FORM 6-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

Report of Foreign Private Issuer
Pursuant to Rule 13a-16 or 15d-16
of the Securities Exchange Act of 1934

For the period of: October 1, 2010 to October 8, 2010

Platinum Group Metals Ltd.
(SEC File No. 0-30306 )

Suite 328 – 550 Burrard Street, Vancouver BC, V6C 2B5, CANADA
Address of Principal Executive Office

Indicate by check mark whether the registrant files or will file annual reports under cover:  Form 20-F [  ] Form 40-F  [X]

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): [   ]

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): [   ]

Indicate by check mark whether by furnishing the information contained in this Form, the registrant is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934:  Yes  [   ]  No  [X]

If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82-___________

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Date: October 8, 2010	“R. Michael Jones”	
 	R. MICHAEL JONES
DIRECTOR & CEO	

 

 

 

 

 

Exhibit List
 
99.1     News Release
99.2     News Release dated October 1, 2010
99.3     News Release dated October 6, 2010
99.4     Material Change Report dated September 30, 2010
99.5     Material Change Report dated October 1, 2010
99.6     Financial Statements for the Third Quarter ended May 31, 2010
99.7     Management Discussion & Analysis for the Third Quarter ended May 31, 2010
99.8     Form 52-109F2R Certification of Refiled Interim Filings - Chief Executive Officer
99.9     Form 52-109F2R Certification of Refiled Interim Filings - Chief Financial Officer
99.10   Consent of Qualified Person
99.11   Consent from Wardrop
99.12   Certificate of Qualified Person
99.13   Sundown Ranch Agreement
99.14   Technical Report

 

 

 

 

 

PLATINUM GROUP METALS ANNOUNCES C$100 MILLION BOUGHT DEAL FINANCING

Platinum Group Metals Ltd. (“Platinum Group” or the “Company”) has announced today that it has entered into an agreement with a syndicate of underwriters, under which the underwriters have agreed to buy on bought deal basis by way of a short form prospectus, 49,000,000 common shares (the “Common Shares”), at a price of C$2.05 per Common Share for gross proceeds of C$100 million (the “Offering”).  The Company will grant the Underwriters an option, exercisable up until 30 days following closing of the offering, to purchase up to an additional 15% of Common Shares at the issue price to cover over-allotments and for market stabilization purposes.

The Offering is expected to close on or about October 21, 2010 and is subject to the Company receiving all necessary regulatory approvals.

The Company intends to use the net proceeds of the offering to fund a payment to a subsidiary of Platinum Group in connection with the shareholders agreement with Wesizwe Platinum of approximately C$60.1 million to increase the Company’s interest in Project 1 of the Western Bushvold Joint Venture from 54.75% to 74%, continued development of WBJV Project 1 and for general corporate purposes.

The Company has completed an extensive strategic review of its options and has considered alternatives including a sale or merger of the Company, partnerships and the creation of a platinum stream. At this time the Company believes that the best option is to complete this proposed offering and advance its key project the WBJV Project 1, while keeping all strategic options open.

The securities offered have not been registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements.  This press release shall not constitute an offer to sell or the solicitation of an offer to buy any of the securities.

About Platinum Group Metals Ltd.

Platinum Group is based in Vancouver BC, Canada and Johannesburg, South Africa. Platinum Group has a management team in both Canada and South Africa, which have successful track records of more than 20 years in exploration, mine discovery, mine construction and mine operations. The Company was formed in 2000 and is focused on the development of platinum operations. It holds significant mineral rights in the Northern and Western Bushveld Igneous Complex of South Africa.

For further information contact:
R. Michael Jones, President
or Kris Begic, Corporate Development
Platinum Group Metals Ltd., Vancouver
Tel: (604) 899-5450 / Toll Free: (866) 899-5450

The Toronto Stock Exchange and the NYSE Amex Equities have not reviewed and do not accept responsibility for the accuracy or adequacy of this news release, which has been prepared by management.

This press release contains forward-looking statements within the meaning of Canadian and U.S. securities laws. Forward-looking statements are typically identified by words such as: believe, expect, anticipate, intend, estimate, postulate and similar expressions, or are those, which, by their nature, refer to future events. All statements that are not statements of historical fact are forward-looking statements. Forward-looking statements in this press release include, without limitation, statements regarding the timing, size and use of proceeds of the proposed private placement and the potential to increase the Company’s interest in certain of its projects. In addition, the results of the feasibility study may constitute forward-looking statements to the extent that they reflect estimates of mineralization, capital and operating expenses, metal prices and other factors. Although the Company believes the forward-looking statements in this press release are reasonable, it can give no assurance that the expectations and assumptions in such statements will prove to be correct. The Company cautions investors that any forward-looking statements by the Company are not guarantees of future results or performance, and that actual results may differ materially from those in forward looking statements as a result of various factors, including, but not limited to, variations in market conditions, the nature, quality and quantity of any mineral deposits that may be located, the Company’s ability to obtain any necessary permits, consents or authorizations required for its activities, the Company’s ability to produce minerals from its properties successfully or profitably, to continue its projected growth, or to be fully able to implement its business strategies and other risk factors described in he Company’s Form 40-F annual report, annual information form and other filings with the SEC and Canadian securities regulators, which may be viewed at www.sec.gov and www.sedar.com, respectively.

 
 
PLATINUM GROUP METALS ANNOUNCES INCREASE TO PREVIOUSLY ANNOUNCED BOUGHT DEAL FINANCING  TO C$125 MILLION

Vancouver, British Columbia (October 1, 2010) - Platinum Group Metals Ltd. (“Platinum Group” or the “Company”) has announced today that, due to strong demand, the Company has increased the size of its previously announced public offering to 61,000,000 common shares (the “Common Shares”), at a price of C$2.05 per Common Share for gross proceeds of C$125,050,000 (the “Offering”). The Company will grant the underwriters an option, exercisable up until 30 days following closing of the offering, to purchase up to an additional 15% of the Common Shares at the issue price to cover over-allotments and for market stabilization purposes.

The Offering is expected to close on or about October 22, 2010 and is subject to the Company receiving all necessary regulatory approvals.

The Company intends to use the net proceeds of the offering to fund a payment to a subsidiary of Platinum Group in connection with the shareholders agreement with Wesizwe Platinum of approximately C$60.1 million to increase the Company’s interest in Project 1 of the Western Bushvold Joint Venture from 54.75% to 74%, continued development of WBJV Project 1 and for general corporate purposes.

The Company has completed an extensive strategic review of its options and has considered alternatives including a sale or merger of the Company, partnerships and the creation of a platinum stream. At this time the Company believes that the best option is to complete this proposed offering and advance its key project the WBJV Project 1, while keeping all strategic options open.

The securities offered have not been registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements.  This press release shall not constitute an offer to sell or the solicitation of an offer to buy any of the securities.

About Platinum Group Metals Ltd.

Platinum Group is based in Vancouver BC, Canada and Johannesburg, South Africa. Platinum Group has a management team in both Canada and South Africa, which have successful track records of more than 20 years in exploration, mine discovery, mine construction and mine operations. The Company was formed in 2000 and is focused on the development of platinum operations. It holds significant mineral rights in the Northern and Western Bushveld Igneous Complex of South Africa.

For further information contact:
R. Michael Jones, President
or Kris Begic, Corporate Development
Platinum Group Metals Ltd., Vancouver
Tel: (604) 899-5450 / Toll Free: (866) 899-5450

The Toronto Stock Exchange and the NYSE Amex Equities have not reviewed and do not accept responsibility for the accuracy or adequacy of this news release, which has been prepared by management.

This press release contains forward-looking statements within the meaning of Canadian and U.S. securities laws. Forward-looking statements are typically identified by words such as: believe, expect, anticipate, intend, estimate, postulate and similar expressions, or are those, which, by their nature, refer to future events. All statements that are not statements of historical fact are forward-looking statements. Forward-looking statements in this press release include, without limitation, statements regarding the timing, size and use of proceeds of the proposed private placement and the potential to increase the Company’s interest in certain of its projects. In addition, the results of the feasibility study may constitute forward-looking statements to the extent that they reflect estimates of mineralization, capital and operating expenses, metal prices and other factors. Although the Company believes the forward-looking statements in this press release are reasonable, it can give no assurance that the expectations and assumptions in such statements will prove to be correct. The Company cautions investors that any forward-looking statements by the Company are not guarantees of future results or performance, and that actual results may differ materially from those in forward looking statements as a result of various factors, including, but not limited to, variations in market conditions, the nature, quality and quantity of any mineral deposits that may be located, the Company’s ability to obtain any necessary permits, consents or authorizations required for its activities, the Company’s ability to produce minerals from its properties successfully or profitably, to continue its projected growth, or to be fully able to implement its business strategies and other risk factors described in he Company’s Form 40-F annual report, annual information form and other filings with the SEC and Canadian securities regulators, which may be viewed at www.sec.gov and www.sedar.com, respectively.

 

 

 

    News Release	No. 191-2010
October 6, 2010	

Platinum Group Metals Restates 3 rd Quarter Results
 
(Vancouver/Johannesburg) Platinum Group Metals Ltd. (PTM-TSX; PLG-NYSE:AMEX) (“Platinum Group” or the “Company”) reports that the consolidated financial statements of the Company for the three and nine month periods ended May 31, 2010 have been restated to reflect future income tax expense relating to the dissolution of the WBJV.  The Company initially estimated that the tax basis of the WBJV was approximately equal to the carrying amount on the consolidated financial statements.  The Company has performed further analysis and now estimates a taxable temporary difference arising from the restructuring of the WBJV and the sale of WBJV Project 2 to Wesizwe for an additional interest in Maseve.  This restatement is for accounting purposes and the resulting accrual for future income tax expense is a non-cash item.  As previously reported the Company has determined that this transaction qualified for relief from current taxes payable in accordance with Section 42 of the South African Income Tax Act 58 of 1962.
The following table summarizes the impact of the adjustment on the consolidated financial statements for the respective periods:
Consolidated balance sheet
As of May 31, 2010
     Debit (Credit)
Future income tax liability
      (11,900,000)
Shareholders’ equity
       11,900,000

Consolidated statement of shareholders’ equity
As of May 31, 2010
       Debit (Credit)
Net earnings for the period
        11,900,000

Consolidated statement of operations
     Quarter ended   
Nine months ended
       May 31, 2010
    May 31, 2010
      Debit (Credit)         Debit (Credit)
Future income tax expense
11,900,000
       11,900,000
Earnings (loss) for the period
11,900,000
       11,900,000
Comprehensive earnings (loss) for the period
11,900,000
       11,900,000
Restated earnings for the nine month period ended May 31, 2010 were $30,800,454 and basic and diluted restated earnings per share were $0.33 and $0.32, respectively, for the nine month period.  The adjustment decreases the Company’s basic and diluted earnings per share by $0.13 and $0.12, respectively, for the nine month period.  There was no impact on operating, investing or financing cash flows to those previously reported.  

PLATINUM GROUP METALS LTD.
…2

Restated Financial Statements and Management’s Discussion and Analysis have been reviewed by the Audit Committee and the Board of Directors and have been refiled on www.Sedar.com .

About Platinum Group Metals Ltd.
Platinum Group is based in Vancouver BC, Canada and Johannesburg, South Africa. Platinum Group has a management team in both Canada and South Africa, which have successful track records of more than 20 years each in exploration, mine discovery, mine construction and mine operations. Platinum Group holds mineral rights in both Canada and South Africa and in addition to the WBJV Project 1 Platinum mine with a completed feasibility study, the Company has two active exploration joint ventures with JOGMEC, the Japanese state company. The Company was formed in 2000 and is focused on the development of platinum operations.

On behalf of the Board of
Platinum Group Metals Ltd.

“Frank R. Hallam”
 
For further information contact:
R. Michael Jones, President
or Kris Begic, Corporate Development
Platinum Group Metals Ltd., Vancouver
Tel: (604) 899-5450 / Toll Free: (866) 899-5450

The Toronto Stock Exchange and the New York Stock Exchange - AMEX have not reviewed and do not accept responsibility for the accuracy or adequacy of this news release, which has been prepared by management.

This press release contains forward-looking statements within the meaning of Canadian and U.S. securities laws. Forward-looking statements are typically identified by words such as: believe, expect, anticipate, intend, estimate, postulate and similar expressions, or are those, which, by their nature, refer to future events. All statements that are not statements of historical fact are forward-looking statements. Forward-looking statements in this press release include, without limitation, statements regarding the Company’s interest in certain of its projects. In addition, the results of the feasibility study may constitute forward-looking statements to the extent that they reflect estimates of mineralization, capital and operating expenses, metal prices and other factors. Although the Company believes the forward-looking statements in this press release are reasonable, it can give no assurance that the expectations and assumptions in such statements will prove to be correct. The Company cautions investors that any forward-looking statements by the Company are not guarantees of future results or performance, and that actual results may differ materially from those in forward looking statements as a result of various factors, including, but not limited to, variations in market conditions, the nature, quality and quantity of any mineral deposits that may be located, the Company’s ability to obtain any necessary permits, consents or authorizations required for its activities, the Company’s ability to produce minerals from its properties successfully or profitably, to continue its projected growth, or to be fully able to implement its business strategies and other risk factors described in the Company’s Form 40-F annual report, annual information form and other filings with the SEC and Canadian securities regulators, which may be viewed at www.sec.gov and www.sedar.com , respectively.

FORM 51-102F3
MATERIAL CHANGE REPORT
Item 1
Name and Address of Company
PLATINUM GROUP METALS LTD. (the “ Platinum Group ” or the “ Company ”)
328 – 550 Burrard Street
Vancouver BC, V6C 2B5
Item 2
Date of Material Change
September 30, 2010
Item 3
News Release
The news release dated September 30, 2010 was filed with the TSX and the securities commissions in British Columbia, Alberta, Manitoba, New Brunswick, Newfoundland and Labrador, Nova Scotia, Ontario, Prince Edward Island, Quebec and Saskatchewan via SEDAR and disseminated through Marketwire.
Item 4
Summary of Material Change
The Company announced an updated resource estimate for Project 3 of the Western Bushveld Joint Venture (the “ WBJV ”) of 1.938 million 4E (platinum, palladium, rhodium and gold) ounces in the Indicated Mineral Resource category and 21,000 4E ounces in the Inferred Mineral Resources category.  Details of the new resource estimates are provided in the tables below:

Reef	Resource
Category	Tonnes
(million)	Grade
(4E) (g/t)	Width (metres)	Prill Splits (4E)	WBJV Ozs (million)	PTM Interest	PTM Ozs (million)	
					Pt	Pd	Rh	Au				
 	 	 	 	 	 	 	 	 	 	 	 	
MR	Indicated	5.157	6.03	1.14	64%	27%	4%	5%	0.999	74%	0.739	
UG2	Indicated	5.947	4.91	1.16	62%	28%	9%	1%	0.939	74%	0.695	
MR	Inferred	0.443	1.47	1.14	64%	27%	5%	5%	0.021	74%	0.016	

Prill Splits	Pt	Pt (g/t)	Pd	Pd (g/t)	Rh	Rh (g/t)	Au	Au (g/t)	
Project 3 MR	64%	4.01	27%	1.69	4%	0.25	5%	0.31	
Project 3 UG2 CL	62%	3.42	28%	1.54	9%	0.50	1%	0.06	

The updated resource estimate is contained in a technical report dated August 31, 2010, prepared by Charles Muller of Minxcon (Pty) Ltd. (“ Minxcon ”) entitled “Technical Report on Project 3 Resource Cut Estimation of the Western Bushveld Joint Venture (WBJV) located on the Western Limb of the Bushveld Igneous Complex, South Africa” (the “ Project 3 Report ”).  The purpose of the Project 3 Report is to update and summarize the technical aspects of the resource estimates for the Project 3 area of the WBJV (“ Project 3 ”) available since the drilling information for Project 3 was first announced on April 25, 2008.  
In addition, three shareholders of the Company exercised a total of 3,308,400 common share purchase warrants at a price of $1.75 per share for proceeds of $5,789,700.

- 2 -

Item 5
Full Description of Material Change
5.1
Full Description of Material Change
PROJECT 3 RESOURCE ESTIMATE AND PROJECT 3 REPORT
The Company announced an updated resource estimate for Project 3 of the WBJV as contained in a technical report dated August 31, 2010, prepared by Charles Muller of Minxcon entitled “Technical Report on Project 3 Resource Cut Estimation of the Western Bushveld Joint Venture (WBJV) located on the Western Limb of the Bushveld Igneous Complex, South Africa”.
The following is a summary of certain portions of the Project 3 Report:
PROPERTY DESCRIPTION AND LOCATION
The WBJV project is located on the south western limb of the Bushveld Igneous Complex (“ BIC ”) some 35 km northwest of the town of Rustenburg, North West Province, South Africa.  The property adjoins the Bafokeng Rasimone Platinum Mine (“ BRPM ”) of Anglo Platinum Ltd. (“ Anglo Platinum ”) and the Styldrift Project to the southeast and east respectively.  Project 3 of the WBJV is located on a section of the farm Koedoesfontein 94JQ and covers an area of 1,709.28 hectares.
Platinum Group, through its subsidiary Platinum Group Metals RSA (Pty) Ltd. (“ PTM-SA ”), holds a 54.75% interest in Project 3 through its shareholdings in Maseve Investments 11 (Pty) Ltd. (“ Maseve ”), the operating company which holds the interests in Projects l and 3. Platinum Group has the right to subscribe for an additional 19.25% interest in Maseve by paying Rand 408.6 million to Maseve by mid January, 2011.
The BIC in general is well known for containing a large share of the world's platinum and palladium resources.  There are two very prominent economic deposits within the BIC.  First, the Merensky Reef and the Upper Group 2 chromitite layer (“ UG2 CL ”), which together can be traced on surface for 300 km in two separate areas.  Secondly, the Northern Limb, which extends for over 120 km in the area north of Mokopane.
Exploration drilling to date on the WBJV area has shown that both economic units (Merensky Reef and UG2 CL) are present and economically of interest on the WBJV properties.  The mineral resources of Project 3 are located approximately 11 km along strike from the active Merensky Reef mining face at the BRPM, which completed opencast mining on the UG2 CL within 100 m of the WBJV property boundary.  No mineral reserves have been estimated.  As this project constitutes an exploration project, no mining infrastructure currently exists on the properties.
Licences
Legal Aspects and Tenure of the Project 3 Area

Holder	Permit/Right
Number	Description of property	Property
Size	Validity	
Rustenburg Platinum Mines Ltd.
(a subsidiary of
Anglo Platinum)	Koedoesfontein 94-JQ
DME :
NW
30/5/1/1/2/1264	The Farm Koedoesfontein 94-JQ.	1702.8204Ha	Protocol No
555/2007
Commence
04/07/2007
Expiry
03/07/2012	

 

- 3 -

Royalties
A 3% gross royalty on the production of refined platinum is required to be paid to the South African Government.
Survey
Koedoesfontein (RPM) :  Koedoesfontein is registered with the Deeds Office (RSA) under Koedoesfontein 94JQ, Northern Province.  The farm can be located on Government 1:50,000 Topo-cadastral sheet 2527AC Sun City (4 th Edition 1996) which is published by the Chief Directorate, Surveys and Mapping.  The approximate coordinates (WGS84) are 27° 02’ 00’’ (E) and 25° 07’ 00’’ (S).
PHYSIOGRAPHY, ACCESSIBILITY AND LOCAL RESOURCES
Topography, Elevation and Vegetation
The WBJV area is located on a central plateau.  The Project area has prominent hills, which occur in the northern most portions, but generally, variations in topography are minor and limited to low, gently sloped hills.  The section of the Koedoesfontein property covered by the Project 3 area gently dips in a north-easterly direction toward a tributary of the Elands River.  Elevations range from 1,060 m above mean sea level (“ AMSL ”) towards the Sandspruit River in the north to 1100 m amsl towards the south eastern corner of the property.  The area is characterised by extensive savannah with vegetation consisting of grasses and shrub with few trees.
Means of Access to the Property
South Africa has a large and well-developed mining industry.  The WBJV is located in an area with a long history of mining activity and this, among other factors, means that the infrastructure in the area is well established, with well-maintained roads and highways as well as electricity distribution networks and telephone systems.
The Project 3 area is located, some 42 km northwest of the North West Province town of Rustenburg.   The informal settlement of Ledig is situated 2 km north of the Project 3 area via the tarred R565 main road that crosses the Project area.  The WBJV adjoins the AP-managed BRPM to the southeast.  A railway line linking BRPM to the national network passes the WBJV area immediately to the east with a railway siding at Boshoek.
The WBJV properties are readily accessible from Johannesburg by travelling 120 km northwest on Regional Road 24 to the town of Rustenburg and then a further 41 km.  The resort of Sun City is located approximately 6 km northeast of Project 3 area.  Both BRPM to the south of the Project area and Styldrift, a joint venture between the Royal Bafokeng Nation and Anglo Platinum, which lies directly to the east of the property, have modern access roads and services.  Numerous gravel roads crossing the WBJV properties provide easy access to all portions.
Population Centres and Modes of Transport
The closest major population centre to the Project 3 is the town of Rustenburg, located about 41 km to the southeast of the Project 3.  Pretoria lies approximately 100 km to the east and Johannesburg about 120 km to the southeast.  A popular and unusually large hotel and entertainment centre, Sun City, lies about 6 km to the northeast of the Project 3 area.  The Sundown Ranch Hotel lies in close proximity to the Project 3 area and offers rooms and chalets as accommodation.  The WBJV properties fall under the jurisdiction of the Moses Kotane Municipality.  A paved provincial road crosses the property.  Access across most of the property can be achieved by truck without the need for significant road building.

 

- 4 -

Climate and Length of Operating Season
With low rainfall (the area is considered semi arid with an annual rainfall of 520 mm) and high summer temperatures, the area is typical of the Highveld Climatic Zone.  The rainy season is in the summer months from October to April with the highest rainfall in December and January.  In summer (November to April) the days are warm to hot, with afternoon showers or thunderstorms; temperatures average 26ºC (79ºF) and can rise to 38ºC (100ºF); and night temperatures drop to around 15ºC (60ºF).  During winter months (May to October), days are dry and sunny with moderate to cool temperatures, while evening temperatures drop sharply.  Temperatures by day generally reach 20ºC (68ºF) and can drop to below 0ºC with frost occurring in the early morning.  The hottest months are generally December and January with June and July being the coldest.  The climate of the area does not hinder the operating season and exploration can continue all year long.
Infrastructure with respect to Mining
As the Project 3 Report deals with an exploration project, it suffices to note that all areas are close to major towns and informal settlements as a potential source of labour with paved roads being the norm.  Power lines cross both project areas and water is, as a rule, drawn from boreholes.  As several platinum mines are located adjacent to and within 50 km of the property, there is excellent access to materials and skilled labour.  One of the smelter complexes of AP is located within 60 km of the property.  No surface rights are held on the Project 3 area, however, surface rights to 365 ha on Elandsfontein have been purchased and this may be of some use for potential operations.  Further surface rights will be required.
HISTORY
Previous geological exploration on the farm Koedoesfontein was carried out by Anglo Platinum as the original owner of some of the mineral rights.  Anglo Platinum managed the exploration drilling programme for the Koedoesfontein borehole series in the area of interest.  Geological and sampling logs and an assay database are available which was utilised in the resource estimation for Project 3 area.  
The drilling programme consisted of three boreholes (KD1, KD2 and KD3).  Boreholes KD1 and KD3 were drilled beyond the Merensky Reef and UG2 CL subcrop, and terminated in sediments of the Transvaal Supergroup.  Drilling of borehole KD2 was stopped short of the Merensky Reef subcrop.  No historical Mineral Resources or Mineral Reserves have been estimated for the Project 3 Area.  There has been no previous production from any of the WBJV properties.
GEOLOGICAL SETTING
Regional Geology of the BIC
The stable Kaapvaal and Zimbabwe Cratons in southern Africa are characterised by the presence of large mafic-ultramafic layered complexes.  These include the Great Dyke of Zimbabwe, the Molopo Farms Complex in Botswana and the well-known BIC.  The BIC is by far the most economically important of these deposits as well as the largest in terms of preserved lateral extent, covering an area of over 66,000 km 2 .  It has a maximum thickness of 8 km. The mafic component of the BIC hosts layers rich in platinum group elements (“ PGEs ”), nickel, copper, chromium and vanadium.  The mafic component of the BIC is subdivided into several generally arcuate segments/limbs, each associated with a pronounced gravity anomaly. These include the western, eastern, northern/Potgietersrus, far western/Nietverdient and southeastern/Bethal limbs. The mafic rocks are collectively termed the Rustenburg Layered Suite (“ RLS ”) and are subdivided into the following five zones:

 

- 5 -

·
Marginal Zone –  comprising finer-grained gabbroic rocks with abundant country-rock xenoliths.
·
Lower Zone – the overlying Lower Zone is dominated by orthopyroxenite with associated olivine-rich cumulates (harzburgite, dunite).
·
Critical Zone – its commencement is marked by first appearance of well-defined cumulus chromitite layers.  Seven lower group chromitite layers have been identified within the lower Critical Zone.  Two further chromitite layers – Middle Group (“ MG ”) – mark the top of the pyroxenite-dominated lower Critical Zone.  From this stratigraphic position upwards, plagioclase becomes the dominant cumulus phase and noritic rocks predominate.  The MG3 and MG4 chromitite layers occur at the base of the upper Critical Zone, which is characterised from here upwards by a number of cyclical units.  The cycles commence in general with narrow pyroxenitic horizons (with or without olivine and chromitite layers); these invariably pass up into norites, which in turn pass into leuconorites and anorthosites.  The first of the two Upper Group chromitite layers (“ UG1 CL ”) is a cyclical unit consisting of chromitite layers with overlying footwall units that are supported by an underlying anorthosite.  The overlying UG2 CL is of considerable importance because of its economic concentrations of PGEs.  The two uppermost cycles of the Critical Zone include the Merensky and Bastard cycles.  The Merensky Reef is found at the base of the Merensky cycle, which consists of a pyroxenite and pegmatoidal feldspathic pyroxenite assemblage with associated thin chromitite layers that rarely exceed one metre in thickness.  The top contact of the Critical Zone is defined by a giant mottled anorthosite that forms the top of the Bastard cyclic unit.
·
Main Zone – consists of norites grading upwards into gabbronorites.  It includes several mottled anorthosite units towards the base and a distinctive pyroxenite two thirds of the way up.  This marker-unit does not occur in the project area, but is evident in the adjacent BRPM.  The middle to upper part of the Main Zone is very resistant to erosion and gives rise to distinctive hills, which are currently being mined for dimension stone (black granite).
·
Upper Zone – the base is defined by the appearance of cumulus magnetite above the pyroxenite marker.  The Upper Zone is divided into Subzone A at the base; Subzone B, where cumulus iron-rich olivine appears; and Subzone C, where apatite appears as an additional cumulus phase.
Local Geology –Western Bushveld Limb
Exposures of the BIC located on the western limb include the stratigraphic units of the RLS. The sequence comprises mostly gabbros, norites, anorthosites and pyroxenites.  Viljoen (1999) originally proposed a structural interpretation based on geological and geophysical data for the western lobe of the BIC.  This study included gravity and vibrosis seismic data for the south western portion of the RLS northwest of Rustenburg. It was concluded that the Merensky Reef is present within much of this lobe, including the part further to the east below the Nebo granite sheet.  The position of the Merensky Reef is fairly closely defined by seismic reflectors associated with the cyclic units of the upper Critical Zone. The seismic data also portrayed an essentially sub-horizontal disposition of the layering within the BIC mafic rocks below the Nebo granite sheet.  The gravity data indicates a gravity-high axis extending throughout the western lobe following the upper contact of the mafic rocks with the overlying granitic rocks.  A number of pronounced gravity highs occur on this axis.  A gravity anomaly with a strike length of 9 km is situated northeast of Rustenburg towards the east of the Boshoek section.  The gravity highs have been interpreted as representing a thickening of the mafic rocks, reflecting feeder sites for the mafic magma of the western BIC (Viljoen, 1999).

 

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The western limb is interpreted by Viljoen as having two main arcuate feeder dykes which, closer to surface, have given rise to arcuate, coalescing, boat-shaped keels containing saucer-shaped, inward-dipping layers, analogous to the Great Dyke of Zimbabwe.
In the Boshoek section north of Rustenburg, the variable palaeo-topography of the Bushveld floor represented by the Transvaal Supergroup contact forms a natural unconformity with the overlying Bushveld layered sequence.  Discontinuities due to structural interference of faults, sills and dykes are pronounced in the area and are ascribed to the presence of the Pilanesberg Alkaline Complex intrusion to the north of the property.
Stratigraphy of the Upper Critical Zone
The upper Critical Zone of the RLS comprises mostly norites, leuconorites and anorthosites.  Leeb-Du Toit (1986) assigned numbers to the various lithological units according to their position in relation to the Merensky unit.  The footwall layers range from FW14 below the UG1 chromitite to FW1 directly below the Merensky Reef.  The hanging wall layers are those above the Bastard Reef and range from HW1 to HW5.  The different layers within the Merensky unit are the Merensky feldspathic pyroxenite at the base, followed by a leuconorite (Middling 2) and a mottled anorthosite (Middling 3).  The feldspathic pyroxenite layers (pyroxene cumulates) are named according to the reef hosted by them.  These include (from the base upwards) the UG1 CL, the UG2 CL (upper and lower), the Merensky and the Bastard pyroxenite.
Schürmann (1993) subdivided the upper Critical Zone in the Boshoek section into six units based on lithological features and geochemical trends.  These are the Bastard, the Merensky, the Merensky footwall, the Intermediate, the UG2 CL and the UG1 CL units.  The Intermediate and Merensky footwall units were further subdivided based on modal-mineral proportions and whole-rock geochemical trends.  The following is a detailed description of the subdivision of the upper Critical Zone in the Boshoek section (Schürmann).
Bastard Unit
The Bastard unit consists of a basal pyroxenite some 3 m thick with a thin chromitite developed on the lower contact.  This chromitite is the uppermost chromitite layer in the Critical Zone.  A 6.5 m-thick norite layer (HW1) overlies the pyroxenite.  HW1 is separated from HW2 by two thin mottled anorthosite layers.  HW3 is a 10 m-thick mottled anorthosite and constitutes the base of the Giant Mottled Anorthosite.  The mottled anorthosites of HW4 and HW5 are about 2 m and 37 m thick respectively.  Distinction between HW3, 4 and 5 is based on the size of the mottles of the respective layers.
Merensky Unit
The Merensky unit, with the Merensky Reef at its base, is the most consistent unit within the Critical Zone.
Merensky Footwall Unit
This unit contains the succession between the FW7/FW6 and the FW1/MR contacts.  Leeb-Du Toit (1986) indicated that where the FW6 layer is thicker than 3 m, it usually consists of four well-defined rock types.  The lowermost sublayer, FW6(d), is a mottled anorthosite with mottles of between 30 mm and 40 mm in diameter.  It is characterised by the presence of nodules or “boulders” and is commonly referred to as the Boulder Bed.  The nodules are described as muffin-shaped, 5–25 cm in diameter, with convex lower contacts and consisting of cumulus olivine and orthopyroxene with intercumulus plagioclase.  A single 2–10 mm chromitite stringer is present at the base of the FW6(d) sublayer.  FW6(c) is also a mottled anorthosite but not always developed. FW6(b) is a leuconorite containing pyroxene oikocrysts 10–20 mm in diameter.  Two layers (both 2–3 cm thick) consisting of fine-grained orthopyroxene and minor olivine define the upper and lower contacts.  FW6(a), the uppermost sublayer, is also a mottled anorthosite.

 

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FW6 is overlain by a uniform norite (FW5), with a thickness of 4.1 m.  It appears to thin towards the north to about one metre.  FW4 is a mottled anorthosite 40 cm thick, with distinct layering at its base.  FW3 is an 11 m-thick uniform leuconorite.
FW2 is subdivided into three sublayers.  FW2(b) is a 76 cm-thick leuconorite and is overlain by a 33 cm-thick layer of mottled anorthosite – FW2(a).  Where FW2 attains a maximum thickness of 2 m, a third layer in the form of a 1–2 cm-thick pyroxenite or pegmatite pyroxenite, FW2(c), is developed at the base.  FW2(c) is absent in the Boshoek section area (Schürmann, 1993).  FW1 is a norite layer about 7 m thick.
Schürmann further subdivided the Merensky footwall unit into four subunits.  The lowermost subunit consists of sublayers FW6(d) and FW6(b).  Subunit 2, which overlies subunit 1, commences with FW6(a) at the base and grades upwards into FW5.  The FW5/FW4 contact is sharp and divides subunits 2 and 3. Subunit 3 consists of FW4, FW3 and sublayer FW2(b).  Subunit 4 consists of FW2(a) and FW1 and forms the uppermost subunit of the Merensky footwall unit.
Intermediate Unit
The Intermediate unit overlies the upper pyroxenite of the UG2 unit and extends to the FW7/FW6 contact.  The lowermost unit is the 10 m-thick mottled anorthosite of FW12, which overlies the UG2 upper pyroxenite with a sharp contact.  FW11, a roughly 1 m thick leuconorite, has gradational contacts with the under and overlying layers.  FW10 consists of a leuconorite layer of about 10 m.  Subdivision between these two units is based on the texture and subtle differences in the modal composition of the individual layers.  Leeb-Du Toit (1986) termed FW11 a spotted anorthosite and FW10 an anorthositic norite.  FW12, 11 and 10 constitute the first Intermediate subunit as identified by Schürmann (1993).  The second Intermediate subunit consists of FW9, 8 and 7.  The 2 m-thick FW9 mottled anorthosite overlies the FW10 leuconorite with a sharp contact.  The FW8 leuconorite and FW7 norite are respectively 3 m and 37 m thick.  The FW9/FW8 and FW8/FW7 contacts are gradational but distinct.  A 1.5 m-thick highly contorted mottled anorthosite “flame bed” is present 15 m above the FW8/FW7 contact.
UG2 CL Unit
The UG2 CL unit commences with a feldspathic pyroxenite (about 4 m thick) at its base and is overlain by an orthopyroxene pegmatoidal layer (0.2–2 m thick) with a sharp contact.  Disseminated chromite and chromitite stringers are present within the pegmatoid.  This unit in turn is overlain by the UG2 CL (0.5–0.8 m thick) on an irregular contact.  Poikilitic bronzite grains give the chromitite layer a spotted appearance.  A 9 m feldspathic pyroxenite overlies the UG2 CL.  The upper and lower UG2 CL pyroxenites have sharp contacts with FW12 and FW13.  The upper UG2 CL pyroxenite hosts the UG2 CL leader seams, which occur between 0.2 m and 3 m above the main UG2 CL.
UG1 CL Unit
The UG1 CL is approximately 1 m thick and forms the base of this unit.  It is underlain by the 10 m-thick FW14 mottled anorthosite.  The UG1 CL bifurcates and forms two or more layers within the footwall mottled anorthosite, while lenses of anorthosite also occur within the chromitite layers.  The overlying pyroxenite consists of cumulus orthopyroxene, oikocrysts of clinopyroxene and intercumulus plagioclase.  The UG1 CL pyroxenite is separated from the overlying FW13 leuconorite (about 8 m thick) by a thin chromitite layer (1–10 cm) with sharp top and bottom contacts.

 

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Local Structure
Floor rocks in the south western BIC display increasingly varied degrees of deformation towards the contact with the RLS.  Structure within the floor rocks is dominated by the north-northwest trending post-Bushveld Rustenburg Fault.  This normal fault with down-throw to the east extends northwards towards the west of the Pilanesberg Alkaline Complex.  A second set of smaller faults and joints, striking 70° and dipping very steeply south-southeast or north-northwest, are related to the Rustenburg fault system.  These structures were reactivated during the intrusion of the Pilanesberg Alkaline Complex.  Dykes associated with this Complex intruded along these faults and joints.
Major structures, which occur within the WBJV area, include the Caldera and Elands Faults and Chaneng Dyke and a major north-south trending feature, which can be observed across the entire Pilanesberg Complex.  These east-west trending structures dip steeply (between 80° and 90°).  The magnetics indicate that the Chaneng Dyke dips steeply to the north.  This is consistent with similar structures intersected underground on the neighbouring Bafokeng Rasimone Platinum Mine, which all dip steeply northward.
Two stages of folding have been recognised within the area.  The earliest folds are mainly confined to the Magaliesberg Quartzite Formation.  The fold axes are parallel to the contact between the RLS and the Magaliesberg Formation.  Quartzite xenoliths are present close to the contact with the RLS and the sedimentary floor.  Examples of folding within the floor rocks are the Boekenhoutfontein, Rietvlei and Olifantsnek anticlines.  The folding was initiated by compressional stresses generated by isostatic subsidence of the Transvaal Supergroup during sedimentation and the emplacement of the pre-Bushveld sills.  The presence of an undulating contact between the floor rocks and the RLS, and in this instance the resultant formation of large-scale folds, substantiates a second stage of deformation.  The fold axes trend at approximately orthogonal angles to the first folding event.  Deformation during emplacement of the BIC was largely ductile and led to the formation of basins by sagging and folding of the floor rocks.  This exerted a strong influence on the subsequent evolution of the Lower and Critical Zones and associated chromitite layers.
The structural events that influenced the floor rocks played a major role during emplacement of the BIC.  There is a distinct thinning of rocks from east to west as the BIC onlaps onto the Transvaal floor rocks, even to the extent that some of the normal stratigraphic units have been eliminated.
The Merensky and UG2 CL isopach decreases from 60 m to 2 m at outcrop position.  There is also a subcrop of the Critical Zone against the Main Zone rocks.
Project Geology
The sequence of the BIC within the WBJV area is confined to the lower part of the Main Zone (Porphyritic Gabbro Marker) and the Critical Zone (HW5-1 and Bastard Reef to UG1 footwall sequence).  The rock sequence thins towards the southwest (subcrop) including the marker horizons with concomitant middling of the economic reefs or total elimination thereof.  The UG2 CL and, more often, the UG1 CL are not developed in some areas owing to the irregular and elevated palaeo-floor of the Transvaal sediments.

 

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Surface Geology
 
The WBJV is underlain by the lower portion of the RLS, comprising the Critical Zone and lower portion of the Main Zone.  The ultramafic Lower Critical Zone and the Mafic Upper Critical Zone and the Main Zone weather to dark, black clays with very little topography.  The underlying Transvaal Supergroup comprises shale and quartzite of the magaliesberg formation, which creates a more undulating topography.  Gravity, magnetic, LANDSAT, aerial photography and geochemistry have been used to map out lithological units.
The Merensky Reef subcrops, as does the UG2 CL, beneath a relatively thick main zone of the Bushveld against the Transvaal basement.  The sequence strikes northwest to southeast and has an average dip of ~10° in the Project 3 area.  The top 32 m of rock formation below the soil column is characterized by a highly weathered rock profile (regolith) consisting mostly of gabbro within the Main Zone.  Thicknesses of this profile increase near intrusive dykes traversing the area.
Reefs
The Merensky Reef structure at the Project 3 area has not been interpreted to date.
The UG2 CL is well developed towards the northeast of the Project 3 area, but deteriorates towards the southwest.  Within the latter area, the chromitite layer is present as a thin discontinuous or disrupted chromitite/pyroxenite layer. It also appears to be disrupted by the shear zone along the footwall alteration zone.  
The thickness of the sequences between the UG2 CL and MR in the Project 3 area increases from ~6 m to 25 m in a southwest-northeast direction.  In general, the thickness between the units appears to increase in a north easterly direction, sub-parallel to the strike of the BIC layered lithologies.
Project Structure
A structural model was developed from data provided by the magnetic survey results and geological logs of drilled cores.  At least three generations of faults were identified on the property.
The oldest event appears to be associated with dykes and sills trending at 305 ° and is of post-BIC age.  It appears to be the most prominent, with the largest displacement component of more than 20 m. The majority of the faults are normal faults dipping in a westerly direction, decreasing in their dip downwards and displaying typical listric fault system behaviour.
A second phase represented by younger fault features is trending in two directions at 345 ° and 315 ° northwards respectively and appears to have consistent down-throws towards the west.
A third phase of deformation may be related to a regional east-west-striking dyke system causing discontinuity on adjacent structures.  Several dolerite intrusives, mainly steep-dipping dykes and bedding-parallel sills, were intersected in boreholes.  These range in thickness from 0.5–30 m and most appear to be of a chilled nature; some are associated with faulted contacts.  Evident on the magnetic image is an east-west-trending dyke, which appears to be of Pilanesberg-intrusion age.  This dyke has a buffer effect on structural continuity as faulting and earlier stage intrusives are difficult to correlate on either side; and more work is required to understand the mechanics.
EXPLORATION
Survey (field observation) Results, Procedures and Parameters
Exploration to date for the Project 3 area comprises of geophysical surveys (magnetic, gravity, 3D seismics and aerial magnetic).  This programme is currently still in process.  The purpose of the exploration programme is to re-evaluate the Project 3 area via geophysical assessments with regard to structure.

