UPDATE 1-Northam Platinum to build new mine in 2010

* To fund project via rights issue, own cash, bank debt

* New mine could double Northam Platinum's output

(Adds details)

JOHANNESBURG, Oct 8 (Reuters) - South Africa's Northam Platinum Ltd (NHMJ.J) said on Thursday it would start construction on a big new platinum mine by early 2010 and the first phase would cost about 3 billion rand ($403.3 million).

Northam Platinum -- a unit of black owned Mvelaphanda Resources MVLJ.J -- owns the deepest platinum mine in the world and is betting that the development of the vast new Booysendal mine will expand its production options.

The company said in a statement that it had completed a feasibility study for Booysendal, which could more than double Northam Platinum's output, pushing it to rank fourth after the world's third-biggest platinum producer, Lonmin Plc (LMI.L).

"Our intention remains to fund the project through a combination of a rights issue, internal retentions (own cash) and medium-term bank debt," said Glyn Lewis, the company's chief executive.

"Booysendal is living up to our expectations and is likely to be a significant, long-life producer, and one of the new-generation PGM (platinum group metals) mining projects of the future."

Northam Platinum's production of metals in concentrate during the year to end June rose by 3 percent to 302,474 ounces.

Lewis said the first phase or module of the project could give rise to sales of some 130,000 ounces of mainly platinum and palladium, rhodium, gold a year, rising by a further 115,000 ounces per annum from the second phase, to a total of 245 000 ounces for both phases.

The first phase of the project's life-of-mine is expected to exceed 20 years, during which period further production expansions would be developed, he said.

Lewis said South Africa's power utility, Eskom [ESCJ.UL], has undertaken a feasibility study for a new substation to be situated on the Booysendal property.

Northam Platinum is the only fully independent black-owned platinum group metal producer listed on the JSE Ltd (JSEJ.J).

Shares in Northam Platinum ended at 33.50 rand on Wednesday. (Reporting by James Macharia)