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

Market Wire, July, 2008

Social Development and Responsibilities

Feedback from the public consultation processes for the environmental assessment and social and labour plan development have been constructive and positive. The mine capital development plan includes a significant investment in training through the life of mine, allocated to a social and labour plan to ensure maximum value from the project for all stakeholders including local residents. Based on interaction with the community, a skills and needs assessment, and our training plans the project is planning for 2,700 jobs with a target of at least 30% from the local communities. The WBJV is committed to a strong community involvement in the project particularly as Wesizwe Platinum is a 26% partner in the project and their largest shareholder is one of the communities near the mine. The mine's financial estimates include an accumulated charge per tonne to create a fund for eventual closure of the mine projected in 2031.

Risks and Opportunities

The project is subject to a number of risks including, but not limited to, the normal project risks associated with a mining project of this type, such as geology, grade, structure, mining plans, mining width, mining dilution, rates of extraction per reef type, water supply, power and labour shortages and estimation risks in the capital and operating costs and exchange rates and metal prices. The estimates in June 2008 money terms are /-10% on the capital and /-10% on the operating costs and /-15% on project timing. A contingency of 12% of the capital cost required to reach first production included in the financial model mitigates the risks of a capital over run. The estimated capital costs of Platinum Group Metals Ltd.'s share of the project exceed its working capital and significant project funding is required. The approval of a majority of the WBJV partners will be required in order to implement the decision to mine.

Not all of the surface rights over the proposed infrastructure design in the Feasibility Study have been purchased. An allowance for the cost of this has been made. The Mineral Petroleum Development Act may provide some assistance in ensuring that access to the minerals can be achieved at a reasonable cost; however there is no certainty that this process will be successful or timely. To mitigate this risk the Platinum Group Metals Ltd. has purchased approximately 575 hectares of land over part of the deposit or adjacent to an area of the mine that may be useable for mine access and infrastructure. Platinum Group Metals Ltd. holds a further 365 hectares adjacent to the south west of the deposit area. The purchased areas have not been tested for suitability and amendments to the mine plan, capital and operating cost estimates that would be required to relocate the mine infrastructure have not yet been completed.

A significant portion of the defined Resources are not mined in the Feasibility Study. Continued strong metal prices and implementation level engineering will provide an opportunity to re-evaluate these resources. There are other platinum mining projects in the immediate area - including Project 2 of the WBJV - planned for development. Potential cost savings and reduced impacts by designing combined infrastructure will be investigated.