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Interpretation of Survey (field observation) Results
The structural features identified from the aeromagnetic data were interpreted in terms of a regional structural model.  Major dyke features were easily recognized and these assisted in the compilation of a structural model for the WBJV project area.
Survey (field observation) Data Collection and Compilation
Initial processing of the geophysical data collected was conducted by Anglo American Technical Division, Geoscience.  Final processing of data is conducted by Rock Deformation Research Limited.
DEPOSIT TYPES AND MINERALISATION
The most pronounced PGE mineralisation in the project area occurs within the Merensky Reef and is generally associated with a 0.1–1.2 m thick pegmatoidal feldspathic pyroxenite unit.  The Merensky Reef is generally also associated with thin chromitite layers on either/both the top and bottom contacts of the pegmatoidal feldspathic pyroxenite.  The second important mineralised unit is the UG2 CL, which is on average 1.50 m thick and occurs within the project area.
MR Facies Types
The Merensky Reef occurs as the Detached Facies in the project area.  The Detached Facies comprises a pegmatoid of feldspathic pyroxenite reef type, or pyroxenite bounded by top and bottom chromitite layers.  It generally overlies several meters of fine to medium grained pyroxenite and is overlain by feldspathic pyroxenite with base metal sulphides mineralization within 1.0 m thick just below the chromitite.  It lies on footwall rocks from FW 1 to FW 6. It is similar to the detached Merensky Reef facies describe at the adjacent project of Wesizwe.
UG2 Facies Types
The UG2 CL is composed of a choromitite layer and generally has a base feldspathic pyroxenite pegmatoid and certain overlying chromitite layers termed leader and triplets.  Most of the intersections encountered in PTM-SA’s exploration campaign have no basal pegmatoid but do have FW13 Anorthosite Unit underlying the main band, pinching out in a northeast direction and sitting directly on UG1 CL hangingwall pyroxenite.
Correlation and Lateral Continuity of the Reefs
The Merensky Reef and UG2 CL are positively identified in new intersections.  Only the reef intersections that had no faulting or disruptions/discontinuities were used in the resource estimate.  The UG1 CL, traditionally classified as a secondary reef typically with multiple chromitite seams, has been intersected in some boreholes; although in many cases strongly disrupted, it showed surprisingly attractive grades.
Resource estimation is not possible within 50 m from surface owing to core loss resulting from near-surface weathering (weathered rock profile), joint set interference, and reef identification/correlation problems and thinning of the reefs towards the west.

 

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Merensky Reef is poorly developed at the project area, from the subcrop position to as far as 100 m down-dip and as far as 800 m along strike.  This was evident in marginal grades, and is no doubt due to the presence of a palaeo-high in the Transvaal sediment floor rocks below the BIC.  The area is locally referred to as the Abutment.
With respect to the UG2 CL in the project area, relative to the Abutment’s effect, a smaller area extending from subcrop position to as deep as 400 m down-dip with strike length 420 m of UG2 CL was characterised by a relatively low grade.
Potholes
The limited exploration and drilling at the Project 3 area has revealed no real evidence of potholes.  However, positive identification of pothole intersections for the Merensky Reef and UG2 CL in other areas of the WBJV has occurred.  The possible position of these potholes may be indicated by the following:
·
where footwall stratigraphic widths are wider;
·
where the Merensky Pyroxenite or UG2 CL is bifurcating, split or absent; and
·
where the Merensky Reef width is anomalous with regard its normal facies widths.
Replacement Pegmatites
Due to limited drilling at Project 3 area, little evidence for the occurrence of pseudo-form replacement bodies have been encountered.  However, evidence for replacement pegmatoids has been encountered in other areas of the WBJV.
No metallurgical testwork has been conducted by PTM-SA for Project 3 to date.  However, metallurgical testwork has been conducted for southern areas of the WBJV, and it is expected that the mineralogy at Project 3 will be similar.  The following is an excerpt from the technical report completed for the Project 1 and 1A areas.
Mineralisation Styles and Distribution
Bulk modal analyses were estimated based on the results from XRD analysis (RIR method) and optical microscopic examination. The results were as follows:
·
Alteration – Silicates showed low to moderate alteration, mainly associated with fractured zones. The degree of alteration is not expected to hinder flotation results, but should be monitored.
·
Sulphide Assemblages – Sulphide composition of the samples was variable.  The results of the estimated sulphide composition of the composite sample were as follows:
o
Chalcopyrite (CuFeS 2 ):
20%
o
Pyrite (FeS 2 ):
2%
o
Pyrrhotite (Fe 7 S 8 ):
35%
o
Pentlandite ((Fe, Ni)S):
43%
Examination of the polished thin-sections showed that the sulphides occurs as sporadically distributed, fine grained clusters associated with interstitial silicates or as isolated, coarse composite particles and blebs.  The liberation characteristics of the sulphides are expected to be relatively good apart from the fine disaggregated disseminated chalcopyrite.

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PGE and Gold Deportment
PGE searches (including gold bearing phases) were conducted by manually scanning a selection of the polished sections utilizing a scanning electron microscope to obtain a statistical particle count.  Approximately 237 particles were located in 8 thin sections and image analysis software was employed to measure the size of each particle.
Speciation
The major PGE phase encountered was cooperite (PtS) which comprise 63% of the observed particles.  Moncheite (PtTe 2 ) was the next most common PGE encountered (11%).  The major gold-bearing phase, electrum (AuAg), was found to comprise 6% of the observed particles.  Braggite (PtPd)S is also fairly common and comprises 5% of the observed particles.  Sperrylite (PtAs 2 ) is less common, comprising about 4% of the observed PGEs.  A PGE phase composed of Pd, Pt, As and some Te was found to be present in 2.4% of the observed particles.  Hollingworthite (RhAsS), isoferroplatinum (Pt 3 Fe) and laurite (RuS 2 ) are less common PGEs, each comprising about 1.5% of the total observed particles.  Froodite (PdBi2) comprise about 1% of the observed particles and was found only in one thin-section (41/D4/B).  The remaining 2.8% of the observed particles are composed of 9 other PGE and gold species.
In order to reach a better understanding of the PGE speciation, they were classified into five groups: (a) sulphides, (b) arsenides, (c) Te-, Sb- and Bi-bearing, (d) Au-bearing phases and (e) Fe bearing PGEs.  The sulphides comprise about 71% of PGEs observed (of which cooperate comprise about 90%).
Mineral Association
With regard to the mineral associations, 77% of the total PGEs (+Au-phases) observed are associated with sulphides (mainly occluded or attached to chalcopyrite or pentlandite), 21% is occluded in silicates (usually in close proximity to sulphides), and only 2% occur on the boundary between silicate minerals and chromite.  Microscopic observation indicates that PGEs (+Au-phases) concluded in silicate minerals occur mainly in the alteration silicates and in interstitial silicate phases i.e. talc, chlorite, quartz, amphibole and phlogopite.
Grain-Size Distribution
With regard to the grain size distributions, nearly 40% of the total PGEs are sulphides that are larger than 1000 µm 2 in size.  Approximately 75% of the observed PGEs are larger than 100 µm 2 in size.  It was also noted that the Te-, Sb- and Bi-bearing PGEs are generally smaller than the sulphides.  The largest PGE particle observed was measured at ~5000 µm 2 .  Only 2 particles were measured at less than 1000 µm 2 , but this accounted for nearly 37% of total PGEs observed.
The sulphide and PGE composition of the composite sample is normal for the Merensky Reef.  The most significant observations resulting from these processes are:
·
the formation of deleterious alteration products such as talc and chlorite which will tend to dilute grades of flotation concentrates, and affect the milling and filtration characteristics of the ore; and
·
alteration tends to disaggregate primary sulphides (and PGEs) in situ, to form very fine disseminated clusters within alteration silicates, which will require finer grinding to achieve effective liberation.

 

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DRILLING
Type of Drilling
The type of drilling being conducted on the WBJV is a diamond-drilling core-recovery technique involving a BQ-size solid core extraction.  The drilling is placed on an unbiased 500 m x 500 m grid and detailed when necessary to a 250 m x 250 m grid.  Three deflections were drilled for boreholes which intersected the Merensky Reef or UG2 CL, and all of these deflections were assayed.  Drilling at the Project 3 Area was still ongoing at the time of writing of the Project 3 Report.
Procedures, Summary and Interpretation of Results
The results of the drilling and the general geological interpretation are digitally captured in SABLE and a GIS software package named ARCVIEW.  The exact borehole locations, together with the results of the economic evaluation, are plotted on plan.  From the geographic location of the holes drilled, regularly spaced sections are drawn by hand and digitised.  This information was useful for interpreting the sequence of the stratigraphy intersected as well as for verifying the borehole information.
Comment on True and Apparent Widths of the Mineralised Zones
The geometry of the deposit has been clearly defined in the sections drawn through the property.  All holes were drilled vertically and the down hole surveys indicate very little deviation.  A three-dimensional surface – digital terrain model (“ DTM ”) – was created and used in the calculation of the average dip of 10°.  This dip has been factored into the calculations on which resource estimates are based.
Comment on the Orientation of the Mineralised Zones
The mineralised zones within the Project 3 area include the Merensky Reef and the UG2 CL, both of which are planar tabular ultramafic precipitants of a differentiated magma and therefore form a continuous sheet-like accumulate.
The stratigraphic markers above and below the economic horizons have been recognised and facilitate recognition of the Merensky Reef and the UG2 CL.  There are a few exceptions to the quality of recognition of the stratigraphic sequences.  These disruptions are generally of a structural nature and are to be expected within this type of deposit.
In some boreholes no clear stratigraphic recognition was possible.  These holes were excluded from resource calculations.
SAMPLING METHOD AND APPROACH
Sampling Method, Location, Number, Type and Size of Sampling
The first step in the sampling of the diamond-drilled core is to mark the core from the distance below collar in 1 m units and then for major stratigraphic units.  Once the stratigraphic units are identified, the economic units – Merensky Reef and UG2 CL – are marked.  The top and bottom contacts of the reefs are clearly marked on the core.  Thereafter the core is rotated in such a manner that all lineations pertaining to stratification are aligned to produce a representative split.  A centre cut line is then drawn lengthways for cutting.  After cutting, the material is replaced in the core trays.  The sample intervals are then marked as a line and a distance from collar.
The sample intervals are typically 15 – 25 cm in length.  In areas where no economic zones are expected, the sampling interval could be as much as a metre.  The sample intervals are allocated a sampling number, and this is written on the core for reference purposes.  The half-core is then removed and placed into high-quality plastic bags together with a sampling tag containing the sampling number, which is entered onto a sample sheet.  The start and end depths are marked on the core with a corresponding line.  The duplicate tag stays as a permanent record in the sample booklet, which is secured on site.  The responsible project geologist then seals the sampling bag.  The sampling information is recorded on a specially designed sampling sheet that facilitates digital capture into the SABLE system (commercially available logging software).  The sampling extends for about a metre into the hangingwall and footwall of the economic reefs.

 

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Drilling Recovery
All reef intersections that are sampled require a 100% core recovery.  If less than 100% is recovered, the drilling company will re-drill, using a wedge to achieve the desired recovery.
Sample Quality and Sample Bias
The sampling methodology accords with PTM protocol based on industry-accepted best practice.  The quality of the sampling is monitored and supervised by a qualified geologist.  The sampling is done in a manner that includes the entire economic unit together with hanging wall and footwall sampling.  Sampling over-selection and sampling bias is eliminated by rotating the core so that the stratification is vertical and by inserting a cutline down the centre of the core and removing one side of the core only.
Widths of Mineralised Zones – Resource Cuts
The Merensky Reef resource width is on average 114 cm thick and the UG2 CL is on average 116 cm thick.  A minimum resource width of 80 cm was selected.  Although the average widths are more than 1 m, there are a significant number of reef intersections less than 1 m; reef intersections more than 80 cm were kept as is.
The Merensky resource width (used as reef width) is defined as the upper chrome seam defines the upper limit of the resource cut.  If the upper sample plus reef is less than 80 cm then sample in the footwall was added to define a minimum of as close as possible to a 80 cm resource cut.
The UG2 CL resource width (used as reef width) is defined as the reef width and if the reef width was less than 80 cm then samples were added in the hanging wall to define a minimum width of as close to 80 cm as possible.  Reef intersections more than 80 cm were kept as is.
SAMPLE PREPARATION, ANALYSES AND SECURITY
Persons Involved in Sample Preparation
Drilled core is cleaned, de-greased and packed into metal core boxes by the drilling company.  The core is collected from the drilling site on a daily basis by a PTM-SA geologist and transported to the exploration office by PTM-SA personnel.  Before the core is taken off the drilling site, the depths are checked and entered on a daily drilling report, which is then signed off by PTM-SA.  The core yard manager is responsible for checking all drilled core pieces and recording the following information:
·
drillers’ depth markers (discrepancies are recorded);
·
fitment and marking of core pieces;
·
core losses and core gains;
·
grinding of core;
·
one-meter-interval markings on core for sample referencing; and
·
rechecking of depth markings for accuracy.

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Core sampling is carried out by a qualified geologists under the supervision of the project geologist, who is responsible for timely delivery of the samples to the relevant laboratory.  The supervising and project geologists ensure that samples are transported by PTM-SA contractors.
Sample Preparation, Laboratory Standards and Procedures
When samples are prepared for shipment to the analytical facility the following steps are followed:
·
samples are sequenced within the secure storage area and the sample sequences examined to determine if any samples are out of order or missing;
·
the sample sequences and numbers shipped are recorded both on the chain-of-custody form and on the analytical request form;
·
the samples are placed according to sequence into large plastic bags (the numbers of the samples are enclosed on the outside of the bag with the shipment, waybill or order number and the number of bags included in the shipment);
·
the chain-of-custody form and analytical request sheet are completed, signed and dated by the project geologist before the samples are removed from secured storage.  The project geologist keeps copies of the analytical request form and the chain-of-custody form on site; and
·
once the above is completed and the sample shipping bags are sealed, the samples may be removed from the secured area.  The method by which the sample shipment bags have been secured must be recorded on the chain-of-custody document so that the recipient can inspect for tampering of the shipment.
For the present database, field samples have been analyzed by three different laboratories: ALS Chemex (South Africa), Genalysis (Australia) and currently Set Point laboratories (South Africa).  Samples from borehole WBJV008 onwards were sent to the Set Point Laboratory preparation facility at Mokopane.
Transportation from their preparation laboratory in Mokopane to their laboratory in Johannesburg was done under secure conditions as required by PTM-SA.  Dr. B. Smee has accredited Set Point Laboratories.
Samples are received, sorted, verified and checked for moisture and dried if necessary.  Each sample is weighed and the results are recorded.  Rocks, rock chips or lumps are crushed using a jaw crusher to less than 10 mm.  The samples are then milled for 5 minutes in a Labtech Essa LM2 mill to achieve a fineness of 90% less than 106 µm, which is the minimum requirement to ensure the best accuracy and precision during analysis.
Samples are analysed for 4E by standard 25 g lead fire-assay using silver as requested by a co-collector to facilitate easier handling of prills as well as to minimise losses during the cupellation process.  Although collection of three elements (platinum, palladium and gold) is enhanced by this technique, the contrary is true for rhodium, which volatilises in the presence of silver during cupellation.  Palladium is used as the co-collector for rhodium analysis.  The resulting prills are dissolved with aqua regia for Inductively Coupled Plasma (“ ICP ”) analysis.

 

- 16 -

After pre-concentration by fire assay and microwave dissolution, the resulting solutions are analysed for gold and PGEs by the technique of ICP-OES (inductively coupled plasma–optical emission spectrometry).
Quality Assurance and Quality Control (“QA&QC”) Procedures and Results
The PTM-SA protocols for quality control are as follows:
·	the project geologist (Mr. M. Rhentho) oversees the sampling process;
·	the core yard manager (Mr. I. Ernest) oversees the core quality control;
·	the exploration geologists (Ms. T. Saindi and Ms. T. Thapelo) and the sample technician (Mr. L.J. Selaki) is responsible for the actual sampling process;
·	the project geologist oversees the chain of custody;
·	the internal qualified person (“QP”) (Mr. W. Visser) verifies both processes and receives the laboratory data;
·	the internal resource geologist (Mr. T. Botha) and the database manager (Mr. M. Rhantho) merge the data and produce the SABLE sampling log with assay values;
·	together with the project geologist, the resource geologist determines the initial resource cut;
·	the external auditor (Mr. N. Williams) verifies the sampling process and signs off on the resource cut;
·	the second external database auditor (Ms. H. Sternberg) verifies the SABLE database and highlights QA&QC failures;
·	Ms. R. de Klerk (Maxwell Datashed) runs the QA&QC graphs (standards, blanks and duplicates) and reports anomalies and failures to the internal QP;
·	the internal QP requests re-assays; and
·	check samples are sent to a second laboratory to verify the validity of data received from the first laboratory.
Standards
The following analytical standards were used to assess the accuracy and possible bias of assay values for platinum and palladium.  Rhodium and gold were monitored where data for the standards were available, but standards were not failed on rhodium and gold alone.
Standards used for QA&QC

Standard type	Pt	Pd	Rh	Au	
CDN-PGES-5	Yes	Yes	-	-	
CDN-PGES-6	Yes	Yes	-	Yes	
CDN-PGES-7	Yes	Yes	-	Yes	
CDN-PGES-11	Yes	Yes	-	Yes	
AMIS0005	Yes	Yes	Yes	-	
AMIS0007	Yes	Yes	Yes	-	
AMIS0010	Yes	Yes	-	-	

 

- 17 -
 
Generally, the standards are inserted in place at the fifteenth sample site in the sample sequence.  The standards are stored in sealed containers and considerable care is taken to ensure that they are not contaminated in any manner (e.g. through storage in a dusty environment, being placed in a less than pristine sample bag or being in any way contaminated in the core saw process).
Assay testing refers to round robin programmes involving collection and preparation of material of varying matrices and grades, to provide homogeneous material for developing reference materials (standards) necessary for monitoring assaying.  Assay testing is also useful in ensuring that analytical methods are matched to the mineralogical characteristics of the mineralisation being explored.  Samples are sent to a sufficient number of international testing laboratories to provide enough assay data to statistically determine a representative mean value and standard deviation necessary for setting acceptance/rejection tolerance limits.
Tolerance limits are set at two and three standard deviations from the round robin mean value of the reference material.  A single analytical batch is rejected for accuracy when reference material assays are beyond three standard deviations from the certified mean, and any two consecutive standards within the same batch are rejected on the basis of bias when both reference material assays are beyond two standard deviations limit on the same side of the mean.  Reasons why standards failed may include database errors, selection of wrong standards in the field, sample mis-ordering errors and bias from the laboratory.  A failed standard is considered to be cause for re-assay if it falls within a determined resource cut for either the Merensky Reef or UG2 CL (MRMC and UG2MC).  The bulk of the economic value of the reefs is located within the combined value for platinum and palladium, with rhodium and gold comprising only 10% of the 4E value.  As requested by a result, standards that failed for rhodium and/or gold (rhodium evaluated for AMIS0005, AMIS0007 and AMIS0010 standards; gold evaluated for CDN-PGES-5, 6, 7 and 11) are not included in the final results as the influence is deemed as not of material economic value.
Blanks
The insertion of blanks provides an important check on the laboratory practices, especially potential contamination or sample sequence mis-ordering.  Blanks consist of a selection of Transvaal Quartzite pieces (devoid of platinum, palladium, copper and nickel mineralisation) of a mass similar to that of a normal core sample.  The blank being used is always noted to track its behaviour and trace metal content.  Typically the first blank is sample 5 in a given sampling sequence.
Duplicates
The purpose of having field duplicates is to provide a check on possible sample over-selection.  The field duplicate contains all levels of error core or reverse-circulation cutting splitting, sample size reduction in the prep lab, sub-sampling at the pulp, and analytical error.
No duplicate samples were assayed for Project 3.

 

- 18 -

Assay Validation
Although samples are assayed with reference materials, an assay validation programme is being conducted to ensure that assays are repeatable within statistical limits for the styles of mineralisation being investigated.  It should be noted that validation is different from verification; the latter implies 100% repeatability.  The assay validation programme entails:
·
a re-assay programme conducted on standards that failed the tolerance limits set at two and three standard deviations from the round robin mean value of the reference material;
·
ongoing blind pulp duplicate assays at Set Point Laboratory; and
·
check assays conducted at an independent assaying facility (Genalysis).
Adequacy of Sampling Procedures, Security and Analytical Procedures
Sampling Procedures
The QA&QC practice of PTM-SA is a process beginning with the actual placement of the borehole position (on the grid) and continuing through to the decision for the 3D economic intersection to be included in (passed into) the database.  The values are also confirmed, as well as the correctness of correlation of reef/resource cut so that populations used in the geostatistical modelling are not mixed; this makes for a high degree of reliability in estimates of resources/reserves.
The author of the Project 3 Report relied on subordinate qualified persons for the following:
·
correct sampling procedures (marking, cutting, labelling and packaging) were followed at the exploration office and accurate recording (sample sheets and digital recording in SABLE) and chain-of-custody procedures were followed;
·
adequate sampling of the two economic horizons (Merensky Reef and UG2 CL) was done;
·
preparations by PTM-SA field staff were done with a high degree of precision and no deliberate or inadvertent bias;
·
correct procedures were adhered to at all points from field to database;
·
PTM-SA’s QA&QC system meets or exceeds the requirements of NI 43-101 and mining best practice; and
·
the estimates provided for the Merensky Reef and UG2 CL are a fair and valid representation of the actual in-situ value.
The QP’s view is supported by Mr N Williams, who audited the whole process (from field to database), and by Ms H Sternberg, who regularly audited the SABLE database for correct entry and integrity and also verifies the standards, blanks and duplicates within the database as a second check to the QA&QC graphs run by Ms R de Klerk.
Security
Samples are not removed from secured storage location without completion of a chain-of-custody document; this forms part of a continuous tracking system for the movement of the samples and persons responsible for their security.  Ultimate responsibility for the secure and timely delivery of the samples to the chosen analytical facility rests with the project geologist and samples are not transported in any manner without the project geologist’s permission.

 

- 19 -

During the process of transportation between the project site and analytical facility the samples are inspected and signed for by each individual or company handling the samples.  It is the mandate of both the supervising and project geologist to ensure secure transportation of the samples to the analytical facility.  The original chain-of-custody document always accompanies the samples to their final destination.
DATA VERIFICATION
Quality Control Measures and Data Verification
All scientific information is manually captured and digitally recorded.  The information derived from the core logging is manually recorded on A4-size logging sheets.  After being captured manually, the data is electronically captured in a digital logging program (SABLE).  For this exercise the program has very specific requirements and standards.  Should the entered data not be in the set format the information is rejected.  This is the first stage of the verification process.
After the information is transferred into SABLE, the same information is transferred into a modelling package (DATAMINE).  Modelling packages are rigorous in their rejection of conflicting data (e.g. the input is aborted if there are any overlaps in distances or inconsistencies in stratigraphic or economic horizon nomenclature).  This is the second stage of verification.  Once these stages of digital data verification are complete, a third stage is generated in the form of section construction and continuity through DATAMINE.  The lateral continuity and the packages of hanging wall and footwall stratigraphic units must align or be in a format consistent with the general geometry.  If this is not the case, the information is again aborted.
The final stage of verification is of a geostatistical nature, where population distributions, variance and spatial relationships are considered.  Anomalies in grade, thickness, isopach or isocon trends are noted and questioned.  Should inconsistencies and varying trends be un-explainable, the base data is again interrogated, and the process is repeated until a suitable explanation is obtained.
Verification of Data
The geological and economic base data has been verified by Ms. H. Sternberg and has been found to be acceptable.
Nature of the Limitations of Data Verification Process
As with all information, inherent bias and inaccuracies can and may be present.  Given the verification process that has been carried out, however, should there be a bias or inconsistency in the data, the error would be of no material consequence in the interpretation of the model or evaluation.  The data is checked for errors and inconsistencies at each step of handling.  The data is also rechecked at the stage where it is entered into the deposit-modelling software.  In addition to ongoing data checks by project staff, the senior management and directors of PTM-SA have completed spot audits of the data and processing procedures.  Audits have also been done on the recording of borehole information, the assay interpretation and final compilation of the information.  The individuals in PTM-SA’s senior management and certain directors of the company who completed the tests and designed the processes are non-independent mining or geological experts.

 

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MINERAL RESOURCE ESTIMATES
Standard Resource and Reserve Reporting System
The author has classified the mineral resources according to the South African Code for Reporting of Mineral Resources and Mineral Reserves (“ SAMREC Code ”).  The Project 3 Report deals primarily with the mineral resources.  No mineral reserves have been classified.  Indicated and inferred mineral resources have been classified.  No addition of the inferred mineral resources to other mineral resource categories has occurred.
Relationship of the QP to the Company
Apart from having been contracted to compile this report, the QP, Mr. Charles J. Muller, has no commercial or other relationship with the Company.
Detailed Mineral Resource Tabulation
From the interpolated block model, indicated and inferred mineral resources were estimated.  Table 4 shows the tonnage and grade for each reef at specific cut-off grades for the 4Es (cm.g/t).  The cut-off grade categories are based on content as the interpolation was carried out on content, as was the mechanism for the change of support or post processing.
Indicated Mineral Resource for UG2 CL and Merensky Reef at Project 3

Indicated Mineral Resource (4E)	Cut-off (cm.g/t) 4E	Million Tonne	Grade 4E (g/t)	Potential Resource Width (m)	Tons PGE
(4E)	Moz PGEs (4E)	
Project 3 MR	100	5.157	6.03	1.14	31.097	0.999	
Project 3 UG2 CL	100	5.947	4.91	1.16	29.199	0.939	
Total Indicated	100	11.104	5.43	1.15	60.296	1.938	

Inferred Mineral Resource for the Merensky Reef at Project 3

Inferred Mineral Resource (4E)	Cut-off (cm.g/t) 4E	Million Tonne	Grade 4E (g/t)	Potential Resource Width (m)	Tons PGE
(4E)	Moz PGEs (4E)	
Project 3 MR	100	0.443	1.47	1.14	0.651	0.021	
Total Inferred	100	0.443	1.47	1.14	0.651	0.021	

MR = Merensky Reef; UG2 CL = Upper Group No. 2 chromitite seam; PGE = Platinum Group Metals.
The cut-offs for Indicated and Inferred Mineral Resources have been established by a qualified person after a review of potential operating costs and other factors.
Tonnes discount for geological loss (14%) and dip.
Due to rounding, columns may not add up.

Prill Splits	Pt	Pt (g/t)	Pd	Pd (g/t)	Rh	Rh (g/t)	Au	Au (g/t)	
Project 3 MR	64%	4.01	27%	1.69	4%	0.25	5%	0.31	
Project 3 UG2 CL	62%	3.42	28%	1.54	9%	0.50	1%	0.06	

A cut-off grade of 100cm.g/t was selected as a resource cut-off.  The reason for using the 100cm.g/t cut-off is in compliance with responsible engineering practice to simulate probable working cost and flow of ore parameters, in order to report potentially economical resources.  The mineral resources are estimated by the kriging method of resource estimation.  In keeping with best practice in resource estimation, an allowance for known and expected geological losses (14%) is made.
Key Assumptions, Parameters and Methods of Resource Calculation
The following table details the number of boreholes used in the estimation of the mineral resources:

 

- 21 -

Borehole Intercepts used in the estimation of the Mineral Resources

Data	Valid MR intercepts used for Model	Valid UG2 CL intercepts used for Model	
No. of intercepts for Project 3	37	30	

Resource widths and 4E grades used in the resource estimation exercises are depicted in the diagrams below.  The available borehole data was obtained from PTM-SA.  In the evaluation process the metal content (4E cm.g/t) and resource width (cm) values are used.  The resource cut width refers to the corrected width.  The values have been interpolated into a 2D block model.  The 4E grade (g/t) has been calculated from the interpolated content and resource width values.  For modelling purposes on Project 3, the Merensky Reef was divided into two geological domains and the UG2 CL consists of two domains (Figure 6).  Grade and resource width estimates were calculated within specific geological domains.
Statistical Analysis
Descriptive statistics in the form of histograms (frequency distributions) and probability plots (to evaluate the normality of the distribution of a variable) were used to develop an understanding of the statistical relationships.  Skewness is a measure of the deviation of the distribution from symmetry (0 = no skewness).  Kurtosis measures the "peakedness" of a distribution (3 = normal distribution).
No corrections were made (top cut etc.) to the data and the statistical analyses show the expected relationships for these types of reef.
Variography
Variograms are a useful tool for investigating the spatial relationships of samples.  Variograms for channel width (cm), 4E cm.g/t and 4E, per domains, were modelled during the estimation process.
All variograms are omni-directional spherical semi-variograms.  The 4E content and resource cut width variograms, have a modelled grade continuity range of ~270-700 m for the Merensky Reef and a modelled grade continuity range of ~245-600 m for the UG2 CL.  The nugget effect is on average 35% of the sill or population variance for the Merensky Reef and 31% for the UG2 CL.  No top-cuts were used for the generation of the experimental variograms.
Grade Estimation
Full reef composite data – resource cut width (cm) and 3PGE_Au content (cm.g/t) (CM4E) were estimated for both the Merensky Reef and UG2 CL.  Both simple kriging (“ SK ”) and ordinary kriging (“ OK ”) techniques have been used.  Specific to the Project 3 it has been shown that the SK technique is more efficient when limited data are available for the estimation process.
The 4E grade concentration (g/t) was calculated from the interpolated kriged 4E content (cm.g/t) and resource width (cm) values.  Detailed checks were carried out to validate kriging outputs, including input data, kriged estimates and kriging efficiency checks.
The simple kriging process uses a local or global mean as a weighting factor.  For this exercise all blocks within a specific domain have been assigned a global mean for that domain.  Ordinary kriging balances the kriging weights to one without the use of a local/global mean, whereas, simple kriging introduces the local/global mean in the balancing of the equations.
The following parameters were used in the kriging process for both project areas:
·
Full reef composite data – resource cut width (cm) and content (CM4E / 4E cm.g/t);

 

- 22 -

·
200 m x 200 m x 1 m block size;
·
Discretisation 5 x 5 x 1 for each 200 m x 200 m x 1 m block;
·
First search volume – 850 m:
o
minimum number of samples 4;
o
maximum number of samples 40;
·
Second search volume – 5 times the first search volume:
o
minimum number of samples 2;
o
maximum number of samples 40;
·
Third search volume:
o
minimum number of samples 1;
o
maximum number of samples 20;
·
Interpolation methods – simple kriging; and
·
Local / global mean values used in the simple kriging process.
The first 50 m of the ore body is considered to represent a weathered zone and is discarded in the modelling and estimation procedures.
The kriged estimates were post-processed to calculate the information effect, dispersion variance and grade tonnage intervals.  The UG2 CL conformed to a log-normal distribution and was post-processed accordingly.  However, the Merensky Reef displayed a strongly normal distribution and hence the post-processing conducted on the reef was undertaken in normal space.  With further information, the log-normal post-processing of the UG2 CL should be reviewed.  The 4E cut-off values used ranged from 100–600 cm.g/t.  An average dip value of 10° was used for estimation of resources at Project 3.
Post Processing
During early stages of projects the data is invariably on a relatively large grid.  This grid is much larger than the block size of a selective mining interest (i.e., selective mining units (“ SMU ”)).  Efficient kriging estimates for SMUs or of much larger blocks units will then be smoothed due to information effect or size of blocks.  Any mine plan or cash flow calculations made on the basis of the smoothed kriged estimates will misrepresent the economic value of the project (i.e., the average grade above cut-off will be underestimated and the tonnage overestimated).  Some form of post processing is required to reflect the realistic tonnage grade estimates for respective cut-offs.  Using the limited data available preliminary post-processed analysis has been done.
An SMU of 20 m x 40 m was selected with an expected future underground sampling configuration on a 20 m x 20 m grid.  Information effects were calculated based on the SMU and the expected future production underground sampling configuration.
Within the parent blocks of 200 m x 200 m x 1 m, the distribution of SMUs has been estimated for various cut-offs.  The latter for the UG2 CL has been estimated using lognormal distribution of SMUs within the large parent blocks – 200 m x 200 m x 1 m.  This technique for post processing has been used based on the observed lognormal distribution of the underlying 4E values in the Project 3 area (i.e., the indirect lognormal post-processing technique has been used for the change of support analysis).  The Merensky Reef has been estimated using a normal distribution of SMUs within the large parent blocks – 200 m x 200 m x 1 m.

- 23 -

For each parent block the grade, tonnage and metal content above respective cut-offs (based on the SMUs) were translated into parcels to be used for mine planning.  Grade tonnage curves were therefore calculated for each parent block.  The following cut-offs were considered 100, 200, 300, 400, 500 and 600cm.g/t as detailed in the tables below.
Cut-off Grades for Merensky Reef Indicated Resource Estimation

Cut-Off (4E)	Tonnage	                                                      4E                                    	
cm.g/t	t	g/t	grams	Moz	
0.00	5,180,884	6.00	31,085,304	0.999	
100.00	5,156,829	6.03	31,095,678	0.999	
200.00	5,095,600	6.08	30,981,248	0.996	
300.00	4,960,795	6.19	30,707,321	0.987	
400.00	4,704,239	6.37	29,966,002	0.963	
500.00	4,282,028	6.63	28,389,845	0.913	
600.00	3,680,784	6.97	25,655,064	0.825	

Cut-off Grades for Merensky Reef Inferred Resource Estimation

Cut-Off (4E)	Tonnage	               4E	
cm.g/t	t	g/t	grams	Moz	
0.00	1,965,010	1.47	2,888,564	0.093	
100.00	443,046	5.34	2,365,865	0.076	
200.00	401,023	5.75	2,305,882	0.074	
300.00	362,481	6.11	2,214,758	0.071	
400.00	325,475	6.44	2,096,059	0.067	
500.00	286,363	6.79	1,944,404	0.063	
600.00	242,197	7.19	1,741,396	0.056	

Cut-off Grades for UG2 CL Indicated Resource Estimation

Cut-Off (4E)	Tonnage	             4E	
cm.g/t	t	g/t	grams	Moz	
0.00	6,270,309	4.70	29,470,452	0.947	
100.00	5,947,286	4.91	29,201,174	0.939	
200.00	5,334,503	5.30	28,272,865	0.909	
300.00	5,108,323	5.43	27,738,193	0.892	
400.00	4,972,271	5.48	27,248,045	0.876	
500.00	4,434,979	5.67	25,146,330	0.808	
600.00	3,247,228	6.07	19,710,673	0.634	

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A SG of 3.21t/m3 was used for the Merensky Reef and 3.85t/m3 for the UG2 CL tonnage calculations.  SG values are average values based on measured values for specific reef intersections.
Resource Classification
The mineral resource classification is a function of the confidence of the whole process from drilling, sampling, geological understanding and geostatistical relationships.  The following aspects or parameters were considered for resource classification:
·
Sampling – Quality Assurance / Quality Control
o
Measured:  high confidence, no problem areas
o
Indicated:  high confidence, some problem areas with low risk
o
Inferred: some aspects might be of medium to high risk
·
Geological Confidence
o
Measured:  high confidence in the understanding of geological relationships, continuity of geological trends and sufficient data
o
Indicated:  good understanding of geological relationships
o
Inferred:  geological continuity not established
·
Number of samples used to estimate a specific block
o
Measured:  at least 4 boreholes within semi-variogram range and minimum of twenty 1 m composited samples
o
Indicated:  at least 3 boreholes within semi-variogram range and a minimum of twelve 1 m composite samples
o
Inferred:  less than 3 boreholes within the semi-variogram range
·
Kriged variance
o
This is a relative parameter and is only an indication and used in conjunction with the other parameters
·
Distance to sample (semi-variogram range)
o
Measured:  at least within 60% of semi – variogram range
o
Indicated:  within semi-variogram range
o
Inferred:  further than semi-variogram range
·
Lower confidence limit (blocks)
o
Measured:  less than 20% from mean (80% confidence)
o
Indicated:  20% – 40% from mean (80% – 60% confidence)
o
Inferred:  more than 40% (less than 60% confidence)
·
Kriging Efficiency
o
Measured:  more than 40%
o
Indicated:  20 – 40%
o
Inferred:  less than 20%

 

- 25 -

·
Deviation from lower 90% confidence limit (data distribution within resource area considered for classification)
o
Measured:  less than 10% deviation from the mean;
o
Indicated:  10 – 20% deviation from the mean
o
Inferred:  less than 20% deviation from the mean
Using the above criteria, the Merensky Reef and UG2 CL within the Project 3 area was classified as indicated and inferred mineral resources.  Inferred mineral resources are classified, under the SAMREC Code, as follows:
An “Inferred Mineral Resource” is that part of a Mineral Resource for which volume and/or tonnage, grade and mineral content can be estimated with a low level of confidence.  It is inferred from geological evidence and sampling and assumed but not verified geologically and/or through analysis of grade continuity.  It is based on information gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings and drill holes that may be limited in scope or of uncertain quality and reliability.
An Inferred Mineral Resource has a lower level of confidence than that applying to an Indicated Mineral Resource.
No account of any modifying factors such as taxation, socio-economic, marketing or political factors have been taken into account.  No environmental, permitting, legal or title factors will affect the estimated mineral resource.
OTHER RELEVANT DATA AND INFORMATION
The economic viability of the Mineral Resources declared in this report has not been demonstrated.  Such deductions can only be made once, among other things, at least financial and working cost estimates are applied to these resources.
RSA Reserve and Resource Declaration Rules
The SAMREC Code sets out minimum standards, recommendations and guidelines for public reporting of Mineral Resources and Mineral Reserves in South Africa.  Documentation prepared for public release must be done by or under the direction of, and signed by, a competent QP.  A QP is a person who is a member of the South African Council for Natural Scientific Professions (SACNASP) or the Engineering Council of South Africa (ECSA) or any other statutory South African or international body that is recognised by SAMREC.  A QP should have a minimum of five years experience relevant to the style of mineralisation and type of deposit under consideration.
A Mineral Resource is a concentration (or occurrence) of material of economic interest in or on the earth’s crust in such form, quality and quantity that there are, in the opinion of the QP, reasonable and realistic prospects for eventual economic extraction.
INTERPRETATION AND CONCLUSIONS
Results
Indicated and inferred resources have been estimated for the Project 3 area.  There is insufficient data in Merensky Reef Domain 2, which has been classified as inferred mineral resource, to classify the area into a higher resource category.

 

- 26 -

Interpretation of the Geological Model
The stratigraphy of the Project 3 area is well understood and specific stratigraphic units could be identified in the borehole core.  The Merensky Reef and UG2 CL could be recognised in the core and are correlatable across the Project 3 area.  It was possible to interpret major structural features from the borehole intersections as well as from geophysical information.
Evaluation Technique
The evaluation of the Project 3 was done using best practices.  Simple kriging was selected as the best estimate for the specific borehole distribution.  Change of support (SMU) was considered for the initial large estimated parent blocks with specific cut-off grades.
Reliability of the Data
The PTM-SA data was specifically inspected by Mr. Muller and found to be reliable and consistent.    
Strengths and Weaknesses with respect to the Data
The regular QA&QC process carried out by PTM-SA is of a high standard and applies to the full audit trail from field data to resource modelling.  The data have been found to be accurate, consistent and well structured.  The system of support for the digital data by paper originals and chain-of-custody and drilling records is well developed.  Additional drilling will have to be carried out in order to increase the confidence in the resource estimate in the Project 3 area.
Objectives of adherence to the Scope of Study
The intention of this phase of the work programme was to establish the resource cut estimation for Project  3 area.  This has been achieved and thus the objectives of the programme have been met.
Recommendations
For the indicated mineral resources to be potentially upgraded, infill drilling can be considered.  After completion of the drilling and the subsequent QA&QC, the additional data will be incorporated into the current model as presented in this document.
EXERCISE OF WARRANTS
Three shareholders of the Company exercised a total of 3,308,400 common share purchase warrants at a price of $1.75 per share for proceeds of $5,789,700.
5.2
Disclosure for Restructuring Transactions
N/A
Item 6
Reliance on subsection 7.1(2) of National Instrument 51-102
N/A
Item 7
Omitted Information
N/A
 
Item 8
Executive Officer
The following senior officer of the Company is knowledgeable about the material change and this report:
Frank R. Hallam
Chief Financial Officer
Tel:  (604) 899-5450
Item 9
Date of Report
October 5, 2010

 

 

FORM 51-102F3

MATERIAL CHANGE REPORT

Item 1
Name and Address of Company
Platinum Group Metals Ltd. (“Platinum Group”)
328 – 550 Burrard Street Vancouver BC, V6C 2B5
Telephone: (604) 899-5450 / Facsimile: (604) 484-4710

Item 2
Date of Material Change
October 1, 2010
Item 3
Press Release
A news release announcing the material change was issued on October 1, 2010 for distribution through Marketwire.
Item 4
Summary of Material Change
Platinum Group reports equity financings of up to C$125,050,000.
Item 5
Full Description of Material Change
5.1
Full Description of Material Change
Platinum Group reports that it has entered into an agreement with a syndicate of underwriters led by BMO Capital Markets, GMP Securities L.P. and RBC Capital Markets, under which the underwriters have agreed to buy on a bought deal basis by way of a short form prospectus, 61,000,000 common shares (the "Common Shares"), at a price of C$2.05 per Common Share for gross proceeds of C$125,050,000 (the "Offering"). Platinum Group will grant the underwriters an option, exercisable up until 30 days following closing of the Offering, to purchase up to an additional 15% of the Common Shares at the issue price to cover over-allotments and for market stabilization purposes.  The Offering constitutes an increase to the equity financing announced earlier on October 1, 2010, in which 49,000,000 common shares were to have  been offered for gross proceeds of C$100,000,000, with all other terms to have been the same as those of the Offering.
The Offering is expected to close on or about October 22, 2010 and is subject to Platinum Group receiving all necessary regulatory approvals.
The underwriters will receive a cash commission of 5.5% of the gross proceeds raised under the Offering.

