Sibanye finalises agreements with Amplats to process its PGMs
Sibanye-Stillwater said yesterday that it was finalising agreements with Amplats for processing all platinum group metal (PGM) material produced from its Rustenburg and Platinum Mile mines as well as about half of the PGM containing material produced from the Kroondal operations to limit the supply disruption caused by the unanticipated force majeure event.
Chief executive Neal Froneman said the management had optimised available capacity at the Marikana processing facilities allowing the group to minimise the potential impact on its contractual obligations to its customers.
“We welcome the finalisation of these arrangements with Anglo Platinum, which will largely offset the impact of the force majeure event on the Sibanye-Stillwater operations and result in a minimal impact on the production outlook for the South African PGM operations,” said Froneman.
Earlier this month, Amplats announced the temporary shutdown of the entire Anglo Converter Plant (ACP), part of the chain of processing facilities, and declared force majeure.
It said the ACP phase A converter plant, at Waterval smelter in Rustenburg, was damaged following an explosion within the converter in early February.
Repairs to phase A are expected to be completed by the second quarter of 2021. The company said it had commissioned the phase B unit to take over from the phase A plant. It was in the process of ramping up to steady-state, when water was detected in the furnace.
“This poses a high risk of explosion. The company has determined that it has no other option but to temporarily shut down the phase B unit, to ensure the safety of all employees, and avoid a catastrophic event.
“It is anticipated that the repair works to fix the phase B unit will take approximately 80 days,” Amplats said earlier this month.
Amplats slashed its 2020 annual refined output and said it would now refine 900000 less PGM ounces following the decision to temporarily close the critical concentrator plant.
Sibanye-Stillwater said that before the force majeure 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 the purchase of concentrate agreement.
The terms of revised processing agreements with Amplats include that PGM concentrate from the Rustenburg operations would continue to be smelted by Amplats on the same terms as the existing toll arrangement for the smelter portion, but thereafter, the matte would be further processed and refined at the Marikana processing facilities.
It said at Platinum Mile, mine concentrate would be sold to and processed by the Marikana processing facilities for the duration of the force majeure period under the same terms as the pre-existing purchase of concentrate (PoC) agreement with Amplats. All benefits of the agreement would accrue to Marikana.
At the Kroondal operations for the duration of the force majeure period, 50 percent of the concentrate produced from Kroondal, under a pool and share agreement attributable to both parties, would now be sold to and processed by the Marikana processing facilities under the same terms as the pre- existing PoC agreement with Amplats.