Sibanye-Stillwater sells Blue Ridge PGM mine to Mantengu Mining

Mantengu plans to implement a phased investment strategy for Blue Ridge. The transaction to acquire Blue Ridge from Sibanye-Stillwater comes with a sizeable tailings dump of 1 million tons which contains significant quantities of chrome and PGM. Picture: Supplied

Mantengu plans to implement a phased investment strategy for Blue Ridge. The transaction to acquire Blue Ridge from Sibanye-Stillwater comes with a sizeable tailings dump of 1 million tons which contains significant quantities of chrome and PGM. Picture: Supplied

Published Oct 11, 2024

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Sibanye-Stillwater has disposed of its Blue Ridge Platinum mine, which has been under care and maintenance since 2011, to Mantengu Mining that has a listing on the JSE AltX.

The Blue Ridge platinum group metals (PGM) mine has an integrated ore processing plant and is located in South Africa’s Limpopo Province, and will resume operations under Mantengu Mining on approval of all conditions precedent to the transaction.

“The acquisition of Blue Ridge is in line with its investment strategy of unlocking intrinsic economic value trapped in the small to large mining sector,” said Mantengu Mining’s CEO, Michael Miller.

Blue Ridge currently owes more than R1.1 billion to its major creditors that include Sibanye-Stillwater, the Industrial Development Corporation (IDC), and the Development Bank of South Africa (DBSA).

Mantengu will be acquiring, for a nominal amount, all the loans owed by Blue Ridge to its major creditors.

On finalisation, Mantengu will “initially take ownership of 100% of the ordinary shares and debt claims” of Blue Ridge.

However, about 30% of the ordinary shares in the mine will subsequently be distributed to strategic empowerment groups, including a 5% alloction to newly formed Employee and Community Trusts respectively.

Sibanye-Stillwater CEO, Neal Froneman said the PGM and gold miner was “pleased to facilitate new entrants into the PGM market by offering them growth” opportunities. “Moreover, we endorse the transaction structure that ensures direct equity participation for communities and employees in Blue Ridge,” said Froneman.

For Mantengu said the junior miner’s chairman, Jonas Tshikundamalema, the “acquisition reflects Mantengu’s entrepreneurial spirit and our dedication to delivering real value” for shareholders.

“The Blue Ridge Mine has important economic potential, and under our leadership, it will become a sustainable and profitable asset that supports the local economy,” he said.

Mantengu plans to implement a phased investment strategy for Blue Ridge. The transaction to acquire Blue Ridge from Sibanye-Stillwater comes with a sizeable tailings dump of 1 million tons which contains significant quantities of chrome and PGM.

Mantengu will initially invest in plant and equipment to process the tailings dump to produce chrome and PGM concentrate.

The miner estimates that the tailings project could produce up to 375 000 tons of chrome concentrate and 35 000 ounces of PGM and is confident that the tailings project will be able to operate as an extremely low-cost producer of chrome and PGM.

“Our approach is rooted in smart, sustainable growth at the lowest risk level possible. With our financial resources and operational expertise, we aim to unlock Blue Ridge’s full potential,” said Miller.

He added that the transaction strengthened the company’s solvency and allowed for new capital to be injected into the business to create processing capability.

As part of its planned investment into Blue Ridge, Mantengu will invest in a bankable feasibility study into the underground UG2 mining operations, a process that is expected to take 18 months to complete.

Should the feasibility study prove economic viability, Mantengu will seek to pursue full-scale underground mining.

BUSINESS REPORT