in place, construction started • Project debt financing mandate awarded – significant de-risking • Near term: concentrate off-take, mining right, funding completion • Opportunity for conso
Slide 30: Appendix: Updated Feasibility Study October 2009
Appendix Updated Feasibility Study October 2009 30
Slide 31: Valuations - 100% WBJV Project 1
Valuations -100% WBJV Project 1 Parameter Change in Change in Change in Parameter Parameter Parameter PGM Basket Price -20% 0% 20% IRR (post-tax) 11.3% 18.9% 25.3% NPV (5% Discount) R(M) 1,892 4,660 7,393 US$ (M) 236 583 924 Opex -20% 0% 20% IRR (post-tax) 22.3% 18.9% 15.4% NPV (5% Discount) R(M) 5,
Slide 32: Team
Team • R. Michael Jones – President/CEO/Director • 20 years of experience as a professional geological engineer • Past President of gold producer Cathedral Gold and VP with Aber Resources - $1B Mine Construction • Founder of Glimmer Resources, MAG Silver and West Timmins Mining, West Kirkland Mining
Slide 33: Central Surface Infrastructure
Central Surface Infrastructure 33
Slide 34: Advance of Project Facility
Advance of Project Facility 180 Thousands Initial Production 21 000 oz/Month , 259 000 oz/Year ( Steady State 275 000 oz / Year) Start of Central Decline Expected Schedule Slippage 160 ± 8 Months 140 Advance of Project Facility South Box Cut South Decline South Mine - Phase 1 120 53 Ktpm @ Steady St
Slide 35: Production Profile
Production Profile 350,000 7 300,000 4E Pt,Pd,Rh, Au Ounces recovered 250,000 + 200,000 + 150,000 + 100,000 + 50,000 + » k © © OD ad ob o> * oo A PAS SK SS SS” Gh py BW” OY gh Qh” SSG GH GPG? GM hg? Mg? Go? MMS A @ Ounces recovered 35
Slide 36: Net Present Value (Pre-Tax)
Net Present Value (Pre-Tax) EVALUATION (NPV) ~ Pre-tax NPV 5% NPV 10% NPV 12.5% Discount Discount Discount 3 Year Trailing R (Million) 7,848 3,804 2,578 Price (Case A) US$ (Million) 981 475 322 IRR 23.54% Recent Prices R (Million) 3,671 1,330 622 (Case B) US$ (Million) 459 166 78 IRR 15.63% 36
Slide 37: Net Present Value (Post-Tax)
Net Present Value (Post-Tax) EVALUATION (NPV) ~ Post-tax NPV 5% NPV 10% NPV 12.5% Discount Discount Discount 3 Year Trailing R (Million) 4,660 2,031 1,229 Price (Case A) US$ (Million) 582 254 154 IRR 18.94% Recent Prices R (Million) 2,016 425 -59 (Case B) US$ (Million) 252 53 -7 IRR 12.15% 37
Slide 38: Financial Details - Updated
Financial Details - Updated METAL PRICES & EXCHANGE RATE Case A Case B 3 Year Recent Prices Trailing Prices Platinum (US$/oz) 1,343 1,295 Palladium (US$/oz) 322 296 Rhodium (US$/oz) 4,951 1,650 Gold (US$/oz) 807 997 Copper (US$/tonne) 6,428 6,250 Nickel (US$/tonne) 25,529 18,000 Rand/US$ 8.00 8.00 3
Slide 39: Financial Details - Updated
Financial Details - Updated FINANCIAL PARAMETERS AND INDICATORS at R8.00/US$ Basket Prices 4E R/kg US$/oz R/kg US$/oz (Pt, Pd, Rh, Au) Case A Case A Case B Case B Basket Price Merensky Reef 304,751 1,185 263,526 1,025 Basket Price UG2 Reef 368,571 1,433 274,639 1,068 39
Slide 40: Financial Details - Updated
Financial Details - Updated Smelter and Refinery Discount Smelter US$/oz US$/oz Discount Case A Case B Reduction in Basket Price MR 15.16% $180 $155 Reduction in Basket Price UG2 15.16% $217 $162 Received Basket Price for MR 15.16% $1,005 $869 Received Basket Price for UG2 15.16% $1,216 $906 40
Slide 41: Financial Details - Updated
Financial Details - Updated TAXES –Royalty Pending Finalization Government Royalty Payment: PGM (% of Revenue) 3% Government Royalty Payment: Base Metals (% of Revenue) 2% Company Tax (% of Profit) 28% Secondary Tax on Companies (STC) (% of Profit) 10% 41