- 2 -

Platinum Group intends to use the net proceeds of the offering to fund a payment to a subsidiary of Platinum Group in connection with the shareholders agreement with Wesizwe Platinum of approximately C$60.1 million to increase the Company's interest in Project 1 of the Western Bushveld Joint Venture from 54.75% to 74%, continued development of WBJV Project 1 and for general corporate purposes.
The Company has completed an extensive strategic review of its options and has considered alternatives including a sale or merger of the Company, partnerships and the creation of a platinum stream. At this time the Company believes that the best option is to complete this proposed offering and advance its key project the WBJV Project 1, while keeping all strategic options open.
The securities offered have not been registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements.  
5.2
Disclosure for Restructuring Transactions
N/A
Item 6
Reliance on subsection 7.1(2) of National Instrument 51-102
N/A
Item 7
Omitted Information
N/A
Item 8
Executive Officer
The following senior officer of the Company is knowledgeable about the material change and this report:
Frank R. Hallam
Chief Financial Officer
Tel:  (604) 899-5450

Item 9
Date of Report
October 5, 2010

Platinum Group Metals Ltd.
(Exploration and Development Stage Company)
Restated Consolidated Financial Statements (Unaudited)
For the third quarter ended May 31, 2010

Filed: October 6, 2010

A copy of this report will be provided to any shareholder who requests it.

 
			
 	Platinum Group Metals Ltd.	
(An exploration and development stage company)	
 	For the quarter ended May 31, 2010	

							
PLATINUM GROUP METALS LTD.	 	 	 	 	
(An exploration and development stage company)	 	 	 	 	
Restated Consolidated Balance Sheets	 	 	 	Unaudited	 	 	
(expressed in Canadian dollars)	 	 	 	May 31, 2010	 	Aug. 31, 2009	
ASSETS	 	 	 	(Restated - Note14)	 	 	
 	 	 	 	 	 	 	
CURRENT	 	 	 	 	 	 	
Cash and cash equivalents	 	 	 	 $ 4,782,350 	 	 $ 32,965,685 	
Amounts receivable (Note 3)	 	 	 	  415,656 	 	  344,538 	
Available-for-sale securities (Note 4)	 	 	 	  -   	 	  2,135,002 	
Due from WBJV partners	 	 	 	  -   	 	  988,880 	
Due from JOGMEC partner (Note 5(b))	 	 	 	  99,439 	 	  224,482 	
Prepaid expenses and other assets	 	 	 	  72,049 	 	  50,812 	
Assets held for sale (Note 6(c))	 	 	 	  2,269,220 	 	  -   	
Total current assets	 	 	 	  7,638,714 	 	  36,709,399 	
PERFORMANCE BONDS	 	 	 	  146,111 	 	  137,849 	
INVESTMENT IN WBJV (Note 5(a))	 	 	 	  -   	 	  20,561,154 	
MINERAL PROPERTIES (Note 5(a))	 	 	 	  108,103,738 	 	  6,057,034 	
FIXED ASSETS (Note 6(a))	 	 	 	  331,178 	 	  365,079 	
SURFACE RIGHTS (Note 6(b))	 	 	 	  3,955,602 	 	  3,240,282 	
Total assets	 	 	 	 $ 120,175,343 	 	 $ 67,070,797 	
 	 	 	 	 	 	 	
LIABILITIES	 	 	 	 	 	 	
 	 	 	 	 	 	 	
CURRENT	 	 	 	 	 	 	
Accounts payable and accrued liabilities	 	 	 	 $ 1,195,637 	 	 $ 861,041 	
Due to Wesizwe	 	 	 	  212,822 	 	  -   	
Total Current Liabilities	 	 	 	  1,408,459 	 	  861,041 	
 	 	 	 	 	 	 	
FUTURE INCOME TAXES (Note 14)	 	 	 	  11,900,000 	 	  -   	
Total liabilities	 	 	 	  13,308,459 	 	  861,041 	
 	 	 	 	 	 	 	
NON CONTROLLING INTEREST (Note 5(a))	 	 	 	 $ 11,108,653 	 	 $ - 	
 	 	 	 	 	 	 	
SHAREHOLDERS' EQUITY	 	 	 	 	 	 	
 	 	 	 	 	 	 	
Share capital (Note 7)	 	 	 	  91,730,755 	 	  89,945,316 	
Contributed surplus	 	 	 	  10,953,195 	 	  11,458,915 	
Accumulated other comprehensive income	 	 	 	  (3,507,273)	 	  (975,575)	
Retained earnings (deficit)	 	 	 	  (3,418,446)	 	  (34,218,900)	
Total shareholders' equity	 	 	 	  95,758,231 	 	  66,209,756 	
Total liabilities and shareholders' equity	 	 	 	 $ 120,175,343 	 	 $ 67,070,797 	
CONTINGENCIES AND COMMITMENTS (NOTE 11)	 	 	 	 	 	 	
 	 	 	 	 	 	 	
APPROVED BY THE DIRECTORS:	 	 	 	 	 	 	
"Iain McLean"	 	 	 	 	 	 	
Iain McLean, Director	 	 	 	 	 	 	
 	 	 	 	 	 	 	
"Eric Carlson"	 	 	 	 	 	 	
Eric Carlson, Director	 	 	 	 	 	 	

See accompanying notes to the consolidated financial statements.

 

					
  		 	Platinum Group Metals Ltd.	
 		(An exploration and development stage company)	
 		 	For the quarter ended May 31, 2010	
 		
PLATINUM GROUP METALS LTD.		 	 	 	
(An exploration and development stage company)		 	 	 	
Restated Interim Consolidated Statements of Operations		 	 	 	
(Unaudited)		 	 	 	
(expressed in Canadian dollars)		 	 	 	
	Three Months	Three 
Months	Nine 
Months	Nine 
Months	
	Ended	Ended	Ended	Ended	
	May 31, 2010	May 31, 2009	May 31, 2010	May 31, 2009	
	(Restated - Note 14)	 	(Restated - Note 14)	 	
					
EXPENSES	 	 	 	 	
Amortization	$ 25,027	$ 36,886	$ 80,139	$ 105,681	
Annual general meeting	94	-	52,498	67,530	
Filing and transfer agent fees	6,374	57,427	121,157	101,662	
Foreign exchange loss (gain)	820,940	(26,719)	906,749	(259,540)	
Insurance	23,490	30,496	79,975	90,847	
Management and consulting fees	440,095	147,562	1,089,558	769,610	
News releases, print and mailout	2,587	6,971	34,969	38,730	
Office and miscellaneous	61,432	42,775	157,129	137,105	
Professional fees	742,828	328,997	1,208,601	726,768	
Promotion	71,912	79,609	154,255	175,741	
Rent	49,063	47,023	155,952	140,910	
Salaries and benefits	487,814	434,725	1,333,235	1,284,623	
Shareholder relations	21,946	76,560	140,550	286,271	
Stock compensation expense	-	219,535	137,600	1,394,986	
Telephone	19,221	27,768	50,940	68,941	
Travel	114,219	173,658	329,756	481,090	
Recoveries	(60,545)	(58,307)	(160,434)	(152,835)	
 	(2,826,497)	(1,624,966)	(5,872,629)	(5,458,120)	
Less interest earned	220,145	73,959	432,790	98,233	
Loss for the period before other items	(2,606,352)	(1,551,007)	(5,439,839)	(5,359,887)	
Other items:	 	 	 	 	
Realized gain on available-for-sale securities (Note 4)	82,047	-	2,796,738	-	
Gain on sale of Project #2 (Note 5)	45,619,744	-	45,619,744	-	
Gain on sale of fixed assets	227	-	1,661	-	
Earnings (Loss) for the period before income taxes	43,095,666	(1,551,007)	42,978,304	(5,359,887)	
 	
Future income tax (expense) credit	(11,911,718)	72,200	(12,177,850)	114,960	
Earnings (Loss) for the period	$ 31,183,948	$ (1,478,807)	$ 30,800,454	$ (5,244,927)	
 	
Other comprehensive (loss) income	 	 	 	 	
Realized gain on available-for-sale securities	(47,660)	-	(1,636,252)	-	
Unrealized (loss) gain on available-for-sale	 	 	 	 	
securities (Note 4)	(18,743)	273,701	-	71,401	
Comprehensive earnings (loss) for the period	$ 31,117,545	$ (1,205,106)	$ 29,164,202	$ (5,173,526)	
 	
Basic earnings (loss) per common share	$ 0.33	$ (0.02)	$ 0.33	$ (0.08)	
 	
Diluted earnings (loss) per common share	$ 0.32	$ (0.02)	$ 0.32	$ (0.08)	
 	
Weighted-average number of	 	 	 	 	
common shares outstanding - Basic	93,927,292	67,714,707	93,348,779	67,073,502	
 	
Weighted-average number of	 	 	 	 	
common shares outstanding - Diluted	97,794,583	67,714,707	95,432,692	67,073,502	

See accompanying notes to the consolidated financial statements.

 

 	 	 	 	 	Platinum Group Metals Ltd.	
 	 	 	(An exploration and development stage company)	
 	 	 	 	For the quarter ended May 31, 2010	
 	
PLATINUM GROUP METALS LTD.	 	 	 	 	 	 	
(An exploration and development stage company)	 	 	 	 	 	 	
Restated Consolidated Statements of Shareholders' Equity	 	 	 	 	 	 	
August 31, 2006, to May 31, 2010	 	 	 	 	 	 	
(Unaudited)	 	 	 	 	 	 	
(expressed in Canadian dollars)	 	 	 	 	Retained	 	
 	 	 	 	 	Earnings/Deficit	 	
 	 	 	 	 	accumulated	 	
 	 	 	 	Accumulated	during	 	
 	Common shares	 	other	exploration &	Total	
 	without par value	Contributed	comprehensive	development	shareholders'	
 	Shares	Amount	surplus	income	stage	equity	
 	 	 	 	 	(Restated - Note 14)	(Restated - Note 14)	
Balance, August 31, 2006	53,691,178	39,798,768	1,785,705	(658,381)	(15,410,804)	25,515,288	
Issued on exercise of warrants	6,333,194	11,454,791	-	-	-	11,454,791	
Issued on exercise of stock options	914,375	892,557	(266,982)	-	-	625,575	
Issued for mineral properties net of costs	50,000	227,742	-	-	-	227,742	
Stock options granted	-	-	1,487,661	-	-	1,487,661	
Translation adjustment	-	-	-	(1,707,495)	-	(1,707,495)	
Net loss	-	-	-	-	(6,758,123)	(6,758,123)	
Balance, August 31, 2007	60,988,747	52,373,858	3,006,384	(2,365,876)	(22,168,927)	30,845,439	
Transition adjustment (Note 4)	-	-	-	1,592,901	-	1,592,901	
Issued on exercise of warrants	850,000	1,487,500	-	-	-	1,487,500	
Issued on exercise of stock options	760,500	1,334,748	(512,924)	-	-	821,824	
Issued for mineral properties net of costs	50,000	163,236	-	-	-	163,236	
Stock options granted	-	-	1,288,383	-	-	1,288,383	
Translation adjustment	-	-	-	(674,771)	-	(674,771)	
Unrealized loss on AFS securities	-	-	-	(821,101)	-	(821,101)	
Net loss	-	-	-	-	(5,086,589)	(5,086,589)	
Balance, August 31, 2008	62,649,247	55,359,342	3,781,843	(2,268,847)	(27,255,516)	29,616,822	
Issuance of common shares and warrants for cash	29,969,770	34,174,382	5,288,917	-	-	39,463,299	
Issued on exercise of stock options	196,650	411,592	(129,952)	-	-	281,640	
Stock options granted	-	-	2,518,107	-	-	2,518,107	
Translation adjustment	-	-	-	428,820	-	428,820	
Unrealized gain on AFS securities	-	-	-	864,452	-	864,452	
Net loss	-	-	-	-	(6,963,384)	(6,963,384)	
Balance, August 31, 2009	92,815,667	89,945,316	11,458,915	(975,575)	(34,218,900)	66,209,756	
Issued on exercise of stock options	1,111,625	1,785,439	(670,615)	-	-	1,114,824	
Stock options granted	-	-	164,895	-	-	164,895	
Translation adjustment	-	-	-	(895,448)	-	(895,448)	
Realized gain transferred to income	 	 	 	(1,636,250)	 	(1,636,250)	
Net earnings for the period	-	-	-	-	30,800,454	30,800,454	
Balance, May 31, 2010 (Restated - Note 14)	93,927,292	$ 91,730,755	$ 10,953,195	$ (3,507,273)	$ (3,418,446)	$ 95,758,231	

See accompanying notes to the consolidated financial statements.

 

 	 	Platinum Group Metals Ltd.	
 	(An exploration and development stage company)	
 	 	For the quarter ended May 31, 2010	

PLATINUM GROUP METALS LTD.	 	 	 	 	
(An exploration and development stage company)	 	 	 	 	
Restated Interim Consolidated Statements of Cash Flows	 	 	 	
(Unaudited)	 	 	 	 	
(expressed in Canadian dollars)	 	 	 	 	
 	
 	Three Months	Three Months	Nine Months	Nine Months	
 	Ended	Ended	Ended	Ended	
 	May 31, 2010	May 31, 2009	May 31, 2010	May 31, 2009	
 	(Restated - Note 14)	 	(Restated - Note 14)	 	
OPERATING ACTIVITIES	 	 	 	 	
Earnings (loss) for the period	$ 31,183,948	$ (1,478,807)	$ 30,800,454	$ (5,244,927)	
Add items not affecting cash	 	 	 	 	
Amortization	25,027	36,886	80,139	105,681	
Future income tax expense (credit)	11,911,718	(72,200)	12,177,850	(114,960)	
Realized gain on available-for-sale securities	(82,047)	-	(2,796,738)	-	
Realized gain on sale of project #2	(45,619,744)	-	(45,619,744)	-	
Non-cash stock compensation expense	-	219,535	137,600	1,394,986	
Net change in non-cash working	 	 	 	 	
capital (Note 12)	(135,913)	(52,661)	367,284	(301,030)	
 	(2,717,011)	(1,347,247)	(4,853,155)	(4,160,250)	
 	
FINANCING ACTIVITIES	 	 	 	 	
Performance bonds	1,069	37,787	(8,262)	29,695	
Issuance of common shares	-	171,041	1,114,824	7,589,721	
 	1,069	208,828	1,106,562	7,619,416	
 	
INVESTING ACTIVITIES	 	 	 	 	
Acquisition of fixed assets	(6,187)	(9,028)	(46,238)	(19,617)	
Acquisition cost of mineral properties	(25,238,702)	(399)	(27,213,100)	(16,941)	
Acquisition of surface rights	-	(1,942,784)	-	(1,951,313)	
Expenditure on exploration	(155,690)	13,724	(184,142)	(217,038)	
Investment in WBJV	-	(311,221)	-	(168,256)	
Proceeds on sale of available-for-sale securities	88,347	-	3,006,738	-	
 	(25,312,232)	(2,249,708)	(24,436,742)	(2,373,165)	
Net (decrease)/ increase in cash and cash equivalents	(28,028,174)	(3,388,127)	(28,183,335)	1,086,001	
Cash and cash equivalents, beginning of period	32,810,524	6,253,999	32,965,685	1,779,871	
Cash and cash equivalents, end of period	$ 4,782,350	$ 2,865,872	$ 4,782,350	$ 2,865,872	

See accompanying notes to the consolidated financial statements.

Platinum Group Metals Ltd.
(An exploration and development stage company)
Notes to the unaudited consolidated financial statements
For the quarter ended May 31, 2010

1.
NATURE OF OPERATIONS
The Company is a British Columbia corporation incorporated on February 18, 2002 by an order of the Supreme Court of British Columbia approving an amalgamation between Platinum Group Metals Ltd. and New Millennium Metals Corporation ("New Millennium"). The Company is an exploration and development company conducting work on mineral properties it has staked or acquired by way of option agreements in Ontario, Canada and the Republic of South Africa.

2.
SIGNIFICANT ACCOUNTING POLICIES
These consolidated financial statements have been prepared in accordance with Canadian generally accepted accounting principles ("Canadian GAAP") and include the significant policies outlined below.

(a)
Basis of presentation and principles of consolidation
The financial statements of entities which are controlled by the Company through voting equity interest, referred to as subsidiaries, are consolidated. Variable interest entities ("VIEs"), which include, but are not limited to, special purpose entities, trusts, partnerships and other legal structures, as defined by the Accounting Standards Board in Accounting Guideline 15, "Consolidation of Variable Interest Entities", are entities in which equity investors do not have the characteristics of a "controlling financial interest" or there is not sufficient equity at risk for the entity to finance its activities without additional subordinated financial support. VIEs are subject to consolidation by the primary beneficiary who will absorb the majority of the entities' expected losses and/or residual returns.  The Company does not currently have any VIEs.

These consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary, Platinum Group Metals (RSA) (Pty) Ltd. ("PTM RSA") (and in turn PTM RSA's wholly-owned subsidiary Wesplats Holdings (Proprietary) Limited ("Wesplats") and the 54.75% owned subsidiary Maseve Investments 11 (Pty) Ltd. ("Maseve"). PTM RSA holds mineral rights and conducts operations in the Republic of South Africa. Wesplats owns surface rights areas overlying and adjacent to mineral rights held by PTM RSA and on behalf of the Company.  Maseve holds a 100% interest in Projects 1 and 3 of the former Western Bushveld Joint Venture ("WBJV").  All significant intercompany balances and transactions have been eliminated upon consolidation.

These unaudited interim consolidated financial statements do not include all the information and disclosures required by Canadian GAAP for annual consolidated financial statements. They have been prepared using the same accounting policies and methods of applications as the latest annual consolidated financial statements except for the adoption of Section 3064 as indicated in note 2(m). In the opinion of management, all adjustments of a normal recurring nature necessary for a fair presentation have been made. The results for interim periods are not necessarily indicative of results for the entire year. The information contained in these unaudited interim financial statements should be read in conjunction with the Company's latest audited consolidated financial statements for the year ended August 31, 2009.

(b)
Short-term investments
Short-term investments comprise guaranteed investment certificates with original maturities of more than 90 days and less than one year.

Platinum Group Metals Ltd.
(An exploration and development stage company)
Notes to the unaudited consolidated financial statements
For the quarter ended May 31, 2010

(c)
Mineral properties, surface rights, and deferred exploration and development costs
Mineral properties consist of exploration and mining concessions, options, contracts and certain surface rights. Surface rights that have no associated mineral title and which are owned by the Company outright are shown separately. Acquisition and leasehold costs, exploration costs and surface rights are capitalized until such time as the property is put into production or disposed of either through sale or abandonment. Development expenditures incurred subsequent to the establishment of economic recoverability and upon receipt of project development approval from the Board of Directors are capitalized and included in the carrying amount of the related property. If put into production, the costs of acquisition, exploration and development will be amortized over the life of the property based on estimated economic reserves. If a property is abandoned, the property and deferred exploration costs are written off to operations.

Management of the Company reviews and evaluates the carrying value of each mineral property and its mineral investments for impairment regularly. Where estimates of future net cash flows are available and the total estimated future cash flows on an undiscounted basis are less than the carrying amount of the asset, an impairment loss is recognized and assets are written down to fair value.  Where estimates of future net cash flows are not available, management assesses whether the carrying value can be recovered by considering alternative methods of determining fair value. When it is determined that a mineral property is impaired it is written down to its estimated fair value.

(d)
Cash and cash equivalents
Cash and cash equivalents consist of cash and short-term deposits, which are readily convertible to cash and have original maturities of 90 days or less.

(e)
Reclamation and closure costs
The Company recognizes the estimated fair value of liabilities for asset retirement obligations including reclamation and closure costs in the period in which they are incurred. A corresponding increase to the carrying amount of the related asset is recorded and amortized over the life of the asset. The liability is adjusted for changes in estimate at each reporting period and is accreted over time to the estimated asset retirement obligation ultimately payable through charges to operations.

The estimates are based principally on legal and regulatory requirements. It is possible that the Company's estimates of its ultimate reclamation and closure liabilities could change as a result of changes in regulations, the extent of environmental remediation required, changes in technology and the means and cost of reclamation. Based on management's estimates, the Company has determined that there are no significant reclamation liabilities as at period end.

(f)
Income taxes
Future income taxes relate to the expected future tax consequences of differences between the carrying amount of balance sheet items and their corresponding tax values. Future tax assets, if any, are recognized only to the extent that, in the opinion of management, it is more likely than not that the future income tax assets will be realized. Future income tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment or substantive enactment.

Platinum Group Metals Ltd.
(An exploration and development stage company)
Notes to the unaudited consolidated financial statements
For the quarter ended May 31, 2010

 
 (g)
Fixed assets
Fixed assets are recorded at cost and are amortized at the following annual rates:

Computer equipment and software
          30% declining balance
Office furniture and equipment
          20% declining balance
Vehicles
30% declining balance
Leasehold improvements
          2 years straight line

 (h)
Earnings (loss) per common share
Basic earnings (loss) per common share are calculated using the weighted average number of common shares outstanding.

The Company uses the treasury stock method for the calculation of diluted earnings per share. Diluted per share amounts reflect the potential dilution that could occur if securities or other contracts to issue common shares were exercised or converted to common shares. In periods when a loss is incurred, the effect of potential issuances of shares under options and share purchase warrants would be anti-dilutive, and accordingly basic and diluted loss per share are the same.

(i)
Measurement uncertainty
The preparation of financial statements in conformity with Canadian generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements, and the reported amounts of expenditures during the reporting period. Significant items where management's judgement is applied include the assessment of impairment of long-lived assets, amortization, income tax provisions, contingent liabilities, and stock-based compensation and asset retirement obligations. Actual results could differ from those estimates.

(j)
Translation of foreign currencies
These consolidated financial statements are expressed in Canadian dollars. For integrated foreign operations, monetary assets and liabilities are translated at year end exchange rates and other assets and liabilities are translated at historical rates. Revenues, expenses and cash flows are translated at average exchange rates. Gains and losses on translation of monetary assets and monetary liabilities are charged to operations.

(k)
Stock-based compensation
The fair values for all stock-based awards are estimated using the Black-Scholes model and recorded in operations over the period of vesting. The compensation cost related to stock options granted is recorded in operations or capitalized to mineral properties, as applicable.

Cash received on exercise of stock options is credited to share capital and the amount previously recognized in contributed surplus is reclassified to share capital.

Platinum Group Metals Ltd.
(An exploration and development stage company)
Notes to the unaudited consolidated financial statements
For the quarter ended May 31, 2010

 (l)
Financial instruments
The Company's financial instruments are comprised primarily of cash and cash equivalents, amounts receivable, amounts due from project partners, performance bonds, and accounts payable and accrued liabilities.

Cash and cash equivalents are recognized at their fair value.  The carrying value of all other financial instruments approximate their fair values due to their short-term maturity or their capacity of prompt liquidation.

(m)
New accounting pronouncements
Section 3064, Goodwill and Intangible Assets , replaces Section 3062, Goodwill and Other Intangible Assets and Section 3450, Research and Development Costs . In February 2008, the CICA issued the new pronouncement establishing revised standards for the recognition, measurement, presentation and disclosure of goodwill and intangible assets.  The new standard also provides guidance for  the  treatment  of  preproduction  and  startup  costs  and  requires  that  these  costs  be expensed  as  incurred. The new standard applies to annual and interim financial statements relating to fiscal years beginning on or after October 1, 2008. Section 3064 was adopted September 1, 2009, and doing so has had no effect.
In July 2009, the CICA approved amendments to Section 3862, Financial Instruments - Disclosures. The amendments require additional fair value disclosure for financial instruments and liquidity risk disclosures. These amendments require a three-level hierarchy that reflects the significance of the inputs used in making fair value assessments. The amendments to Section 3862 apply for financial statements relating to fiscal years ending after September 30, 2009. The Company is assessing the impact of these amendments on its consolidated financial statements.

In January 2009, The CICA issued CICA Handbook Section 1582, Business Combinations, Section 1601, Consolidations, and Section 1602, Non-controlling Interests. These sections replace the former CICA Handbook Section 1581, Business Combinations and Section 1600, Consolidated Financial Statements and establish a new section for accounting for a non-controlling interest in a subsidiary. CICA Handbook Section 1582 establishes standards for the accounting for a business combination, and states that all assets and liabilities of an acquired business will be recorded at fair value. Obligations for contingent considerations and contingencies will also be recorded at fair value at the acquisition date. The standard also states that acquisition related costs will be expensed as incurred and that restructuring charges will be expensed in the periods after the acquisition date. The section applies prospectively to business combinations for which the acquisition date is on or after the beginning of the first annual reporting period beginning on or after January 1, 2011.

CICA Handbook Section 1601 establishes standards for the preparation of consolidated financial statements.

CICA Handbook Section 1602 establishes standards for accounting for a non-controlling interest in a subsidiary in the preparation of consolidated financial statements subsequent to a business combination.

CICA Handbook Section 1601 and Section 1602 apply to interim and annual consolidated financial statements relating to fiscal years beginning on or after January 1, 2011. Earlier adoption of these sections is permitted as of the beginning of a fiscal year.

Platinum Group Metals Ltd.
(An exploration and development stage company)
Notes to the unaudited consolidated financial statements
For the quarter ended May 31, 2010

All three sections must be adopted concurrently. The Company is currently evaluating the impact of adopting the sections.

3.
AMOUNTS RECEIVABLE

	 	 	May 31, 2010	 	Aug. 31, 2009	
	Expenditure advances receivable	 	 $ 3,126 	 	 $ 3,581 	
	Due from related parties (Note 10 (d) and (e ))	 	  68,699 	 	  17,172 	
	Goods and services tax recoverable	 	  72,565 	 	  37,160 	
	South African value added tax ("VAT") recoverable	 	  270,366 	 	  272,973 	
	Interest receivable	 	  900 	 	  13,652 	
	 	 	 $ 415,656 	 	 $ 344,538 	

4.
AVAILABLE-FOR-SALE SECURITIES

During the period the Company sold all its marketable securities accounted for as available-for-sale at the previous year-end August 31, 2009.

	August 31, 2009	Number of
Shares	Cost ($)	Accumulated Unrealized
Gains ($)	Fair
Value ($)	
	 	 	 	 	 	
	MAG Silver Corp.	100,000	  50,000	   445,000	    495,000	
	West Timmins Mining Inc.	800,001	160,000	1,480,002	 1,640,002	
	Total Marketable Securities	210,000	1,925,002	 2,135,002	

On November 6, 2009 pursuant to an agreement between West Timmins Mining Inc. and Lake Shore Gold Corp., the Company exchanged its 800,001 shares in West Timmins Mining Inc. for common shares in Lake Shore Gold Corp. at a share exchange rate of 1 West Timmins share to each 0.73 share of Lake Shore Gold Corp. A gain of $2,100,080 was realized on the exchange of shares. In the second quarter of 2010 the Company sold its 584,000 shares of Lake Shore Gold Corp. realizing a further $44,080 gain on the sale of shares.

During the nine month period the Company sold 100,000 MAG Silver Corp. shares for a realized gain of $652,578.

MAG Silver Corp. and West Timmins Mining Inc. were related parties of the Company, as discussed in Note 10.

5.
MINERAL PROPERTIES

	 	 	May 31, 2010	 	Aug. 31, 2009	
	Projects 1 & 3 (a)	 	 $ 101,779,243 	 	-	
	Other mineral properties (b)	 	  6,324,495 	 	  6,057,034 	
	 	 	 	 	 	
	 	 	 $ 108,103,738 	 	 $ 6,057,034 	

Platinum Group Metals Ltd.
(An exploration and development stage company)
Notes to the unaudited consolidated financial statements
For the quarter ended May 31, 2010

a)       Projects 1 & 3

On October 26, 2004 the Company entered into the WBJV with a subsidiary of Anglo Platinum Limited ("Anglo") and Africa Wide Mineral Prospecting and Exploration (Pty) Limited ("Africa Wide") to pursue platinum exploration and development on combined mineral rights covering approximately 67 square kilometres on the Western Bushveld Complex of South Africa. The Company contributed all of its interests in portions of the farms Onderstepoort 98JQ and Elandsfontein 102JQ. Anglo contributed its interests in portions of the farms Koedoesfontein 94JQ, Elandsfontein 102JQ and Frischgewaagd 96JQ. Later, in 2007, Anglo Platinum contributed its 50% interest in Portion 11 of the farm Frischgewaagd bringing the total area of the WBJV to approximately 72 square kilometres. The Company and Anglo Platinum each held a 37% working interest in the WBJV, while Africa Wide held a 26% working interest.  The area of the WBJV was comprised of three functional areas described as Project 1 (100% WBJV), Project 2 (50% WBJV: 50% Wesizwe Platinum Ltd.) and Project 3 (100% WBJV).  In April 2007 the shareholders of Africa Wide sold 100% of their company to Wesizwe Platinum Ltd ("Wesizwe") and since then Wesizwe has become responsible for all of the rights and obligations of Africa Wide.

The Company published a Feasibility Study for Project 1 of the WBJV in July 2008 and later an Updated Feasibility Study in October 2009.  Based on the WBJV resource estimate contained in the July 2008 Feasibility Study, and under the terms of the original WBJV agreement, each party was allocated an equalization amount due or payable based upon their contribution of measured, indicated, and inferred ounces of combined platinum, palladium, rhodium and gold ("4E") from the contributed properties comprising the WBJV.  Inferred ounces were credited at US$0.50 per ounce, indicated ounces at US$3.20 per ounce and measured ounces at US$6.20 per ounce.  Ounces contributed to the WBJV by Anglo in 2007 from a 50% interest in Portion 11 of the Farm Frischgewaagd 96 JQ, a property in Project 2, received an equalization credit of US$0.62 per inferred ounce, US$10.37 per indicated ounce and US$39.55 per measured ounce.  On April 22, 2010 the Company paid its equalization amount due to Anglo in the amount of $ 24.83 million (R 186.26 million).

Also on April 22, 2010, the partners of the WBJV completed a transaction first announced September 2, 2008 whereby the WBJV was dissolved with the following outcomes:

·
The Company and Wesizwe transferred a collective 100% interest in Projects 1 and 3 into new operating company Maseve Investments 11 (Pty) Ltd in exchange for shares of Maseve. Subsequent to this transaction, the Company owned 37% of Maseve.  
·
The Company sold its 18.5% interest in Project 2 to Wesizwe in exchange for an additional 17.25% interest in Maseve.
·
Anglo became a shareholder of Wesizwe Platinum Limited.
·
The Company holds 54.75% of Maseve with a right to subscribe for a further 19.25% interest for Rand 408.6 million (approx. $55.67 million) to bring its holdings to 74%, with Wesizwe holding the remaining interest.

Any additional subscriptions' the Company makes in shares of Maseve will be held in escrow to be applied towards Wesizwe's capital requirements for Projects 1 and 3.  The subscription into Maseve is due by January 22, 2011.  The Company may make partial subscriptions.

The sale of the Company's 18.5% interest in Project 2 was accounted for as an arm's length transaction at a fair market value for a gain of $45.62 million. (Note 14) The transfer of the Company's 37% interest in Projects 1 and 3 into Maseve was accounted for as a reorganization of existing business and was transferred into

Platinum Group Metals Ltd.
(An exploration and development stage company)
Notes to the unaudited consolidated financial statements
For the quarter ended May 31, 2010

Maseve at book cost.  The April 22, 2010 transactions qualified for relief from capital gains tax in accordance with South African tax law.

The Company consolidated the financial statements of Maseve from the effective date of the reorganization.
b) Other mineral properties

Nine month period ended May 31, 2010

 	South Africa	 	 	 	 	 	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	 	Tweespalk	 	War Springs	 	Other	 	LDI River	 	Shelby Lake	 	South Legris	 	Other	 	Total	
Acquisition costs	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
of mineral rights	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
   Balance, beginning of year	 	 $ 59,995 	 	 $ 144,498 	 	 $ 3,321 	 	 $ 598,571 	 	 $ 313,864 	 	 $ 60,000 	 	 $ -   	 	 $ 1,180,249 	
   Incurred during period	 	  20,880 	 	  17,295 	 	  13,176 	 	  -   	 	  -   	 	  -   	 	  31,968 	 	  83,319 	
   Balance, end of period	 	 $ 80,875 	 	 $ 161,793 	 	 $ 16,497 	 	 $ 598,571 	 	 $ 313,864 	 	 $ 60,000 	 	 $ 31,968 	 	 $ 1,263,568 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Deferred exploration costs	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
   Assays and geochemical	 	 $ -   	 	 $ 118,717 	 	 $ 36,814 	 	 $ -   	 	 $ -   	 	 $ -   	 	 $ -   	 	 $ 155,531 	
   Drilling	 	  -   	 	  687,793 	 	  -   	 	  -   	 	  -   	 	  -   	 	  -   	 	  687,793 	
   Geological	 	  990 	 	  162,207 	 	  307,108 	 	  2,800 	 	  8,231 	 	  8,231 	 	  124,737 	 	  614,304 	
   Maps, fees and licenses	 	  -   	 	  -   	 	  -   	 	  -   	 	  -   	 	  -   	 	  -   	 	  -   	
   Site administration	 	  -   	 	  96,136 	 	  16,107 	 	  -   	 	  -   	 	  -   	 	  -   	 	  112,243 	
   Travel	 	  -   	 	  60,172 	 	  32,377 	 	  -   	 	  -   	 	  -   	 	  -   	 	  92,549 	
 	 	  990 	 	  1,125,025 	 	  392,406 	 	  2,800 	 	  8,231 	 	  8,231 	 	  124,737 	 	  1,662,420 	
   Balance, beginning of year	 	  892,135 	 	  2,271,260 	 	  632,011 	 	  363,755 	 	  563,687 	 	  153,937 	 	  -   	 	  4,876,785 	
   Recoveries	 	  -   	 	  (1,125,025)	 	  (353,253)	 	  -   	 	  -   	 	  -   	 	  -   	 	  (1,478,278)	
   Balance, end of period	 	 $ 893,125 	 	 $ 2,271,260 	 	 $ 671,164 	 	 $ 366,555 	 	 $ 571,918 	 	 $ 162,168 	 	 $ 124,737 	 	 $ 5,060,927 	
Total Other Mineral Properties	 	 $ 974,000 	 	 $ 2,433,053 	 	 $ 687,661 	 	 $ 965,126 	 	 $ 885,782 	 	 $ 222,168 	 	 $ 156,705 	 	 $ 6,324,495 	

Three month period ended May 31, 2010

 	South Africa	 	 	 	 	 	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	 	Tweespalk	 	War Springs	 	Other	 	LDI River	 	Shelby Lake	 	South Legris	 	Other	 	Total	
Acquisition costs	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
of mineral rights	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
   Balance, beginning of period	 	 $ 77,415 	 	 $ 157,932 	 	 $ 15,953 	 	 $ 598,571 	 	 $ 313,864 	 	 $ 60,000 	 	 $ -   	 	 $ 1,223,735 	
   Incurred during period	 	  3,460 	 	  3,861 	 	  544 	 	  -   	 	  -   	 	  -   	 	  31,968 	 	  39,833 	
   Balance, end of period	 	 $ 80,875 	 	 $ 161,793 	 	 $ 16,497 	 	 $ 598,571 	 	 $ 313,864 	 	 $ 60,000 	 	 $ 31,968 	 	 $ 1,263,568 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Deferred exploration costs	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
   Assays and geochemical	 	 $ -   	 	 $ 27,451 	 	 $ 36,814 	 	 $ -   	 	 $ -   	 	 $ -   	 	 $ -   	 	 $ 64,265 	
   Drilling	 	  -   	 	  168,750 	 	  -   	 	  -   	 	  -   	 	  -   	 	  -   	 	  168,750 	
   Geological	 	  -   	 	  24,411 	 	  37,901 	 	  800 	 	  800 	 	  799 	 	  124,737 	 	  189,448 	
   Maps, fees and licenses	 	  -   	 	  -   	 	  -   	 	  -   	 	  -   	 	  -   	 	  -   	 	  -   	
   Site administration	 	  -   	 	  33,182 	 	  14,489 	 	  -   	 	  -   	 	  -   	 	  -   	 	  47,671 	
   Travel	 	  -   	 	  -   	 	  24,332 	 	  -   	 	  -   	 	  -   	 	  -   	 	  24,332 	
 	 	  -   	 	  253,794 	 	  113,536 	 	  800 	 	  800 	 	  799 	 	  124,737 	 	  494,466 	
   Balance, beginning of period	 	  893,125 	 	  2,271,260 	 	  642,610 	 	  365,755 	 	  571,118 	 	  161,369 	 	  -   	 	  4,905,237 	
   Recoveries	 	  -   	 	  (253,794)	 	  (84,982)	 	  -   	 	  -   	 	  -   	 	  -   	 	  (338,776)	
   Balance, end of period	 	 $ 893,125 	 	 $ 2,271,260 	 	 $ 671,164 	 	 $ 366,555 	 	 $ 571,918 	 	 $ 162,168 	 	 $ 124,737 	 	 $ 5,060,927 	
Total Other Mineral Properties	 	 $ 974,000 	 	 $ 2,433,053 	 	 $ 687,661 	 	 $ 965,126 	 	 $ 885,782 	 	 $ 222,168 	 	 $ 156,705 	 	 $ 6,324,495 	

Platinum Group Metals Ltd.
(An exploration and development stage company)
Notes to the unaudited consolidated financial statements
For the quarter ended May 31, 2010

(1)
Republic of South Africa
(i)
War Springs and Tweespalk
On June 3, 2002, the Company acquired an option to earn a 100% interest in the 2,396 hectare War Springs property and the 2,177 hectare Tweespalk property both located in the Northern Limb or Platreef area of the Bushveld Complex north of Johannesburg.  The Company now holds New Order prospecting permits on 100% of this territory.  Acquisition and exploration costs on these properties to May 31, 2010 total $3,407,053.

The Company can settle the vendors' residual interests in these mineral rights at any time for US$690 per hectare. The Company pays annual prospecting fees to the vendors of US$3.25 per hectare. The vendors retain a 1% NSR Royalty on the property, subject to the Company's right to purchase the NSR at any time for US$1.4 million. A 5% finders' fee applies to vendor payments.

Black Economic Empowerment groups Africa Wide, a subsidiary of Wesizwe Platinum Ltd. and Taung Minerals (Pty) Ltd., a subsidiary of Platmin Limited, have each acquired a 15% interest in the Company's rights to the War Springs project carried to bankable feasibility. The Company retains a net 70% project interest.  Africa Wide also has a 30% participating interest in the Tweespalk property.

On March 5, 2009 the Company announced an agreement with the Japan Oil, Gas and Metals National Corporation ("JOGMEC"), an incorporated administrative institution of the Government of Japan, whereby they may earn up to a 35% interest in the Company's rights to the War Springs project for an optional work commitment of US$10 million over 5 years. Total expenditures incurred by JOGMEC to May 31, 2010 amounted to approximately $1,920,951.  An amount of $59,187 was due from JOGMEC at period end.

