PAN AFRICAN RESOURCES PLC

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PAN AFRICAN RESOURCES PLC - 2014 Abridged Mineral Resource & Mineral Reserve Report

PR Newswire

London, September 2

3 September 2014 Pan African Resources PLC(Incorporated and registered in England and Wales under Companies Act 1985 with registered number 3937466 on 25 February 2000) Share code on AIM: PAF Share code on JSE: PAN ISIN: GB0004300496 ("Pan African Resources" or the "Company" or the "Group") 2014 Abridged Mineral Resource & Mineral Reserve ReportPan African Resources PLC (AIM: PAF, JSE: PAN), the African focused preciousmetals producer, is pleased to announce that the 2014 Abridged Mineral Resourceand Mineral Reserve Report ("MR&MR") has now been published and is available onthe Company's website at www.panafricanresources.com. A summary of the reportincluding the Group mineral resource and reserve statement as at 30 June 2014has been provided below.Overview * 0.9Moz or 9.8% gross annual increase in Group gold reserves to 10.1Moz (2013: 9.2Moz) * 1.6Moz or 4.5% decrease in Group gold resources to 33.5Moz (2013: 35.1Moz) * 0.2Moz or 67% increase in Group PGE reserves to 0.5Moz (2013: 0.3Moz) * 0.1Moz or 14% decrease in Group PGE resource to 0.6Moz (2013: 0.7Moz) * Exploration drilling and work to increase access and development of orebodies at the Group's key projects progressed and has added incremental resource ounces * Ongoing conversion of resources to reserves expected to continue to increase life of mine production profilesGoldGroup Gold Mineral ResourcesThe Group's attributable gold Mineral Resources decreased from 35.1 millionounces ("Moz") in June 2013 to 33.5Moz in June 2014, equating to an annualdecrease of 1.6Moz, or 4.5%. Of this variance, a decrease of 1.9Moz can beattributed to Evander Mines and an increase of 0.3Moz to Barberton Mines.As at 30 June 2014 Tonnes Grade Contained gold Category (million) (g/t) Kg MozMineral Resource Measured 6.3 10.67 66 958 2.1 Indicated 277.3 2.23 645 929 20.8 Inferred 42.7 7.74 330 126 10.6Pan African Total 326.3 3.20 1 043 015 33.5ResourcesThe decrease in Mineral Resources can be attributed to a lower gold price andinflationary cost drivers in the reporting of the 2014 Mineral Resources. The0.3Moz positive variance in contained gold at Barberton Mines was a result ofadding new surface resources and extending the MRC orebody on Fairview Mine.Group Gold Mineral ReservesThe Group's attributable Mineral Reserves increased from 9.2Moz in June 2013 to10.1Moz in June 2014 - an annual increase of 0.9Moz, or 9.8%. Of this variance,0.6Moz increase can be attributed to Barberton Mines and a 0.3Moz increase toEvander Mines.As at 30 June 2014 Tonnes Grade Contained gold Category (million) (g/t) Kg MozMineral Reserve Proved 3.8 7.38 27 826 0.9 Probable 83.6 3.41 286 103 9.2Pan African Total 87.6 3.58 313 929 10.1ResourcesThe total increase in the Mineral Reserves can be attributed to the conversionof Mineral Resources of Evander No. 8 - 26 level and at Barberton the FairviewMine extension of MRC orebody and the inclusion of New Consort and Sheba Minetailings dams.Platinum Group Elements ("PGE")Group PGE Mineral ResourcesThe Group's attributable PGE Mineral Resources decreased from 0.7Moz in June2013 to 0.6Moz in June 2014 - an annual decrease of 0.1Moz or 14%. Thisdecrease can be attributed to a lower Mineral Resource declared from the IFMLesedi Mine (current arisings) and the treatment of the Buffelsfontein dumps.As at 30 June 2014 Tonnes Grade Contained PGE's Category (million) (g/t) Kg MozMineral Resource Measured 1.8 2.58 4 559 0.1 Indicated 3.3 3.56 11 574 0.4 Inferred 0.9 3.05 2 833 0.1Pan African Total 6.0 3.19 18 966 0.6ResourcesGroup PGE Mineral ReservesThe Group's attributable PGE Mineral Reserves increased from 0.3Moz in June2013 to 0.5Moz in June 2014 - an annual increase of 0.2Moz or 67%. Thissignificant increase can be attributed to the re-stating of the modifyingfactors in the Mineral Reserve of Phoenix Platinum.As at 30 June 2014 Tonnes Grade Contained PGE's Category (million) (g/t) Kg MozMineral Reserve Proved 1.8 2.58 4 559 0.1 Probable 3.2 3.56 11 574 0.4Pan African Total 5.0 3.21 16 133 0.5ResourcesGroup organic growthCurrent exploration drilling as well as accessing and developing of the orebodywere maintained during the year. The strategy of converting Mineral Resource toMineral Reserve was progressed by moving organic projects further up the miningvalue chain towards commissioning. The tables below reflect the progress ofnear-mine growth projects that have contributed ounces to the Mineral Resourcefor the year.Group: Exploring the orebody - exploration drillingOperation Total No. of