SIBANYE-Stillwater has taken 100% control of Kroondal Platinum Mines (KPM) after bringing forward an agreement to buy the 50% stake of its joint venture partner Anglo American Platinum (Amplats).
That agreement, signed in January 2022, had a number of conditions precedent of which one was the delivery of 1.35 million ounces of platinum group metals (PGMs) during 2024. That condition has now been waived.
In its place, Sibanye-Stillwater has agreed to a deferred payment to Amplats of its portion of pre-tax cash flow from KPM by the second quarter of 2024, and 231,009 4E ounces which will be delivered in terms of the existing purchase of concentrate agreement between Amplats and Sibanye-Stillwater.
As identified in 2022, the agreement will enable Sibanye-Stillwater to access the farther reaches of its Rustenburg Platinum orebody which is adjacent to KPM, and preserve jobs until 2029.
The agreement today has the support of the Competition Commission and the requisite licensing from the Department of Mineral Resources & Energy. As part of the deal, Sibanye-Stillwater will take over the environmental liabilities of KPM.
The joint venture between the two companies stems back to the Nineties when Amplats and Aquarius Platinum signed a pool and share agreement (PSA). In terms of the PSA, Aquarius would access Amplats mineral resources at Rustenburg Platinum from Kroondal. (The PSA also involved sharing the proceeds from the Marikana mine which has since been shut and which Sibanye-Stillwater will now use as a deposition site).
In 2015 Sibanye-Stillwater bought Aquarius Platinum – taking over its PSA with Amplats – and then – around the same time – it acquired Rustenburg Platinum from Amplats. However, it had not bought Amplats ought of the PSA – which the transaction unveiled today now achieves.
Once the final 231,009 oz has been delivered to Amplats, the PoC agreement will be replaced by a toll treatment arrangement.
Buying Amplats out of the PSA will also enable Sibanye-Stillwater to press forward on the development of the Klipfontein open pit project which it announced last year at a capital expenditure of about R60m.