Sibanye-Stillwater announces $1 billion deal for Brazilian nickel and copper mines

Sibanye-Stillwater has signed definitive purchase and sale agreements with affiliates of funds advised by Appian Capital Advisory LLP to purchase the Santa Rita nickel mine and the Serrote copper mine, both located in Brazil.

The multinational miner said it will pay US$1 billion in cash for the assets, along with a 5% net smelter return royalty – valued at $218 million – for potential future underground production from Santa Rita, which CEO Neal Froneman said was a top 10 global producing nickel sulphide mine.

“The transaction represents a unique opportunity for Sibanye-Stillwater to acquire significantly pre-developed and pre-capitalised, low-cost, producing nickel and copper assets with strong ESG credentials, which will continue to be managed by a high-quality team with a wealth of operating experience in Brazil,” Froneman said.

Appian had acquired Santa Rita via a bankruptcy process of the previous operator, Australian firm Mirabela Nickel. The investment advisor’s Atlantic Nickel unit returned the project to production in 2020.

The Santa Rita open pit is forecast to produce 16,000 tonnes nickel-equivalent annually over seven years, followed by a circa 27-year underground operation. Meanwhile, Appian has just finished construction at Serrote, which is expected to produce about 20,000 tonnes of copper-equivalent annually over 13 years.

The deal adds two further assets to Sibanye’s ‘green metals’ business and is part of a wider transition into ‘a climate change resilient’ organisation. Sibanye agreed to purchase 50% of a Nevada-based lithium project in September.