Sibanye-Stillwater pulls plug on US lithium project

SIBANYE-Stillwater has pulled out of US lithium/boron project Rhyolite Ridge which would have committed it to spending just under $500m for a 50% stake.The Johannesburg-headquartered group said in a statement on Wednesday that its board found the project did not meet its investment hurdles “at prudent pricing assumptions”.This was following a due diligence of a technical report summary submitted by Sibanye-Stillwater’s joint venture partner, ioneer at the end of last year, and shortly after US authorities fast-tracked environmental approval for the project.The joint venture, formed in 2021, would have committed Sibanye-Stillwater to make a $490m contribution for a 50% interest in the joint venture. Ioneer, an Australian firm, was to maintain its 50% stake and operate the project.The proposed mine, roughly 362km north of Las Vegas in Nevada, contains enough lithium to power roughly 370,000 electric vehicles each year. Ford Motor and a joint venture between Toyota 7203.T and Panasonic 6752.T had agreed to buy lithium from the mine, according to reports.Sibanye-Stillwater said in its statement that it remained “committed to the US market and its battery metals strategy” and would continue to assess growth opportunities. But there has been strain in the lithium industry with prices down more than 80% since 2022.“Both the nickel and lithium markets look likely to remain substantially in oversupply until the end of the decade,” Wood Mackenzie analyst James Whiteside told Bloomberg News this week. “A lot of producers are burning cash, so any non-essential spend will remain curtailed.”Another uncertainty for Sibanye-Stillwater is whether Rhyolite Ridge would qualify for US subsidies in terms of the Inflation Reduction Act. US president Donald Trump is keen to encourage local investment but it’s unknown if this extends to electric vehicle production.“The change in the US administration in January 2025, has introduced some uncertainty regarding the Section 45X regulations,” said Neal Froneman, CEO of Sibanye-Stillwater last week. However, the group stood to benefit from historic and current tax credits totalling $121m in Ebitda for its US PGM operations which supply the internal combustion engine.In addition, Sibanye-Stillwater has recently reset its balance sheet amid a sustained decline in platinum group metals (PGMs). The company reported a basic earnings loss $398m for the year, albeit it a major improvement on a $2bn loss in 2023.It also raised about $30bn in debt and through contracts selling gold, PGM and chrome by-products resetting its balance sheet, staving off concerns last year that it would have to issue shares.Sibanye-Stillwater still has one more year of financing for its Keliber lithium project in Finland which is expected to start producing lithium ore a year earlier than planned, in 2026 rather. It has previously planned to treat third party ore next year and phasing in own production from 2027.The post Sibanye-Stillwater pulls plug on US lithium project appeared first on Miningmx.Weiter zum vollständigen Artikel bei Mining.com Weiter zum vollständigen Artikel bei Mining.com