Cluff hopes for PGM boost
Article Date: Oct 17 2002Aim-listed Cluff Mining, shunned by investors since its £20 million share placing in August, is believed to have high hopes of a feasibility study into its Blue Ridge prospect in South Africa's Bushveld Complex. Analysts believe it could indicate annual production of 250,000 oz of platinum group metals, writes Robert Tyerman.
Shares in Cluff have fallen nearly 30 per cent to 187.5p since its August placing at 265p – against a year's high of 293.5p – despite bullish reports about its platinum group metals prospects. Analysts contend that, with platinum trading at around $600 an oz, one year's cashflow from Blue Ridge could be as much as Cluff's present stock market value of £50 million.
Recent revelations that South Africa's impending new mining rules could require 51 per cent black participation in projects within a decade sent shock waves through the market. But the impact has been softened by indications that 26 per cent would be an acceptable level. Cluff claims its own deal, by which entrepreneur Mzi Khumalo took a significant stake, has pre-empted Pretoria's legislation, though Khumalo has aroused controversy elsewhere by selling and lending shares in other local mining companies.
Cluff denies suggestions of fracturing problems at its Bushveld deposits.
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