In a remarkable announcement, Sibanye-Stillwater has declared its lowest group serious injury frequency rate (SIFR) in its history for the first quarter of 2024. This significant milestone, reported as a SIFR of 2.19, demonstrates a 15% decrease from the previous year and marks the third consecutive year of improvement since 2021.
Neal Froneman, CEO of Sibanye-Stillwater, expressed satisfaction with the continuous safety performance improvement, attributing it to the effective implementation of the company’s safety strategies. “The year-on-year safety improvement is a testament to our commitment to reducing risks and enhancing safety protocols across all operations,” Froneman stated during the company’s first-quarter operating update.
In addition to the drop in SIFR, the company also reported a 7.6% decrease in the lost-day injury frequency rate and an 11.3% reduction in the total recordable injury frequency rate. These statistics not only underscore Sibanye’s dedication to safety but also align with the mining sector’s broader goals of minimizing workplace injuries.
Froneman highlighted that operational restructuring and capital preservation initiatives undertaken in the latter half of the previous year have begun to bear fruit, particularly in the company’s US platinum group metals (PGM) operations. “We are now seeing the benefits of these restructuring efforts, with our US PGM operations showing a marked performance improvement,” he noted.
The restructuring efforts are expected to gradually manifest in the South African operations, with anticipated enhancements in efficiency and cost reductions. Froneman remains optimistic about the future, stating, “These changes ensure a more sustainable cost structure for our South African region, despite the initial disruptions and phased closure costs impacting the first quarter results.”
The first quarter of 2024 saw Sibanye’s underground mined 2E production increase by 22% compared to the first quarter of 2023, with a 5% increase over the fourth quarter of the previous year. Moreover, all-in sustaining costs (AISC) for 2E production plummeted by 28% year-on-year to $1,335 per ounce, staying within the company’s guidance for the year.
This production upswing and cost efficiency are pivotal as Sibanye continues to navigate the complexities of the mining industry, especially in terms of addressing skills shortages and operational constraints. “Our ongoing initiatives are set to bring further operational gains as the year progresses,” Froneman added.
Despite the positive trends in safety and PGM operations, Sibanye’s South African gold operations faced challenges. Gold production dropped by 18% compared to the first quarter of 2023, mainly due to the cessation of production from the Kloof 4 shaft. However, costs associated with the phased closure process continue to accrue, leading to a 19% increase in AISC.
The South African PGM operations also experienced a dip in production from several shafts undergoing restructuring. Nevertheless, the acquisition of an additional 50% stake in Kroondal production from Anglo American Platinum in late 2023 helped mitigate some production losses.
The operational efficiency of the Sandouville refinery saw significant enhancement following mid-2023 repairs and other improvements. This led to a 42% increase in production compared to the first quarter of the previous year, with nickel equivalent sustaining costs reduced by 40%.
Looking ahead, Sibanye has initiated a pre-feasibility study (PFS) for potentially repurposing the Sandouville nickel refinery in France to produce precursor cathode active material. This project, dubbed the GalliCam project, is expected to deliver its initial findings by year-end.
Despite operational advancements, the broader economic environment posed challenges, particularly with the significant drop in PGM prices over the last year. This, coupled with lower production and residual costs from the restructuring efforts, led to a steep 72% decline in adjusted earnings before interest, taxes, depreciation, and amortization (Ebitda) to $113 million for the quarter.
Froneman concluded with a note on the economic outlook, stating, “With the recent uptick in zinc prices and considerably lower yearly benchmark treatment charges, we are optimistic about the future despite the current challenges.”
As Sibanye-Stillwater continues to adapt and innovate, its focus remains steadfast on safety, operational excellence, and strategic growth to maintain its position as a leader in the mining industry.
Source: Mining Weekly
