‘I believe every automaker is here’ - Sibanye-Stillwater CEO on mining shows and car manufacturers

It's hard to find compelling deals in the battery metal space, noted Sibanye-Stillwater CEO Neal Froneman.

In February Froneman was interviewed by mining audiences manager Michael McCrae at the BMO Global Metals, Mining & Critical Minerals Conference.

Sibanye-Stillwater (NYSE: SBSW) is a diversified miner with gold, battery metal and platinum group metal operations. In 2023 it hit a rough patch when it reported a 49% decline in full-year profit after a lengthy strike at its South African gold mines and flooding at its U.S platinum operations hit production.

The company announced its intention to get into the battery metal space in a strategic announcement in 2019. In 2021 Sibanye-Stillwater acquired Eramet’s Sandouville nickel processing facilities in France for €65 million (US$76.82 million). Sibanye paid EUR30 million (US$35.46 million), for an approximate 30% equity shareholding into Keliber, the owner of the eponymous advanced lithium project, located in the Kaustinen region of Finland. It also paid $490 million to joint venture with ioneer (ASX: INR) to develop its Rhyolite Ridge Lithium-boron project located in Nevada, USA.

Froneman noted the change in sentiment between making those transactions then and now.

"When we made our first entry, we could literally pick and choose. We could find a lot of value. Obviously we were capital constrained," noted Froneman. "Today it is hard to find value. There is a lot of froth, a lot of excitement."

Froneman spoke to Kitco at the BMO mining show.

"I believe every automaker is here. That just tells you what is happening in the sector."

While Froneman is bullish on energy transition, the amount of electric vehicles generally projected to be sold is too optimistic.

"I don't think there's enough battery metals to actually go around to ensure the penetration rates that I envisage," said Froneman. "It's a very exciting time in the sector, but we have to moderate expectations."

Coverage of BMO Global Metals, Mining & Critical Minerals Conference was sponsored by First Majestic Silver.

0:20 - How competitive is M&A in the battery metal space?
1:57 - Should automakers become miners?
2:50 - Valuation in the battery metal sector.
4:25 - Technology to ease critical metals crunch.
6:00 - Impact of Biden's Inflation Reduction Act and how are other countries responding.
10:55 - Cleavage of the battery metal sector from Western countries and Asia.

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