(ii)
Other

During 2009 the Company acquired by staking various prospecting permits in South Africa including the Sable Joint Venture project area on the Western Limb of the Bushveld Complex west of Pretoria and the Waterberg project area on the far Northern Limb of the Bushveld Complex.

In October 2009 the Company entered an agreement with JOGMEC whereby they may earn up to a 37% interest in the Waterberg project for an optional work commitment of US$3.2 million over 4 years. Total expenditures incurred by JOGMEC to May 31, 2010 amounted to approximately $353,253.  An amount of $40,252 was due from JOGMEC at period end.

(2)

Ontario, Canada
 (i)
Lac des Iles ("LDI") River
On May 5, 2000, the Company entered into an option agreement to acquire a 50% interest in the Lac des Iles River property located near Thunder Bay, Ontario in exchange for cash payments ($43,500 paid in total) and the completion of exploration expenditures. On October 6, 2006, the Company and the property vendors entered into a termination and sale agreement whereby the option agreement was cancelled and the Company purchased an undivided 100% interest in the property subject only to underlying 2.0% Net Smelter Return Royalties. In settlement the Company made a one-time payment to the vendors of $50,000 in lieu of past and future exploration expenditure commitments not incurred.

Platinum Group Metals Ltd.
(An exploration and development stage company)
Notes to the unaudited consolidated financial statements
For the quarter ended May 31, 2010

 
 
(ii)
South Legris
In April 2000, and later as amended in January 2005, the Company acquired an option to earn a 50% interest in the South Legris property located near Thunder Bay, Ontario in exchange for cash payments ($105,000 paid in total) and the completion of certain exploration expenditures. On October 13, 2006, the Company and the property vendors entered into a termination and sale agreement whereby the option agreement was cancelled and the Company purchased an undivided 100% interest in the property subject only to underlying 2.0% Net Smelter Return Royalties. In settlement the Company made a one-time payment of $50,000 in lieu of past and future exploration expenditure commitments not incurred.

(iii)
Shelby Lake
On June 28, 2000, the Company entered into an option agreement to earn up to 60% interest in the Shelby Lake property, located near Thunder Bay, Ontario in exchange for cash payments of $15,000 (paid), issue 30,303 shares (issued) and complete $500,000 in exploration expenditures over a four-year period. On October 18, 2006, the Company and the property vendor entered into a termination and sale agreement whereby the option agreement was cancelled and the Company purchased an undivided 100% interest in the property for a one-time payment of $5,000 subject only to an underlying 2.0% Net Smelter Return Royalty, of which the Company may buy back one half for $500,000.

(iv)
Other
The Company has staked other properties in the Lac des Isle camp and has paid $31,968 for staking these claims.

(3)
Title to mineral properties
Although the Company has taken steps to verify title to mineral properties in which it has an interest, in accordance with industry standards for the current stage of exploration of such properties, these procedures do not guarantee the Company's title. Property title may be subject to unregistered prior agreements and non-compliance with regulatory requirements.

Platinum Group Metals Ltd.
(An exploration and development stage company)
Notes to the unaudited consolidated financial statements
For the quarter ended May 31, 2010

6.
FIXED ASSETS

(a)
Equipment, Leaseholds and Vehicles

 	 	May 31, 2010	 	 	 	 	
 	 	 	 	Accumulated	 	Net Book	
 	 	Cost	 	Amortization	 	Value	
Computer equipment and software	 	510,846 	 	375,753 	 	 $ 135,093 	
Leasehold improvements	 	38,641 	 	30,694 	 	  7,947 	
Office furniture and equipment	 	265,718 	 	131,134 	 	  134,584 	
Vehicles	 	82,485 	 	28,931 	 	  53,554 	
 	 	897,690 	 	566,512 	 	 $ 331,178 	

							
 	 	August 31, 2009	 	 	 	 	
 	 	 	 	Accumulated	 	Net Book	
 	 	Cost	 	Amortization	 	Value	
Computer equipment and software	 	 $ 495,049 	 	 $ 337,386 	 	 $ 157,663 	
Leasehold improvements	 	  38,642 	 	  28,423 	 	  10,219 	
Office furniture and equipment	 	  257,445 	 	  112,977 	 	  144,468 	
Vehicles	 	  85,818 	 	  33,089 	 	  52,729 	
 	 	 $ 876,954 	 	 $ 511,875 	 	 $ 365,079 	

(b)
Surface Rights

In 2004 the Company acquired surface and mineral rights to 365.64 hectares of the farm Elandsfontein 102 JQ in exchange for total payments of approximately $1.4 million.  The benefit of these rights became part of the WBJV under the original 2004 agreement.  The Elandsfontein mineral titles were transferred to project operating company Maseve on April 22, 2010 while the surface rights, valued at half of the original acquisition cost, remain under title to the Company and a 45.25% credit of approximately $316,750 was applied to amounts due to/from Wesizwe in recognition of their attributable portion of the surface rights.

During 2008 the Company purchased surface rights adjacent to the WBJV Project 1 deposit area measuring 216.27 hectares for Rand 8.0 million (approx. $1.09 million) and the Company also acquired surface rights directly over a portion of the WBJV Project 1 deposit area measuring 358.79 hectares for an amount of Rand 15.07 million (approx. $2.07 million).  The rights to these two properties are to the benefit of the Company alone and are distinct from the 365.64 hectare Elandsfontein Farm described above.

(c)
Rock Winders

During 2008 the Company acquired two rock winders at a cost of R 16.6 million (approx. $2,269,220) on behalf of the WBJV for use on a possible shaft facility for Project 1 of the WBJV.  Later designs excluded the use of winders and these winders have been held for sale.  They remain under title to the Company.  On April 22, 2010 the Company applied a 45.25% credit for $1,026,822 to the amount due to/from Wesizwe in recognition of their attributable share of the winders.  Subsequent to period end the Company entered into a sale agreement whereby one winder will be sold for US $1.28 million (approx. R 9.6 million) and a deposit of 50% was received on June 23, 2010.

Platinum Group Metals Ltd.
(An exploration and development stage company)
Notes to the unaudited consolidated financial statements
For the quarter ended May 31, 2010

 

7.
SHARE CAPITAL
(a)
Authorized
Unlimited common shares without par value

(b)
Issued and outstanding
At May 31, 2010 there were 93,927,292 shares outstanding.

During the period ended May 31, 2010:

(i)
1,111,625 stock options were exercised for proceeds of $1,114,824.

During the year ended August 31, 2009:

(ii)
the Company closed a brokered placement on June 16, 2009 for gross proceeds of $35,002,020 upon the issue of 24,999,300 units at a price of $1.40 per unit.  Each unit consisted of one common share and one-half of one common share purchase warrant.  Of the gross proceeds $29,713,103 was assigned to the common shares issued and $5,288,917 to the warrants.  Each whole warrant entitles the holder to purchase one additional common share at an exercise price of $1.75 until December 16, 2010.  The Company paid the underwriters a fee of $2,100,121 representing 6% of the aggregate gross proceeds of the offering. Other issue costs of $746,681 related to TSX and NYSE Alternext filing fees, underwriters' expenses and legal fees.

(iii)
the Company closed a non-brokered private placement in October 2008 for $7,611,229 upon the issue of 4,910,470 common shares at a price of $1.55 per share.  A finders' fee of $186,000 in cash and a further 60,000 shares at the offering price was paid in respect of certain of the subscriptions. Other issue costs of $117,148 related to TSX and NYSE Alternext filing fees and legal fees.

(iv)
During the period 196,650 stock options were exercised for proceeds of $281,640.

(c)
Incentive stock options

The Company has entered into Incentive Stock Option Agreements ("Agreements") with directors, officers and employees. Under the terms of the Agreements, the exercise price of each option is set at a minimum, at the fair value of the common shares at the date of grant. Stock options granted to certain employees, directors and officers of the Company vest on average at an amount of 25% per six month period, while others vest immediately.

Platinum Group Metals Ltd.
(An exploration and development stage company)
Notes to the unaudited consolidated financial statements
For the quarter ended May 31, 2010

The following tables summarize the Company's outstanding stock options:

 	 	 	 	Weighted	 	 	
 	 	Number	 	Average	 	Number	
 	 	Outstanding at	 	Remaining	 	Exercisable at	
Exercise	 	May 31,	 	Contractual	 	May 31,	
Price	 	2010	 	Life (Years)	 	2010	
 	 	 	 	 	 	 	
  1.05 	 	  37,500 	 	  0.17 	 	  37,500 	
  1.40 	 	  1,379,000 	 	  4.20 	 	  1,379,000 	
  1.50 	 	  9,500 	 	  0.61 	 	  9,500 	
  1.60 	 	  1,492,000 	 	  3.38 	 	  1,492,000 	
  1.85 	 	  175,000 	 	  1.23 	 	  175,000 	
  1.95 	 	  50,000 	 	  3.68 	 	  50,000 	
  2.27 	 	  10,000 	 	  3.69 	 	  10,000 	
  2.57 	 	  885,000 	 	  1.63 	 	  885,000 	
  4.15 	 	  150,000 	 	  2.40 	 	  150,000 	
  4.40 	 	  850,000 	 	  2.40 	 	  850,000 	
 	 	  5,038,000 	 	  3.00 	 	  5,038,000 	

The weighted average exercise price of the exercisable options at period end was $2.27.

 	 	 	 	Weighted	
 	 	 	 	Average	
 	 	Number	 	Exercise	
 	 	of Shares	 	Price	
Options outstanding at August 31, 2008	 	  3,857,875 	 	  2.56 	
   Granted	 	  3,279,000 	 	  1.52 	
   Exercised	 	  (196,650)	 	  1.43 	
    Forfeited	 	  (790,600)	 	  2.54 	
Options outstanding at August 31, 2009	 	  6,149,625 	 	 $ 2.04 	
    Granted	 	  -   	 	  -   	
    Exercised	 	  (1,111,625)	 	  1.00 	
    Forfeited	 	  -   	 	  -   	
Options outstanding at May 31, 2010	 	  5,038,000 	 	 $ 2.27 	

During the period ended May 31, 2010 the Company granted no stock options (May 31, 2009 - 1,887,000).  The Company has recorded $164,895 ($137,600 expensed and $27,295 capitalized to the WBJV, not including gross up FIT liability of $10,900 (May 31, 2009 - $102,360)) of compensation expense relating to stock options granted or vested in this period (May 31, 2009 - $1,654,486 ($1,394,986 expensed and $259,500 capitalized to the WBJV)). Cash received from the exercise of stock options during the period ended May 31, 2010 totalled $1,114,824 (May 31, 2009 - $281,640).

Platinum Group Metals Ltd.
(An exploration and development stage company)
Notes to the unaudited consolidated financial statements
For the quarter ended May 31, 2010

The Company used the Black-Scholes model to determine the grant date fair value of stock options granted. The following weighted average assumptions were used in valuing stock options granted during the period:

 	 	May 31,	 	May 31,	
 	 	2010	 	2009	
Risk-free interest rate	 	N/A	 	2.8	
Expected life of options	 	N/A	 	3.21	
Annualized volatility	 	N/A	 	72.33	
Dividend rate	 	N/A	 	0.00%	

(d)
Share purchase warrants

During the year ended August 31, 2009, 12,537,150 purchase warrants were issued at $1.75 as a part of the placement on June 16, 2009 as described above. These warrants have an expiry date of December 16, 2010. None of the warrants have been exercised. There are no other warrants outstanding.

8.
CAPITAL RISK MANAGEMENT
The Company's objectives in managing its liquidity and capital are to safeguard the Company's ability to continue as a going concern and provide financial capacity to meet its strategic objectives. The capital structure of the Company consists of equity attributable to common shareholders, contributed surplus, accumulated other comprehensive income and accumulated deficit.

The Company manages the capital structure and makes adjustments to it in light of changes in economic conditions and the risk characteristics of the underlying assets. To maintain or adjust the capital structure, the Company may issue new shares, issue new debt, acquire or dispose of assets.

In order to facilitate the management of its capital requirements, the Company prepares annual expenditure budgets that are updated as necessary based on various factors, including successful capital deployment and general industry conditions. The annual and updated budgets are approved by the Board of Directors. The Company does not currently declare or pay out dividends.

As at May 31, 2010, the Company does not have any long-term debt and is not subject to any externally imposed capital requirements.

9.
FINANCIAL INSTRUMENTS AND RISK MANAGEMENT
The Company examines the various financial risks to which it is exposed and assesses the impact and likelihood of occurrence. These risks may include credit risk, liquidity risk, currency risk, interest rate risk and other price risks.

(a)
Credit risk

Counterparty credit risk is the risk that the financial benefits of contracts with a specific counterparty will be lost if a counterparty defaults on its obligations under the contract. This includes any cash amounts owed to the Company by those counterparties, less any amounts owed to the counterparty by the Company where a legal right of set-off exists and also includes the fair values of contracts with individual counterparties which are recorded in the financial statements.

Platinum Group Metals Ltd.
(An exploration and development stage company)
Notes to the unaudited consolidated financial statements
For the quarter ended May 31, 2010

(i)
Trade credit risk

The Company is an exploration and development company, and has not yet commenced commercial production or sales. Therefore, the Company is not exposed to significant trade credit risk.

(ii)
Cash and cash equivalents

In order to manage credit and liquidity risk we invest only in term deposits with Canadian Chartered banks that have maturities of three months or less. Limits are also established based on the type of investment, the counterparty and the credit rating.

(iii)
Due from joint venture partners

In order to manage credit risk management regularly reviews amounts outstanding from partners and considers recoverability.

(b)
Liquidity risk

The Company has in place a planning and budgeting process to help determine the funds required to support the Company's normal operating requirements and its exploration and development plans. The annual budget is approved by the Board of Directors.

Future exploration, development, mining, and processing of minerals from the Company's properties will require additional financing.  The Company has no credit facilities in place at this time, although it is currently evaluating possible debt financing.  The only other current source of funds available to the Company is the issuance of additional equity capital, which if available, may result in substantial dilution to existing shareholders. There is no assurance that such funding will be available to the Company, or that it will be obtained on terms favourable to the Company.  Failure to obtain sufficient financing may result in delaying or indefinite postponement of exploration, development, or production on any or all of the Company's properties, or even a loss of property interests.

(c)
Currency risk

The Company's functional currency is the Canadian dollar, while its operations are in both Canada and South Africa; therefore the Company's net earnings (losses) and other comprehensive earnings (losses) are impacted by fluctuations in the value of foreign currencies in relation to the Canadian dollar. The Company's significant foreign currency exposures on financial instruments comprise cash and cash equivalents, performance bonds, amounts due from WBJV partners, and accounts payable and accrued liabilities. The Company has not entered into any agreements or purchased any instruments to hedge possible currency risks at this time.

The Company's net loss and other comprehensive loss are affected by changes in the exchange rate between its operating currencies and the Canadian dollar.  At May 31, 2010, based on this exposure a 10% change in the Canadian dollar versus Rand foreign exchange rate would give rise to a change in the loss for the nine month period presented of approximately $239,535.

Platinum Group Metals Ltd.
(An exploration and development stage company)
Notes to the unaudited consolidated financial statements
For the quarter ended May 31, 2010

(d)
Interest rate risk  

The Company's interest revenue earned on cash and cash equivalents and on short term investments is exposed to interest rate risk. At May 31, 2010, based on this exposure a 1% change in the average interest rate would give rise to an increase/decrease in the loss for the period of approximately $47,824.

10.
RELATED PARTY TRANSACTIONS
Transactions with related parties are as follows:

(a)
During the period, $612,848 (May 31, 2009 - $294,724) was paid to directors for salary, consulting, bonus and Director's fees. At May 31, 2010, $22,757 was included in accounts payable (2009 - $8,099).

(b)
The Company received $64,347 (May 31, 2009 - $102,131) during the period from MAG Silver Corp. ("MAG"), a company with three directors in common.  Amounts receivable at the end of the period include an amount of $Nil (2009 - $6,803) due from MAG. MAG terminated its service agreement with the Company on December 31, 2009.

(c)
During the period the Company accrued or received payments of $8,000 (May 31, 2009 - $32,000) from West Timmins Mining Inc. ("WTM"), a company that had three directors in common and an officer in common, for administrative services. Amounts receivable at the end of the period includes an amount of $Nil (2009 - $12,072 due from WTM). This agreement was terminated at December 15, 2009 after the amalgamation by plan of arrangement between Lakeshore Gold Corp. and WTM in November 2009.

(d)
During the period the Company accrued or received payments of $21,250 (May 31, 2009 - $Nil) from West Kirkland Mining Inc. ("WKM"), a company with three directors in common, for administrative services. Amounts receivable at the end of the period includes an amount of $35,490 (2009 - $Nil due from WKM).

(e)
During the period the Company accrued or received payments of $25,500 (May 31, 2009 - $Nil) from Nextraction Energy Corp. ("NE"), a company with three directors in common, for administrative services. Amounts receivable at the end of the period includes an amount of $33,209 (2009 - $Nil due from NE).

(f)
The Company entered into an office lease agreement with Anthem Works Ltd. ("Anthem"), a company with a director in common in 2005. During the period ended May 31, 2010 the Company accrued or paid Anthem $65,870 under the office lease agreement (2009 - $65,376).

All amounts in Amounts receivable and Accounts payable owing to or from related parties are non-interest bearing with no specific terms of repayment.

These transactions are in the normal course of business and are measured at the exchange amount, which is the consideration established and agreed to by the noted parties.

Platinum Group Metals Ltd.
(An exploration and development stage company)
Notes to the unaudited consolidated financial statements
For the quarter ended May 31, 2010

11.
CONTINGENCIES AND COMMITMENTS

The Company's remaining minimum payments under its office and equipment lease agreements in Canada and South Africa, which it has entered into for the years ending on August 31, are as follows:

			
August 31, 2010	 	 $ 36,680 	
August 31, 2011	 	  10,162 	
August 31, 2012	 	  1,694 	
 	 	 $ 48,536 	

12.
SUPPLEMENTARY CASH FLOW INFORMATION
Net change in non-cash working capital

 	 	Three months	 	Three months	 	Nine months	 	Nine months	 	 	
 	 	Ended	 	Ended	 	Ended	 	Ended	 	August 31,	
 	 	May 31, 2010	 	May 31, 2009	 	May 31, 2010	 	May 31, 2009	 	2003	
Amounts receivable	 	 $ (82,945)	 	 $ 52,301 	 	 $ 53,925 	 	 $ (36,192)	 	 $ 217,633 	
Prepaid expenses and other	 	  24,689 	 	  (267,269)	 	  (21,237)	 	  (201,771)	 	  33,678 	
Accounts payable	 	  (77,657)	 	  162,307 	 	  334,596 	 	  (63,067)	 	  58,120 	
 	 	 $ (135,913)	 	 $ (52,661)	 	 $ 367,284 	 	 $ (301,030)	 	 $ 309,431 	

13.
SEGMENTED INFORMATION

The Company operates in one operating segment, that being exploration on mineral properties. Segmented information presented on a geographic basis follows:

Assets

 	 	May 31,	 	August 31,	 	August 31,	
 	 	2010	 	2009	 	2006	
 	 	 	 	 	 	 	
Canada	 	 $ 7,017,567 	 	 $ 37,143,004 	 	 $ 12,947,384 	
South Africa	 	  113,157,776 	 	  29,927,793 	 	  14,717,057 	
 	 	 $ 120,175,343 	 	 $ 67,070,797 	 	 $ 27,664,441 	

Substantially all of the Company's capital expenditures are made in the South African geographical segment.

Results of Operations
											
 	 	Three Months	 	Three Months	 	Nine Months	 	Nine Months	 	 	
 	 	 Ended	 	Ended	 	Ended	 	Ended	 	August 31,	
 	 	May 31, 2010	 	May 31, 2009	 	May 31, 2010	 	May 31, 2009	 	2003	
 	 	(Restated - Note 14)	 	 	 	(Restated - Note 14)	 	 	 	 	
Canada	 	 $ (1,142,283)	 	 $ (1,112,999)	 	 $ (600,933)	 	 $ (4,055,948)	 	 $ 217,633 	
South Africa	 	  32,326,231 	 	  (365,808)	 	  31,401,387 	 	  (1,188,948)	 	  58,120 	
 	 	 $ 31,183,948 	 	 $ (1,478,807)	 	 $ 30,800,454 	 	 $ (5,244,896)	 	 $ 275,753 	

Platinum Group Metals Ltd.
(An exploration and development stage company)
Notes to the unaudited consolidated financial statements
For the quarter ended May 31, 2010

14.
Restatement of the May 31, 2010 Interim Results

The consolidated financial statements of the Company for the three and nine month periods ended May 31, 2010 have been restated to reflect future income tax expense relating to the dissolution of the WBJV.  The Company initially estimated that the tax basis of the WBJV was approximately equal to the carrying amount on the consolidated financial statements.  The Company has performed further analysis and now estimates a taxable temporary difference arising from the restructuring of the WBJV and the sale of WBJV Project 2 to Wesizwe for an additional interest in Maseve.  This note reflects the affects of this restatement for accounting purposes.  The resulting accrual for future income tax expense is a non-cash item.  As previously reported the Company has determined that this transaction qualified for relief from current taxes payable in accordance with Section 42 of the South African Income Tax Act 58 of 1962.

The following table summarizes the impact of the adjustment on the consolidated financial statements for the respective periods:

Consolidated balance sheet
As of May 31, 2010
Debit (Credit)
Future income tax liability
(11,900,000)
Shareholders' equity
 11,900,000
Consolidated statement of shareholders' equity
As of May 31, 2010

Debit (Credit)
Net earnings for the period
 11,900,000
 
Consolidated statement of operations
Quarter ended
Nine months ended
May 31, 2010
May 31, 2010
Debit (Credit)
Debit (Credit)
Future income tax expense
 11,900,000
 11,900,000
Earnings (loss) for the period
 11,900,000
 11,900,000
Comprehensive earnings (loss) for the period
 11,900,000
 11,900,000

					

					

					

					

					

					

This adjustment decreases the Company's basic and diluted earnings per share by $0.13 and $0.12, respectively for the quarter ended May 31, 2010 and by $0.13 and $0.12, respectively, for the nine months ended May 31, 2010.  There was no impact on operating, investing or financing cash flows to those previously reported.  

The above estimated future tax liability is based on management's determination of the tax basis of the WBJV versus the carrying amount for accounting purposes.  The determination of these amounts and the resulting deferred tax liability remains subject to measurement uncertainty.

Platinum Group Metals Ltd.
(Exploration and Development Stage Company)
Restated Supplementary Information and MD&A
For the quarter ended May 31, 2010

Dated: October 6, 2010

 

 

A copy of this report will be provided to any shareholder who requests it.

 

 

Platinum Group Metals Ltd.
(Exploration and Development Stage Company)
           
Restated Supplementary Information and MD&A
For the quarter ended May 31, 2010

RESTATEMENT

The consolidated financial statements of the Company for the three and nine month periods ended May 31, 2010 have been restated to reflect future income tax expense relating to the dissolution of the WBJV.  For details see Item 12. “Restatement of May 31, 2010 Interim Results” below.

NOTE REGARDING FORWARD -LOOKING STATEMENTS:

This report contains forward-looking statements, being all statements that are not historical facts, including, without limitation, statements regarding our future plans and activities, anticipated developments on our properties, the potential for mineral production, results of permit applications and future commodity markets. In addition, estimates of resources may be forward-looking statements to the extent they represent estimates of mineralization that will be encountered if a property is developed. Forward-looking statements are necessarily based on a number of estimates and assumptions. There can be no assurance that our forward-looking statements will be accurate. Factors that could cause results to differ materially from those expressed in our forward-looking statements include the actual results of further exploration and development, financing risks, the risk of currency and commodity price fluctuations, execution risk, political risk, and the other risks set forth  in our most recent annual information form filed with the Canadian provincial securities regulators and the Company's most  recent annual report on Form 40-F filed with the SEC, which are available at www.sedar.com and www.sec.gov, respectively. You should not place undue reliance upon our forward-looking statements. We disclaim any responsibility to update our forward-looking statements.

NOTE TO U.S. INVESTORS REGARDING RESOURCE ESTIMATES:

All resource estimates contained in this report have been prepared in accordance with National Instrument 43-101 and the Canadian Institute of Mining, Metallurgy and Petroleum Classification System in compliance with Canadian securities laws, which differ from the requirements of United States securities laws. Without limiting the foregoing, this report uses the terms “measured resources”, “indicated resources” and “inferred resources”. U.S. investors are advised that, while such terms are recognized and required by Canadian securities laws, the U.S. Securities and Exchange Commission (“SEC”) does not recognize them. Under U.S. standards, mineralization may not be classified as a “reserve” unless the determination has been made that the mineralization could be economically and legally produced or extracted at the time the reserve determination is made. U.S. investors are cautioned not to assume that all or any part of measured or indicated resources will ever be converted into reserves. Further, inferred resources have a great amount of uncertainty as to their existence and as to whether they can be mined legally or economically. It cannot be assumed that all or any part of the inferred resources will ever be upgraded to a higher category. U.S. investors are cautioned not to assume that all or any part of the inferred resources exist, or that they can be mined legally or economically. Information concerning descriptions of mineralization and resources contained in this report may not be comparable to information made public by U.S. companies subject to the reporting and disclosure requirements of the SEC.

Platinum Group Metals Ltd.
(Exploration and Development Stage Company)
           
Restated Supplementary Information and MD&A
For the quarter ended May 31, 2010

Management Discussion and Analysis

1.
DESCRIPTION OF BUSINESS
Platinum Group Metals Ltd. (the “Company” or “Platinum Group”) is a British Columbia corporation incorporated on February 18, 2002 by an order of the Supreme Court of British Columbia approving an amalgamation between Platinum Group Metals Ltd. and New Millennium Metals Corporation (“New Millennium”). The Company is an exploration and development company conducting work primarily on mineral properties it has staked or acquired by way of option agreement in the Republic of South Africa and Ontario, Canada. The Company completed a definitive Feasibility Study in July 2008 and an Updated Feasibility Study in October 2009 with respect to its Western Bushveld Joint Venture (“WBJV”) in the Republic of South Africa. Included in each Study is a declaration of reserves at the time of publication.

The Company defers all acquisition, exploration and development costs related to mineral properties. The recoverability of these amounts is dependent upon the existence of economically recoverable reserves, the ability of the Company to obtain the necessary financing to complete the development of the property, and any future profitable production; or alternatively upon the Company's ability to dispose of its interests on an advantageous basis.

This management discussion and analysis (“MD&A”) of the Company focuses on the financial condition and results of operations of the Company for the period ended May 31, 2010. It is prepared as of July 14, 2010 (restated for certain items as described above at “Restatement” and below at Item 12. “Restatement of May 31, 2010 Interim Results” on October 6, 2010) and should be read in conjunction with the unaudited consolidated financial statements of the Company for the quarter ended May 31, 2010 together with the notes thereto.

All references herein to “dollars” or “$” refer to Canadian dollars unless otherwise stated.

2.
DISCUSSION OF OPERATIONS AND FINANCIAL CONDITION
a)
Results of Operations
Any reference to “period” refers to the nine months ended May 31, 2010.

At May 31, 2010 the Company had cash and cash equivalents of $4.78 million as compared to $2.87 million on May 31, 2009. At May 31, 2010 the Company owed $212,822 to Wesizwe Platinum Limited (“Wesizwe”) for past expenditures by Wesizwe on Project 2 of the WBJV, net of amounts due to/from Wesizwe for expenditures and items related to Projects 1 and 3. Accounts payable at period end totaled $1.20 million (2009 - $885,807); of this amount approximately $350,000 was payable against legal costs, $253,000 was due for advisory and consulting expenses and $43,000 was payable for accounting, tax consulting and audit review fees. There was also approximately $300,000 payable for exploration expenses with approximately $100,000 in turn being receivable from joint venture partners and the balance being related to overhead costs. The balance of accounts payable related to overhead and administrative costs.

During the period the Company had net earnings on a restated basis of $30,800,454 million (2009 – ($5.24 million) net loss). The gain is primarily due to the sale of the Company's 18.5% interest in Project 2 of the WBJV to Wesizwe on April 22, 2010 for a gain on sale of $45.62 million.  The Company has accrued a future income tax expense related to the transaction of $11,900,000.  The accrual for future income tax expense is a non-cash item.  The Company has determined that this transaction qualified for relief from current taxes payable in accordance with Section 42 of the South African Income Tax Act 58 of 1962.  The Company also realized a gain of $2.80 million on sale of marketable securities during the period.  

Platinum Group Metals Ltd.
(Exploration and Development Stage Company)
           
Restated Supplementary Information and MD&A
For the quarter ended May 31, 2010

Before a non-cash charge for stock based compensation of $137,600 (2009 - $1.39 million), and not including net interest earned of $432,790 (2009 - $98,233), general and administrative expenses totaled $5.74 million (2009 - $4.06 million).  The increase in general and administrative expenses over the comparative period is explained for the most part by a foreign exchange loss of $906,749 compared to a foreign exchange gain of $259,540 in 2009.  Professional fees totalled $1.21 million for the period (2009 - $726,768).  This amount includes $984,186 for legal fees, $117,186 for accounting advisory fees and $107,229 for audit fees.  All of these costs are higher than in the comparative period as the Company has been conducting negotiations, due diligence and drafting of agreements related to strategic options.  Management and Consulting fees of $1.09 million (2009 - $769,610) were higher in the current period in part due to $184,881 incurred for independent technical due diligence and $123,340 in additional director and senior management fees.  The amount of salaries and benefits expensed in the period remained constant $1.33 million (2009 - $1.28 million).  Offsetting some of these increased expenses was a decrease of $145,721 in shareholder relations expenses ($140,550 vs. $286,271 in 2009); and a decrease of $151,334 in travel expenses ($329,756 vs. $481,090 in 2009).

Apart from the realized gains described above and net interest of $432,790 (2009 - $98,233) earned on cash deposits during the period, the Company had no significant revenues.  In October 2008 the Company closed a non-brokered private placement for net cash proceeds of $7.31 million, and in June 2009 the Company closed a brokered offering for net cash proceeds of $32.16 million. Proceeds of the June 2009 offering were primarily used to pay Anglo Platinum Limited (“Anglo”) an equalization amount on April 22, 2010 of $24.83 million for the ounces contributed by Anglo to the WBJV.  The remainder of the net proceeds are being used for continued exploration and development work and for general working capital purposes.
Total global exploration, engineering and development expenditures for the Company's account, including the Company's share of WBJV expenditures during the period, totaled $1.01 million (2009 - $1.11 million). Of this amount $828,552 was for the WBJV (2009 - $894,312) and $184,142 was for other exploration (2009 - $217,038). Total WBJV expenditures during the period by all WBJV partners amounted to $2.24 million (2009 - $1.35 million).  After April 22, 2010 the WBJV was dissolved and expenditures related to Projects 1 and 2 were conducted by our 54.75% owned operating subsidiary Maseve (See details below).  

Exploration expenditures by JOGMEC for the War Springs and Waterberg projects of $1.48 million during the period are netted against payments made by JOGMEC to the Company and therefore are not included in the total reported above.

On April 22, 2010 the Company paid an equalization amount due to Anglo of $24.83 million (R 186.26 million) as required under the terms of the original WBJV Agreement.  On the same date the Company then completed a transaction originally announced September 2, 2008 with Anglo and Wesizwe whereby the WBJV was dissolved and the Company sold its 18.5% effective interest in Project 2 to Wesizwe and transferred its 37% interest in Projects 1 and 3 into project operating company Maseve Investments 11 (Pty) Ltd. (“Maseve”).  At the same moment Wesizwe acquired Anglo's 37% interest in the WBJV, retained Anglo's effective 18.5% interest in Project 2, and then transferred 63% of Projects 1 and 3 into Maseve, the result being that Wesizwe retained 100% of Project 2 and that Maseve obtained 100% of Projects 1 and 3.  In exchange for its effective 18.5% of Project 2 the Company received a 17.75% interest in Maseve.  The Company also received a 37% interest in exchange for its share of Projects 1 and 3, bringing its holdings in Maseve to 54.75%.  Wesizwe received a 45.25 % initial interest in Maseve.  The Company has a right to acquire a further 19.25% interest in Maseve for subscriptions in the amount of R 408.6 million (approx $55.67 million), thereby allowing the Company to increase its shareholding in Maseve to 74%. Any subscription funds will be held in escrow to be applied towards Wesizwe's capital requirements for Projects 1 and 3.  The cash subscriptions into Maseve are due by January 22, 2011 or the Company will lose the right to increase its interest to 74%.  The Company may make partial subscriptions if it so chooses.

Platinum Group Metals Ltd.
(Exploration and Development Stage Company)
           
Restated Supplementary Information and MD&A
For the quarter ended May 31, 2010

 

The sale of the Company's 18.5% interest in Project 2 was accounted for as an arm's length transaction at fair market value on April 22, 2010.  The transfer of the Company's 37% interest in Projects 1 and 3 was accounted for as a continuity of interests and was transferred into Maseve at book cost.

Activities for Projects 1 and 3 during the period included research and data review, prospecting, mapping, detailed engineering, drilling of project areas, geophysical studies, geotechnical work, metallurgical studies and mine plan and scheduling work. The Company has paid the South African power utility Company (ESKOM) deposits against their work to design infrastructure for the delivery of construction power and commercial production power to the property.

An Updated Feasibility Study and revised resource estimation for the Project 1 area of the WBJV was announced October 8, 2009 entitled “Technical Report (Updated Feasibility Study) Western Bushveld Joint Venture Project 1 (Elandsfontein and Frischgewaagd)” and was filed by the Company on www.sedar.com on November 25, 2009.  Results of the Updated Feasibility Study estimated 275,000 ounces of 4E (platinum, palladium, rhodium and gold) and show a 23.54% Internal Rate of Return (pre-tax) Base Case, using 3 year trailing metal prices to September 2009, calculated on the monthly averages including US$1,343 per ounce for platinum. The Updated Feasibility Study model does not include escalation due to inflation of costs or metal prices.

Details of the Company's Revised Attributable Reserves and Resources from the Updated Feasibility Study are shown below at Item 2d. “Exploration Programs and Expenditures”.

The Company maintains three projects in South Africa on the North Limb of the Bushveld Complex; Tweespalk, Waterberg and War Springs.  The Tweespalk property is currently being reviewed.  During 2008 the Company conducted soil and geological surveys on the War Springs project. On March 17, 2008 the Company published a revised and updated resource calculation for the War Springs project based on drilling and exploration work conducted in the previous three years. (See Item 2d. “Exploration Programs and Expenditures” below).

On March 5, 2009 the Company announced an agreement with Japan Oil, Gas and Metals National Corporation (“JOGMEC”), an incorporated administrative institution of the Government of Japan, whereby they may earn up to a 35% interest in the Company's rights to the War Springs project for an optional work commitment of US$10 million over 5 years. The first and second year JOGMEC option commitments of US$1.5 million have been completed with approximately 12,397 metres drilled to March 31, 2010.  Total expenditures incurred by JOGMEC to May 31, 2010 amounted to approximately $1.92 million. Further work programs for War Springs to be funded by JOGMEC in 2010 have been approved and are currently being planned.

Platinum Group Metals Ltd.
(Exploration and Development Stage Company)
           
Restated Supplementary Information and MD&A
For the quarter ended May 31, 2010

 

The Company also entered an agreement in October 2009 with JOGMEC whereby they may earn up to a 37% interest in the Waterberg project for an optional work commitment of US$3.2 million over 4 years. Total expenditures incurred by JOGMEC on this project to May 31, 2010 amounted to approximately $353,000.  Exploration work consisted of geophysical surveys, ground mapping and compilation of existing data.  Further work has been approved by JOGMEC.

The Company conducted work programs on its Canadian projects during the years ended August 31, 2008 and 2009 and in the period ended May 31, 2010. A 1,125 metre drill program was completed on the Company's Lac Des Iles project in the first quarter of 2008 and a further 978 metres was completed in February of 2009. In the period ended May 31, 2010 the Company incurred $143,999 in geophysical and other ground based work in the Thunder Bay area.  The Company maintains a large mineral rights position in the Lac des Iles area north of Thunder Bay as a strategic holding against potentially increasing prices for palladium and platinum. Encouraging exploration results for palladium, platinum, nickel and copper continue to be returned and the Company plans to invest further in this area in the future.  

For more information about the former WBJV, the Company's Projects 1 and 3 and the Company's other mineral properties, please refer to Notes 5. of the Company's May 31, 2010 unaudited financial statements and below.

The Company's complement of staff, consultants and casual workers consists of approximately 30 individuals at present. Office space and support services in Canada and South Africa are being maintained at similar levels in 2010 as compared to 2009.

The Company still actively reviews many potential property acquisitions in the normal course of business. The Company also makes efforts to raise its profile and liquidity in the capital markets.

The following tables set forth selected financial data from the Company's annual audited financial statements and should be read in conjunction with those financial statements:

	 	Year ended
Aug 31, 2009	Year ended Aug. 31, 2008	Year ended Aug. 31, 2007	
	Interest income	$139,548 (1)	$243,339	$434,949	
	Net Loss	($6,963,384) (2)	($5,086,589)	($6,758,123)	
	Basic and diluted Loss per Share	($0.10) (3)    	($0.08)	($0.12)	
	Total Assets	$67,070,797 (4)	$32,492,583	$36,764,203	
	Long Term Debt	Nil	Nil	Nil	
	Dividends	Nil	Nil	Nil	
Explanatory Notes:

(1)
The Company's only significant source of revenue during the years ending August 31, 2007 to 2009 was interest revenue from interest bearing accounts held by the Company. The amount of interest earned correlates directly to the interest rate at the time and the amount of cash on hand during the year referenced.

Platinum Group Metals Ltd.
(Exploration and Development Stage Company)
           
Restated Supplementary Information and MD&A
For the quarter ended May 31, 2010

 

(2)
The Company's net loss during the year ending August 31, 2009 was higher than in 2008 and 2007 due to several factors. Compensation expense totalled $1,615,361 in 2009 as opposed to $1,345,722 in 2008 and $1,400,258 in 2007. Another factor is the stock compensation expense which totalled $2,100,736 in 2009 as opposed to $580,128 in 2008 and $1,487,661 in 2007. Another factor is the write off of deferred mineral property costs of $Nil in 2009, $Nil in 2008, and $1,323,222 in 2007. If one removes the effect of these factors from each fiscal year the recorded annual loss is $3,247,287 for 2009, and $3,160,739 for 2008 and $2,546,982 for 2007. The remaining general and administrative costs are higher in 2009 than in 2008 and 2007 except for travel expenses, news releases, print and mail out, and filing and transfer agent fees. The Company also had a $360,173 increase in foreign exchange gains when comparing 2009 to 2008. The Company had a foreign exchange loss of $83,292 in 2007, a $37,340 loss in 2008 to a $322,833 gain in 2009.

(3)
Basic earnings (loss) per common share are calculated using the weighted average number of common shares outstanding.  The Company uses the treasury stock method for the calculation of diluted earnings per share. Diluted per share amounts reflect the potential dilution that could occur if securities or other contracts to issue common shares were exercised or converted to common shares. In periods when a loss is incurred, the effect of potential issuances of shares under options and share purchase warrants would be anti-dilutive, and accordingly basic and diluted loss per share are the same.

(4)
Total assets had been increasing year-on-year primarily as a result of the Company's cash balance and continued investment in mineral properties funded by completion of private placement equity financings. At August 31, 2009 the Company held $32,965,685 (2008 -$1,779,871; 2007 - $14,669,067) in cash and cash equivalents. The Company's cash balance at August 31, 2008 was much lower than 2007 and 2009 as it did not complete any equity financings during 2008.

The following table sets forth selected quarterly financial information for each of the last eight (8) quarters.

Quarter Ending	Interest & Other Income (1)	Net Gain  
(Loss) (2)	Net Basic Earnings (Loss)
per Share	
May 31, 2010 restated	$220,145	$31,183,948	$0.33	
February 28, 2010	$177,201	($975,747)	($0.01)	
November 30, 2009	$35,444	          $592,253  	$0.01	
August 31, 2009	$41,315	($2,036,467)	($0.02)	
May 31, 2009	$73,959	($1,478,807)	($0.02)	
February 28, 2009	$24,172	($1,665,682)	($0.03)	
November 30, 2008	$102	($2,100,438)	($0.03)	
August 31, 2008	$22,396	($1,143,001)	($0.02)	
Explanatory Notes:

(1) The Company's primary source of revenue during the quarters listed above was interest revenue from interest bearing accounts held by the Company. The amount of interest revenue earned correlates directly to the amount of cash on hand during the period referenced.