Slide 42: Financial Details - Updated
Financial Details - Updated CAPITAL COST Rand US$ Peak funding Case A 3,545,000,000 443,125,000 Peak funding Case B 3,727,000,000 465,875,000 Total Life of Mine Capital Costs 4,761,849,843 595,231,230 42
Slide 43: Sensitivity Three Year Trailing Metals Prices Pre-tax
Sensitivity Three Year Trailing Metals Prices Pre-tax Parameter Change in Change in Change in Parameter Parameter Parameter PGM Basket Price -20% 0% 20% IRR (pre-tax) 14.5% 23.5% 31.2% NPV (5% Discount) R(M) 3,494 7,848 12,202 US$ (M) 437 981 1,525 Opex -20% 0% 20% IRR (after tax) 27.5% 23.5% 19.4%
Slide 44: Valuations - Three Year Trailing Metals Prices Post-tax
Valuations - Three Year Trailing Metals Prices Post-tax Parameter Change in Change in Change in Parameter Parameter Parameter PGM Basket Price -20% 0% 20% IRR (post-tax) 11.3% 18.9% 25.3% NPV (5% Discount) R(M) 1,892 4,660 7,393 US$ (M) 236 583 924 Opex -20% 0% 20% IRR (post-tax) 22.3% 18.9% 15.4% N
Slide 45: WBJV Project 1
WBJV Project 1 Measured Cut-off Million Grade Mining Tonnes Moz Mineral (cm.g/t) Tonnes 4E Width PGE PGE’s Resource (Mt) (g/t) (m) (4E) (4E) (4E) Project 1 300 6.603 8.38 1.33 55.333 1.779 MR Project 1 300 7.464 4.26 1.34 31.797 1.022 UG2 Total 300 14.067 6.19 1.34 87.13 2.801 Measured QP Charles Mu
Slide 46: WBJV Project 1
WBJV Project 1 Measured Pt Pt Pd Pd Rh Rh Au Au Resources Prill (g/t) (g/t) (g/t) (g/t) Splits Project 1 MR 64% 5.36 27% 2.26 4% 0.34 5% 0.42 Project 1 UG2 63% 2.68 26% 1.11 10% 0.43 1% 0.04 QP Charles Muller of Minxcon, See details Press Release and 43-101 reports on www.sedar.com 46
Slide 47: WBJV Project 1
WBJV Project 1 Indicated Cut-off Million Grade Mining Tonnes Moz Mineral (cm.g/t) Tonnes 4E Width PGE PGE’s Resource (Mt (g/t) (m) (4E) (4E) (4E) Project 1 & 300 11.183 7.25 1.24 81.077 2.607 1A MR Project 1 & 300 19.209 4.46 1.39 85.672 2.754 1A UG2 Total 300 30.392 5.49 1.34 166.749 5.361 Indicate
Slide 48: WBJV Project 1
WBJV Project 1 Indicated Prill Splits Pt Pt Pd Pd Rh Rh Au Au (g/t) (g/t) (g/t) (g/t) Project 1 & 1A MR 64% 4.64 27% 1.96 4% 0.29 5% 0.36 Project 1 & 1A UG2 63% 2.81 26% 1.16 10% 0.45 1% 0.04 QP Charles Muller of Minxcon, See details Press Release and 43-101 reports on www.sedar.com 48
Slide 49: WBJV - Statement of Reserves for the Merensky Reef
WBJV ~ Statement of Reserves for the Merensky Reef Tonnes (000) 4E Content 4E t g/t tonne Moz Merensky Proven 6,678 5.61 37,478 1.21 Merensky Probable 11,333 5.44 61,677 1.98 Total Merensky Mineral Reserves 18,011 5.51 99,155 3.19 QP Charles Muller of Minxcon Resources, See details Press Release and
Slide 50: WBJV - Statement of Reserves for the UG2 Reef
WBJV ~ Statement of Reserves for the UG2 Reef Tonnes (000) 4E Content 4E t g/t tonne Moz UG2 Proven 5,086 3.37 17,126 0.55 UG2 Probable 8,449 3.41 28,831 0.93 Total UG2 Mineral Reserves 13,535 3.40 45,957 1.48 QP Charles Muller of Minxcon Resources, See details Press Release and 43-101 reports on ww
Slide 51: WBJV Statement of Reserves
WBJV Statement of Reserves Reserve Prill Splits Pt Pt Pd Pd Rh Rh Au Au (g/t) (g/t) (g/t) (g/t) Project 1 & 1A MR 64% 3.52 27% 1.49 4% 0.22 5% 0.28 Project 1&1A UG2 63% 2.15 26% 0.88 10% 0.34 1% 0.03 QP Charles Muller of Minxcon Resources, See details Press Release and 43-101 reports on www.sedar.co
Slide 52: Contacts
Contacts: Platinum Group Metals Ltd Suite 328 – 550 Burrard Street Vancouver, BC V6C 2B5 +1604-899-5450 info@platinumgroupmetals.net Platinum Group Metals RSA (Pty) Ltd Technology House Victory Park Johannesburg +27 11 782 2186 52
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