Sibanye-Stillwater assumes full ownership of Kroondal earlier than expected, doubling its life of mine

Johannesburg: Sibanye-Stillwater has announce that the transaction entered into between Rustenburg Platinum Mines Limited (RPM) a subsidiary of Anglo American Platinum Limited (AAP), and Sibanye-Stillwater’s subsidiary, Sibanye Rustenburg Platinum Mines Limited (Rustenburg operation) as announced on 31 January 2022, has been brought forward, resulting in the Rustenburg operation acquiring RPM’s 50% share in the Kroondal pool and share agreement (Kroondal PSA) and the Group assuming full ownership of the low cost, mechanised Kroondal operation, effective 1 November 2023.

Sibanye-Stillwater Chief Executive Officer Neal Froneman commented “Concluding the transaction earlier enables effective consolidation of these operations under a single owner. By extending the operating life of the Kroondal operation, which as a standalone operation was constrained by the existing PSA agreement. We are now able to realise the true potential of our adjacent resources by utilising the mechanised and low-cost Kroondal operation to mine across the boundary with the Rustenburg operation. This will accelerate the extraction of more remote parts of the Rustenburg operation orebody, expected to sustain employment for thousands of employees until 2029 and ensure the creation of significant shared value for all stakeholders in the region.”

The Sale Transaction has been implemented with all conditions precedent having been met including:

1. Receiving approval from the Competition Commission (without conditions);
2. Receiving Section 11 consent terms of the Mineral and Petroleum Resources Development Act, 2002 for the transfer of the mining right, currently held by RPM, to Sibanye-Stillwater’s Rustenburg operation.

The parties have further agreed to waive the last condition precedent for the delivery of the 1,350,000 4Eoz by the Kroondal operation to RPM, subject to the following revised terms:

• The Rustenburg operation will pay RPM a deferred consideration (Deferred Consideration) calculated from 1 November 2023 until the full 1,350,000 4Eoz have been delivered, which is expected to be during Q2 2024 (the Deferred Period)
• The Deferred Consideration shall be calculated as an amount equal to a determined percentage (which percentage is based on the 4E rand PGM basket price achieved during the deferred consideration period, which at current commodity prices is estimated at 40%) of the Kroondal operation’s cumulative pre-tax cashflows generated during the Deferred Period (the cumulative pre-tax cashflow are based on prior practice of the PSA’s)
• The remaining ounces (approx. 231,009 4E as at end September 2023) will continue to be delivered under the terms of the current Kroondal operation purchase of concentrate (PoC) agreement. Upon delivery of the final remaining ounces, the PoC will fall away and all PGM concentrate from the Kroondal operation, will be subject to the terms of the current Rustenburg operation’s sale and toll treatment agreement with RPM.