Northam Platinum: swimming upstream can bring rewards
Northam’s shares have outperformed those of its peers over the past two years, almost trebling to R51 from a low of about R19 in December 2015
Six years ago the buzzword for the platinum industry was "consolidation" in response to a weak platinum price. It never really happened. Most companies contracted, shelving projects and closing unprofitable shafts rather than taking advantage of buying opportunities. The exceptions are Sibanye Gold and Northam Platinum, which have built or bought mines and undeveloped resources at a steady pace, showing management’s conviction that the platinum price will eventually turn. Northam has expanded from a single mine, Zondereinde, to building a second one, Booysendal North, and developing a third, Booysendal South, using some of the Everest mine infrastructure. Its goal is annualised production of 850,000oz of platinum group metals (PGM) by 2022 from about 440,000oz at present, and 800,000t of chrome. Its latest coup was to buy the mothballed Eland platinum mine from Glencore for R175m, including about R100m of equipment. Xstrata, which merged with Glencore five years ago, paid US$1bn for...
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.
Subscribe now to unlock this article.
Support BusinessLIVE’s award-winning journalism for R129 per month (digital access only).
There’s never been a more important time to support independent journalism in SA. Our subscription packages now offer an ad-free experience for readers.
Cancel anytime.
Questions? Email helpdesk@businesslive.co.za or call 0860 52 52 00. Got a subscription voucher? Redeem it now.