[miningmx.com] – NEAL Froneman was the archetypal mover and shaker of South Africa’s mining sector in 2015 announcing a string of corporate activities which saw his company potentially move into the platinum and coal sectors in its search for dividend yield.
Yet operationally, the year was a relatively poor one for Froneman’s Sibanye Gold. The R1bn year-end dividend which was promised seems unlikely to materialise amid lower than promised production figures from some of his mines.
As a result, 2016 will represent a period when Froneman must prove that the series of headline-making corporate deals have not distracted him from his core ability as a mechanical-turned-mining-engineer.
He will be unable to control the dollar gold price which is likely not to be helped by a rate increase in the US, but equally, Froneman’s Sibanye will benefit from the melt-down in the rand/dollar exchange rate. Already, analysts are calculating the benefit of a R15/$1 exchange rate to gold equities.
In addition to closing out the corporate deals, Froneman also has to bring closure to wage negotiations last year which see the Association of Mineworkers & Construction Union stubbornly resisting signing the deal (a deal has been agreed with the National Union of Mineworkers).
As for the corporate deals, a R4.5bn for the Rustenburg platinum shafts of Anglo American Platinum (Amplats) is due for completion in the course of 2016, but there is a pocket of thought that thinks the twists and turns on this transaction isn’t yet complete.
Might Froneman return to the negotiating table with Amplats given that the platinum group metal market has deteriorated significantly since first unveiling the deal, and knowing that Amplats’ parent company, Anglo American, will be desperate to sell the asset in the course of 2016 to show its own rate of progress?
