Sibanye Gold is considering a financing option that has been around for a decade but is little used by South African mining companies, particularly those stung by hedging or selling forward their gold production in the past. While different from hedging, which entails selling future production at an agreed price, streaming has its proponents and its detractors. Streaming entails an upfront payment, almost a deposit, from a streaming company for future, heavily discounted deliveries of a set amount of physical metal, generally a by-product of the mining process. These contracts may run for the life of the mine. Local analysts describe the financing option as a largely North American one and a scheme that is not well understood or liked locally, as it tends to impart too much value to the streaming company. Sibanye spokesman James Wellsted says the difference in multiples stems from the fact that streaming companies have no operational costs or risks that are associated with mining co...

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