(2) Net gains (losses) by quarter are often materially affected by the timing and recognition of large non-cash income, expenses or write-offs. The quarter ended May 31, 2010 included a non-cash realized gain for the sale of the Company's 18.5% interest in Project 2 of the WBJV in the amount of $45,619,744 and a future income tax expense accrual for $11,900,000.  In the quarter ended February 28, 2010 there were no non-cash income, expenses or write-offs but for example, the quarter ended November 30, 2009 includes a non-cash charge for stock based compensation in the amount of $137,600, and a non-cash gain realized on marketable securities of $2,100,080. The quarter ended August 31, 2009 includes a non-cash charge for stock based compensation in the amount of $705,750, the quarter ended May 31, 2009 includes a non-cash charge for stock based compensation in the amount of $219,535, the quarter ended February 28, 2009 includes a non-cash charge for stock based compensation in the amount of $373,042, the quarter ended November 30, 2008 includes a non-cash charge for stock based compensation in the amount of $802,409, the quarter ended August 31, 2008 includes a non-cash charge for stock based compensation in the amount of $Nil. After adjusting these non-cash charges, the results for the quarters listed show a more consistent trend, with a general growth in expenses over time that is consistent with the Company's increased exploration and corporate activities over the past two years as described above at “Discussion of Operations and Financial Condition”.

Platinum Group Metals Ltd.
(Exploration and Development Stage Company)
           
Restated Supplementary Information and MD&A
For the quarter ended May 31, 2010

 

The Company has not declared nor paid dividends on its common shares. The Company has no present intention of paying dividends on its common shares, as it anticipates that all available funds will be invested to finance the growth of its business.

b)
Trend Information
Other than the financial obligations as set out in the table provided at Item 6. below, there are no demands or commitments that will result in, or that are reasonably likely to result in, the Company's liquidity either increasing or decreasing at present or in the foreseeable future. The Company will require additional capital in the future to meet both its contractual and non-contractual project related expenditures as set out in the table at Item 6. It is unlikely that the Company will generate sufficient operating cash flow to meet all of these expenditures in the foreseeable future. Accordingly, the Company will need to raise additional capital by issuance of securities or by a sale or partnering of project interests in order to meet its ongoing cash requirements.  See discussions at item 2. a) "Results of Operations" above and at item 6. "Liquidity and Capital Resources" below. The Company has completed a Feasibility Study for the Project 1 area of the WBJV. If a production decision is taken the Company will pursue both equity and debt financing for its share of the capital requirements for that project.

c)
Risk Factors
The Company's securities should be considered a highly speculative investment and investors should carefully consider all of the information disclosed in the Company's Canadian and U.S. regulatory filings prior to making an investment in the Company. For a discussion of risk factors applicable to the Company, see the section entitled “Risk Factors” in the Company's most recent annual information form filed with Canadian provincial securities regulators, which was also filed as part of the Company's most recent annual report on Form 40-F with the U.S. Securities & Exchange Commission. Without limiting the foregoing, the following risk factors should be given special consideration when evaluating an investment in the Company's securities.

General
Resource exploration and development is a speculative business, characterized by a number of significant risks including, among other things, unprofitable efforts resulting not only from the failure to discover mineral deposits but also from finding mineral deposits, which, though present, are insufficient in quantity and/or quality to return a profit from production.

The Company's business is subject to exploration and development risks
All but one of the Company's properties are in the exploration stage and no known reserves have been discovered on such properties, the exception being the development stage Project 1 of the WBJV (see Item 2d. “Exploration Programs and Expenditures” below). At this stage, favorable results, estimates and studies are subject to a number of risks, including:

Platinum Group Metals Ltd.
(Exploration and Development Stage Company)
           
Restated Supplementary Information and MD&A
For the quarter ended May 31, 2010

·
the limited amount of drilling and testing completed to date;
·
the preliminary nature of any operating and capital cost estimates;
·
the difficulties inherent in scaling up operations and achieving expected metallurgical recoveries;
·
the likelihood of cost estimates increasing in the future; and
·
the possibility of difficulties procuring needed supplies of electrical power and water.
 
There is no certainty that the expenditures to be made by us or by our joint venture partners in the exploration of the properties described herein will result in discoveries of precious metals in commercial quantities or that any of our properties will be developed. Most exploration projects do not result in the discovery of precious metals and no assurance can be given that any particular level of recovery of precious metals will in fact be realized or that any identified resource will ever qualify as a commercially mineable (or viable) resource which can be legally and economically exploited. Estimates of reserves, mineral deposits and production costs can also be affected by such factors as environmental permit regulations and requirements, weather, environmental factors, unforeseen technical difficulties, unusual or unexpected geological formations and work interruptions. In addition, the grade of precious metals ultimately discovered may differ from that indicated by drilling results. There can be no assurance that precious metals recovered in small-scale tests will be duplicated in large-scale tests under on-site conditions or in production scale.

Economic and Political instability may affect the Company's business
Since mid-calendar 2008 until early 2009 there had been a negative trend with regard to the market for metal commodities and related products as a result of global economic uncertainty, reduced confidence in financial markets, bank failures and credit availability concerns. Markets have shown an improving trend since that time, but macro-economic events could still negatively affect the mining and minerals sectors in general. The Company will consider its business plans and options carefully going forward in 2010 and beyond. Based on current and expected metal prices and cost structures, management has determined that the values of the Company's mineral properties have not been impaired at this time.

South Africa has undergone significant change in its government and laws since the free elections in 1994. At present, Mining Legislation in South Africa is continuing to undergo change. The new Mineral and Petroleum Resources Development Act became law on May 1, 2004. The regulation and operation of this new law is still being implemented. In association with the new Act, the Mining Charter sets out a target of 26% ownership and participation in the mineral industry by “Historically Disadvantaged Persons” within ten years, but the mechanisms to fully affect this objective are still evolving. Accordingly, the South African legal regime may be considered relatively new, resulting in risks related to the possible misinterpretation of new laws, unilateral modification of mining or exploration rights, operating restrictions, increased taxes, environmental regulation, mine safety and other risks arising out of new sovereignty over mining, any or all of which could have an adverse affect on the Company. There is no certainty that the Company will be able to convert its existing exploration rights into mining rights. The Company's operations in general may also be affected in varying degrees by political and economic instability, terrorism, crime, fluctuations in currency exchange rates and inflation.

Platinum Group Metals Ltd.
(Exploration and Development Stage Company)
           
Restated Supplementary Information and MD&A
For the quarter ended May 31, 2010

 

The Company is subject to risk of fluctuations in the relative values of the Canadian Dollar as compared to the South African Rand and the U.S. Dollar
The Company may be adversely affected by foreign currency fluctuations. The Company is primarily funded through equity investments into the Company denominated in Canadian Dollars. In the normal course of business the Company enters into transactions for the purchase of supplies and services denominated in South African Rand. The Company also has cash and certain liabilities denominated in South African Rand. Several of the Company's options to acquire properties or surface rights in the Republic of South Africa may result in payments by the Company denominated in South African Rand or in U.S. Dollars. Exploration, development and administrative costs to be funded by the Company in South Africa will also be denominated in South African Rand. Fluctuations in the exchange rates between the Canadian Dollar and the South African Rand or U.S. Dollar may have an adverse or positive affect on the Company. In the past year to July 14, 2010 the South African Rand has remained constant to the Canadian dollar and the Canadian dollar has appreciated to the American dollar by approximately 10.23%.

The Company's properties are subject to title risks
The Company's properties may be subject to prior unregistered agreements or transfers and title may be affected by undetected defects. These defects could adversely affect the Company's title to such properties or delay or increase the cost of the development of such properties. In addition, the Company's properties may be subject to aboriginal or other historical rights that may be claimed on Crown properties or other types of tenure with respect to which mineral rights have been conferred. The Company is not aware of any aboriginal land claims having been asserted or any legal actions relating to native issues having been instituted with respect to any of the mineral properties in which the Company has an interest. The Company is aware of the mutual benefits afforded by co-operative relationships with indigenous people in conducting exploration activity and is supportive of measures established to achieve such co-operation.

Environmental risk
Environmental legislation on a global basis is evolving in a manner that will ensure stricter standards and enforcement, increased fines and penalties for non-compliance, more stringent environmental assessment of proposed development and a higher level of responsibility for companies and their officers, directors and employees. There is no assurance that future changes to environmental legislation in Canada or South Africa will not adversely affect the Company's operations. Environmental risks may exist on properties in which the Company holds interests which are unknown at present and which have been caused by previous or existing owners or operators. Furthermore, future compliance with environmental reclamation, closure and other requirements may involve significant costs and other liabilities. In particular, the Company's operations and exploration activities are subject to Canadian and South African national and provincial laws and regulations governing protection of the environment. Such laws are continually changing, and in general are becoming more restrictive.

The mineral exploration industry is extremely competitive
The resource industry is intensely competitive in all of its phases, and the Company competes with many companies that possess greater financial resources and technical facilities. Competition could adversely affect the Company's ability to acquire suitable new producing properties or prospects for exploration in the future. Competition could also affect the Company's ability to raise financing to fund the exploration and development of its properties or to hire qualified personnel.

Platinum Group Metals Ltd.
(Exploration and Development Stage Company)
           
Restated Supplementary Information and MD&A
For the quarter ended May 31, 2010

 
Metal prices affect the success of the Company's business
Metal prices have historically been subject to significant price fluctuation. No assurance may be given that metal prices will remain stable. Significant price fluctuations over short periods of time may be generated by numerous factors beyond the control of the Company, including domestic and international economic and political trends, expectations of inflation, currency exchange fluctuations, interest rates, global or regional consumption patterns, speculative activities and increases or decreases in production due to improved mining and production methods. Significant reductions or volatility in metal prices may have an adverse effect on the Company's business, including the economic attractiveness of the Company's projects, the Company's ability to obtain financing and, if the Company's projects enter the production phase, the amount of the Company's revenue or profit or loss.

d)
Exploration Programs and Expenditures General
The Company continues to be active in the Republic of South Africa (“RSA”). In 2003 the Company acquired a 100% South African subsidiary named Platinum Group Metals RSA (Pty.) Ltd. (“PTM RSA”) for the purposes of holding mineral rights and conducting operations on behalf of the Company. The Company conducts all of its South African exploration and development work through PTM RSA.

Mineral property acquisition and capital costs deferred during the period totaled $84,548 (2009 - $67,094). Of this amount acquisition costs relating to the Company's pro-rata share of the WBJV amounted to $1,229 (2009 - $49,536). The balance of $83,319 (2009 - $16,941) was spent on other mineral property costs in Canada and South Africa. Exploration, engineering and development costs incurred globally in the period for the Company's interests totaled $1,012,694 (2009 - $1,111,350). Of that amount $143,999 (2009 - $136,462) was incurred on the Company's Canadian properties and $868,695 (2009 - $974,888) was incurred on the Company's South African properties. Of the South African amount, $828,552 was for the Company's share of WBJV expenditures (2009 - $894,312). The total amount (100%) of expenditures by all Joint Venture partners for the period for the WBJV came to $2,239,330 which was higher than the 100% amount spent for the same period last year (2009 - $1,304,629).

During the period there were no write-offs in deferred costs relating to South African or Canadian projects, and there were no write-offs during the prior period. For more information on mineral properties, see Note 5 of the Company's May 31, 2010 unaudited consolidated financial statements.

Western Bushveld Joint Venture
On October 26, 2004 the Company (37%) entered into a Joint Venture with Anglo Platinum Limited (“Anglo”) (37%) and Africa Wide Mineral Prospecting and Exploration (Pty) Limited (“Africa Wide”) (26%) to pursue platinum exploration and development on combined mineral rights covering approximately 67 square kilometres on the Western Bushveld Complex of South Africa. The Company contributed all of its interests in portions of the farms Onderstepoort 98 JQ and Elandsfontein 102 JQ. Anglo contributed its interests in portions of the farms Koedoesfontein 94 JQ, Elandsfontein 102 JQ and Frischgewaagd 96 JQ. On April 9, 2007, Anglo contributed to the WBJV a 50% interest in the mineral rights to the 494 hectare Portion 11 of the Farm Frischgewaagd 96 JQ. With this addition, the WBJV encompasses approximately 72 square kilometres of territory.

Platinum Group Metals Ltd.
(Exploration and Development Stage Company)
           
Restated Supplementary Information and MD&A
For the quarter ended May 31, 2010

 

In April 2007 Africa Wide accepted an offer for the purchase of 100% their company from Wesizwe. The transaction closed in September 2007 and Wesizwe paid consideration of 57.4 million new shares of Wesizwe at a deemed price of Rand 10.48 per share for total consideration of Rand 601.5 million (approximately $90 million). Since September 2007 Wesizwe has become responsible for all of the rights and obligations of Africa Wide.

The Company published a Feasibility Study for Project 1 of the WBJV in July 2008 and later an Updated Feasibility Study in October 2009.  Based on the WBJV resource estimate contained in the July 2008 Feasibility Study, and under the terms of the original WBJV agreement, each party was allocated an equalization amount due or payable based upon their contribution of measured, indicated, and inferred ounces of combined platinum, palladium, rhodium and gold (“4E”) from the contributed properties comprising the WBJV.  Inferred ounces were credited at US$0.50 per ounce, indicated ounces at US$3.20 per ounce and measured ounces at US$6.20 per ounce.  Ounces contributed to the WBJV by Anglo in 2007 from a 50% interest in Portion 11 of the Farm Frischgewaagd 96 JQ, a property in Project 2, received an equalization credit of US$0.62 per inferred ounce, US$10.37 per indicated ounce and US$39.55 per measured ounce.  On April 22, 2010 the Company paid its equalization amount due to Anglo in the amount of $24.83 million (R 186.26 million).

On April 22, 2010 the Company also completed a transaction originally announced September 2, 2008 with Anglo and Wesizwe whereby the WBJV was dissolved and the Company sold its 18.5% effective interest in Project 2 to Wesizwe and transferred its 37% interest in Projects 1 and 3 into project operating company Maseve Investments 11 (Pty) Ltd. (“Maseve”) for a 37% interest in Maseve.  At the same moment Wesizwe acquired Anglo's 37% interest in the WBJV, retained Anglo's effective 18.5% interest in Project 2, and then transferred 63% of Projects 1 and 3 into Maseve, the result being that Wesizwe retained 100% of Project 2 and that Maseve obtained 100% of Projects 1 and 3.  In exchange for its effective 18.5% of Project 2 the Company received an additional 17.75% interest in Maseve, bringing its holdings in Maseve to 54.75%.  The Company also received a right to acquire a further 19.25% interest in Maseve for subscriptions in the amount of R 408 million (approx. $55.67 million), thereby allowing the Company to increase its shareholding in Maseve to 74%.  Any subscription funds will be held in escrow to be applied towards Wesizwe's capital requirements for Projects 1 and 3.  The cash subscriptions into Maseve are due by January 22, 2011 or the Company will lose the right to increase its interest to 74%.  The Company may make partial subscriptions if it so chooses.

At April 22, 2010 the Company had a total investment in its 37% share of the WBJV of approximately $43.4 million (May 31, 2009 - $19.69 million).  Of this amount costs associated specifically to Project 2 totaled $23.0 million.  The cost attributable to Project 2 is relatively high because of the high equalization costs associated with Portion 11 of the farm Frischgewaagd, as described above.  Based on an estimated fair market value of $65.42 million for an 18.5% interest in Project 2, the Company has recorded a gain on the sale of its share of Project 2 in the amount of $45.62 million.  

Mineral Resources – (MR- Merensky Reef; UG2- Upper Group 2 Reef).

The prill splits and 4E estimates for Project 1 and 3 have been tested for reasonableness 
by kriging on the individual elements. Copper and nickel as well as the minor platinum group elements have also been estimated with a statistical process of Simple Kriging for Project 1.

Platinum Group Metals Ltd.
(Exploration and Development Stage Company)
           
Restated Supplementary Information and MD&A
For the quarter ended May 31, 2010

The Company reported an updated Mineral Resource in a news release dated October 8, 2009.  This updated Resource is based on the additional drilling done in Project 1 & 1A areas. The revised resource estimation indicates that measured and indicated resources have increased as a result of further drilling in the Project 1 & 1A areas. These upgraded ounces have not yet been included in the mineable Reserves of the Updated Feasibility mine plan. The Resource update was done to conform to a minimum 80cm resource cut which is in line with that used by producing mines in the area. Sampling practice, bore hole data, other factors and quality control and assurance are as reported previously. The Resources are estimated by kriging of approximately 231 boreholes plus deflections and are reported under SAMREC. The categories are the same as CIM categories. Quality controls include chain of custody, insertion of blanks, duplicates, standards and check assays as previously disclosed.

The Independent Qualified Person for the Mineral Resources is Charles Muller of Minxcon.

Note the Company's 74% interest in the following reserves and resources is subject to the completion of the Consolidation Transaction announced on September 2, 2008 and which is described above at Item 2 a) “Results of Operations” and elsewhere in this document.

WBJV Project 1 – 100% Basis

Measured Mineral Resource (4E)	Cut-off (cm.g/t)	 Tonnage (Mt)	Grade 4E
(g/t)	Mining Width (m)	Content
(4E)+	Content 4E (Moz)	
Project 1 MR	300	6.603	8.38	1.33	55.333	1.779	
Project 1 UG2	300	7.464	4.26	1.34	31.797	1.022	
Total Measured	300	14.067	6.19	1.34	87.130	2.801	

Prill Splits	Pt	Pt (g/t)	Pd	Pd (g/t)	Rh	Rh (g/t)	Au	Au (g/t)	
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	

							
Indicated Mineral Resource (4E)	Cut-off (cm.g/t)	Million Tonnes (Mt)	Grade 4E
(g/t)	Mining Width (m)	Tonnes PGE
(4E)	Moz PGE's (4E)	
Project 1 & 1A MR	300	11.183	7.25	1.24	81.077	2.607	
Project 1 & 1A  UG2	300	19.209	4.46	1.39	85.672	2.754	
Total Indicated	300	30.392	5.49	1.34	166.749	5.361	

Platinum Group Metals Ltd.
(Exploration and Development Stage Company)
           
Restated Supplementary Information and MD&A
For the quarter ended May 31, 2010

									
Prill Splits	Pt	Pt (g/t)	Pd	Pd (g/t)	Rh	Rh (g/t)	Au	Au (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	

Inferred Mineral Resource (4E)	Cut-off (cm.g/t)	Million Tonnes (Mt)	Grade 4E
(g/t)	Mining Width (m)	Tonnes PGE
(4E)	Moz PGE's (4E)	
Project 1 MR	300	0.154	8.96	1.06	1.380	0.044	
Project 1 UG2	300	0.022	3.91	0.83	0.086	0.003	
Total Inferred	300	0.176	8.33	1.03	1.466	0.047	

Prill Splits	Pt	Pt (g/t)	Pd	Pd (g/t)	Rh	Rh (g/t)	Au	Au (g/t)	
Project 1 MR	64%	5.73	27%	2.42	4%	0.36	5%	0.45	
Project 1 UG2	63%	2.46	26%	1.02	10%	0.39	1%	0.04	

Mineral Reserves – derived from the Measured & Indicated Resources and not in addition to them.

Cautionary Note to U.S. Investors : The U.S. Securities and Exchange Commission permits U.S. mining companies, in their filings with the SEC, to disclose only those mineral deposits that a company can economically and legally extract or produce. We use certain terms in this document, such as “measured,” “indicated,” and “inferred,” “reserves,” “resources,” that the SEC guidelines strictly prohibit U.S. registered companies from including in their filings with the SEC. “Resources” are not “Reserves” and so do not have demonstrated economic viability. U.S. investors are urged to consider closely the disclosure in our U.S. regulatory filings, File No. 001-033562, which may be secured from us, or from the SEC's website at:  http://sec.gov

A Probable Reserve is the economically mineable part of an Indicated, and in some circumstances a Measured Resource, demonstrated by at least a Pre-Feasibility Study including adequate information on mining, processing, metallurgy, and economic and other factors that demonstrate, at the time of reporting, that economic extraction can be justified. A Proven Reserve is the economically mineable part of a Measured Resource demonstrated by the same level and factors as above. A Proven Mineral Reserve implies that there is a high degree of confidence.

The current Mineral Reserve used for mine planning purposes has not yet taken the updated Resource into account.

The conversion to Mineral Reserves was undertaken at 3.5g/t stope cut-off grade. Each stope has been fully diluted for mine modeling purposes by way of planned dilution and additional dilution for all aspects of the mining process. The Inferred Resources are outside and in addition to the reserves.

Platinum Group Metals Ltd.
(Exploration and Development Stage Company)
           
Restated Supplementary Information and MD&A
For the quarter ended May 31, 2010

The Independent Qualified Person for the Statement of Reserves is Tim Spindler.

Merensky	 	UG2	
Tonnage	4E	Content 4E	 	Tonnage	4E	Content 4E	
(000)
T	(g/t)	Tonne	Moz	 	(000)
T	(g/t)	Tonne	Moz	
Merensky Proven	 	UG2 Proven	
6,678	5.61	37.478	1.21	 	5,086	3.37	17.126	0.55	
Merensky Probable	 	UG2 Probable	
11,333	5.44	61.677	1.98	 	8,449	3.41	28.831	0.93	
Total Merensky Mineral Reserves	 	Total UG2 Mineral Reserves	
18,011	5.51	99.155	3.19	 	13,535	3.40	45.957	1.48	

Prill Splits	Pt	Pt (g/t)	Pd	Pd (g/t)	Rh	Rh (g/t)	Au	Au (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	

The prill splits as shown above are the same percentages as for the earlier reported Measured and Indicated Resources. The splits have a lower confidence level when compared to the 4E grades. The reserves are stated with certain risk factors including, but not limited to, mining project risks as highlighted in the “Risks and Opportunities” section as well in the disclosure statement.

The Updated Feasibility Study recommends a series of five simultaneous declines accessing the deposit with a mining rate of 156,000 tonnes per month, which provides 13 years of steady state tonnage production. First ore is reached by development 13 months from the commencement of underground work. Mining is only scheduled on the reserves. There are further Inferred Resources in the Project 1 area which may represent additional production potential. The lower grade UG2 resources also provide some future opportunities. The mining and development plan includes conventional hand held drilling utilizing electrical drills and scraper winch cleaning similar to the successful conventional mining at the adjacent producing Bafokeng Rasimone Platinum Mine. Declines and primary access to the deposit is designed for development with mechanized equipment. Ore is initially to be hauled out of the mine with mechanized equipment and assisted then by conveyor from year 4 of mine life to end of mine life.

The Merensky Reef will be mined at widths between 93cm and 176cm at an average of 115cm and the UG2 Reef will be mined at widths between 105cm and 205cm at an average of 153cm.

The updated Project 1 mine design involves the construction of a platinum mine and concentrator to produce approximately 275,000 ounces of combined platinum, palladium, rhodium and gold (“4E”) in concentrate per year steady state for 9 years with a 22 year total underground mine life. The capital cost for the mine and concentrator complex were estimated at R3.55 billion (approximately $497 million at the time of writing) for peak funding and R4.76 billion (approximately $667 million at the time of writing) for life of mine funding. The current peak funding capital cost estimate is approximately R500 million (approximately $70 million) lower than the July 2007 estimate, primarily due to the reduction in capital costs resulting in a design change from 100% diesel self electrical generation capacity to a 25% stand by capacity as well as from improved mine development planning.

Platinum Group Metals Ltd.
(Exploration and Development Stage Company)
           
Restated Supplementary Information and MD&A
For the quarter ended May 31, 2010

 

The results of the Updated Feasibility Study show a 23.5% Internal Rate of Return (pre-tax) Base Case, using 3 year trailing metal prices to September 2009, calculated on the monthly averages including US$1,343 per ounce for platinum. The Updated Feasibility Study model does not include escalation due to inflation of costs or metal prices.

Project 1 Resource Calculation Detail

The Mineral Resources reported in the Updated Feasibility Study had not been previously disclosed. This updated Resource is based on the additional drilling done in Project 1 & 1A areas. The Resource update was done to conform to a minimum 80cm resource cut which is in line with that used by producing mines in the area. Sampling practice, bore hole data, other factors and quality control and assurance are as reported previously. The Resources are estimated by kriging of approximately 231 boreholes plus deflections and are reported under SAMREC. The categories are the same as CIM categories. Quality controls include chain of custody, insertion of blanks, duplicates, standards and check assays as previously disclosed.
Project Area 3 – Mineral Resource Statement
MR = Merensky Reef; UG2 = Upper Group No. 2 chromitite seam; PGE=Platinum Group Metals.

The cut-offs for Inferred Mineral Resources have been established by a qualified person after a review of potential operating costs and other factors.

The following resources are quoted on a 100% basis. The Company has agreements in place whereby it will attain 74% of these resources.

Inferred Mineral Resource (4E)	Cut-off (cm.g/t)	Million Tonnes	Grade 4E (g/t)	Potential Mining Width (m)	Tons PGE (4E)	Moz PGEs
(4E)	
Project 3 MR	100	4.040	6.26	1.12	25.307	0.814	
Project 3 UG2	100	6.129	5.51	1.22	33.781	1.086	
Total Inferred	100	10.169	5.81	 	59.088	1.900	

Prill Splits	Pt	Pt (g/t)	Pd	Pd (g/t)	Rh	Rh (g/t)	Au	Au (g/t)	
Project 3 MR	64%	4.01	27%	1.69	4%	0.25	5%	0.31	
Project 3 UG2	62%	3.42	28%	1.54	9%	0.50	1%	0.06	

The Qualified Person for the mineral resources reported above is Charles Muller of Minxcon.

Project 3 Resource Calculation Detail
A 14% geological loss for the Merensky Reef and UG2 Reef respectively was applied to the area to accommodate for areas of potentially un-mineable structural and geological conditions. This geological loss considers losses for faults, dykes, potholes and areas of iron replacement pegmatite. Structural loss estimates are based on drilling, field mapping and remote sense data which include a high resolution aeromagnetic survey and a 3D seismic survey. The Merensky mineral resource estimate is based on 24 boreholes with 27 intercepts and the UG2 is based on 15 intercepts within the 224.28 hectare area. The prill split has been calculated by weighted averages as a proportion of the total 4E and the grades have been estimated with a more rigorous statistical process of Simple Kriging. (The prill splits and 4E estimates have been tested for reasonableness by kriging on the individual elements).  Copper and nickel as well as the minor platinum group elements have also been estimated with a statistical process of Simple kriging. The cut-off was determined on a practical mining width and the known costs and mining methods regionally. Platinum Group's independent consulting Qualified Person has provided the mineral resource estimate according to the SAMREC code. The reconciliation to the CIM codes is that the categories are the same. The resources are located on new order prospecting permits that provide for the right to be converted to mining rights. Charles Muller of Minxcon is the Qualified Person for this report. He is registered with the South African Council for Natural Scientific Professions (“SACNASP”) (Registration No. 400201/04).

Platinum Group Metals Ltd.
(Exploration and Development Stage Company)
           
Restated Supplementary Information and MD&A
For the quarter ended May 31, 2010

 

Northern Limb, Bushveld - War Springs and Tweespalk Properties
On June 3, 2002, the Company acquired an option to earn a 100% interest in the 2,396 hectare War Springs property and the 2,177 hectare Tweespalk property both located in the Northern Limb or Platreef area of the Bushveld Complex north of Johannesburg. The Company now holds New Order prospecting permits on 100% of this territory. Acquisition and exploration costs on these properties net of recoveries to May 31, 2010 total $3.42 million (2009 - $3.36 million). The Company can settle the vendors' residual interests in these mineral rights at any time for US$690 per hectare. The Company pays annual prospecting fees to the vendors of US$3.25 per hectare. The vendors retain a 1% NSR Royalty on the properties, subject to the Company's right to purchase the NSR at any time for US$1.4 million.
Black Economic Empowerment groups Africa Wide, a subsidiary of Wesizwe, and Taung Minerals (Pty) Ltd., a subsidiary of Platmin Limited, have each acquired a 15% interest in the Company's rights to the War Springs project carried to bankable feasibility. The Company retains a net 70% project interest. Africa Wide also has a 30% participating interest in the Tweespalk property.
On March 5, 2009 the Company announced an agreement with JOGMEC, an incorporated administrative institution of the Government of Japan, whereby they may earn up to a 35% interest in the Company's rights to the War Springs project for an optional work commitment of US$10 million over 5 years. The first and second year JOGMEC option commitments of US$1,500,000 has been completed with approximately 12,397 metres drilled to March 31, 2010. Total expenditures incurred by JOGMEC to May 31, 2010 amounted to approximately $1.92 million.  Further work programs for the War Springs project in 2010 are currently being planned and funding in the amount of US $475,195 has been approved by JOGMEC for the next phase of work.

The Company has entered an agreement with JOGMEC whereby they may earn up to a 37% interest in the Company's rights to the Waterberg project for an optional work commitment of US$3.2 million over 4 years. Total expenditures incurred by JOGMEC to May 31, 2010 amounted to approximately $392,471 on the Waterberg project.  Further work programs for the Waterberg project in 2010 are currently being planned and funding in the amount of US $445,894 has been approved by JOGMEC for the next phase of work.

Platinum Group Metals Ltd.
(Exploration and Development Stage Company)
           
Restated Supplementary Information and MD&A
For the quarter ended May 31, 2010

On March 17, 2008 the Company published a revised and updated resource calculation for the War Springs property based on drilling and exploration work conducted in the last three years. Details are as follow:

100% Basis

Reef	Cut-off 3E	Tonnage	3E	Ni	Cu	Channel Width	
 	cmg/t	T	g/t	G	Moz	%	t	%	t	Cm	
B Reef	300	20,934,894	0.95	19,947,131	0.641	0.18	35,870	0.14	27,863	657	
C Reef	300	26,030,561	1.24	32,192,522	1.035	0.08	25,812	0.06	19,388	875	
Total	300	46,965,455	1.11	52,139,652	1.676	0.13	64,965	0.10	49,868	734	

							
  Reef	Prill Splits	
	Pt	Pd	Au	
	g/t	%	g/t	%	g/t	%	
B Reef	0.32	34	0.55	58	0.08	8	
C Reef	0.20	16	0.97	78	0.07	6	

The War Springs Mineral Resource is characterised by two distinct reef layers, termed the "B" and "C" reefs. Both reefs are typically greater than 6 metres thick. The reefs outcrop on surface and extend down dip in parallel sheets at a 65 degree angle to a depth of 400 metres, remaining open at depth. A 5% geological loss has been applied. Eighteen holes had been completed by the end of May 2005, relating to 7,433 metres of drilling. A total of 8,188 samples were collected for the determination of elements Platinum, Palladium, Gold, Copper and Nickel. Four additional boreholes were drilled (1,646m) during the period November 2005 to early February 2006, on high priority soil targets (Phase 2 Drilling Program). An additional 1,738 samples were collected for analysis. Of the 22 boreholes drilled, 15 boreholes intersected the “B” Reef and 8 boreholes intersected the “C” Reef. Drilling results from Phase 1 and 2 covering approximately 2,200 metres of strike length on a 250 metre spacing, combined with a review of the cut-off, form the basis of the updated Inferred Mineral Resource estimation reported in a NI43-101 document, compiled by Minxcon (Pty) Ltd, dated March, 2008. Mr. Charles Muller of Minxcon is the Qualified Person for the War Springs resource estimate. Samples were analyzed under Platinum Group's previously published protocols for the project including insertion of blanks, duplicates and certified reference materials in the assay stream once in every 24 or fewer samples. This is in addition to internal quality control measures undertaken by the contracted certified analytical facilities. Assays were completed by standard fire assay procedures with preparation at the Setpoint facility at Mokopane and final assays at Genalysis Laboratories Services Pty Ltd. in Perth Australia or Anglo Research Laboratories.

Lac Des Iles Area Properties, Ontario
On May 5, 2000, New Millennium entered into an option agreement to acquire a 50% interest in the Lac des Iles River property located near Thunder Bay, Ontario in exchange for cash payments ($43,500 paid in total) and the completion of exploration expenditures. On October 6, 2006, the Company and the property vendors entered into a termination and sale agreement whereby the option agreement was cancelled and the Company purchased an undivided 100% interest in the property subject only to an underlying 2.0% Net Smelter Return Royalty. In settlement the Company made a one-time payment to the vendors of $50,000 in lieu of past and future exploration expenditure commitments not incurred.

Platinum Group Metals Ltd.
(Exploration and Development Stage Company)
           
Restated Supplementary Information and MD&A
For the quarter ended May 31, 2010

 

In April 2000, and later as amended in January 2005, the Company acquired an option to earn a 50% interest in the South Legris property located near Thunder Bay, Ontario in exchange for cash payments ($105,000 paid in total) and the completion of certain exploration expenditures. On October 13, 2006, the Company and the property vendors entered into a termination and sale agreement whereby the option agreement was cancelled and the Company purchased an undivided 100% interest in the property subject only to underlying 2.0% Net Smelter Return Royalties. In settlement the Company made a one-time payment of $50,000 in lieu of past and future exploration expenditure commitments not incurred.

On June 28, 2000, the Company entered into an option agreement to earn up to 60% interest in the Shelby Lake property, located near Thunder Bay, Ontario in exchange for cash payments of $15,000 (paid), the issue of 30,303 shares (issued) and the completion of exploration expenditures. On October 18, 2006, the Company and the property vendor entered into a termination and sale agreement whereby the option agreement was cancelled and the Company purchased an undivided 100% interest in the property for a one-time payment of $5,000 subject only to an underlying 2.0% Net Smelter Return Royalty.

The Company has conducted work programs on its Lac Des Iles projects during 2008, 2009 and 2010. A 1,125 metre drill program was completed on the projects in the first quarter of 2008 and a further 978 metres was completed in February of 2009.  In the period ended May 31, 2010 the Company incurred $143,999 of costs for geophysical and other ground based work on the Lac des Iles project area.  Encouraging exploration results for palladium, platinum, nickel and copper continue to be returned and the Company plans to invest further in the project.

e)
Administration Expenses
The Company maintains a corporate office in Canada and both a corporate and field office in South Africa.  General and administrative expenses for the period totaled $5,735,029 (2009 - $4,063,134).  The increase in general and administrative expenses over the comparative period is explained for the most part by a foreign exchange loss of $906,749 compared to a foreign exchange gain of $259,540 in 2009.  Professional fees totalled $1.21 million for the period (2009 - $726,768).  This amount includes $984,186 for legal fees, $117,186 for accounting advisory fees and $107,229 for audit fees.  All of these costs are higher than in the comparative period as the Company has been conducting negotiations, due diligence and drafting of agreements related to strategic options.  Management and Consulting fees of $1.09 million (2009 - $769,610) were higher in the current period in part due to $184,881 incurred for independent technical due diligence and $123,340 in additional director and senior management fees.  The amount of salaries and benefits expensed in the period remained constant $1.33 million (2009 - $1.28 million).  Offsetting some of these increased expenses was a decrease of $145,721 in shareholder relations expenses ($140,550 vs. $286,271 in 2009); and a decrease of $151,334 in travel expenses ($329,756 vs. $481,090 in 2009).

Platinum Group Metals Ltd.
(Exploration and Development Stage Company)
           
Restated Supplementary Information and MD&A
For the quarter ended May 31, 2010

 

f)
Related Party Transactions
Management, consulting fees and salaries incurred with directors and officers during the period amounted to $612,848 (2009 - $294,724). Of this amount, approximately $289,307 (2009 - $155,974) was paid as fees to the Company's President, and $243,542 (2009 - $138,750) was paid as salary for the Company's CFO. At May 31, 2010 there were $22,757 in fees (2009 - $8,099) owed and included in accounts payable.

Until early 2010 the Company provided services at market rates for day-to-day administration and accounting to MAG Silver Corp. (“MAG”), a company with three common directors. Fees received have been credited by the Company against its own administrative costs.  The Company received service fees of $64,347 (2009 - $102,131) during the period from MAG.  Since January 2010 the service fees the Company receives from MAG have been reduced or eliminated as MAG Silver is now handling its own administration.

During the period the Company accrued or received service fees of $8,000 (2009 – $32,000) from West Timmins Mining Inc. (“WTM”), a company which prior to being acquired by Lake Shore Gold Corp, had three common directors.  These service fees were eliminated in 2010, since WTM was acquired by Lakeshore Gold. Corp. in November 2009.

During the period the Company provided services at market rates for day-to-day administration and accounting to West Kirkland Mining Inc. (“WKM”), a company with three common directors.  Fees received have been credited by the Company against its own administrative costs.  The Company received service fees of $21,250 (2009 - $Nil) during the period from WKM.

During the period the Company provided services at market rates for day-to-day administration and accounting to Nextraction Energy Corp. (“Ne”), a company with three common directors.  Fees received have been credited by the Company against its own administrative costs.  The Company received service fees of $25,500 (2009 - $Nil) during the period from Ne.

During the period ended August 31, 2005, the Company entered into an office lease agreement with Anthem Works Ltd. (“Anthem”), a company with a common director. During the period ended May 31, 2010 the Company accrued or paid Anthem $65,870 under the office lease agreement (2009 - $65,376). The space occupied approximates one third of 6,050 square feet in a first tier building located in downtown Vancouver, British Columbia. The rental rate was negotiated on an “arm's length basis”.

All of the above transactions are in the normal course of business and are measured at the exchange amount which is the consideration established and agreed to by the noted parties.
g)
Shareholder Relations' Expenses
Shareholder relations' expense during the period totaled $140,550 (2009 - $286,271).  The decrease from the prior year is due to more normalized expenditures for the period, whereas in the previous year the volatile economic circumstances required greater effort and spending in this cost area. The Company manages its shareholder relations as an internal function and the Company actively seeks to raise its profile with both retail and institutional investors. From June 2005 to present Mr. Tony Mahalski of LM Associates in London, U.K., has also been engaged for a fee of GBP 1,000 per month for the purpose of general business development and the raising of the Company's profile in Europe.

Platinum Group Metals Ltd.
(Exploration and Development Stage Company)
           
Restated Supplementary Information and MD&A
For the quarter ended May 31, 2010

h)
Travel and Promotion Expenses
Travel expenses for the period amounted to $329,756 (2009 - $481,090). These activities relate to the supervision of ongoing operations in South Africa and Canada, new property investigations and meetings with potential and current institutional and sophisticated investors. Travel related to all of these activities was lower during the period than in the same period in 2009. Promotional expenses in the period amounted to $154,255 (2009 - $175,741) and these costs relate to design work, media relations, printed material, postage and trade show attendance and efforts were made to reduce such costs during the period.

i)
Property Acquisition and Capital Expenses
Property acquisition expenditures and capital costs during the year totaled $84,548 (2009 - $67,094). These expenditures were incurred to acquire or maintain option rights to South African mineral properties.

The Company evaluates its property interests on an ongoing basis and intends to abandon properties that fail to remain prospective. Apart from a possible buy-out of the War Springs and Tweespalk properties, the Company has no other required property acquisition payments due to vendors under mineral property option agreements. At the time of writing the Company was incurring further property acquisition expenses, such as research and staking expenses, through its activities in Ontario, Canada and South Africa.

During the year ended August 31, 2008 the Company purchased surface rights adjacent to the WBJV Project 1 deposit area measuring 216.27 hectares at a price of Rand 8.0 million (approx. $1.09 million). During the 2009 year the Company completed the purchase of surface rights directly over a portion of the WBJV Project 1 deposit area measuring 358.79 hectares for the price of Rand 15.07 million (approx. $2.07 million).  The rights to these two properties are to the benefit of the Company only and are distinct from the 365.64 hectare Elandsfontein Farm originally purchased in 2004 for the benefit of the WBJV.

j)
Off-Balance Sheet Arrangements
The Company has no off-balance sheet arrangements.

3.
CRITICAL ACCOUNTING ESTIMATES
The preparation of financial statements in conformity with Canadian GAAP requires Management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements, and the reported amounts of revenues and expenditures during the reporting period. Management has identified (i) mineral property acquisition and exploration deferred costs (ii) provision for reclamation and closure, (iii) future income tax provision (iv) stock based compensation and (v) recoverability of its interest in mineral properties as the main estimates for the following discussion. Please refer to Note 2 of the Company's Audited consolidated financial statements for a description of all of the significant accounting policies.

