Sibanye-Stillwater Pulls Out of US Lithium Mine Project

South African mining giant Sibanye-Stillwater has announced that it will no longer pursue the development of the Rhyolite Ridge Lithium-Boron Project in Nevada, USA, citing concerns over investment returns.

Why Sibanye-Stillwater Is Exiting

The company had entered into a joint venture agreement with Australian mining firm Ioneer in September 2021 to co-develop the lithium site. However, after reviewing updated technical and project information provided in October 2024, Sibanye-Stillwater determined that the expected financial returns did not meet its required investment hurdle rate.

An investment hurdle rate represents the minimum return an investor requires before proceeding with a project. Sibanye-Stillwater’s decision reflects a cautious approach to capital allocation, ensuring that all ventures align with its long-term financial strategy.

Impact of the Decision

1. Effect on Ioneer and the Rhyolite Ridge Project

Ioneer had positioned Rhyolite Ridge as a cost-effective lithium source, with a valuable boron co-product and a projected 26-year lifespan. The mine was expected to support the production of batteries for over 50 million electric vehicles. Sibanye’s withdrawal could impact Ioneer’s ability to secure funding and partnerships to advance the project.

2. Sibanye-Stillwater’s Strategic Direction

Sibanye-Stillwater remains invested in lithium and battery metal markets but will focus on projects with higher return potential. The company retains a 6.91% equity stake in Ioneer, which suggests ongoing interest in the lithium sector despite this withdrawal.

3. Global Lithium Supply and EV Market

The decision to pull out of Rhyolite Ridge highlights the challenges of lithium mining investments, particularly in North America. As demand for electric vehicles grows, securing reliable and cost-effective lithium sources remains crucial for automakers and battery manufacturers.

What’s Next?

With Sibanye-Stillwater stepping away, Ioneer will need to explore new partnerships or financing options to move forward with Rhyolite Ridge. Meanwhile, Sibanye-Stillwater is expected to continue evaluating opportunities in the global battery metals sector that better align with its financial goals.

As the electric vehicle revolution accelerates, mining companies will need to carefully balance investment risks with the growing demand for critical minerals. Sibanye-Stillwater’s exit from Rhyolite Ridge underscores the complexities of securing sustainable lithium production at viable financial returns.

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