Sibanye Gold and Harmony Gold have entered into an agreement for the exchange and sale of certain mining right portions of Sibanye’s Beatrix operation and Harmony’s Joel operation in the Southern Free State, South Africa. Sibanye will exchange two mining right portions at Beatrix that are not included in its current life-of-mine (LOM) profile for two mining right portions at Harmony’s Joel operation that will be more readily accessible from the Beatrix North and South sections.
Sibanye will also sell a further two mining right portions at its Beatrix operation to Harmony for a royalty of 3% of net revenue derived from underground mining from these portions.
The companies expect the transaction to create value by allowing the early and optimal extraction of resources currently not in their respective LOM plans. By utilizing available capacity at existing and adjacent infrastructure, the cost of extracting these resources will be lower and the operating lives of the shafts will be extended, facilitating job creation in the region.
Sibanye CEO Neil Froneman said, “Much has been said in the past about the potential to unlock value in the South African gold industry by breaking down the farm fences, and I believe that there remains significant potential to create meaningful value for shareholders through