Positive Independent Feasibility Study for Platinum Group Metals' Project 1 Platinum Mine

Market Wire, July, 2008

Platinum Group Metals Ltd. (TSX: PTM)(AMEX: PLG) announces a positive Feasibility Study for the Project 1 Platinum mine of the Western Bushveld Joint Venture ("WBJV") in South Africa.

Summary

The Net Present Value ("NPV") of Project 1 has increased as compared to the value achieved in the January 2007 Pre-Feasibility Study for the Project. At a 5% discount rate, an exchange rate of 8 rand to the US dollar and using 3 year trailing average metal prices, the Feasibility Study estimates an NPV of US$987 million pre-tax and US$578 million post-tax. At recent metals prices the NPV at a 5% discount rate is US$2.30 billion pre-tax and US$1.40 billion post-tax. The pre-tax NPV estimates for Platinum Group Metals Ltd.'s 37% share of the project are US$365 million using 3 year trailing average metal prices and US$851 million using recent metal prices. The mine design involves the construction of a platinum mine and concentrator to produce 235,000 to 271,000 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. In the Feasibility Study initial underground production from the mine is scheduled for late 2010. Average operating Margin on three year trailing metals prices including minor elements and copper and nickel is estimated at US$739 per 4E ounce life of mine.

The results of this Feasibility Study represent the culmination of 18 months of work by independent engineers from Turnberry Projects of South Africa, Wardrop Engineering Inc. of Canada and the UK, Platinum Group Metals' own engineers from South Africa and Canada, and a team of specialists from several South African firms.

The WBJV Project 1 is located in the heart of the Western Bushveld area of South Africa where 70% of the world's platinum is produced from the Merensky and UG2 Platinum Reefs; the same two horizons to be mined in the Feasibility Study. The partners in the WBJV are Platinum Group Metals Ltd. 37% (operator), Anglo Platinum (JSE: AMS) 37% (the world's largest producer of platinum), and Wesizwe Platinum (JSE: WEZ) 26%.

R. Michael Jones, President of Platinum Group Metals Ltd. said, "Since the Pre-Feasibility Study was published we have optimized the mine design with earlier access to ore, improved ramp-up rate on higher grade material, and added 1.12 million ounces to the mine plan. Due mainly to market cost trends we also have higher costs as compared to our earlier designs. These cost increases have been offset by higher metal prices. We are pleased to move forward to the next step of the Western Bushveld Joint Venture and look forward to a decision from the WBJV partners to build the Project 1 mine. The partners will review the Feasibility Study and a construction decision is expected to be recommended to the WBJV Management Committee by Platinum Group Metals Ltd. in early October 2008."

Ron Hieber, Head of Exploration and Mineral Strategy at Anglo Platinum and member of the WBJV Management Committee said, "We are pleased that the good working relationship with our partners continues and that we have reached this point in the project development with delivery of the Feasibility Study to the partners for evaluation. We are in full agreement with the resource evaluation and resource statement. We note that the Feasibility Study team addressed a broad range of issues, including for example their innovative approach to minimizing risk associated with current electricity constraints in South Africa and the costing thereof."

Financial Details

The results of the Feasibility Study are a strong modeled return at a 20.08% Internal Rate of Return "IRR" (pre-tax) Base Case, using 3 year trailing metal prices, calculated on the monthly averages including US$1,295 per ounce platinum for the 235,000 - 271,000 4E concentrate ounces per year. Using recent metal prices, including US$2,035 per ounce platinum, the IRR for the project (pre-tax) is 34%. Recent metals prices are taken as the average daily price for the month of June 2008 to June 23, 2008 for the base metals and June 24, 2008 for the platinum group metals. Net Present Value is calculated at September 2008 in June 2008 terms. The model does not include escalation due to inflation of costs or metal prices.

Average life-of-mine cash operating costs to produce concentrate is estimated at R451 per tonne (US$56.38) of ore or (R3,504) US$438 per 4E ounce on a life of mine basis. The Merensky Reef layer represents the first 15 years of production and the basket price per 4E ounce is modeled at US$1,168 (3 year trailing prices) and US$1,854 (recent prices). The UG2 layer represents the balance of the production. The model includes a subsequent average 15.16% discount from the metal price to estimate the smelter pay discount. Operating margin life of mine on three year trailing 4E metal prices is approximately US$739 per ounce or 63% of revenue and on recent prices it is US$1,355 per ounce or 76%.

The project has an estimated life of 22 years with 9 years at a steady state of production of 235,000 to 271,000 ounces per year. The capital cost for the mine and concentrator complex are R4.055 billion or US$507 million for peak funding and R5.474 billion (US$684 million) for life of mine funding. The capital costs estimate includes R506 million (US$63.3 million) for the capital costs for self-generation of the electrical requirements of the project to the end of 2012 at full production levels. This includes the entire infrastructure for power including diesel storage. None of these costs were included in the January 2007 Pre-Feasibility Study model. If grid power becomes available it will significantly reduce electricity costs. Eskom has indicated that an allocation of 2 MW should be available for the construction phase of the project, and this has been assumed in the Feasibility Study. A contingency of R467 million or US$58.4 million is included in the overall capital estimate.