Rhyolite Ridge, Nevada

Sibanye-Stillwater Limited is pleased to announce that it has reached agreement with ioneer Limited (ioneer) to establish a joint venture with respect to the Rhyolite Ridge Lithium-Boron Project (Joint Venture). Following the satisfaction of all conditions precedent as detailed in Transaction Details, in paragraph 4 below, Sibanye-Stillwater will contribute US$490 million for a 50% interest in the Joint Venture, with ioneer maintaining a 50% interest and retaining the operational management responsibility for the Joint Venture.

In addition, Sibanye-Stillwater has agreed to subscribe for a strategic placement of new ordinary shares in ioneer equal to 7.1% of ioneer’s ordinary share capital post placement, for approximately US$70 million.

Neal Froneman, CEO of Sibanye-Stillwater, said:
“This is Sibanye-Stillwater’s second lithium transaction and third transaction in the battery metals sector, which will be essential for the transition to a cleaner future. We are excited to build a long-term relationship with ioneer, who share our vision of facilitating security of lithium supply to the North American markets. Rhyolite Ridge is a world-class lithium project and we recognize its strategic value, with the potential to become the largest lithium mine in the US. The ioneer team have attracted high quality ex-Orocobre, Rio Tinto and Dow Chemical management which also has strategic importance for our wider battery materials strategy. We look forward to working collaboratively with the ioneer team and leveraging our complementary skills and capabilities to ensure this strategically important, world-class project is delivered, and materially contributes to reducing climate change.”

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About Rhyolite Ridge
Rhyolite Ridge is a large, shallow lithium-boron deposit, located close to existing infrastructure. Rhyolite Ridge is expected to be one of the first large scale US lithium projects to enter production, currently anticipated in H2 2024.

The Rhyolite Ridge Definitive Feasibility Study, completed in April 2020, supports (100% project basis) :
- 22ktpa lithium hydroxide and 174ktpa boric acid average production
- 26-year mine life underpinned by 0.6mt lithium carbonate and 5.3mt boric acid of Ore Reserves and 1.25mt lithium carbonate and 11.9mt boric acid of Mineral Resources
- First quartile cost position (after boric acid revenue credits)
- Strong ESG credentials, with a small mine footprint and a clear competitive advantage from a CO₂ emissions and water usage perspective relative to other projects
- Net Present Value (8%) of US$1.3bn
ioneer has attracted a high-quality team which has been advancing Rhyolite Ridge since 2016, together with world class technical experts, including Fluor, Golder, Veolia and Kemetco Research.
Transaction rationale

Sibanye-Stillwater’s battery material strategy is primarily focused on the United States and Europe in recognition of the developing need for battery metals for the transition towards greater electrification of their established automotive industries. Consistent with this, the US Government has declared lithium as critical to economic and national security and has called for the development of US critical metal processing and refining capacity.

Sibanye-Stillwater has identified ioneer as a partner and Rhyolite Ridge as a project that are aligned with the Group’s strategy and the requirement for lithium in the US.

Sibanye-Stillwater is well placed to be a supportive partner and add significant value to the project given its complementary global mining experience and expertise, including its US mining operational and project development expertise, hydrometallurgical expertise and deep relationships with automakers and automotive OEMs globally.

Sibanye-Stillwater and ioneer share a strong cultural alignment and a focus on ESG, as highlighted by the Group’s experience with the Good Neighbor Agreement in Montana.
Transaction details
1. Particulars of the transaction
  Following the satisfaction of the conditions precedent, Sibanye-Stillwater will contribute US$490 million in direct funding to the newly formed Joint Venture in exchange for 50% of the ordinary units in the Joint Venture. It is anticipated Sibanye-Stillwater’s investment along with third party debt will fund the project into production. ioneer will contribute 100% of Rhyolite Ridge for a 50% interest in the Joint Venture.
  
  Under the terms of the Joint Venture, Sibanye-Stillwater will also have an 18-month option after completion has occurred to acquire a 50% interest in the North Basin, a highly prospective exploration asset neighbouring the current project, for up to an additional US$50m, subject to certain terms and conditions.
  
  Sibanye-Stillwater will also subscribe for the ioneer Placement. Together, the Joint Venture and ioneer Placement are referred to as the “Transaction”.
1. Transaction Consideration
  The total consideration in respect of the Transaction, will amount to US$560 million, payable in cash.
  
  Sibanye-Stillwater will fund its obligations through available liquidity.
1. Net assets value and the profits of the subject of the Joint Venture
  ioneer’s Rhyolite Ridge Definitive Feasibility Study, released to the Australian Securities Exchange in April 2020, supported a net present value at an 8% discount rate of US$1.3bn (100% project basis).
  
  Rhyolite Ridge is a development asset, and as such there are no profits attributable to the Joint Venture at present.
1. Conditions Precedent
  Conditions precedent for completion of the Joint Venture include (among others):
  - the receipt of final permits necessary to commence construction of Rhyolite Ridge;
  - relevant regulatory approvals (including the South African Reserve Bank) being obtained;
  - issuance of the “Full Notice to Proceed” under the engineering, procurement and construction management (EPCM) agreement related to the project;
  - receipt of required governmental consents; and
  - debt financing being secured on customary terms.
  It is expected the conditions precedent will be satisfied during the second half of calendar year 2022, at which point the Joint Venture will become effective.
  
  Conditions precedent for completion of the ioneer Placement include (among others):
  - the approval of ioneer shareholders at an Extraordinary General Meeting expected to be held on 21 October 2021;
  The ioneer Placement is expected to become effective in Q4 2021.
  
  The Joint Venture and the ioneer Placement are not inter-conditional.
1. Other significant terms of the Joint Venture
  Under the newly formed Joint Venture, Sibanye-Stillwater and ioneer will have equal board representation rights with ioneer to be manager and operator of the Joint Venture. Sibanye-Stillwater and ioneer will establish joint technical, marketing and ESG steering committees to assist with Rhyolite Ridge’s development and operations.
1. Categorisation in terms of the JSE Listings Requirements
  The Joint Venture together with the ioneer Placement is classified as a category 2 transaction in terms of the JSE Listings Requirements. As such no shareholder approval is required in this regard.