Platinum Group Metals Ltd.
(Exploration and Development Stage Company)
           
Restated Supplementary Information and MD&A
For the quarter ended May 31, 2010

Under Canadian GAAP, the Company defers all costs relating to the acquisition and exploration of its mineral properties. Any revenues received from such properties are credited against the costs of the property. When commercial production commences on any of the Company's properties, any previously capitalized costs would be charged to operations using a unit-of-production method. The Company reviews when events or changes in circumstances indicate the carrying values of its properties including its investment in the WBJV, to assess their recoverability and when the carrying value of a property exceeds the estimated net recoverable amount, provision is made for impairment in value.
The existence of uncertainties during the exploration stage and the lack of definitive empirical evidence with respect to the feasibility of successful commercial development of any exploration property does create measurement uncertainty concerning the estimate of the amount of impairment to the value of any mineral property. The Company relies on its own or independent estimates of further geological prospects of a particular property and also considers the likely proceeds from a sale or assignment of the rights before determining whether or not impairment in value has occurred.

Reclamation and closure costs have been estimated based on the Company's interpretation of current regulatory requirements, however changes in regulatory requirements and new information may result in revisions to estimates. The Company recognizes the fair value of liabilities for reclamation and closure costs in the period in which they are incurred. A corresponding increase to the carrying amount of the related assets is generally recorded and depreciated over the life of the asset.

The future income tax provision is based on the liability method. Future taxes arise from the recognition of the tax consequences of temporary differences by applying enacted or substantively enacted tax rates applicable to future years to differences between the financial statement carrying amounts and the tax bases of certain assets and liabilities. The Company records a valuation allowance against any portion of those future income tax assets that it believes will, more likely than not, fail to be realized.

For its 2005 fiscal year, The Company adopted CICA Handbook Section 3870 – Stock-Based Compensation and other Stock-Based Payments, which requires the fair value method of accounting for stock options. Under this method, the Company is required to recognize a charge to the income statement based on an option-pricing model based on certain assumptions. For the year ended August 31, 2009 the assumptions were as follows; no dividends were paid, a weighted average volatility of the Company's share price of 77.97%, a weighted average annual risk free rate of 2.59% and an expected life of 3.21 years. The resulting weighted average option pricing resulted in an expense for stock options in the year ended August 31, 2009 of $2,518,107. Of the $2,518,107 in cost calculated for August 31, 2009 an amount of $2,100,736 was expensed while $417,371 was capitalized to deferred mineral property exploration costs in the Company's WBJV interest. In the period ended May 31, 2010 no stock options were granted. Of the $164,894 in cost calculated for May 31, 2010 for options vested in the period, an amount of $137,600 was expensed while $27,294 was capitalized to deferred mineral property exploration costs, not including gross up FIT liability of $10,900.

4.
SIGNIFICANT ACCOUNTING POLICIES
The Company's significant accounting policies are set out in Note 2 of its Financial Statements for the period ended May 31, 2010. There are several policies that are significant to the financial results of the Company.

Under Canadian GAAP, the Company defers all costs relating to the acquisition and exploration of its mineral properties. Any revenues received from such properties are credited against the costs of the property. When commercial production commences on any of the Company's properties, any previously capitalized costs would be charged to operations over the life of the property using a unit-of-production method. The Company regularly reviews deferred exploration costs to assess their recoverability when facts and circumstances indicate that the carrying value of a property exceeds the estimated net recoverable amount, provision is made for impairment in value.

Platinum Group Metals Ltd.
(Exploration and Development Stage Company)
           
Restated Supplementary Information and MD&A
For the quarter ended May 31, 2010

The existence of uncertainties during the exploration stage and the lack of definitive empirical evidence with respect to the feasibility of successful commercial development of any exploration property do create measurement uncertainty concerning the calculation of the amount of impairment to the value of any mineral property. The Company relies on its own or independent estimates of further geological prospects of a particular property and also considers the likely proceeds from a sale or assignment of the rights before determining whether or not impairment in value has occurred.

Future income taxes are calculated based on the liability method. Future income taxes arise from the recognition of the tax consequences of temporary differences by applying enacted or substantively enacted tax rates applicable to future years to differences between the financial statement carrying amounts and the tax bases of certain assets and liabilities. The Company records a valuation allowance against any portion of those future income tax assets that it believes will, more likely than not, fail to be realized.

5.

RECENT ACCOUNTING PRONOUNCEMENTS
CICA Section 3064, Goodwill and Intangible Assets , replaces Section 3062, Goodwill and Other Intangible Assets and Section 3450, Research and Development Costs . In February 2008, the CICA issued the new pronouncement establishing revised standards for the recognition, measurement, presentation and disclosure of goodwill and intangible assets. The new standard also provides guidance for  the  treatment  of  preproduction  and  startup  costs  and  requires  that  these  costs  be expensed  as  incurred. The new standard applies to annual and interim financial statements relating to fiscal years beginning on or after October 1, 2008. Section 3064 was adopted September 1, 2009, and doing so has had no effect.

In July 2009, the CICA approved amendments to Section 3862, Financial Instruments – Disclosures. The amendments require additional fair value disclosure for financial instruments and liquidity risk disclosures. These amendments require a three-level hierarchy that reflects the significance of the inputs used in making fair value assessments. The amendments to Section 3862 apply for financial statements relating to fiscal years ending after September 30, 2009. The Company is assessing the impact of these amendments on its consolidated financial statements.

In January 2009, The CICA issued CICA Handbook Section 1582, Business Combinations, Section 1601, Consolidations, and Section 1602, Non-controlling Interests. These sections replace the former CICA Handbook Section 1581, Business Combinations and Section 1600, Consolidated Financial Statements and establish a new section for accounting for a non-controlling interest in a subsidiary. CICA Handbook Section 1582 establishes standards for the accounting for a business combination, and states that all assets and liabilities of an acquired business will be recorded at fair value. Obligations for contingent considerations and contingencies will also be recorded at fair value at the acquisition date. The standard also states that acquisition related costs will be expensed as incurred and that restructuring charges will be expensed in the periods after the acquisition date. The section applies prospectively to business combinations for which the acquisition date is on or after the beginning of the first annual reporting period beginning on or after January 1, 2011.
CICA Handbook Section 1601 establishes standards for the preparation of consolidated financial statements.

Platinum Group Metals Ltd.
(Exploration and Development Stage Company)
           
Restated Supplementary Information and MD&A
For the quarter ended May 31, 2010

CICA Handbook Section 1602 establishes standards for accounting for a non-controlling interest in a subsidiary in the preparation of consolidated financial statements subsequent to a business combination.

CICA Handbook Section 1601 and Section 1602 apply to interim and annual consolidated financial statements relating to fiscal years beginning on or after January 1, 2011. Earlier adoption of these sections is permitted as of the beginning of a fiscal year.

All three sections must be adopted concurrently. The Company is currently evaluating the impact of adopting the sections.
Convergence with International Financial Reporting Standards (“IFRS”). In February 2008, the Canadian Accounting Standards Board confirmed that publicly accountable enterprises will be required to adopt IFRS for fiscal years beginning on or after January 1, 2011, with earlier adoption permitted. Accordingly, the conversion to IFRS will be applicable to the Company no later than the quarter ended November 30, 2011, with restatement of comparative information presented. The conversion to IFRS will impact the Company's accounting policies, information technology and data systems, internal control over financial reporting, and disclosure controls and procedures. The transition may also impact business activities, such as foreign currency activities, certain contractual arrangements, capital requirements and compensation arrangements. The Company is currently evaluating the future impact of IFRS on its financial statements and will continue to invest in training and additional resources to ensure a timely conversion.

6.
LIQUIDITY AND CAPITAL RESOURCES
During the period the Company issued a total of 1,111,625 (2009 – 5,167,120) common shares for net cash proceeds of $1,114,824 (2009 - $7,589,721). Cash proceeds are primarily spent on mineral property and surface right acquisitions, exploration and development as well as for general working capital purposes. The Company's primary source of capital has been from the sale of equity. At May 31, 2010 the Company had cash and cash equivalents on hand of $4,782,350 compared to $2,865,872 at May 31, 2009.

The Company receives lump sum cash advances at various times as laid out in agreed budgets from its joint venture partners to cover the costs of the WBJV and JOGMEC. The balance of cash outflows is made up of management and consulting fees and salaries of $2,422,793 (2009 - $2,054,233) and other general and administrative expenses of $3,312,235 (2009 - $2,008,901).

The following Table discloses the Company's continual obligations for optional mineral property acquisition payments and contracted office and equipment lease obligations. Apart from a possible buy-out of the War Springs and Tweespalk projects (these optional acquisition payments are included in the following table); the Company has no other property acquisition payments due to vendors under mineral property option agreements. The Company has no long term debt or loan obligations. Under the terms of several of the Company's mineral property option and purchase agreements, the Company is required to make certain scheduled acquisition payments as summarized in the table below in order to preserve the Company's interests in the related mineral properties. In the event the Company is unable or unwilling to make these payments, it is likely that the Company would forfeit its rights to acquire the related properties.

Platinum Group Metals Ltd.
(Exploration and Development Stage Company)
           
Restated Supplementary Information and MD&A
For the quarter ended May 31, 2010

 

Payments by period in Canadian Dollars	
Total	< 1
Year	1 – 3
Years	3 – 5
Years	> 5
Years	
Optional Subscription into Maseve (1)	
$55,668,468	
$55,668,468	
$0	
$ 0	
$0	
Costs due Wesizwe Platinum (2)	
$212,822	
$212,822	
$0	
$0	
$0	
Optional Acquisition Payments (War Springs & Tweespalk) (3)	

$3,250,000	

$3,250,000	

$0	

$0	

$0	
Lease Obligations	   $48,536	$36,680	$ 11,856	$0	$0	
Totals	$59,179,826  	$59,167,970  	$11,856  	$ 0	$ 0	
Explanatory Notes:

(1)
The optional Maseve subscription amount is denominated in Rand and is set at Rand 408.61 million.  See above at item “2. Discussion of Operations and Financial Condition, a) Results of Operations” for details of the Maseve subscription amount.  

(2)
Upon the wind up of the WBJV on April 22, 2010 an amount of R 7.09 million was due from Wesizwe to the Company for their share of project costs.  An amount was also due from Anglo for project costs accrued since August 15, 2008 of R 10.01 million and this amount was added to the amount due from Wesizwe pursuant to the agreements whereby the WBJV was wound up.  At April 22, 2010 the Company recorded a credit to Wesizwe's account for R 7.51 million for their share of the book value of winders held for sale and for R 1.63 million for their share of Elandsfontein surface rights, both items being originally for the benefit of the WBJV.  At April 22 the Company accrued an amount due and a further credit of R 9.72 million to Wesizwe's account representing PTM's estimated obligation to Wesizwe for past exploration costs on Project 2 pursuant to the agreements whereby the WBJV was wound up.  After the above items are recorded the Company estimates a net amount of R 1.76 million ($212,822) due to Wesizwe.  
 
(3)
The optional acquisition payments for the War Springs and Tweespalk properties are denominated in US dollars. See item 2. d) “Exploration Programs and Expenditures” above.

Cash at May 31, 2010 is sufficient to fund the general operation costs of the Company for calendar 2010, but will be insufficient to cover all of the payments envisioned in the table above.  The Company is considering and analyzing various strategies to maximize shareholder value going forward. One strategy would be to simply conserve working capital and look toward potential traditional construction financing in 2010. The Company continues to discuss financing possibilities with several large banks who have expressed interest to be involved in the financing of Project 1. A second option would be to consider a strategic partner who has the financial ability to finance Project 1 construction costs, possibly with a metal price instrument or hedge.  A third option would be to sell some or all of the South African projects at the most favorable price for shareholders. All three options are currently being pursued.

7.
OUTSTANDING SHARE DATA
The Company has an unlimited number of common shares authorized for issuance without par value. At May 31, 2010 and at July 14, 2010 there were 93,927,292 common shares outstanding, 5,038,000 incentive stock options outstanding and 12,537,150 common share purchase warrants outstanding. During the period ending May 31, 2010, the Company made no changes to the exercise price of outstanding options through cancellation and reissuance or otherwise.

Platinum Group Metals Ltd.
(Exploration and Development Stage Company)
           
Restated Supplementary Information and MD&A
For the quarter ended May 31, 2010

8.
DISCLOSURE CONTROLS AND INTERNAL CONTROL OVER FINANCIAL REPORTING
The Company maintains a set of disclosure controls and procedures designed to ensure that information required to be disclosed in filings made pursuant to both U.S. Securities and Exchange Commission and Canadian Securities Administrators requirements are recorded, processed, summarized and reported in the manner specified by the relevant securities laws applicable to the Company. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Act is accumulated and communicated to the issuer's management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. The Company operates in both Canada and the Republic of South Africa and work is ongoing to improve and modernize these controls and to ensure that they remain consistently applied in both jurisdictions. The Chief Executive Officer and the Chief Financial Officer have evaluated the Company's disclosure control procedures as of May 31, 2010 through inquiry, review, and testing, as well as by drawing upon their own relevant experience. The Company retained an independent third party specialist in 2009 to assist in the assessment of its disclosure control procedures. The Chief Executive Officer and the Chief Financial Officer have concluded that, as at May 31, 2010, the Company's disclosure control procedures were effective. Management is also developing and implementing a plan to address disclosure controls and procedures on a forward looking basis as the Company continues to grow.

The Company also maintains a system of internal controls over financial reporting designed under the supervision of the Company's Chief Executive Officer and Chief Financial Officer to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with Canadian GAAP. The Company retained an independent third party specialist in 2009 to assist in the assessment of its internal control procedures. The Board of Directors approves the financial statements and ensures that management discharges its financial responsibilities. The Board's review is accomplished principally through the audit committee, which is composed of independent non-executive directors.

The audit committee meets periodically with management and auditors to review financial reporting and control matters. The Board of Directors has also appointed a compensation committee composed of non-executive directors whose recommendations are followed with regard to executive compensation.

From time to time the board may also form special sub-committees, which must investigate and report to the Board on specific topics.

During the year ended August 31, 2007, the Company affected changes in internal control over financial reporting that have materially affected, or may materially affect, the Company's internal control over financial reporting. The Company has (i) taken steps to improve segregation of duties and the authorization process through the addition of accounting personnel; and (ii) reviewed and refined internal control processes; and (iii) adopted and published new corporate governance policies; and (iv) reviewed and improved general controls over information technology; and (v) enhanced financial control over period close processes. During the period ended May 31, 2010 there were no significant changes with regard to internal control over financial reporting that has materially affected or is reasonably likely to materially affect the Company's internal control over financial reporting.

Platinum Group Metals Ltd.
(Exploration and Development Stage Company)
           
Restated Supplementary Information and MD&A
For the quarter ended May 31, 2010

The Company's management, including the Chief Executive Officer and the Chief Financial Officer, is responsible for establishing and maintaining adequate internal control over financial reporting, and evaluating the effectiveness of the Company's internal control over financial reporting as at each fiscal year end. Management has used the Committee of Sponsoring Organizations of the Treadway Commission (COSO) framework to evaluate the effectiveness of the Company's internal control over financial reporting as at May 31, 2010. Based on this evaluation, management has concluded that as at May 31, 2010, the Company's internal control over financial reporting was effective.

The Company's evaluation of internal control over financial reporting has been audited by PricewaterhouseCoopers LLP, an independent registered public accounting firm, who have expressed their opinion in their report included with the Company's annual consolidated financial statements.

9.
NYSE AMEX LLC CORPORATE GOVERNANCE
The Company's common shares are listed on the NYSE AMEX LLC (formerly the American Stock Exchange) (“NYSE-AMEX”). Section 110 of the NYSE-AMEX company guide permits NYSE-AMEX to consider the laws, customs and practices of foreign issuers in relaxing certain AMEX listing criteria, and to grant exemptions from NYSE-AMEX listing criteria based on these considerations. A company seeking relief under these provisions is required to provide written certification from independent local counsel that the non-complying practice is not prohibited by home country law. A description of the significant ways in which the Company's governance practices differ from those followed by domestic companies pursuant to NYSE-AMEX standards is posted on the Company's website at www.platinumgroupmetals.net and a copy of such description is available by written request made to the Company.

10.
OTHER INFORMATION

Additional information relating to the Company, including the Company's Annual Information Form for the year ended August 31, 2009, may be found on SEDAR at www.sedar.com . and on EDGAR at www.sec.gov.

11.
SUBSEQUENT EVENTS
There were no material subsequent events at the date of this document.

Subsequent events of a non-material nature may be discussed elsewhere within this document.

12.
RESTATEMENT OF MAY 31, 2010 INTERIM RESULTS
The consolidated financial statements of the Company for the three and nine month periods ended May 31, 2010 have been restated to reflect future income tax expense relating to the dissolution of the WBJV.  The Company initially estimated that the tax basis of the WBJV was approximately equal to the carrying amount on the consolidated financial statements.  The Company has performed further analysis and now estimates a taxable temporary difference arising from the restructuring of the WBJV and the sale of WBJV Project 2 to Wesizwe for an additional interest in Maseve.  This report reflects the affects of this restatement for accounting purposes.  The resulting accrual for future income tax expense is a non-cash item.  As previously reported the Company has determined that this transaction qualified for relief from current taxes payable in accordance with Section 42 of the South African Income Tax Act 58 of 1962.

Platinum Group Metals Ltd.
(Exploration and Development Stage Company)
           
Restated Supplementary Information and MD&A
For the quarter ended May 31, 2010

 
The following table summarizes the impact of the adjustment on the consolidated financial statements for the respective periods:

Consolidated balance sheet
As of May 31, 2010
Debit (Credit)
Future income tax liability
(11,900,000)
Shareholders' equity
 11,900,000
Consolidated statement of shareholders' equity
As of May 31, 2010

Debit (Credit)
Net earnings for the period
 11,900,000
 
Consolidated statement of operations
Quarter ended
Nine months ended
May 31, 2010
May 31, 2010
Debit (Credit)
Debit (Credit)
Future income tax expense
 11,900,000
 11,900,000
Earnings (loss) for the period
 11,900,000
 11,900,000
Comprehensive earnings (loss) for the period
 11,900,000
 11,900,000

				

				

				

				

				

This adjustment decreases the Company's basic and diluted earnings per share by $0.13 and $0.12, respectively for the quarter ended May 31, 2010 and by $0.13 and $0.12, respectively, for the nine months ended May 31, 2010.  There was no impact on operating, investing or financing cash flows to those previously reported.  

The above estimated future tax liability is based on management's determination of the tax basis of the WBJV versus the carrying amount for accounting purposes.  The determination of these amounts and the resulting deferred tax liability remains subject to measurement uncertainty.

13.
LIST OF DIRECTORS AND OFFICERS

a)
Directors:	b)
Officers:	
R. Michael Jones	R. Michael Jones (Chief Executive Officer)	
Frank R. Hallam (Secretary)	Frank R. Hallam (Chief Financial Officer)	
Iain McLean	Peter C. Busse (Chief Operating Officer)	
Eric Carlson	 	
Barry W. Smee	 	

FORM 52-109F2R
 CERTIFICATION OF REFILED INTERIM FILINGS
This certificate is being filed on the same date that Platinum Group Metals Ltd. (the “issuer”) has refiled interim financial statements and interim MD&A for the interim period ended May 31, 2010.
I, R. Michael Jones, Chief Executive Officer of the issuer , certify the following:
1.
Review :  I have reviewed the interim financial statements and interim MD&A (together, the “interim filings”) of the issuer for the interim period ended May 31, 2010.
2.
No misrepresentations: Based on my knowledge, having exercised reasonable diligence, the interim filings do not contain any untrue statement of a material fact or omit to state a material fact required to be stated or that is necessary to make a statement not misleading in light of the circumstances under which it was made, with respect to the period covered by the interim filings.
3.
Fair presentation:  Based on my knowledge, having exercised reasonable diligence, the interim financial statements together with the other financial information included in the interim filings fairly present in all material respects the financial condition, results of operations and cash flows of the issuer, as of the date of and for the periods presented in the interim filings.
4.
Responsibility:  The issuer’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (DC&P) and internal control over financial reporting (ICFR), as those terms are defined in National Instrument 52-109 Certification of Disclosure in Issuers’ Annual and Interim Filings , for the issuer.
5.
Design:  Subject to the limitations, if any, described in paragraphs 5.2 and 5.3, the issuer’s other certifying officer(s) and I have, as at the end of the period covered by the interim filings
(a)
designed DC&P, or caused it to be designed under our supervision, to provide reasonable assurances that
(i)
material information relating to the issuer is made known to us by others, particularly during the period in which the interim filings are being prepared; and
(ii)
information required to be disclosed by the issuer in its annual filings, interim filings or other reports filed or submitted by it under securities legislation is recorded, processed, summarized and reported within the time periods specified in securities legislation; and
(b)
designed ICFR, or caused it to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with the issuer’s GAAP.
5.1
Control Framework:  The control framework the issuer’s other certifying officer(s) and I used to design the issuer’s ICFR is the Internal Control – Integrated Framework (COSO Framework) prepared by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”).
5.2
ICFR – material weakness relating to design:  N/A
5.3
Limitation on scope of design:   N/A
6.
Reporting changes in ICFR:  The issuer has disclosed in its interim MD & A any change in the issuer’s ICFR that occurred during the period beginning March 1, 2010 and ended on May 31, 2010 that has materially affected, or is reasonably likely to materially affect, the issuer’s ICFR.
 
Date:  October 6, 2010

//signed//
 R. Michael Jones
 President & CEO	 	 	

 

 

FORM 52-109F2R
 CERTIFICATION OF REFILED INTERIM FILINGS
This certificate is being filed on the same date that Platinum Group Metals Ltd. (the “issuer”) has refiled interim financial statements and interim MD&A for the interim period ended May 31, 2010.
I, Frank R. Hallam Chief Financial Officer of the issuer , certify the following:
1.
Review : I have reviewed the interim financial statements and interim MD&A (together, the “interim filings”) of the issuer for the interim period ended May 31, 2010.
2.
No misrepresentations: Based on my knowledge, having exercised reasonable diligence, the interim filings do not contain any untrue statement of a material fact or omit to state a material fact required to be stated or that is necessary to make a statement not misleading in light of the circumstances under which it was made, with respect to the period covered by the interim filings.
3.
Fair presentation:  Based on my knowledge, having exercised reasonable diligence, the interim financial statements together with the other financial information included in the interim filings fairly present in all material respects the financial condition, results of operations and cash flows of the issuer, as of the date of and for the periods presented in the interim filings.
4.
Responsibility:  The issuer’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (DC&P) and internal control over financial reporting (ICFR), as those terms are defined in National Instrument 52-109 Certification of Disclosure in Issuers’ Annual and Interim Filings , for the issuer.
5.
Design:  Subject to the limitations, if any, described in paragraphs 5.2 and 5.3, the issuer’s other certifying officer(s) and I have, as at the end of the period covered by the interim filings
(a)
designed DC&P, or caused it to be designed under our supervision, to provide reasonable assurances that
(i)
material information relating to the issuer is made known to us by others, particularly during the period in which the interim filings are being prepared; and
(ii)
information required to be disclosed by the issuer in its annual filings, interim filings or other reports filed or submitted by it under securities legislation is recorded, processed, summarized and reported within the time periods specified in securities legislation; and
(b)
designed ICFR, or caused it to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with the issuer’s GAAP.
5.1
Control Framework:  The control framework the issuer’s other certifying officer(s) and I used to design the issuer’s ICFR is the Internal Control – Integrated Framework (COSO Framework) prepared by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”).
5.2
ICFR – material weakness relating to design:  N/A
5.3
Limitation on scope of design:   N/A
6.
Reporting changes in ICFR:  The issuer has disclosed in its interim MD & A any change in the issuer’s ICFR that occurred during the period beginning March 1, 2010 and ended on May 31, 2010 that has materially affected, or is reasonably likely to materially affect, the issuer’s ICFR.
 
Date:  October 6, 2010

//signed//
 Frank R. Hallam
 Chief Financial Officer & Director	 	 	

CONSENT OF QUALIFIED PERSON

Attention:
Toronto Stock Exchange
Alberta Securities Commission
Autorite des marches financiers
British Columbia Securities Commission
Manitoba Securities Commission
New Brunswick Securities Commission
Securities Commission of Newfoundland and Labrador
Nova Scotia Securities Commission
Ontario Securities Commission
Superintendent of Securities, Prince Edward Island
Saskatchewan Securities Commission
NYSE - Amex

I, Charles Johannes Muller, BSc (Hons), Pr.Sc.Nat., a registered professional natural scientist with the South African Council for Natural Scientific Professionals (SACNASP) (Reg. No. 400201/04), am the author of the technical report dated August 31, 2010 and entitled “Technical Report on Project 3 Resource Cut Estimation of the Western Bushveld Joint Venture (WBJV) located on the Western Limb of the Bushveld Igneous Complex, South Africa” (the “ Report ”), and do hereby consent to the filing of the Report with the regulatory authorities referred to above, and to the use and reference of the Report in the material change report dated October 5, 2010 (the “ MCR ”) and to the extracts from, or a summary of, the Report in the written disclosure contained in the MCR and any publication by them for regulatory purposes, including electronic publication in the public company files on their websites accessible to the public.  I confirm that I have read the MCR being filed and that the MCR fairly and accurately represents the information in the Report that supports the disclosure.  I further have consented to being named in the MCR and Platinum Group Metals Ltd. filing the Report and the MCR on SEDAR.

Dated this 5th day of October, 2010.

 
Charles Johannes Muller
            
B.Sc. (Hons), Pr. Sc. Nat.

 	Alberta Securities Commission
Autorité des marches financiers
British Columbia Securities Commission
Ontario Securities Commission
Toronto Stock Exchange	
		
Subject	Platinum Group Metals / Revised Technical Report – Western Bushveld Joint Venture Project 1 – Elandsfontein and Frischgewaagd	
 
Dears Sirs/Mesdames:
I, S. Byron V. Stewart, P.Eng., a registered professional engineer with the Association of Professional Engineers and Gesoscientists of BC, Lic. No.11414), am the co-author of the technical report entitled “Updated Technical Report (Updated Feasibility Study) – Western Bushveld Joint Venture – Project 1 - Elandsfontein and Frischgewaagd”, dated 20 November 2009 (the “Report”) and amended 10 June 2009 and do hereby consent to the filing of the report with the regulatory authorities referred to above, and any publication by them for regulatory purposes, including electronic publication in the public company files on their websites accessible to the public. I have further consented to the company filing the report on SEDAR.
Dated this 25 h day of November, 2009
SIGNED
“Original Document signed and sealed by

S.      	Byron V. Stewart, P.Eng.”	
 	S. Byron V. Stewart, P.Eng.	

 	Consultant
Wardrop Engineering Inc.	

I, S. Byron V. Stewart, P.Eng. of Lions bay, BC, do hereby certify that as a co-author of this technical report titled “Updated Technical Report (Updated Feasibility Study) Western Bushveld Joint Venture Project 1 – Elandsfontein and Frischgewaagd)”, dated 20 November 2009, as revised (the “Updated Feasibility Study) I hereby make the following statements:
·	I am a Consultant with Wardrop Engineering Inc. with a business address at 800-555 West Hastings Street, Vancouver, B.C., V6B 1M1.
·	I am a graduate of Royal School of Mines, B.Sc. (Hons) Mining Engineering, 1973.
·	I am a member in good standing of the Association of Professional Engineers and Geoscientists of BC, Licence #11414.
·	I have practiced my profession continuously since graduation.
·	I have read the definition of “qualified person” set out in National Instrument 43-101 (NI 43-101) and certify that, by reason of my education, affiliation with a professional association (as defined in NI 43-101) and past relevant work experience, I fulfill the requirements to be a “qualified person” for the purpose of NI 43-101.
·	My relevant experience with respect to Western Bushveld Joint Venture – Project 1 - Elandsfontein and Frischgewaagd includes production experience in underground gold mines in South Africa. Over 30 years experience on numerous hard rock mine studies and mine projects as a senior mining engineering consultant, in various countries.
·	I am responsible for the preparation of the parts of Section 9 related to the mechanized mining of declines and accesses, and parts of the mine capital cost and operating cost estimates of Section 9 of this technical report titled “Updated Technical Report (Updated Feasibility Study) Western Bushveld Joint Venture Project 1 – Elandsfontein and Frischgewaagd)”, dated 20 November 2009, as revised (the “Updated Feasibility Study). In addition, I visited the Property during the periods of December 2007 and January 2008.
·	I have no prior involvement with the Property that is the subject of the Technical Report.
·	As of the date of this Certificate, to my knowledge, information, and belief, this Technical Report contains all scientific and technical information that is required to be disclosed to make the technical report not misleading.
·	I am independent of the Issuer as defined by Section 1.4 of the Instrument.
·	I have read NI 43-101 and the Technical Report has been prepared in compliance with NI 43-101 and Form 43-101F1.

 	Signed and dated this 25 th day of November, 2009 at Vancouver, BC

“Original Document signed and sealed by
S. Byron V. Stewart, P.Eng. ”	

 	S. Byron V. Stewart, P.Eng.
Consultant
Wardrop Engineering Inc.	

 
PLATINUM GROUP METALS (RSA) (PTY) LTD
REPUBLIC OF SOUTH AFRICA REGISTERED COMPANY
REGISTRATION NUMBER: 2000/025984/07

A WHOLLY-OWNED SUBSIDIARY OF

PLATINUM GROUP METALS LTD
TSX – PTM; AMEX - PLG
TECHNICAL REPORT
ON PROJECT 3 RESOURCE CUT ESTIMATION
OF THE WESTERN BUSHVELD JOINT VENTURE (WBJV)
LOCATED ON THE WESTERN LIMB OF THE
BUSHVELD IGNEOUS COMPLEX, SOUTH AFRICA
Western Bushveld Joint Venture
 
Prepared For:
Platinum Group Metals Ltd.
 Suite 328 – 550 Burrard Street
Vancouver, British Columbia  V6C 2B5  Canada
By:

CJ MULLER (SACNAPS 400201/04)
MINXCON
ROODEPOORT, GAUTENG, REPUBLIC OF SOUTH AFRICA
August 31, 2010

 

Technical Report Project 3 Resource Cut Estimation August 2010                                                                                                                                                                                                                                                                                                i

Table of Contents	
 	
ITEM 1:	SUMMARY	1	
The Property and Terms of Reference	1	
Location	2	
Ownership	2	
Geology	2	
Mineralisation	2	
Exploration Concept	2	
Independently estimated Mineral Resource base (100% WBJV Area)	3	
 	
ITEM 2:	INTRODUCTION	3	
Terms of Reference	3	
Purpose of the Report	3	
Sources of Information	4	
Involvement of the Qualified Person: Personal Inspection	4	
 	
ITEM 3:	RELIANCE ON OTHER EXPERTS	4	
ITEM 4:	ITEM 4: PROPERTY DESCRIPTION AND LOCATION	4	
Extent and Location of the Project	4	
Licenses	8	
Survey	8	
Location of Mineralised Zones, Mineral Resources and Mining Infrastructure	8	
 	
ITEM 5:	PHYSIOGRAPHY, ACCESSIBILITY AND LOCAL RESOURCES	9	
Item 7(a): Topography, Elevation and Vegetation	9	
Means of Access to the Property	9	
Population Centres and Modes of Transport	10	
Climate and Length of Operating Season	10	
Infrastructure with respect to Mining	10	
 	
ITEM 6:	HISTORY	11	
Prior Ownership	11	
Work Done by Previous Owners	11	
Historical Mineral Reserves and Resources	11	
Production from the Property	11	
 	
ITEM 7:	GEOLOGICAL SETTING	11	
Regional Geology of the BIC	11	
Local Geology –Western Bushveld Limb	14	
Project Geology	22	
 	
ITEM 8:	DEPOSIT TYPES	26	
ITEM 9:	MINERALISATION	27	
Mineralisation Styles and Distribution	28	
PGE and Gold Deportment	28	
 	
ITEM 10: EXPLORATION	30	
Survey (field observation) Results, Procedures and Parameters	30	
Interpretation of Survey (field observation) Results	30	
Survey (field observation) Data Collection and Compilation	30	

Technical Report Project 3 Resource Cut Estimation August 2010                                                                                                                                                                                                                                                                                                ii

ITEM 11: DRILLING	30	
Type of Drilling	30	
Procedures, Summary and Interpretation of Results	31	
Comment on True and Apparent Widths of the Mineralised Zones	31	
Comment on the Orientation of the Mineralised Zones	31	
 	
ITEM 12: SAMPLING METHOD AND APPROACH	31	
Sampling Method, Location, Number, Type and Size of Sampling	31	
Drilling Recovery	32	
Sample Quality and Sample Bias	32	
Widths of Mineralised Zones – Resource Cuts	32	
Summary of Sample Composites with Values and Calculated Resource Widths	33	
 	
ITEM 13: SAMPLE PREPARATION, ANALYSES AND SECURITY	34	
Persons Involved in Sample Preparation	34	
Sample Preparation, Laboratory Standards and Procedures	35	
Quality Assurance and Quality Control (QA&QC) Procedures and Results	36	
Standards	36	
Blanks	37	
Duplicates	38	
Assay Validation	38	
Adequacy of Sampling Procedures, Security and Analytical Procedures	38	
Sampling Procedures	38	
Security	39	
Adequacy of Analytical Procedures	39	
 	
ITEM 14: DATA VERIFICATION	40	
Quality Control Measures and Data Verification	40	
Verification of Data	40	
Nature of the Limitations of Data Verification Process	40	
 	
ITEM 15: MINERAL RESOURCE ESTIMATES	41	
Standard Resource and Reserve Reporting System	41	
Relationship of the QP to the Issuer	41	
Detailed Mineral Resource Tabulation	41	
Key Assumptions, Parameters and Methods of Resource Calculation	42	
Statistical Analysis	47	
Variography	51	
Grade Estimation	52	
Post Processing	53	
Resource Classification	54	
 	
ITEM 16: RECONCILIATION	56	
Independently estimated Mineral Resource base (100% WBJV Area)	57	
 	
ITEM 17: OTHER RELEVANT DATA AND INFORMATION	57	
RSA Reserve and Resource Declaration Rules	57	
 	
ITEM 18: INTERPRETATION AND CONCLUSIONS	58	
Results	58	
Interpretation of the Geological Model	58	
Evaluation Technique	58	
Reliability of the Data	58	
Strengths and Weaknesses with respect to the Data	58	
Objectives of adherence to the Scope of Study	58	
 	
ITEM 19: RECOMMENDATIONS	58	
ITEM 20: REFERENCES	59	
ITEM 21: DATE AND SIGNATURE PAGE	59	

Technical Report Project 3 Resource Cut Estimation August 2010                                                                                                                                                                                                                                                                                                iii

 

Appendix 1: Qualified Person's Certificate	62	

 	
 	
Evaluation Technique	58	
Reliability of the Data	58	
Strengths and Weaknesses with respect to the Data	58	
Objectives of adherence to the Scope of Study	58	
 	
ITEM 19: RECOMMENDATIONS	58	
ITEM 20: REFERENCES	59	
ITEM 21: DATE AND SIGNATURE PAGE	59	
 	
Diagrams	
 	
Figure 1: Location of the WBJV in relation to the Bushveld Igneous Complex	6	
Figure 2: Locality Plan of the Project Areas in the WBJV	7	
Figure 3: Location of the WBJV in the Western Limb of the BIC	13	
Figure 4: Detailed Stratigraphy of the Western Bushveld Sequence	18	
Figure 5: Regional Structural Data	22	
Figure 6: UG2 Chromitite Layer Structure (Project 3)	25	
Figure 7: Cross Section through Project 3	26	
Figure 8: Merensky Reef Stratigraphic Column	27	
Figure 9: Location of Boreholes used for Resource Estimation of Merensky Reef and UG2 CL	44	
Figure 10: Kriged Channel Width for Merensky Reef and UG2 CL	45	
Figure 11: Kriged 4E Plots for Merensky Reef and UG2 CL	46	
Figure 12: Geological Domains for Resource Estimation at Project 3	47	
Figure 13: Histograms and Probability Plots - Project 3	50	
 	
Tables	
 	
Table 1: Legal Aspects and Tenure of the WBJV Area	8	
Table 2: PGE + Au speciation and proportional occurrence based on area (um2)	30	
Table 3: Merensky Reef – Resource Width	34	
Table 4: UG2 CL – Resource Width	35	
Table 5: Standards used for QA&QC	38	
Table 6: Indicated Mineral Resource for UG2CL and Merensky Reef at Project 3	42	
Table 7: Inferred Mineral Resource for the Merensky Reef at Project 3	42	
Table 8: Borehole Intercepts used in the estimation of the Mineral Resources	43	
Table 9: Project 3 Merensky Reef Descriptive Statistics	49	
Table 10: Project 3 UG2 CL Descriptive Statistics	49	
Table 11: Variogram Parameters Merensky Reef & UG2 – CM4E and Resource Cut Width	54	
Table 12: Cut-off Grades for Merensky Reef Indicated Resource Estimation	56	
Table 13: Cut-off Grades for Merensky Reef Inferred Resource Estimation	56	
Table 14: Cut-off Grades for UG2 CL Indicated Resource Estimation	56	
Table 15: April 2008 Inferred Mineral Resource Estimation	59	
 	
Appendices	
 	
Appendix 1: Qualified Person's Certificate	62	

Technical Report Project 3 Resource Cut Estimation August 2010                                                                                                                                                                                                                                                                                                1

ITEM 1:  SUMMARY
The Property and Terms of Reference
Prior to April 22, 2010 the Western Bushveld Joint Venture (“WBJV” or “the joint venture”) was owned 37% by Platinum Group Metals RSA (Pty) Ltd, (“PTM”) – a wholly-owned subsidiary of Platinum Group Metals Ltd (Canada), (“PTML”) – 37% by Rustenburg Platinum Mines Ltd (“RPM”), – a subsidiary of Anglo Platinum Ltd (“AP”), – and 26% by Africa Wide Mineral Prospecting and Exploration (Proprietary) Limited, - a 100% subsidiary of Wesizwe Platinum (Pty) Ltd (“Wesizwe”).
The WBJV was a notarial contract managed by a committee representing all partners.  PTM was the operator of the joint venture.  The joint venture related to three project areas on mineral properties on the farms Elandsfontein 102JQ, Onderstepoort 98JQ, Frischgewaagd 96JQ, Mimosa 81JQ and Koedoesfontein 94JQ covering some 72 square kilometres.
On April 22, 2010 the Western Bushveld Joint Venture was legally dissolved by agreement of the joint venture members and the ownership interests of the members in the three project areas were reorganized.  AP first sold its entire ownership in all three projects to Wesizwe in consideration of an equity investment in Wesizwe.  Wesizwe then sold on to PTM its newly acquired 37% interests in Project 1 and 3 to PTM in consideration for all of PTM's interests in Project 2 plus a subscription by PTM of Rand 408.6 million into the new operating company for the WBJV named Maseve Investments 11 (pty) Ltd. (“Maseve”), the subscription funds to be held in escrow by Maseve against Wesizwe's 26% share of ongoing costs for Projects 1 and 3.  PTM has until mid January 2011 to make all of the required subscription into Maseve or its interests will be reduced proportionately down to a minimum of 54.25% should no subscription be made at all.  Wesizwe acquired and retained a 100% interest in the Project 2 area of the former WBJV through this reorganization.
The post April 22, 2010 WBJV consists of Projects 1 and 3, comprised of 47.82 square kilometres, held 100% by Maseve and operated by PTM according to the terms of a formal shareholders agreement.  PTM has a right to acquire up to 74% of Maseve by mid January 2011 as described above while Wesizwe will then hold a 26% interest in Maseve as the Black Economic Empowerment partner for the WBJV.
This Technical Report specifically contains details of the Project 3 area, located largely on the farm Koedoesfontein 94JQ (Figure 2).
The Qualified Person (QP) for this Technical Report is Mr CJ Muller (Minxcon (Pty) Ltd). The QP has visited the WBJV Project Area 3 site during 2007 and 2008.

