Further to the announcement on 6 March 2020, regarding the temporary closure of Anglo American Platinum converter plant at its Rustenburg Platinum Mines processing facilities, which led to Anglo Platinum declaring Force Majeure for a period of approximately 80 days Sibanye-Stillwater has subsequently assessed how best to utilise spare PGM processing capacity at the Marikana operations and at the Precious Metal Refinery in Brakpan.
Sibanye-Stillwater is accordingly pleased to announce that it has reached agreements in principle, with Anglo Platinum regarding processing of all PGM containing material produced from its Rustenburg and Platinum Mile operations and approximately half of the PGM containing material produced from the Kroondal operations, at its Marikana processing facilities for at least the duration of the FM period.
Prior to the FM declaration, PGM bearing concentrate from Rustenburg was smelted and refined by Anglo Platinum under a toll processing agreement while Kroondal and Platinum Mile PGM concentrate was subject to a Purchase of Concentrate agreement.
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The terms of the revised processing agreements currently being finalised with Anglo Platinum at the different operations include:
PGM concentrate from the Rustenburg operations will continue to be smelted by Anglo Platinum on the same terms as the existing toll arrangement for the smelter portion, but thereafter, the resultant matte will be further processed and refined at the Marikana processing facilities.
Platinum Mile concentrate will be sold to and processed by the Marikana processing facilities for the duration of the FM period under the same terms as the pre-existing PoC agreement with Anglo Platinum. All benefits of the PoC agreement will accrue to Marikana.
The Kroondal operations
The Kroondal operations currently operate under a Pool and Share Agreement (PSA) with Anglo Platinum with 50% of the profits attributable to Sibanye-Stillwater shareholders and 50% of the profits attributable to Anglo Platinum shareholders.
For the duration of the FM period, 50% of the concentrate produced from the Kroondal PSA attributable to both parties will now be sold to and
processed by the Marikana processing facilities under the same terms as the pre-existing PoC agreement with Anglo Platinum.
All benefits of the PoC agreement for the 50% concentrate treated by the Marikana processing facilities will accrue to Marikana.
The remaining 50% of the concentrate produced from the Kroondal PSA will continue to be sold to Anglo Platinum on materially the same terms and conditions as the pre-existing PoC agreement.
Furthermore, it has been agreed that concentrate in respect of Platinum Mile and the Kroondal PSA delivered up to 9 March 2020 will be sold to RPM in accordance with the pre-existing PoC agreements.
The additional material planned to be treated at the Marikana processing facilities will have no impact on forecast production from the Marikana operation which is unaffected by the FM event.
Discussions are ongoing with Anglo Platinum regarding the timing of delivery of refined metals from toll material from the Rustenburg operations which was in process prior to the FM declaration, and due to be delivered in March, April and May.
Neal Froneman CEO of Sibanye Stillwater commenting on the agreements says:
“We welcome the finalisation of these arrangements with Anglo Platinum, which will largely offset the impact of the FM event on the Sibanye Stillwater operations and result in a minimal impact on the production outlook for the SA PGM operations.
“It is also pleasing to note the way our management team has optimised available capacity at the Marikana processing facilities, allowing us to minimise the potential impact on our contractual obligations to our customers and reducing the supply disruption caused by the unanticipated FM event.”