<\/p>\n
Shares in African Rainbow Minerals, backed by billionaire Patrice Motsepe, dropped to the lowest in more than a year after the company\u2019s board approved investments of almost $1 billion in two South African mines.<\/p>\n
ARM said on Thursday it plans to spend R15.2 billion ($925 million) over seven years to expand the Bokoni platinum-group metals asset and R753 million to reopen the Nkomati nickel operation.<\/p>\n
The stock dropped as much as 9.7%, and was down 8.5% as of 12:15 p.m. in Johannesburg. The company\u2019s mining portfolio also spans coal, gold and manganese, while Motsepe is ARM\u2019s chairman and single biggest shareholder.<\/p>\n
ARM suspended Bokoni last year amid weak PGM prices, taking a R2.2 billion impairment at the mine. The company said it has revised its development plan, intending to bring the asset back into operation in 2028 before doubling processing capacity from 2030.<\/p>\n
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Autocatalysts that curb emissions from gasoline and diesel vehicles are the biggest source of PGM demand, so mining companies are sensitive to the growth of the electric-vehicle market.<\/p>\n
Read:
Billionaire Motsepe-backed bank makes all employees shareholders
ARM lifts interim earnings as platinum rebound offsets ferrous slump
ARM founder Patrice Motsepe steps down as executive chair<\/p>\n
ARM\u2019s long-term outlook for PGMs \u201cremains constructive, notwithstanding the anticipated impact of battery electric vehicle penetration,\u201d the company said. \u201cSustained underinvestment, accelerating shaft depletion in South Africa and structural decline across other producing regions are collectively expected to progressively reduce primary supply.\u201d<\/p>\n
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Once finished, Bokoni\u2019s expansion will add up to 400 000 ounces a year to ARM\u2019s PGM output, according to the statement.<\/p>\n
In April, ARM announced it had signed a conditional deal to sell nickel from the mothballed Nkomati mine to a Finnish smelter owned by Boliden AB.<\/p>\n
The board has now authorized the resumption of mining and production at Nkomati, although the offtake agreement with Boliden is yet to become unconditional, it said.<\/p>\n
\u00a9 2026 Bloomberg<\/p>\n
#African #Rainbow #shares #fall #R16bn #plan #mines<\/p>\n","protected":false},"excerpt":{"rendered":"
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