 

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Location
The WBJV property is located on the south western limb of the Bushveld Igneous Complex (“BIC”), 110km west-northwest of Pretoria and 120km from Johannesburg. The Resources of the WBJV Project 3 are located approximately 11km along strike from the active Merensky Reef mining face at the operating Bafokeng Rasimone Platinum Mine (“BRPM”). BRPM completed opencast mining on the UG2 Chromite Layer (“UG2 CL”) within 100m of the WBJV property boundary.
Ownership
The government of South Africa holds the mineral rights to the project properties under the new act, No. 28 of 2002: Mineral and Petroleum Resources Development Act, 2002 (“MPRDA”). The rights to the minerals are a combination of new order prospecting rights held under the MPRDA.  Project Area 3 is held 100% by Maseve on behalf of the WBJV.
Geology
The WBJV property is partly situated in a layered igneous complex known as the BIC and its surrounding sedimentary footwall rocks. The BIC is unique and well known for its layering and continuity of economic horizons mined for platinum, palladium and other platinum-group elements (PGE's), chrome and vanadium.
Mineralisation
The potential economic horizons in the WBJV Project 3 area are the Merensky Reef and UG2 Chromitite Layer (“ UG2 CL”) situated in the Critical Zone of the Rustenburg Layered Suite (“RLS”) of the BIC; these horizons are known for their continuity. The Merensky Reef and UG2 CL are mined at the BRPM adjoining the WBJV property as well as on other contiguous platinum-mine properties. In general, the layered package dips at less than 20 degrees and local variations in the reef attitude have been modelled. The Merensky Reef and UG2 CL, in the Project 3 area, dip at approximately 10 degrees.
Exploration Concept
The Merensky Reef has been considered for extraction over a diluted Resource width of 1.14m (Indicated and Inferred Mineral Resources) for the Project 3 area and the UG2 CL has been considered for extraction over a diluted Resource width of 1.16m (Indicated Mineral Resources) for the Project 3 area. A grade content, expressed in centimetre grams per ton (cm.g/t), of 100cm.g/t was used as a Resource cut-off.

 

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Indicated Mineral Resources total 1.938Moz of 4E (platinum, palladium, rhodium and gold) and 0.02Moz Inferred Mineral Resource for Project Area 3. Mineral Resource estimates for Project Area 3 are shown in the following tables.
Independently estimated Mineral Resource base (100% WBJV Area)
Indicated Mineral Resource for UG2CL and Merensky Reef at Project 3
							
Indicated Mineral
Resource (4E)	Cut-off
(cm.g/t) 4E	Million Tonne	Grade 4E
(g/t)	Potential
Resource
Width (m)	Tons PGE
(4E)	Moz PGEs
(4E)	
Project 3 MR	100	5.157	6.03	1.14	31.097	0.999	
Project 3 UG2 CL	100	5.947	4.91	1.16	29.199	0.939	
Total Indicated	100	11.104	5.43	1.15	60.296	1.938	

Inferred Mineral Resource for the Merensky Reef at Project 3
							
Inferred Mineral
Resource (4E)	Cut-off
(cm.g/t) 4E	Million Tonne	Grade 4E
(g/t)	Potential
Resource
Width (m)	Tons PGE
(4E)	Moz PGEs
(4E)	
Project 3 MR	100	0.443	1.47	1.14	0.651	0.021	
Total Inferred	100	0.443	1.47	1.14	0.651	0.021	

MR = Merensky Reef; UG2 CL = Upper Group No. 2 chromitite seam; PGE = Platinum Group Metals.
The cut-offs for Indicated and Inferred Mineral Resources have been established by a qualified person after a review of potential operating costs and other factors.
Tonnes discount for geological loss (14%) and dip.
Due to rounding, columns may not add up.

Prill Splits	Pt	Pt (g/t)	Pd	Pd (g/t)	Rh	Rh (g/t)	Au	Au (g/t)	
Project 3 MR	64%	4.01	27%	1.69	4%	0.25	5%	0.31	
Project 3 UG2 CL	62%	3.42	28%	1.54	9%	0.50	1%	0.06	

Mineral Resources do not have demonstrated economic viability.
ITEM 2:  INTRODUCTION
Terms of Reference
This report is compiled for PTML in terms of the Canadian National Instrument 43-101 Standards of Disclosure , Form 43 101F1 Technical Report and the Companion Policy 43 101CP (NI 43-101).  The information and status of the Project is disclosed in the prescribed manner.
Purpose of the Report
The intention of the report is to summarise the technical aspects of the Resource cut estimation process for Project 3, subsequent to additional drilling information available since the April 2008 Resource declaration.

 

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Sources of Information
The independent author and Qualified Person (“QP”) of this report has used the data provided by the representative and internal experts of PTM. This data is derived from information currently compiled by the operating company, which is PTM. The PTM-generated information is under the control and care of Mr WJ Visser (SACNASP 400279/04), who is an employee of PTM and is not independent.
Involvement of the Qualified Person: Personal Inspection
The listed independent QP has no financial or preferential relationships with PTM. The QP has a purely business-related relationship with the operating company and provides technical and scientific assistance when required and requested by the company. The QP has other significant client lists and has no financial interest in PTM. The independent QP, Mr CJ Muller, has visited the WBJV property during August 2008 and has undertaken a due diligence with respect to the PTM data.
ITEM 3:  RELIANCE ON OTHER EXPERTS
In preparing this report, the author relied upon:-
·
geological and assay information supplied by PTM;
·
borehole analytical and survey data compiled by PTM; and
·
all other applicable information.
The sources were subjected to a reasonable level of inquiry and review. The author has access to all information. The author's conclusion, based on diligence and investigation, is that the information is representative and accurate.
ITEM 4:  PROPERTY DESCRIPTION AND LOCATION
Extent and Location of the Project
The WBJV project is located on the south western limb of the Bushveld Igneous Complex (“BIC”) (Figure 1) some 35km northwest of the town of Rustenburg, North West Province, South Africa. The property adjoins Anglo Platinum's Bafokeng Rasimone Platinum Mine (“BRPM”) and the Styldrift Project to the southeast and east respectively (Figure 2). Project 3 is located on a section of the farm Koedoesfontein 94JQ.
The total joint venture area includes portions of PTM's properties Elandsfontein 102JQ, Mimosa 81JQ and Onderstepoort 98JQ, and also certain portions of Elandsfontein 102JQ, Onderstepoort 98JQ, Frischgewaagd 96JQ, Mimosa 81JQ and Koedoesfontein 94JQ originally contributed by Rustenburg Platinum Mines (“RPM”), a wholly-owned subsidiary of Anglo Platinum . These properties are centred on Longitude 27o 00' 00'' (E) and Latitude 25o 20' 00'' (S) and the mineral rights cover approximately 47.82km 2 or 4,782ha. The Project Area 3 covers an area of 1,709.28ha in extent, excluding the northern portion of the farm Koedoesfontein 94JQ that lies within the Pilanesburg Game Reserve.

 

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Figure 1: Location of the WBJV in relation to the Bushveld Igneous Complex

 

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Figure 2: Locality Plan of the Project Areas in the WBJV

 

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Licences
Table 1: Legal Aspects and Tenure of the Project 3 Area

Holder	Permit/Right
Number	Description of property	Property
Size	Validity	
RPM	Koedoesfontein 94-JQ
DME :
NW
30/5/1/1/2/1264	The Farm Koedoesfontein 94-JQ.	1702.8204Ha	Protocol No
555/2007
Commence
04/07/2007
Expiry
03/07/2012	

Royalties
A 3% Gross Royalty on the production of refined platinum is required to be paid to the South African Government.
Survey
Koedoesfontein (RPM) :  Koedoesfontein is registered with the Deeds Office (RSA) under Koedoesfontein 94JQ, Northern Province.  The farm can be located on Government 1:50,000 Topo-cadastral sheet 2527AC Sun City (4 th Edition 1996) which is published by the Chief Directorate, Surveys and Mapping.  The approximate coordinates (WGS84) are 27° 02' 00'' (E) and 25° 07' 00'' (S).
Location of Mineralised Zones, Mineral Resources and Mining Infrastructure
The BIC in general is well known for containing a large share of the world's platinum and palladium resources. There are two very prominent economic deposits within the BIC. Firstly, the Merensky Reef (“MR”) and the Upper Group 2 (“UG2 CL”) chromitite, which together can be traced on surface for 300km in two separate areas. Secondly, the Northern Limb (Platreef), which extends for over 120km in the area north of Mokopane. Platinum and Palladium production from the BIC represents 72% and 34% of annual global production respectively (Johnson Matthey, 2007).  
Exploration drilling to date on the WBJV area has shown that both economic units (Merensky and UG2) are present and economically of interest on the WBJV properties. No Mineral Reserves have been estimated.
As this project constitutes an exploration project, no mining infrastructure currently exists on the properties.

 

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ITEM 5:  PHYSIOGRAPHY, ACCESSIBILITY AND LOCAL RESOURCES
Item 7(a): Topography, Elevation and Vegetation
Topography
The WBJV area is located on a central plateau. The Project Area has prominent hills, which occur in the northern most portions, but generally, variations in topography are minor and limited to low, gently sloped hills.
Elevation
The section of the Koedoesfontein property covered by the Project 3 Area gently dips in a north-easterly direction toward a tributary of the Elands River. Elevations range from 1,060m above mean sea level (“AMSL”) towards the Sandspruit River in the north to 1100m amsl towards the south eastern corner of the property.
Vegetation
The area is characterised by extensive savannah with vegetation consisting of grasses and shrub with few trees.
Means of Access to the Property
South Africa has a large and well-developed mining industry.  The Project is located in an area with a long history of mining activity and this, among other factors, means that the infrastructure in the area is well established, with well-maintained roads and highways as well as electricity distribution networks and telephone systems.
The Project area is located, some 42km northwest of the North West Province town of Rustenburg.  The informal settlement of Ledig is situated 2km north of the Project area via the tarred R565 main road that crosses the Project Area. The WBJV adjoins the AP-managed BRPM to the southeast. A railway line linking BRPM to the national network passes the WBJV area immediately to the east with a railway siding at Boshoek.
The WBJV properties are readily accessible from Johannesburg by travelling 120km northwest on Regional Road 24 to the town of Rustenburg and then a further 41km.  The resort of Sun City is located approximately 6km northeast of Project Area 3. Both BRPM to the south of the Project Area and Styldrift, a joint venture between the Royal Bafokeng Nation and Anglo Platinum, which lies directly to the east of the property, have modern access roads and services. Numerous gravel roads crossing the WBJV properties provide easy access to all portions.

 

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Population Centres and Modes of Transport
The closest major population centre to the Project is the town of Rustenburg, located about 41km to the southeast of the Project. Pretoria lies approximately 100km to the east and Johannesburg about 120km to the southeast. A popular and unusually large hotel and entertainment centre, Sun City, lies about 6km to the northeast of the Project Area. The Sundown Ranch Hotel lies in close proximity to the Project Area and offers rooms and chalets as accommodation. The WBJV properties fall under the jurisdiction of the Moses Kotane Municipality. A paved provincial road crosses the property. Access across most of the property can be achieved by truck without the need for significant road building.
Climate and Length of Operating Season
With low rainfall, (the area is considered semi arid with an annual rainfall of 520mm) and high summer temperatures, the area is typical of the Highveld Climatic Zone. The rainy season is in the summer months from October to April with the highest rainfall in December and January. In summer (November to April) the days are warm to hot, with afternoon showers or thunderstorms; temperatures average 26ºC (79ºF) and can rise to 38ºC (100ºF); and night temperatures drop to around 15ºC (60ºF). During winter months (May to October), days are dry and sunny with moderate to cool temperatures, while evening temperatures drop sharply.  Temperatures by day generally reach 20ºC (68ºF) and can drop to below 0ºC with frost occurring in the early morning. The hottest months are generally December and January with June and July being the coldest.  The climate of the area does not hinder the operating season and exploration can continue all year long.
Infrastructure with respect to Mining
As this report deals with an exploration project, it suffices to note that all areas are close to major towns and informal settlements as a potential source of labour with paved roads being the norm. Power lines cross both project areas and water is, as a rule, drawn from boreholes. As several platinum mines are located adjacent to and within 50km of the property, there is excellent access to materials and skilled labour. One of the smelter complexes of AP is located within 60km of the property.
No surface rights are held on the Project 3 area, however, surface rights to 365ha on Elandsfontein have been purchased and this may be of some use for potential operations. Further surface rights will be required.

 

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ITEM 6:  HISTORY
Work Done by Previous Owners
Previous geological exploration on the farm Koedoesfontein was carried out by Anglo Platinum as the original owner of some of the mineral rights. AP managed the exploration drilling programme for the Koedoesfontein borehole series in the area of interest. Geological and sampling logs and an assay database are available which was utilised in the Resource estimation for Project Area 3.
The drilling programme consisted of three boreholes (KD1, KD2 and KD3). Boreholes KD1 and KD3 were drilled beyond the Merensky Reef and UG2 CL subcrop, and terminated in sediments of the Transvaal Supergroup. Drilling of borehole KD2 was stopped short of the Merensky Reef subcrop.
Historical Mineral Reserves and Resources
No historical Mineral Resources or Mineral Reserves have been estimated for the Project 3 Area.
Production from the Property
There has been no previous production from any of the WBJV properties.
ITEM 7:  GEOLOGICAL SETTING
Regional Geology of the BIC
The stable Kaapvaal and Zimbabwe Cratons in southern Africa are characterised by the presence of large mafic-ultramafic layered complexes. These include the Great Dyke of Zimbabwe, the Molopo Farms Complex in Botswana and the well-known BIC.
The BIC was intruded about 2,060 million years ago into rocks of the Transvaal Supergroup along an unconformity between the Magaliesberg quartzites (Pretoria Group) and the overlying Rooiberg felsites (a dominantly felsic volcanic precursor). The BIC is by far the most economically important of these deposits as well as the largest in terms of preserved lateral extent, covering an area of over 66,000km 2 . It has a maximum thickness of 8km, and is matched in size only by the Windimurra intrusion in Western Australia and the Stillwater intrusion in the USA (Cawthorn, 1996). The mafic component of the Complex hosts layers rich in PGEs, nickel, copper, chromium and vanadium. The BIC is reported to contain about 75% and 50% of the world's platinum and palladium resources respectively (Vermaak, 1995). The mafic component of the BIC is subdivided into several generally arcuate segments/limbs, each associated with a pronounced gravity anomaly. These include the western, eastern, northern/Potgietersrus, far western/Nietverdient and southeastern/Bethal limbs. The mafic rocks are collectively termed the Rustenburg Layered Suite (RLS) and are subdivided into the following five zones (Figure 3 and Figure 4):

 

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·
Marginal Zone comprising finer-grained gabbroic rocks with abundant country-rock xenoliths.
·
Lower Zone – the overlying Lower Zone is dominated by orthopyroxenite with associated olivine-rich cumulates (harzburgite, dunite).
·
Critical Zone – its commencement is marked by first appearance of well-defined cumulus chromitite layers. Seven Lower Group chromitite layers have been identified within the lower Critical Zone. Two further chromitite layers – Middle Group (MG) – mark the top of the pyroxenite-dominated lower Critical Zone. From this stratigraphic position upwards, plagioclase becomes the dominant cumulus phase and noritic rocks predominate. The MG3 and MG4 chromitite layers occur at the base of the upper Critical Zone, which is characterised from here upwards by a number of cyclical units. The cycles commence in general with narrow pyroxenitic horizons (with or without olivine and chromitite layers); these invariably pass up into norites, which in turn pass into leuconorites and anorthosites. The UG1 – first of the two Upper Group chromitite layers – is a cyclical unit consisting of chromitite layers with overlying footwall units that are supported by an underlying anorthosite. The overlying UG2 chromitite layer is of considerable importance because of its economic concentrations of PGEs. The two uppermost cycles of the Critical Zone include the Merensky and Bastard cycles. The Merensky Reef (MR) is found at the base of the Merensky cycle, which consists of a pyroxenite and pegmatoidal feldspathic pyroxenite assemblage with associated thin chromitite layers that rarely exceed one metre in thickness. The top contact of the Critical Zone is defined by a giant mottled anorthosite that forms the top of the Bastard cyclic unit.

 

Technical Report Project 3 Resource Cut Estimation August 2010                                                                                                                                                                                                                                                                                                12

Figure 3: Location of the WBJV in the Western Limb of the BIC

 

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·
Main Zone – consists of norites grading upwards into gabbronorites. It includes several mottled anorthosite units towards the base and a distinctive pyroxenite, the Pyroxenite Marker, two thirds of the way up. This marker-unit does not occur in the project area, but is evident in the adjacent BRPM. The middle to upper part of the Main Zone is very resistant to erosion and gives rise to distinctive hills, which are currently being mined for dimension stone (black granite).
·
Upper Zone – the base is defined by the appearance of cumulus magnetite above the Pyroxenite Marker. The Upper Zone is divided into Subzone A at the base; Subzone B, where cumulus iron-rich olivine appears; and Subzone C, where apatite appears as an additional cumulus phase.
The location of Project Area 3 on the BIC is illustrated in Figure 1 and Figure 3.
Local Geology –Western Bushveld Limb
Exposures of the BIC located on the western limb include the stratigraphic units of the RLS. The sequence comprises mostly gabbros, norites, anorthosites and pyroxenites. Viljoen (1999) originally proposed a structural interpretation based on geological and geophysical data for the western lobe of the BIC. This study included gravity and vibrosis seismic data for the south western portion of the RLS northwest of Rustenburg. It was concluded that the Merensky Reef is present within much of this lobe, including the part further to the east below the Nebo granite sheet. The position of the Merensky Reef is fairly closely defined by seismic reflectors associated with the cyclic units of the upper Critical Zone. The seismic data also portrayed an essentially sub-horizontal disposition of the layering within the BIC mafic rocks below the Nebo granite sheet. The gravity data indicates a gravity-high axis extending throughout the western lobe following the upper contact of the mafic rocks with the overlying granitic rocks. A number of pronounced gravity highs occur on this axis. A gravity anomaly with a strike length of 9km is situated northeast of Rustenburg towards the east of the Boshoek section. The gravity highs have been interpreted as representing a thickening of the mafic rocks, reflecting feeder sites for the mafic magma of the western BIC (Viljoen, 1999).
The western limb is interpreted by Viljoen as having two main arcuate feeder dykes which, closer to surface, have given rise to arcuate, coalescing, boat-shaped keels containing saucer-shaped, inward-dipping layers, analogous to the Great Dyke of Zimbabwe.
In the Boshoek section north of Rustenburg, the variable palaeo-topography of the Bushveld floor represented by the Transvaal Supergroup contact forms a natural unconformity with the overlying Bushveld layered sequence. Discontinuities due to structural interference of faults, sills and dykes are pronounced in the area and are ascribed to the presence of the Pilanesberg Alkaline Complex intrusion to the north of the property.

 

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Stratigraphy of the Upper Critical Zone
The upper Critical Zone of the RLS comprises mostly norites, leuconorites and anorthosites. Leeb-Du Toit (1986) assigned numbers to the various lithological units according to their position in relation to the Merensky unit. The footwall layers range from FW14 below the UG1 chromitite to FW1 directly below the Merensky Reef. The hanging wall layers are those above the Bastard Reef and range from HW1 to HW5. The different layers within the Merensky unit are the Merensky feldspathic pyroxenite at the base, followed by a leuconorite (Middling 2) and a mottled anorthosite (Middling 3). The feldspathic pyroxenite layers (pyroxene cumulates) are named according to the reef hosted by them. These include (from the base upwards) the UG1, the UG2 (upper and lower), the Merensky and the Bastard pyroxenite.
Schürmann (1993) subdivided the upper Critical Zone in the Boshoek section into six units based on lithological features and geochemical trends. These are the Bastard, the Merensky, the Merensky footwall, the Intermediate, the UG2 and the UG1 units. The Intermediate and Merensky footwall units were further subdivided based on modal-mineral proportions and whole-rock geochemical trends. The following is a detailed description of the subdivision of the upper Critical Zone in the Boshoek section (Schürmann).
Bastard Unit
The Bastard Unit consists of a basal pyroxenite some 3m thick with a thin chromitite developed on the lower contact. This chromitite is the uppermost chromitite layer in the Critical Zone. A 6.5m-thick norite layer (HW1) overlies the pyroxenite. HW1 is separated from HW2 by two thin mottled anorthosite layers. HW3 is a 10m-thick mottled anorthosite and constitutes the base of the Giant Mottled Anorthosite. The mottled anorthosites of HW4 and HW5 are about 2m and 37m thick respectively. Distinction between HW3, 4 and 5 is based on the size of the mottles of the respective layers.
Merensky Unit
The Merensky Unit, with the Merensky Reef at its base, is the most consistent unit within the Critical Zone.
Merensky Footwall Unit
This unit contains the succession between the FW7/FW6 and the FW1/MR contacts. Leeb-Du Toit (1986) indicated that where the FW6 layer is thicker than 3m, it usually consists of four well-defined rock types. The lowermost sublayer, FW6(d), is a mottled anorthosite with mottles of between 30mm and 40mm in diameter. It is characterised by the presence of nodules or “boulders” and is commonly referred to as the Boulder Bed. The nodules are described as muffin-shaped, 5–25cm in diameter, with convex lower contacts and consisting of cumulus olivine and orthopyroxene with intercumulus plagioclase. A single 2–10mm chromitite stringer is present at the base of the FW6(d) sublayer. FW6(c) is also a mottled anorthosite but not always developed. FW6(b) is a leuconorite containing pyroxene oikocrysts 10–20mm in diameter. Two layers (both 2–3cm thick) consisting of fine-grained orthopyroxene and minor olivine define the upper and lower contacts. FW6(a), the uppermost sublayer, is also a mottled anorthosite.

 

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Figure 4: Detailed Stratigraphy of the Western Bushveld Sequence

 

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FW6 is overlain by a uniform norite (FW5), with a thickness of 4.1m. It appears to thin towards the north to about one metre. FW4 is a mottled anorthosite 40cm thick, with distinct layering at its base. FW3 is an 11m-thick uniform leuconorite.
FW2 is subdivided into three sublayers.  FW2(b) is a 76cm-thick leuconorite and is overlain by a 33cm-thick layer of mottled anorthosite – FW2(a). Where FW2 attains a maximum thickness of 2m, a third layer in the form of a 1–2cm-thick pyroxenite or pegmatite pyroxenite, FW2(c), is developed at the base. FW2(c) is absent in the Boshoek section area (Schürmann, 1993). FW1 is a norite layer about 7m thick.
Schürmann further subdivided the Merensky footwall unit into four subunits. The lowermost subunit consists of sublayers FW6(d) and FW6(b). Subunit 2, which overlies subunit 1, commences with FW6(a) at the base and grades upwards into FW5. The FW5/FW4 contact is sharp and divides subunits 2 and 3. Subunit 3 consists of FW4, FW3 and sublayer FW2(b). Subunit 4 consists of FW2(a) and FW1 and forms the uppermost subunit of the Merensky footwall unit.
Intermediate Unit
The Intermediate Unit overlies the upper pyroxenite of the UG2 unit and extends to the FW7/FW6 contact. The lowermost unit is the 10m-thick mottled anorthosite of FW12, which overlies the UG2 upper pyroxenite with a sharp contact. FW11, a roughly 1m thick leuconorite, has gradational contacts with the under- and overlying layers. FW10 consists of a leuconorite layer of about 10m. Subdivision between these two units is based on the texture and subtle differences in the modal composition of the individual layers. Leeb-Du Toit (1986) termed FW11 a spotted anorthosite and FW10 an anorthositic norite. FW12, 11 and 10 constitute the first Intermediate subunit as identified by Schürmann (1993). The second Intermediate subunit consists of FW9, 8 and 7. The 2m-thick FW9 mottled anorthosite overlies the FW10 leuconorite with a sharp contact. The FW8 leuconorite and FW7 norite are respectively 3m and 37m thick. The FW9/FW8 and FW8/FW7 contacts are gradational but distinct. A 1.5m-thick highly contorted mottled anorthosite “flame bed” is present 15m above the FW8/FW7 contact.
UG2 Unit
The UG2 Unit commences with a feldspathic pyroxenite (about 4m thick) at its base and is overlain by an orthopyroxene pegmatoidal layer (0.2–2m thick) with a sharp contact. Disseminated chromite and chromitite stringers are present within the pegmatoid. This unit in turn is overlain by the UG2 chromitite (0.5–0.8m thick) on an irregular contact. Poikilitic bronzite grains give the chromitite layer a spotted appearance. A 9m feldspathic pyroxenite overlies the UG2 chromitite. The upper and lower UG2 pyroxenites have sharp contacts with FW12 and FW13. The upper UG2 pyroxenite hosts the UG2 Leader seams, which occur between 0.2m and 3m above the main UG2 chromitite.

 

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UG1 Unit
The UG1 chromitite layer is approximately 1m thick and forms the base of this unit. It is underlain by the 10m-thick FW14 mottled anorthosite. The UG1 chromitite layer bifurcates and forms two or more layers within the footwall mottled anorthosite, while lenses of anorthosite also occur within the chromitite layers. The overlying pyroxenite consists of cumulus orthopyroxene, oikocrysts of clinopyroxene and intercumulus plagioclase. The UG1 pyroxenite is separated from the overlying FW13 leuconorite (about 8m thick) by a thin chromitite layer (1–10cm) with sharp top and bottom contacts.
Local Structure
Floor rocks in the south western BIC display increasingly varied degrees of deformation towards the contact with the RLS. Structure within the floor rocks is dominated by the north-northwest trending post-Bushveld Rustenburg Fault. This normal fault with down-throw to the east extends northwards towards the west of the Pilanesberg Alkaline Complex. A second set of smaller faults and joints, striking 70° and dipping very steeply south-southeast or north-northwest, are related to the Rustenburg fault system. These structures were reactivated during the intrusion of the Pilanesberg Alkaline Complex. Dykes associated with this Complex intruded along these faults and joints.
Major structures, which occur within the WBJV area, include the Caldera and Elands Faults and Chaneng Dyke and a major north-south trending feature, which can be observed across the entire Pilanesberg Complex (Figure 5). These east-west trending structures dip steeply (between 80° and 90°). The magnetics indicate that the Chaneng Dyke dips steeply to the north. This is consistent with similar structures intersected underground on the neighbouring Bafokeng Rasimone Platinum Mine, which all dip steeply northward.
Two stages of folding have been recognised within the area. The earliest folds are mainly confined to the Magaliesberg Quartzite Formation. The fold axes are parallel to the contact between the RLS and the Magaliesberg Formation. Quartzite xenoliths are present close to the contact with the RLS and the sedimentary floor. Examples of folding within the floor rocks are the Boekenhoutfontein, Rietvlei and Olifantsnek anticlines. The folding was initiated by compressional stresses generated by isostatic subsidence of the Transvaal Supergroup during sedimentation and the emplacement of the pre-Bushveld sills. The presence of an undulating contact between the floor rocks and the RLS, and in this instance the resultant formation of large-scale folds, substantiates a second stage of deformation. The fold axes trend at approximately orthogonal angles to the first folding event. Deformation during emplacement of the BIC was largely ductile and led to the formation of basins by sagging and folding of the floor rocks. This exerted a strong influence on the subsequent evolution of the Lower and Critical Zones and associated chromitite layers.
The structural events that influenced the floor rocks played a major role during emplacement of the BIC. There is a distinct thinning of rocks from east to west as the BIC onlaps onto the Transvaal floor rocks, even to the extent that some of the normal stratigraphic units have been eliminated.

 

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Figure 5: Regional Structural Data

 

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The Merensky and UG2 isopach decreases from 60m to 2m at outcrop position as clearly illustrated by the section in Figure 7.  There is also a subcrop of the Critical Zone against the Main Zone rocks.
 
Project Geology
The sequence of the BIC within the WBJV area is confined to the lower part of the Main Zone (Porphyritic Gabbro Marker) and the Critical Zone (HW5–1 and Bastard Reef to UG1 footwall sequence). The rock sequence thins towards the southwest (subcrop) including the marker horizons with concomitant middling of the economic reefs or total elimination thereof. The UG2 CL and, more often, the UG1 CL are not developed in some areas owing to the irregular and elevated palaeo-floor of the Transvaal sediments.
Surface Geology
The WBJV is underlain by the lower portion of the RLS, comprising Critical Zone and lower portion of the Main Zone. The ultramafic Lower Critical Zone and the Mafic Upper Critical Zone and the Main Zone weather to dark, black clays with very little topography. The underlying Transvaal Supergroup comprises shale and quartzite of the Magaliesberg Formation, which creates a more undulating topography. Gravity, magnetic, LANDSAT, aerial photography and geochemistry have been used to map out lithological units.
The Merensky Reef subcrops, as does the UG2 CL, beneath a relatively thick main zone of the Bushveld against the Transvaal basement. The sequence strikes northwest to southeast and has an average dip of ~10° in the Project 3 Area. The top 32m of rock formation below the soil column is characterized by a highly weathered rock profile (regolith) consisting mostly of gabbro within the Main Zone. Thicknesses of this profile increase near intrusive dykes traversing the area.
Reefs
The Merensky Reef structure at the Project Area has not been interpreted to date.
The UG2 CL is well developed towards the northeast of the Project Area, but deteriorates towards the southwest. Within the latter area, the chromitite layer is present as a thin discontinuous or disrupted chromitite/pyroxenite layer. It also appears to be disrupted by the shear zone along the footwall alteration zone.
The thickness of the sequences between the UG2 and MR in the Project 3 Area increases from ~6m to 25m in a southwest-northeast direction. In general, the thickness between the units appears to increase in a north easterly direction, sub-parallel to the strike of the BIC layered lithologies.

 

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Project Structure
A structural model was developed from data provided by the magnetic survey results and geological logs of drilled cores. At least three generations of faults were identified on the property.
The oldest event appears to be associated with dykes and sills trending at 305 degrees and is of post-BIC age. It appears to be the most prominent, with the largest displacement component of more than 20m. The majority of the faults are normal faults dipping in a westerly direction, decreasing in their dip downwards and displaying typical listric fault system behaviour.
A second phase represented by younger fault features is trending in two directions at 345 degrees and 315 degrees northwards respectively and appears to have consistent down-throws towards the west.
A third phase of deformation may be related to a regional east-west-striking dyke system causing discontinuity on adjacent structures. Several dolerite intrusives, mainly steep-dipping dykes and bedding-parallel sills, were intersected in boreholes. These range in thickness from 0.5–30m and most appear to be of a chilled nature; some are associated with faulted contacts. Evident on the magnetic image is an east-west-trending dyke, which appears to be of Pilanesberg-intrusion age. This dyke has a buffer effect on structural continuity as faulting and earlier stage intrusives are difficult to correlate on either side; and more work is required to understand the mechanics.

 

Technical Report Project 3 Resource Cut Estimation August 2010                                                                                                                                                                                                                                                                                                21

Figure 6: UG2 Chromitite Layer Structure (Project 3)

 

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Figure 7: Cross Section through Project 3

 

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ITEM 8:  DEPOSIT TYPES
The most pronounced PGE mineralisation in the Project Area occurs within the Merensky Reef and is generally associated with a 0.1–1.2m thick pegmatoidal feldspathic pyroxenite unit. The Merensky Reef is generally also associated with thin chromitite layers on either/both the top and bottom contacts of the pegmatoidal feldspathic pyroxenite. The second important mineralised unit is the UG2 chromitite layer, which is on average 1.50m thick and occurs within the Project Area.
MR Facies Types
The Merensky Reef occurs as the Detached Facies in the Project Area. The Detached Facies comprises a pegmatoid of feldspathic pyroxenite reef type, or pyroxenite bounded by top and bottom chromitite layers. It generally overlies several meters of fine to medium grained pyroxenite and is overlain by feldspathic pyroxenite with base metal sulphides mineralization within 1.0m thick just below the chromitite. It lies on footwall rocks from FW 1 to FW 6. It is similar to the detached Merensky Reef facies describe at the adjacent Project of Wesizwe.
Figure 8: Merensky Reef Stratigraphic Column

UG2 Facies Types
The UG2 CL is composed of a choromitite layer and generally has a base feldspathic pyroxenite pegmatoid and certain overlying chromitite layers termed leader and triplets. Most of the intersections encountered in the PTM exploration campaign have no basal pegmatoid but do have FW13 Anorthosite Unit underlying the main band, pinching out in a NE direction and sitting directly on UG1 hangingwall pyroxenite.

 

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Correlation and Lateral Continuity of the Reefs
The Merensky Reef and UG2 CL are positively identified in new intersections. Only the reef intersections that had no faulting or disruptions/discontinuities were used in the Resource Estimate. The UG1, traditionally classified as a secondary reef typically with multiple chromitite seams, has been intersected in some boreholes; although in many cases strongly disrupted, it showed surprisingly attractive grades.
Resource estimation is not possible within 50m from surface owing to core loss resulting from near-surface weathering (weathered rock profile), joint set interference, and reef identification/correlation problems and thinning of the reefs towards the west.
Merensky Reef is poorly developed at the Project Area, from the subcrop position to as far as 100m down-dip and as far as 800m along strike. This was evident in marginal grades, and is no doubt due to the presence of a palaeo-high in the Transvaal sediment floor rocks below the BIC. The area is locally referred to as the Abutment.
With respect to the UG2 CL in the Project Area, relative to the Abutment's effect, a smaller area extending from subcrop position to as deep as 400m down-dip with strike length 420m of UG2 CL was characterised by a relatively low grade.
Potholes
The limited exploration and drilling at the Project 3 Area has revealed no real evidence of potholes. However, positive identification of pothole intersections for the Merensky Reef and UG2 CL in other areas of the WBJV has occurred. The possible position of these potholes may be indicated by the following:-
·
Where footwall stratigraphic widths are wider;
·
Where the Merensky Pyroxenite or UG2 chromitite is bifurcating, split or absent; and
·
Where the Merensky Reef width is anomalous with regard its normal facies widths.
Replacement Pegmatites
Due to limited drilling at Project 3 Area, little evidence for the occurrence of pseudo-form replacement bodies have been encountered. However, evidence for replacement pegmatoids has been encountered in other areas of the WBJV.
ITEM 9:  MINERALISATION  
No metallurgical testwork has been conducted by PTM for Project 3 to date. However, metallurgical testwork has been conducted for southern areas of the WBJV, and it is expected that the mineralogy at Project 3 will be similar this. The following is an excerpt from the technical report completed for the Project 1 and 1A areas.

 

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Mineralisation Styles and Distribution
Bulk modal analyses were estimated based on the results from XRD analysis (RIR method) and optical microscopic examination. The results were as follows:-
·
Alteration – Silicates showed low to moderate alteration, mainly associated with fractured zones. The degree of alteration is not expected to hinder flotation results, but should be monitored.
·
Sulphide Assemblages – Sulphide composition of the samples was variable. The results of the estimated sulphide composition of the composite sample were as follows:-

o
Chalcopyrite (CuFeS2):	20%	
o
Pyrite (FeS2):	2%	
o
Pyrrhotite (Fe7S8):	35%	
o
Pentlandite ((Fe, Ni)S):	43%	
Examination of the polished thin-sections showed that the sulphides occurs as sporadically distributed, fine grained clusters associated with interstitial silicates or as isolated, coarse composite particles and blebs. The liberation characteristics of the sulphides are expected to be relatively good apart from the fine disaggregated disseminated chalcopyrite.
PGE and Gold Deportment
PGE searches (including gold bearing phases) were conducted by manually scanning a selection of the polished sections utilizing a scanning electron microscope to obtain a statistical particle count. Approximately 237 particles were located in 8 thin sections and image analysis software was employed to measure the size of each particle.
a)
Speciation
Taken as a whole, the proportions of the various PGE (+Au) species are depicted in Table 2. The major PGE phase encountered was cooperite (PtS) which comprise 63% of the observed particles. Moncheite (PtTe2) was the next most common PGE encountered (11%). The major gold-bearing phase, electrum (AuAg), was found to comprise 6% of the observed particles. Braggite (PtPd)S is also fairly common and comprises 5% of the observed particles. Sperrylite (PtAs2) is less common, comprising about 4% of the observed PGE's. A PGE phase composed of Pd, Pt, As and some Te was found to be present in 2.4% of the observed particles. Hollingworthite (RhAsS), isoferroplatinum (Pt3Fe) and laurite (RuS2) are less common PGE's, each comprising about 1.5% of the total observed particles. Froodite (PdBi2) comprise about 1% of the observed particles and was found only in one thin-section (41/D4/B). The remaining 2.8% of the observed particles are composed of 9 other PGE and gold species.

 

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In order to reach a better understanding of the PGE speciation, they were classified into five groups: a) sulphides, b) arsenides, c) Te-, Sb- and Bi-bearing, d) Au-bearing phases and e) Fe bearing PGE's. The sulphides comprise about 71% of PGE's observed (of which cooperate comprise about 90%).
Table 2: PGE + Au speciation and proportional occurrence based on area (um2)

b)
Mineral Association
With regard to the mineral associations, 77% of the total PGE's (+Au-phases) observed are associated with sulphides (mainly occluded or attached to chalcopyrite or pentlandite), 21% is occluded in silicates (usually in close proximity to sulphides), and only 2% occur on the boundary between silicate minerals and chromite. Microscopic observation indicates that PGE's (+Au-phases) concluded in silicate minerals occur mainly in the alteration silicates and in interstitial silicate phases i.e. talc, chlorite, quartz, amphibole and phlogopite.
c)
Grain-Size Distribution
With regard to the grain size distributions, nearly 40% of the total PGE's are sulphides that are larger than 1000µm2 in size. Approximately 75% of the observed PGE's are larger than 100µm2 in size. It was also noted that the Te-, Sb- and Bi-bearing PGE's are generally smaller than the sulphides. The largest PGE particle observed was measured at ~5000µm2. Only 2 particles were measured at >1000µm2, but this accounted for nearly 37% of total PGE's observed.

Table 2: PGE + Au speciation and proportional occurrence based on area (um2)

  	No of	Area	% of Total	% in	Group	Group as %	
 	Particles	(um2)	Area	Group	Area	of Total	
Sulphides	 	 	 	 	 	 	
Cooperite	69	12719	63.2	89.29	 	 	
Braggite	2	1069.1	5.3	7.51	 	 	
Laurite	10	319.5	1.6	2.24	 	 	
Platarsite	1	136.9	0.7	0.96	14241.6	70.8	
Arsenides	 	 	 	 	 	 	
Sperrylite	8	754.3	3.8	46.56	 	 	
Palladoarsenide	1	87.0	0.4	5.37	 	 	
PdPt(Te)As	3	476.4	2.4	29.41	 	 	
Hollingworthite	2	302.3	1.5	18.66	1620.0	8.1	
Te-Be- and Bi-Bearing	 	 	 	 	 	 	
Moncheite	37	2128.8	10.6	81.24	 	 	
Michenerite	5	119.1	0.6	4.55	 	 	
Stbiopalladinite	6	99.9	0.5	3.81	 	 	
Stumpflite	1	7.0	0.0	0.27	 	 	
PdSbBi	9	14.3	0.1	0.93	 	 	
Froodite	22	241.3	1.2	9.21	2620.4	13.0	
Au-Bearing	 	 	 	 	 	 	
Electrum	52	1228.4	6.1	6.11	 	 	
Aurostibite	1	37	0.2	0.18	 	 	
Gold	1	72.5	0.4	0.36	 	 	
AuPdTe	2	4.9	0.0	0.02	1342.8	6.7	
Fe-Bearing PGE's	 	 	 	 	 	 	
Isoferroplatinum	5	281.4	1.4	100	281.4	1.4	
TOTAL	237	20106.2	100	 	20106.2	100	

 

Technical Report Project 3 Resource Cut Estimation August 2010                                                                                                                                                                                                                                                                                                27

The sulphide and PGE composition of the composite sample is normal for the Merensky Reef. The most significant observations resulting from these processes are:
·
the formation of deleterious alteration products such as talc and chlorite which will tend to dilute grades of flotation concentrates, and affect the milling and filtration characteristics of the ore;
·
alteration tends to disaggregate primary sulphides (and PGE's) in situ, to form very fine disseminated clusters within alteration silicates, which will require finer grinding to achieve effective liberation.
ITEM 10:  EXPLORATION
Survey (field observation) Results, Procedures and Parameters
Exploration to date for the Project 3 Area comprises of geophysical surveys (magnetic, gravity, 3D seismics and aerial magnetic). This programme is currently still in process. The purpose of the exploration programme is to re-evaluate the Project Area via geophysical assessments with regard to structure.
The exploration programme was concluded in July 2008.
Interpretation of Survey (field observation) Results
The structural features identified from the aeromagnetic data were interpreted in terms of a regional structural model. Major dyke features were easily recognised and these assisted in the compilation of a structural model for the WBJV Project Area.
Survey (field observation) Data Collection and Compilation
Initial processing of the geophysical data collected was conducted by Anglo American Technical Division, Geoscience. Final processing of data is conducted by Rock Deformation Research Limited (“RDR”).
ITEM 11:  DRILLING
Type of Drilling
The type of drilling being conducted on the WBJV is a diamond-drilling core-recovery technique involving a BQ-size solid core extraction. The drilling is placed on an unbiased 500m x 500m grid and detailed when necessary to a 250m x 250m grid. Three deflections were drilled for boreholes which intersected the Merensky Reef or UG2 CL, and all of these deflections were assayed. Drilling at the Project Area was still ongoing at the time of writing of this report.

