Northam Platinum Ltd. agreed to buy a mining right from Anglo American Platinum Ltd. for 1 billion rand ($72 billion), enabling the South African producer to extend the life of the world’s deepest mine for the metal beyond 30 years.
Part of Amplats’s Amandelbult mining right is next to, or contiguous with, the northwestern boundary of Northam’s Zondereinde operation, the Johannesburg-based company said in a statement Tuesday.
“The acquired resource is of high quality, is well understood by Northam and allows us to better leverage the existing Zondereinde infrastructure,” Northam Chief Executive Officer Paul Dunne said in the statement. “The additional resource also enables Northam to continue mining higher-grade Merensky ore for a longer period, with relatively low incremental capital expenditure.”
Amplats, which is the world’s biggest platinum producer and majority-owned by London-based Anglo American Plc, is selling and winding down its older, less-profitable operations as it seeks to cut costs and adjust to a metal price that has fallen by more than half over the past five years. It agreed to sell three mines near its Union operation to Sibanye Gold Ltd. for at least 4.5 billion rand last year.
Northam is also buying part of the Elandsfontein 386 KQ farm overlying part of Amandelbult in exchange for a portion of the Zondereinde mining right, it said. The transactions are subject to consent from Mineral Resources Minister Mosebenzi Zwane.