Sibanye-Stillwater cuts gold reserves as rand price hits record

SIBANYE-Stillwater reduced its gold reserves 15.7% following the closure of…

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SIBANYE-Stillwater reduced its gold reserves 15.7% following the closure of shafts at its Kloof and Beatrix mines in the last 12 months.

This comes as the rand gold price reaches an all time high of R1.26m per kilogram amid a strong dollar gold price and as the rand sank to R19.34 to the dollar – a 12 month depreciation of 4.8%.

Commenting in its 2023 updated mineral resources and reserves statement, the group also downgraded reserves of its South African platinum group metals (PGM) mines. The mineral reserve and resource comparisons are with the group’s numbers for 2022.

Reflecting the changing scope of its strategy to battery minerals, reserves of lithium and zinc increased owing to project development and acquisitions in Finland and Australia respectively.

Neal Froneman, CEO of Sibanye-Stillwater said the group’s strategy was to develop a diversified mix of metals. “This not only mitigates risk through diversification, but supports the company’s strategy of producing green metals that will underpin future energy solutions,” he said in a group statement to the JSE on Monday.

Llithium mineral resources increased 55.1% as the company developed its Keliber joint venture with Finland whilst in Australia it had bought, delisted and recapitalised minerals tailings miner, New Century Resources.

Gold reserves fell to 10.9 million ounces, however, following the closure of Kloof 4 and Beatrix West shafts. Resources fell 23% to 41.2 million oz. The restatement is based on a gold price of $1,650 per ounce or R901,828/kg.

PGM reserves were reduced 10.4% to 28.1 million oz largely owing to depletion, equal to 1.9 million oz and the exclusion of the North Hill Project at Mimosa in Zimbabwe worth 1.5 million oz in reserves. PGM reserves at the firm’s US mine Stillwater were largely unchanged year-on-year.

Sibanye-Stillwater’s price assumptions for platinum and palladium for 2023 were largely unchanged from 2022 at $1,250/oz for each metal but it reduced its price assumption for rhodium to $6,000/oz from $8,000/oz previously.

The basket price for PGMs has been under huge pressure in the last 12 months with palladium falling about 40% in value. The gold price is thriving amid geopolitical volatility, high interest rates and macroeconomic uncertainty.

The gold price is 12.4% higher in the last 12 months while in rands, the price received for local miners is 17.4% higher. At R1.263m per kilogram, the rand gold price is at a record, all-time high.

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