 

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Procedures, Summary and Interpretation of Results
The results of the drilling and the general geological interpretation are digitally captured in SABLE and a GIS software package named ARCVIEW. The exact borehole locations, together with the results of the economic evaluation, are plotted on plan. From the geographic location of the holes drilled, regularly spaced sections are drawn by hand and digitised. This information was useful for interpreting the sequence of the stratigraphy intersected as well as for verifying the borehole information.
Comment on True and Apparent Widths of the Mineralised Zones
The geometry of the deposit has been clearly defined in the sections drawn through the property. All holes were drilled vertically and the down hole surveys indicate very little deviation. A three-dimensional surface – digital terrain model (“DTM”) – was created and used in the calculation of the average dip of 10°. This dip has been factored into the calculations on which Resource Estimates are based.
Comment on the Orientation of the Mineralised Zones
The mineralised zones within the Project Area include the Merensky Reef and the UG2 CL, both of which are planar tabular ultramafic precipitants of a differentiated magma and therefore form a continuous sheet-like accumulate.
The stratigraphic markers above and below the economic horizons have been recognised and facilitate recognition of the Merensky Reef and the UG2 CL. There are a few exceptions to the quality of recognition of the stratigraphic sequences. These disruptions are generally of a structural nature and are to be expected within this type of deposit.
In some boreholes no clear stratigraphic recognition was possible. These holes were excluded from Resource calculations.
ITEM 12:  SAMPLING METHOD AND APPROACH
Sampling Method, Location, Number, Type and Size of Sampling
The first step in the sampling of the diamond-drilled core is to mark the core from the distance below collar in 1m units and then for major stratigraphic units. Once the stratigraphic units are identified, the economic units – Merensky Reef and UG2 CL – are marked. The top and bottom contacts of the reefs are clearly marked on the core. Thereafter the core is rotated in such a manner that all lineations pertaining to stratification are aligned to produce a representative split. A centre cut line is then drawn lengthways for cutting. After cutting, the material is replaced in the core trays. The sample intervals are then marked as a line and a distance from collar.

 

Technical Report Project 3 Resource Cut Estimation August 2010                                                                                                                                                                                                                                                                                                29
 
The sample intervals are typically 15–25cm in length. In areas where no economic zones are expected, the sampling interval could be as much as a metre. The sample intervals are allocated a sampling number, and this is written on the core for reference purposes. The half-core is then removed and placed into high-quality plastic bags together with a sampling tag containing the sampling number, which is entered onto a sample sheet. The start and end depths are marked on the core with a corresponding line. The duplicate tag stays as a permanent record in the sample booklet, which is secured on site. The responsible project geologist then seals the sampling bag. The sampling information is recorded on a specially designed sampling sheet that facilitates digital capture into the SABLE system (commercially available logging software). The sampling extends for about a metre into the hangingwall and footwall of the economic reefs.
Drilling Recovery
All reef intersections that are sampled require a 100% core recovery. If less than 100% is recovered, the drilling company will re-drill, using a wedge to achieve the desired recovery.
Sample Quality and Sample Bias
The sampling methodology accords with PTM protocol based on industry-accepted best practice. The quality of the sampling is monitored and supervised by a qualified geologist. The sampling is done in a manner that includes the entire economic unit together with hanging wall and footwall sampling. Sampling over-selection and sampling bias is eliminated by rotating the core so that the stratification is vertical and by inserting a cutline down the centre of the core and removing one side of the core only.
Widths of Mineralised Zones – Resource Cuts
The Merensky Reef Resource width is on average 114cm thick and the UG2 CL is on average 116cm thick. A minimum Resource width of 80cm was selected. Although the average widths are more than 1m, there are a significant number of reef intersections less than 1m; reef intersections more than 80cm were kept as is.
The Merensky Resource width (used as reef width) is defined as follows:-
The upper chrome seam defines the upper limit of the Resource cut. If the upper sample plus reef is less than 80cm then sample in the footwall was added to define a minimum of as close as possible to a 80cm Resource cut.

 

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The UG2 CL Resource width (used as reef width) is defined as the reef width and if the reef width was less than 80cm then samples were added in the hanging wall to define a minimum width of as close to 80cm as possible. Reef intersections more than 80cm were kept as is.
Summary of Sample Composites with Values and Calculated Resource Widths
Table 3: Merensky Reef – Resource Width

 

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Table 4: UG2 CL – Resource Width

ITEM 13:  SAMPLE PREPARATION, ANALYSES AND SECURITY
Persons Involved in Sample Preparation
Drilled core is cleaned, de-greased and packed into metal core boxes by the drilling company. The core is collected from the drilling site on a daily basis by a PTM geologist and transported to the exploration office by PTM personnel. Before the core is taken off the drilling site, the depths are checked and entered on a daily drilling report, which is then signed off by PTM. The core yard manager is responsible for checking all drilled core pieces and recording the following information:
·
Drillers' depth markers (discrepancies are recorded);
·
Fitment and marking of core pieces;
·
Core losses and core gains;
·
Grinding of core;
·
One-meter-interval markings on core for sample referencing; and
·
Re-checking of depth markings for accuracy.

 

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Core sampling is carried out by a qualified geologists under the supervision of the project geologist, who is responsible for timely delivery of the samples to the relevant laboratory. The supervising and project geologists ensure that samples are transported by PTM contractors.
Sample Preparation, Laboratory Standards and Procedures
When samples are prepared for shipment to the analytical facility the following steps are followed:
·
Samples are sequenced within the secure storage area and the sample sequences examined to determine if any samples are out of order or missing;
·
The sample sequences and numbers shipped are recorded both on the chain-of-custody form and on the analytical request form;
·
The samples are placed according to sequence into large plastic bags. (The numbers of the samples are enclosed on the outside of the bag with the shipment, waybill or order number and the number of bags included in the shipment);
·
The chain-of-custody form and analytical request sheet are completed, signed and dated by the project geologist before the samples are removed from secured storage. The project geologist keeps copies of the analytical request form and the chain-of-custody form on site; and
·
Once the above is completed and the sample shipping bags are sealed, the samples may be removed from the secured area. The method by which the sample shipment bags have been secured must be recorded on the chain-of-custody document so that the recipient can inspect for tampering of the shipment.
For the present database, field samples have been analyzed by three different laboratories: ALS Chemex (South Africa), Genalysis (Australia) and currently Set Point laboratories (South Africa). Samples from borehole WBJV008 onwards were sent to the Set Point Laboratory preparation facility at Mokopane.
Transportation from their preparation laboratory in Mokopane to their laboratory in Johannesburg was done under secure conditions as required by PTM. Dr B Smee has accredited Set Point Laboratories.
Samples are received, sorted, verified and checked for moisture and dried if necessary. Each sample is weighed and the results are recorded. Rocks, rock chips or lumps are crushed using a jaw crusher to less than 10mm. The samples are then milled for 5 minutes in a Labtech Essa LM2 mill to achieve a fineness of 90% less than 106µm, which is the minimum requirement to ensure the best accuracy and precision during analysis.
Samples are analysed for Pt (ppb), Pd (ppb) Rh (ppb) and Au (ppb) by standard 25g lead fire-assay using silver as requested by a co-collector to facilitate easier handling of prills as well as to minimise losses during the cupellation process. Although collection of three elements (Pt, Pd and Au) is enhanced by this technique, the contrary is true for rhodium (Rh), which volatilises in the presence of silver during cupellation. Palladium is used as the co-collector for Rh analysis. The resulting prills are dissolved with aqua regia for Inductively Coupled Plasma (“ICP”) analysis.

 

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After pre-concentration by fire assay and microwave dissolution, the resulting solutions are analysed for Au and PGE's by the technique of ICP-OES (inductively coupled plasma–optical emission spectrometry).
Quality Assurance and Quality Control (QA&QC) Procedures and Results
The PTM protocols for quality control are as follows:-
1.
The project geologist (Mr M Rhentho) oversees the sampling process;
2.
The core yard manager (Mr I Ernest) oversees the core quality control;
3.
The exploration geologists (Ms T Saindi and Ms T Thapelo) and the sample technician (Mr LJ Selaki) is responsible for the actual sampling process'
4.
The project geologist oversees the chain of custody;
5.
The internal QP (Mr W Visser) verifies both processes and receives the laboratory data;
6.
The internal resource geologist (Mr T Botha) and the database manager (Mr M Rhantho) merge the data and produce the SABLE sampling log with assay values;
7.
Together with the project geologist, the resource geologist determines the initial Resource cut;
8.
The external auditor (Mr N Williams) verifies the sampling process and signs off on the Resource cut;
9.
The second external database auditor (Ms H Sternberg) verifies the SABLE database and highlights QA&QC failures;
10.
Ms R de Klerk (Maxwell Datashed) runs the QA&QC graphs (standards, blanks and duplicates) and reports anomalies and failures to the internal QP;
11.
The internal QP requests re-assays; and
12.
Check samples are sent to a second laboratory to verify the validity of data received from the first laboratory.
Standards
The following analytical standards were used to assess the accuracy and possible bias of assay values for Platinum (Pt) and Palladium (Pd). Rhodium (Rh) and Gold (Au) were monitored where data for the standards were available, but standards were not failed on Rh and Au alone.

 

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Table 5: Standards used for QA&QC

Standard type	Pt	Pd	Rh	Au	
CDN-PGES-5	Yes	Yes	-	-	
CDN-PGES-6	Yes	Yes	-	Yes	
CDN-PGES-7	Yes	Yes	-	Yes	
CDN-PGES-11	Yes	Yes	-	Yes	
AMIS0005	Yes	Yes	Yes	-	
AMIS0007	Yes	Yes	Yes	-	
AMIS0010	Yes	Yes	-	-	

Generally, the standards are inserted in place at the fifteenth sample site in the sample sequence. The standards are stored in sealed containers and considerable care is taken to ensure that they are not contaminated in any manner (e.g. through storage in a dusty environment, being placed in a less than pristine sample bag or being in any way contaminated in the core saw process).
Assay testing refers to Round Robin programmes involving collection and preparation of material of varying matrices and grades, to provide homogeneous material for developing reference materials (standards) necessary for monitoring assaying. Assay testing is also useful in ensuring that analytical methods are matched to the mineralogical characteristics of the mineralisation being explored. Samples are sent to a sufficient number of international testing laboratories to provide enough assay data to statistically determine a representative mean value and standard deviation necessary for setting acceptance/rejection tolerance limits.
Tolerance limits are set at two and three standard deviations from the Round Robin mean value of the reference material. A single analytical batch is rejected for accuracy when reference material assays are beyond three standard deviations from the certified mean, and any two consecutive standards within the same batch are rejected on the basis of bias when both reference material assays are beyond two standard deviations limit on the same side of the mean. Reasons why standards failed may include database errors, selection of wrong standards in the field, sample mis-ordering errors and bias from the laboratory. A failed standard is considered to be cause for re-assay if it falls within a determined Resource cut for either the Merensky Reef or UG2 CL (MRMC and UG2MC). The bulk of the economic value of the reefs is located within the combined value for Pt and Pd, with Rh and Au comprising only 10% of the 4E value (refer to Item 3 for the prill splits). As requested by a result, standards that failed for Rh and/or Au (Rh evaluated for AMIS0005, AMIS0007 and AMIS0010 standards; Au evaluated for CDN-PGES-5, 6, 7 and 11) are not included in the final results as the influence is deemed as not of material economic value.
Blanks
The insertion of blanks provides an important check on the laboratory practices, especially potential contamination or sample sequence mis-ordering. Blanks consist of a selection of Transvaal Quartzite pieces (devoid of platinum, palladium, copper and nickel mineralisation) of a mass similar to that of a normal core sample. The blank being used is always noted to track its behaviour and trace metal content. Typically the first blank is sample 5 in a given sampling sequence.

 

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Duplicates
The purpose of having field duplicates is to provide a check on possible sample over-selection. The field duplicate contains all levels of error – core or reverse-circulation cutting splitting, sample size reduction in the prep lab, sub-sampling at the pulp, and analytical error.
No duplicate samples were assayed for Project 3.
Assay Validation
Although samples are assayed with reference materials, an assay validation programme is being conducted to ensure that assays are repeatable within statistical limits for the styles of mineralisation being investigated. It should be noted that validation is different from verification; the latter implies 100% repeatability. The assay validation programme entails:-
·
a re-assay programme conducted on standards that failed the tolerance limits set at two and three standard deviations from the Round Robin mean value of the reference material;
·
ongoing blind pulp duplicate assays at Set Point Laboratory;
·
check assays conducted at an independent assaying facility (Genalysis).
Adequacy of Sampling Procedures, Security and Analytical Procedures
Sampling Procedures
The QA&QC practice of PTM is a process beginning with the actual placement of the borehole position (on the grid) and continuing through to the decision for the 3D economic intersection to be included in (passed into) the database. The values are also confirmed, as well as the correctness of correlation of reef/Resource cut so that populations used in the geostatistical modelling are not mixed; this makes for a high degree of reliability in estimates of Resources/Reserves.
The author of this report (the independent QP) relied on subordinate qualified persons for the following:
·
correct sampling procedures (marking, cutting, labelling and packaging) were followed at the exploration office and accurate recording (sample sheets and digital recording in SABLE) and chain-of-custody procedures were followed;
·
adequate sampling of the two economic horizons (Merensky Reef and UG2 CL) was done;

 

Technical Report Project 3 Resource Cut Estimation August 2010                                                                                                                                                                                                                                                                                                36

·
preparations by PTM field staff were done with a high degree of precision and no deliberate or inadvertent bias;
·
correct procedures were adhered to at all points from field to database;
·
PTM's QA&QC system meets or exceeds the requirements of NI 43-101 and mining best practice; and that
·
the estimates provided for the Merensky Reef and UG2 CL are a fair and valid representation of the actual in-situ value.
The QP's view is supported by Mr N Williams, who audited the whole process (from field to database), and by Ms H Sternberg, who regularly audited the SABLE database for correct entry and integrity and also verifies the standards, blanks and duplicates within the database as a second check to the QA&QC graphs run by Ms R de Klerk.
Security
Samples are not removed from secured storage location without completion of a chain-of-custody document; this forms part of a continuous tracking system for the movement of the samples and persons responsible for their security. Ultimate responsibility for the secure and timely delivery of the samples to the chosen analytical facility rests with the project geologist and samples are not transported in any manner without the project geologist's permission.
During the process of transportation between the Project site and analytical facility the samples are inspected and signed for by each individual or company handling the samples. It is the mandate of both the supervising and project geologist to ensure secure transportation of the samples to the analytical facility. The original chain-of-custody document always accompanies the samples to their final destination.
Adequacy of Analytical Procedures
The QA&QC practice of PTM is a process beginning with the actual placement of the borehole position (on the grid) and continuing through to the decision for the 3D economic intersection to be included in (passed into) the database. The values are also confirmed, as well as the correctness of correlation of reef/Resource cut so that populations used in the geostatistical modelling are not mixed; this makes for a high degree of reliability in estimates of resources/reserves.

 

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ITEM 14:  DATA VERIFICATION
Quality Control Measures and Data Verification
All scientific information is manually captured and digitally recorded. The information derived from the core logging is manually recorded on A4-size logging sheets. After being captured manually, the data is electronically captured in a digital logging program (SABLE). For this exercise the program has very specific requirements and standards. Should the entered data not be in the set format the information is rejected. This is the first stage of the verification process.
After the information is transferred into SABLE, the same information is transferred into a modelling package (DATAMINE). Modelling packages are rigorous in their rejection of conflicting data, e.g. the input is aborted if there are any overlaps in distances or inconsistencies in stratigraphic or economic horizon nomenclature. This is the second stage of verification. Once these stages of digital data verification are complete, a third stage is generated in the form of section construction and continuity through DATAMINE. The lateral continuity and the packages of hanging wall and footwall stratigraphic units must align or be in a format consistent with the general geometry. If this is not the case, the information is again aborted.
The final stage of verification is of a geostatistical nature, where population distributions, variance and spatial relationships are considered. Anomalies in grade, thickness, isopach or isocon trends are noted and questioned. Should inconsistencies and varying trends be un-explainable, the base data is again interrogated, and the process is repeated until a suitable explanation is obtained.
Verification of Data
The geological and economic base data has been verified by Ms. H. Sternberg and has been found to be acceptable.
Nature of the Limitations of Data Verification Process
As with all information, inherent bias and inaccuracies can and may be present. Given the verification process that has been carried out, however, should there be a bias or inconsistency in the data, the error would be of no material consequence in the interpretation of the model or evaluation. The data is checked for errors and inconsistencies at each step of handling. The data is also rechecked at the stage where it is entered into the deposit-modelling software. In addition to ongoing data checks by project staff, the senior management and directors of PTM have completed spot audits of the data and processing procedures. Audits have also been done on the recording of borehole information, the assay interpretation and final compilation of the information.  The individuals in PTM's senior management and certain directors of the company who completed the tests and designed the processes are non-independent mining or geological experts.

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ITEM 15:  MINERAL RESOURCE ESTIMATES
Standard Resource and Reserve Reporting System
The author has classified the Mineral Resources according to the SAMREC Code. This report deals primarily with the Mineral Resources. No Mineral Reserves have been classified. Indicated and Inferred Mineral Resources have been classified. No addition of the Inferred Mineral Resources to other Mineral Resource categories has occurred.
Relationship of the QP to the Issuer
Apart from having been contracted to compile this report, the QP, Mr. Charles J. Muller, has no commercial or other relationship with PTML.
Detailed Mineral Resource Tabulation
From the interpolated block model, Indicated and Inferred Mineral Resources were estimated. Table 7 shows the tonnage and grade for each reef at specific cut-off grades for 4E (cm.g/t.). The cut-off grade categories are based on content as the interpolation was carried out on content, as was the mechanism for the change of support or post processing.
Table 6: Indicated Mineral Resource for UG2CL and Merensky Reef at Project 3

Indicated Mineral
Resource (4E)	Cut-off
(cm.g/t) 4E	Million Tonne	Grade 4E
(g/t)	Potential
Resource
Width (m)	Tons PGE
(4E)	Moz PGEs
(4E)	
Project 3 MR	100	5.157	6.03	1.14	31.097	0.999	
Project 3 UG2 CL	100	5.947	4.91	1.16	29.199	0.939	
Total Indicated	100	11.104	5.43	1.15	60.296	1.938	

Table 7: Inferred Mineral Resource for the Merensky Reef at Project 3

Inferred Mineral
Resource (4E)	Cut-off
(cm.g/t) 4E	Million Tonne	Grade 4E
(g/t)	Potential
Resource
Width (m)	Tons PGE
(4E)	Moz PGEs
(4E)	
Project 3 MR	100	0.443	1.47	1.14	0.651	0.021	
Total Inferred	100	0.443	1.47	1.14	0.651	0.021	

MR = Merensky Reef; UG2 CL = Upper Group No. 2 chromitite seam; PGE = Platinum Group Metals.
The cut-offs for Indicated and Inferred Mineral Resources have been established by a qualified person after a review of potential operating costs and other factors.
Tonnes discount for geological loss (14%) and dip.
Due to rounding, columns may not add up.

									
Prill Splits	Pt	Pt (g/t)	Pd	Pd (g/t)	Rh	Rh (g/t)	Au	Au (g/t)	
Project 3 MR	64%	4.01	27%	1.69	4%	0.25	5%	0.31	
Project 3 UG2 CL	62%	3.42	28%	1.54	9%	0.50	1%	0.06	

 

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A cut-off grade of 100cm.g/t was selected as a Resource cut-off. The reason for using the 100cm.g/t cut-off is in compliance with responsible engineering practice to simulate probable working cost and flow of ore parameters, in order to report potentially economical resources.  The Mineral Resources are estimated by the kriging method of Resource Estimation. In keeping with best practice in Resource Estimation, an allowance for known and expected geological losses (14%) is made.
Key Assumptions, Parameters and Methods of Resource Calculation
The following table details the number of boreholes used in the estimation of the Mineral Resources:-
Table 8: Borehole Intercepts used in the estimation of the Mineral Resources

Data	Valid MR intercepts used for Model	Valid UG2 CL intercepts used for Model	
No. of intercepts for Project 3	37	30	

Resource widths and 4E grades used in the Resource Estimation exercises are depicted in the diagrams below. The available borehole data was obtained from PTM. In the evaluation process the metal content (4E cm.g/t) and Resource width (cm) values are used. The Resource cut width refers to the corrected width. The values have been interpolated into a 2D block model. The 4E grade (g/t) has been calculated from the interpolated content and Resource width values. For modelling purposes on Project 3, the Merensky Reef was divided into two geological domains and the UG2 CL consists of two domains (Figure 12). Grade and Resource width estimates were calculated within specific geological domains.

 

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Figure 9: Location of Boreholes used for Resource Estimation of Merensky Reef and UG2 CL

 

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Figure 10: Kriged Channel Width for Merensky Reef and UG2 CL

 

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Figure 11: Kriged 4E Plots for Merensky Reef and UG2 CL

 

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Figure 12: Geological Domains for Resource Estimation at Project 3

 

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Statistical Analysis
Descriptive statistics in the form of histograms (frequency distributions) and probability plots (to evaluate the normality of the distribution of a variable) were used to develop an understanding of the statistical relationships. Skewness is a measure of the deviation of the distribution from symmetry (0 = no skewness). Kurtosis measures the "peakedness" of a distribution (3 = normal distribution).
Descriptive statistics for the Merensky Reef and the UG2 CL are summarised below.
Table 9: Project 3 Merensky Reef Descriptive Statistics

Domain 1	
	
Domain 2	
	
Notes:
CM4E = cm.g/t of 4 Elements
CW = Channel Width
Table 10: Project 3 UG2 CL Descriptive Statistics

Domain 1	
	
Domain 2	
	
Notes:
CM4E = cm.g/t of 4 Elements
CW = Channel Width
No corrections were made (top cut etc.) to the data and the statistical analyses show the expected relationships for these types of reef.

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Figure 13: Histograms and Probability Plots - Project 3

DOMAIN 1	
Normal Space Histogram – Merensky Reef 4E cm.g/t	Normal Probability Plot – Merensky Reef  4E cm.g/t	
		
Normal Space Histogram – Merensky Reef 4E	Normal Probability Plot – Merensky Reef  4E	

Normal Space Histogram – Merensky Reef CW	Normal Probability Plot – Merensky Reef  CW	
		
Log Probability Plot – Merensky Reef 4E cm.g/t	Log Probability Plot – Merensky Reef 4E	

 

Technical Report Project 3 Resource Cut Estimation August 2010                                                                                                                                                                                                                                                                                                46

Log Probability Plot – Merensky Reef CW	 	
	 	
Normal Space Histogram – UG2 CL 4E cm.g/t	Normal Probability Plot – UG2 CL 4E cm.g/t	
		
Normal Space Histogram – UG2 CL 4E cm.g/t	Normal Probability Plot – UG2 CL 4E	
		
Normal Space Histogram – UG2 CL CW	Normal Probability Plot – UG2 CL CW	
		
Log Probability Plot – UG2 CL 4E cm.g/t	Log Probability Plot – UG2 CL 4E	
		
Log Probability Plot – UG2 CL CW	 	

Variography
Variograms are a useful tool for investigating the spatial relationships of samples. Variograms for channel width (cm), 4E cm.g/t and 4E, per domains, were modelled during the estimation process.

 

Technical Report Project 3 Resource Cut Estimation August 2010                                                                                                                                                                                                                                                                                                47

The table below summarises the variogram model parameters for the different reefs and domains.
Table 11: Variogram Parameters Merensky Reef & UG2 – CM4E and Resource Cut Width

All variograms are omni-directional spherical semi-variograms. Table 11 summarises the 4E content and Resource cut width variograms, which have a modelled grade continuity range of ~270-700m for the Merensky Reef and a modelled grade continuity range of ~245-600m for the UG2 CL.
The nugget effect is on average 35% of the sill or population variance for the Merensky Reef and 31% for the UG2 CL. No top-cuts were used for the generation of the experimental variograms.
Grade Estimation
Full reef composite data – Resource Cut width (cm) and 3PGE_Au content (cm.g/t) (CM4E) were estimated for both the Merensky Reef and UG2 CL.
Both simple kriging (“SK”) and ordinary kriging (“OK”) techniques have been used. Specific to this Project it has been shown that the SK technique is more efficient when limited data are available for the estimation process.
The 4E grade concentration (g/t) was calculated from the interpolated kriged 4E content (cm.g/t) and Resource width (cm) values. Detailed checks were carried out to validate kriging outputs, including input data, kriged estimates and kriging efficiency checks.
The simple kriging process uses a local or global mean as a weighting factor. For this exercise all blocks within a specific domain have been assigned a global mean for that domain.  Ordinary kriging balances the kriging weights to one without the use of a local/global mean, whereas, simple kriging introduces the local/global mean in the balancing of the equations.
The following parameters were used in the kriging process for both project areas:-
1.
Full reef composite data – Resource Cut width (cm) and content (CM4E / 4E cm.g/t,);
2.
200m x 200m x 1m block size;
3.
Discretisation  5 x 5 x 1 for each 200m x 200m x 1m block;

 

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4.
First search volume – 850m:-
a.
Minimum number of samples 4;
b.
Maximum number of samples 40;
5.
Second search volume – 5 times the first search volume:-
a.
Minimum number of samples 2;
b.
Maximum number of samples 40;
6.
Third search volume:-
a.
Minimum number of samples 1;
b.
Maximum number of samples 20;
7.
Interpolation methods – simple kriging; and
8.
Local / global mean values used in the simple kriging process.
The first 50m of the ore body is considered to represent a weathered zone and is discarded in the modelling and estimation procedures. Figure 10 and Figure 11 shows the block model plots for the different parameters.
The kriged estimates were post-processed to calculate the information effect, dispersion variance and grade tonnage intervals. The UG2 CL conformed to a log-normal distribution and was post-processed accordingly. However, the Merensky Reef displayed a strongly normal distribution and hence the post-processing conducted on the Reef was undertaken in normal space. With further information, the log-normal post-processing of the UG2 CL should be reviewed.  The 4E cut-off values used ranged from 100–600cm.g/t. An average dip value of 10° was used for estimation of Resources at Project 3.
Post Processing
During early stages of projects the data is invariably on a relatively large grid. This grid is much larger than the block size of a selective mining interest, i.e. selective mining units (“SMU”). Efficient kriging estimates for SMUs or of much larger blocks units will then be smoothed due to information effect or size of blocks. Any mine plan or cash flow calculations made on the basis of the smoothed kriged estimates will misrepresent the economic value of the project, i.e., the average grade above cut-off will be underestimated and the tonnage overestimated. Some form of post processing is required to reflect the realistic tonnage grade estimates for respective cut-offs. Using the limited data available preliminary post-processed analysis has been done.

 

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An SMU of 20m x 40m was selected with an expected future underground sampling configuration on a 20m x 20m grid. Information effects were calculated based on the SMU and the expected future production underground sampling configuration.
Within the parent blocks of 200m x 200m x 1m, the distribution of SMUs has been estimated for various cut-offs. The latter for the UG2 Chromitite Seam has been estimated using lognormal distribution of SMUs within the large parent blocks – 200m x 200m x 1m (see Assibey-Bonsu and Krige, 1999). This technique for post processing has been used based on the observed lognormal distribution of the underlying 4E values in the Project Area (i.e. the indirect lognormal post-processing technique has been used for the change of support analysis). The Merensky Reef has been estimated using a normal distribution of SMUs within the large parent blocks – 200m x 200m x 1m.
For each parent block the grade, tonnage and metal content above respective cut-offs (based on the SMUs) were translated into parcels to be used for mine planning. Grade tonnage curves were therefore calculated for each parent block. The following cut-offs were considered 100, 200, 300, 400, 500 and 600cm.g/t as detailed in the tables below.
Table 12: Cut-off Grades for Merensky Reef Indicated Resource Estimation

Cut-Off (4E)	Tonnage	4E	
cm.g/t	t	g/t	grams	Moz	
0.00	5,180,884	6.00	31,085,304	0.999	
100.00	5,156,829	6.03	31,095,678	0.999	
200.00	5,095,600	6.08	30,981,248	0.996	
300.00	4,960,795	6.19	30,707,321	0.987	
400.00	4,704,239	6.37	29,966,002	0.963	
500.00	4,282,028	6.63	28,389,845	0.913	
600.00	3,680,784	6.97	25,655,064	0.825	

Table 13: Cut-off Grades for Merensky Reef Inferred Resource Estimation

Cut-Off (4E)	Tonnage	4E	
cm.g/t	t	g/t	grams	Moz	
0.00	1,965,010	1.47	2,888,564	0.093	
100.00	443,046	5.34	2,365,865	0.076	
200.00	401,023	5.75	2,305,882	0.074	
300.00	362,481	6.11	2,214,758	0.071	
400.00	325,475	6.44	2,096,059	0.067	
500.00	286,363	6.79	1,944,404	0.063	
600.00	242,197	7.19	1,741,396	0.056	

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Table 14: Cut-off Grades for UG2 CL Indicated Resource Estimation

Cut-Off (4E)	Tonnage	4E	
cm.g/t	t	g/t	grams	Moz	
0.00	6,270,309	4.70	29,470,452	0.947	
100.00	5,947,286	4.91	29,201,174	0.939	
200.00	5,334,503	5.30	28,272,865	0.909	
300.00	5,108,323	5.43	27,738,193	0.892	
400.00	4,972,271	5.48	27,248,045	0.876	
500.00	4,434,979	5.67	25,146,330	0.808	
600.00	3,247,228	6.07	19,710,673	0.634	

A SG of 3.21t/m3 was used for the Merensky Reef and 3.85t/m3 for the UG2 CL tonnage calculations. SG values are average values based on measured values for specific reef intersections.
Resource Classification
The Mineral Resource classification is a function of the confidence of the whole process from drilling, sampling, geological understanding and geostatistical relationships. The following aspects or parameters were considered for resource classification:
1.
Sampling – Quality Assurance / Quality Control
a.
Measured : high confidence, no problem areas;
b.
Indicated: high confidence, some problem areas with low risk; and
c.
Inferred: some aspects might be of medium to high risk.
2.
Geological Confidence
a.
Measured: High confidence in the understanding of geological relationships, continuity of geological trends and sufficient data;
b.
Indicated : Good understanding of geological relationships; and
c.
Inferred : geological continuity not established.
3.
Number of samples used to estimate a specific block
a.
Measured: at least 4 boreholes within semi-variogram range and minimum of twenty 1m composited samples;
b.
Indicated : at least 3 boreholes within semi-variogram range and a minimum of twelve 1m composite samples; and
c.
Inferred : less than 3 boreholes within the semi-variogram range.

 

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4.
Kriged variance
a.
This is a relative parameter and is only an indication and used in conjunction with the other parameters.
5.
Distance to sample (semi-variogram range)
a.
Measured : at least within 60% of semi – variogram range;
b.
Indicated : within semi-variogram range; and
c.
Inferred : further than semi-variogram range.
6.
Lower Confidence Limit (blocks)
a.
Measured : < 20% from mean (80% confidence);
b.
Indicated : 20% – 40% from mean (80% – 60% confidence); and
c.
Inferred : more than 40% (less than 60% confidence).
7.
Kriging Efficiency
a.
Measured : > 40%;
b.
Indicated : 20 – 40%; and
c.
Inferred : <20%.
8.
Deviation from lower 90% confidence limit (data distribution within resource area considered for classification)
a.
Measured Resource <10% deviation from the mean;
b.
Indicated Resource 10 – 20% deviation from the mean; and
c.
Inferred Resource >20% deviation from the mean.
Using the above criteria, the Merensky Reef and UG2 CL within the Project Area was classified as Indicated and Inferred Mineral Resources. Inferred Mineral Resources are classified, under the SAMREC Code, as follows.  
An ‘Inferred Mineral Resource' is that part of a Mineral Resource for which volume and/or tonnage, grade and mineral content can be estimated with a low level of confidence. It is inferred from geological evidence and sampling and assumed but not verified geologically and/or through analysis of grade continuity. It is based on information gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings and drill holes that may be limited in scope or of uncertain quality and reliability.

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An Inferred Mineral Resource has a lower level of confidence than that applying to an Indicated Mineral Resource.
No account of any modifying factors such as taxation, socio-economic, marketing or political factors have been taken into account.  No environmental, permitting, legal or title factors will affect the estimated Mineral Resource.
ITEM 16:  RECONCILIATION
In April 2008, an Inferred Resource Cut Mineral Resources totalling 1.9Moz of 4E (platinum, palladium, rhodium and gold) were declared for Project Area 3. The Project Area subsequently had more drilling results available for the August 2008 declaration. The April 2008 Mineral Resource estimates for Project Area 3 are shown in the following tables.
Table 15: April 2008 Inferred Mineral Resource Estimation
Independently estimated Mineral Resource base (100% WBJV Area)
MR = Merensky Reef; UG2 = Upper Group No. 2 chromitite seam; PGE = Platinum Group Metals.
The cut-offs for Inferred Mineral Resources have been established by a qualified person after a review of potential operating costs and other factors.

Inferred Mineral Resource (4E)	Cut-off (cm.g/t) 4E	Million Tonne	Grade 4E (g/t)	Potential Resource Width (m)	Tons PGE (4E)	Moz PGEs (4E)	
Project 3 MR	100	4.040	6.26	1.12	25.307	0.814	
Project 3 UG2	100	6.129	5.51	1.22	33.781	1.086	
Total Inferred	100	10.169	5.81	 	59.088	1.900	

Notes:
Due to rounding, columns may not add up.

Prill Splits	Pt	Pt (g/t)	Pd	Pd (g/t)	Rh	Rh (g/t)	Au	Au (g/t)	
Project 3 MR	64%	4.01	27%	1.69	4%	0.25	5%	0.31	
Project 3 UG2	62%	3.42	28%	1.54	9%	0.50	1%	0.06	

ITEM 17:  OTHER RELEVANT DATA AND INFORMATION
The economic viability of the Mineral Resources declared in this report has not been demonstrated.  Such deductions can only be made once, among other things, at least financial and working cost estimates are applied to these Resources.

 

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RSA Reserve and Resource Declaration Rules
The South African Code for Reporting of Mineral Resources and Mineral Reserves (SAMREC Code) sets out minimum standards, recommendations and guidelines for public reporting of Mineral Resources and Mineral Reserves in South Africa.
Documentation prepared for public release must be done by or under the direction of, and signed by, a Competent/Qualified Person. A Qualified Person (QP) is a person who is a member of the South African Council for Natural Scientific Professions (SACNASP) or the Engineering Council of South Africa (ECSA) or any other statutory South African or international body that is recognised by SAMREC. A QP should have a minimum of five years experience relevant to the style of mineralisation and type of deposit under consideration.
A Mineral Resource is a concentration (or occurrence) of material of economic interest in or on the earth's crust in such form, quality and quantity that there are, in the opinion of the QP, reasonable and realistic prospects for eventual economic extraction.
ITEM 18:  INTERPRETATION AND CONCLUSIONS
Results
Indicated and Inferred Resources have been estimated for the Project 3 area. There is insufficient data in Merensky Reef Domain 2, which has been classified as Inferred, to classify the area into a higher Resource category.
Interpretation of the Geological Model
The stratigraphy of the Project Area is well understood and specific stratigraphic units could be identified in the borehole core. The Merensky Reef and UG2 CL could be recognised in the core and are correlatable across the Project Area. It was possible to interpret major structural features from the borehole intersections as well as from geophysical information.
Evaluation Technique
The evaluation of the Project was done using best practices. Simple kriging was selected as the best estimate for the specific borehole distribution. Change of support (SMU) was considered for the initial large estimated parent blocks with specific cut-off grades.
Reliability of the Data
The PTM data was specifically inspected by the QP and found to be reliable and consistent.    

 

Technical Report Project 3 Resource Cut Estimation August 2010                                                                                                                                                                                                                                                                                                54

Strengths and Weaknesses with respect to the Data
The regular QA&QC process carried out by PTM is of a high standard and applies to the full audit trail from field data to Resource modelling. The data have been found to be accurate, consistent and well structured. The system of support for the digital data by paper originals and chain-of-custody and drilling records is well developed. Additional drilling will have to be carried out in order to increase the confidence in the Resource estimate in the Project 3 Area.
Objectives of adherence to the Scope of Study
The intention of this phase of the work programme was to establish the Resource cut estimation for Project Area 3. This has been achieved and thus the objectives of the programme have been met.
ITEM 19:  RECOMMENDATIONS
For the Indicated Mineral Resources to be potentially upgraded, infill drilling can be considered. After completion of the drilling and the subsequent QA&QC process, the additional data will be incorporated into the current model as presented in this document.
ITEM 20:  REFERENCES
Assibey-Bonsu W and Krige DG (1999) . Use of Direct and Indirect Distributions of Selective Mining Units for estimation of Recoverable Resources/Reserves for new Mining Projects. Proc. APCOM 1999, Colorado, USA.
Cawthorn RG (1996) .  Re-evaluation of magma composition and processes in the uppermost Critical Zone of the Bushveld Complex. Mineralog. Mag. 60, pp. 131–148.
Leeb-Du Toit A (1986). The Impala Platinum Mines. Mineral Deposits of South Africa, Volume 2, pp. 1091–1106. Edited by Anhaeusser, CR and Maske, S.
Matthey J (2006). Platinum Report 2006.
SAMREC (2007). South African code for reporting of Mineral Resources and Mineral Reserves.
Vermaak CF (1995). The Platinum-Group Metals – A Global Perspective. Mintek, Randburg, pp. 247.
Viljoen MJ (1999). The nature and origin of the Merensky Reef of the western Bushveld Complex, based on geological facies and geophysical data. S. Afr. J Geol. 102, pp. 221–239.
Wesizwe Platinum (2005), Annual Report.

 

Technical Report Project 3 Resource Cut Estimation August 2010                                                                                                                                                                                                                                                                                                55

ITEM 21:  DATE AND SIGNATURE PAGE
 
The “qualified persons” (within the meaning of NI 43-101) for the purposes of this report is CJ Muller.  The effective date of this report is 31 August, 2010.

	

Charles J. Muller
B.Sc. (Hons), Pr. Sc. Nat
(SACNAPS 400201/04)
Signed on the 5 th day of October, 2010	
 
Appendix : Qualified Person's Certificate

 

 

Technical Report Project 3 Resource Cut Estimation August 2010                                                                                                                                                                                                                                                                                                56

CERTIFICATE OF QUALIFIED PERSON - CHARLES J MULLER
I, Charles J. Muller, B.Sc. (Hons), do hereby certify that:
1.
I am currently employed as a director by:
Minxcon (Pty) Ltd
Suite 5, Coldstream Office Park
Cnr Hendrik Potgieter & Van Staden Road,
Roodepoort, South Africa
2.
I graduated from the Rand Afrikaanse University (B.Sc. (1988) and B.Sc. Hons (1992)).
3.
I am a member in good standing of the South African Council for Natural Scientific Professions (SACNASP), registration number 400201/04.
4.
I have worked as a geoscientist for a total of twenty years since my graduation from university.
5.
I have read the definition of “qualified person” set out in National Instrument 43-101 (“NI 43-101”) and certify that by reason of my education, affiliation with the professional associations (as defined by NI 43-101) and past relevant work experience, I fulfil the requirements to be a “qualified person” for the purposes of NI 43-101.
6.
I am responsible for the preparation of the report dated August 31, 2010 and entitled “Technical Report on Project 3 Resource Cut Estimation of the Western Bushveld Joint Venture (WBJV) located on the Western Limb of the Bushveld Igneous Complex, South Africa” (the “Report”).
7.
I have visited the property that is the subject of the Report on numerous occasions and in particular viewed the core and discussed the technical issues and geology of the project with Willie Visser and T. Botha of Platinum Group Metals RSA (Pty) Ltd., during 2007 and 2008; the author visited the WBJV area in August 2008 for the duration of one day leading up to the compilation of the Report (“Assessment Phase”) referenced herein.
8.
The Report was completed using a dataset compiled from technical data collected during the Assessment Phase by Platinum Group Metals RSA (Pty) Ltd.  Although the dataset is the responsibility of Platinum Group Metals RSA (Pty) Ltd., I have taken reasonable steps to provide comfort that the dataset is accurate and reliable.
9.
I am independent of the issuer, Platinum Group Metals Ltd., applying all of the tests in Section 1.4 of NI 43-101.
10.
I am familiar with the type of deposit found in the area visited and have been involved in similar evaluations and technical compilations.
11.
I have read NI 43-101 and Form 43-101F1, and the Report has been prepared in compliance with that instrument and form.
12.
As at the date of this certificate, to the best of my knowledge, information and belief, the Report contains all scientific and technical information that is required to be disclosed to make the Report not misleading.
Dated the 5 th day of October, 2010

			

Charles Johannes Muller
B.Sc. (Hons), Pr. Sc. Nat.