Sibanye-Stillwater Blitz project begins production ahead of schedule
Move considered a company effort to win over critics.
South African precious metals miner Sibanye-Stillwater (JSE:SGL) (NYSE:SBGL) said Monday it had begun production at its Blitz project in Montana, US, three months ahead of schedule.
The better-than-expected timing is seen by some analysts as an effort to regain investors’ confidence in the company following its recent acquisition of Stillwater Mining, which some critics have considered too costly.
Blitz, a brownfield extension of the existing Stillwater mine, is expected to produce roughly 300,000 ounces a year by late 2021/early 2022.
The $2.2 billion transaction has pushed the company to borrow $1.7 billion as of June 30 to pay for it, and also triggered an indefinite suspension of dividends.
It’s estimated that the Blitz project will boost the firm’s platinum group metals (PGM) production in the US by more than 50% to around 850,000 ounces.
“The operations continue to deliver as anticipated and first production from Blitz is more than three months ahead of schedule,” CEO Neal Froneman said in the statement.
Blitz, a brownfield extension of the existing Stillwater mine, is expected to produce roughly 300,000 ounces a year by late 2021/early 2022. It is also meant to extend Stillwater mine’s underground infrastructure to the east of the current operations, the company said.