Average No. of Average Total metres grade boreholes channel Intersections expenditure width above cut-off (cm) (g/t) (Rm)Barberton Mines 11 993 150 121 93 24.52 7.9Evander Mines 732 22 22 0 14.65 0.54Phoenix Platinum - - - - - -Group: Accessing the orebody - on-reef developmentOperation Total on-reef development (metres) Average grade (g/t)Barberton Mines 1 656 4.31Evander Mines 1 015 43.11Phoenix Platinum - -Barberton Mines: Developing the orebody - capital ore reserve projectsProject 2014 2013 2012 Potential resource target (metres) (metres) (metres) (oz)Sheba - pillar development 351 317 2 006Sheba - Edwin Bray to Thomas and 171 102 303 13 286Joe's Luck areaFairview - 11 Level Royal Reef Equipping 0.1 17 000Fairview - 1# ore reserve opening 154 179 14 821Fairview - 3 Shaft deepening 0 228 109 1 600Fairview - 62 Level 295 601 552 253New Consort - 40 Level 193 252 267 10 000New Consort - 50 Level Decline west 0 150 197 26 000New Consort - MMR pillar development 173 129 (new target area)New Consort - 3 Shaft 253 900Sheba Western Cross 71 44 263Evander Mines: Capital ore reserve projectsProject 2014 2013 2012 Potential resource target (metres) (metres) (metres) (oz)2 Decline 24 - 25 Level 686 554 778 1 200 00025 A block ventilation 925 124 0Reporting in compliance with SAMREC CodeTo meet the requirement of the South African Code for the Reporting ofExploration Results, Mineral Resources and Mineral Reserves ("SAMREC Code")that the material reported as a Mineral Resource should have "reasonable andrealistic prospects for eventual economic extraction", Pan African Resourceshas determined an appropriate cut-off grade which has been applied to thequantified mineralised body. In determining the cut-off grade, Pan AfricanResources uses a gold price of R500 000/kg. At our underground mines, theoptimal cut-off is defined as the lowest grade at which an orebody can be minedsuch that the total profits, under a specified set of mining parameters, aremaximised. The Mineral Resource optimiser tool that was accordingly developedin-house was applied to the Mineral Resource inventory.The optimiser programme requires the following inputs to convert the MineralResource to the Mineral Reserve: * the database inventory of all mineral resource blocks * an assumed gold price - ZAR400 000/kg * planned production rates for each mine * mine call factor (MCF) * plant recovery factors and * planned cash operating costs and other efficiency factors, which are calculated using historical achievements as a baseline.The Mineral Reserves represent that portion of the Measured and IndicatedMineral Resources above cut-off in the LOM plan, and have been estimated afterconsideration of the modifying factors affecting extraction. A range ofdisciplines has been involved at each mine in the LOM planning processincluding geology, surveying, planning, mining engineering, rock engineering,metallurgy, financial management, human resources management and environmentalmanagement.Phoenix Platinum, BTRP and the ETRP are optimised on a 100% extraction plan ontheir Mineral Reserves. No selectivity was applied on tonnages and thus nocut-off grades were determined.Note: Mineral Resources are inclusive of the Mineral Reserve, unless otherwisestated. Rounding of numbers contained in this announcement may result in minorcomputational discrepancies.Competent PersonThe competent person for Pan African Resources, Mr Barry Naicker, the groupMineral Resource Manager, signs off the MR&MR for the Group and has reviewedand approved the information contained in this announcement in writing. He is amember of the South African Council for Scientific Professions (400234/10). MrNaicker has 13 years of experience in economic geology and mineral resourcemanagement.He is based at 1st Floor, The Firs, cnr. Cradock and Biermann Avenues,Rosebank, 2196, Gauteng.Pan African Resources EnquiriesRon Holding Cobus LootsPan African Resources PLC Pan African Resources PLCChief Executive Officer Financial DirectorOffice: + 27 (0) 11 243 2900 Office: + 27 (0) 11 243 2900Phil Dexter Neil Elliot / Peter StewartSt James's Corporate Services Canaccord Genuity LimitedLimitedCompany Secretary Nominated Adviser and Joint BrokerOffice: + 44 (0) 207 499 3916 Office: +44 (0)207 523 8350Matthew Armitt / Ross Allister Sholto SimpsonPeel Hunt LLP One CapitalJoint Broker JSE SponsorOffice: +44 (0)020 741 8900 Office: + 27 (0) 11 550 5009Julian Gwillim Daniel ThöleAprio Strategic Communications Bell Pottinger PRPublic & Investor Relations SA Public & Investor Relations UKOffice: +27 (0)11 880 0037 Office: + 44 (0) 203 772 2500For further information on Pan African Resources, please visit the website atwww.panafricanresources.com