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Case centres on a 2018 toxic spill at the Badila oilfield, equivalent in volume to 34 Olympic-sized swimming pools.
Anglo American Platinum’s CEO said he expected the low metal prices companies in South Africa are currently grappling with to persist, and he was aligning the business for the possibility that they would not rise for some time.
Prices for platinum-group metals, which have declined rapidly over recent months, could remain depressed, Craig Miller, CEO of the world’s biggest platinum miner by value, told Reuters.
“I really hope I am wrong but the way I am setting up the business is that those prices are in place for a bit of time,” Miller said in an interview.
The Anglo American unit and its South African peers, including Sibanye Stillwater and Impala Platinum, had been raking in windfall profits as prices for the metals, which are used in catalysts that curb toxic vehicle emissions soared.
Rhodium, which is extracted from platinum, hit almost $30,000 an ounce in 2021 and palladium soared to more than $3,400 an ounce after Russia’s invasion of Ukraine last year.
Palladium fell 1.4% on Thursday to a five-year low of about $1,151 an ounce. Platinum, of which South Africa is the world’s top supplier, hovered around $861 an ounce.
The rapid plunge in prices is threatening jobs in South Africa, which has some of the world’s deepest, ageing and costly platinum mines.
“We need to make sure that our business is set up for that possibility where prices are lower for some period of time. At the same we need to set up for a turnaround when prices change,” Miller said.
The de-stocking of metal inventories that built up in the early days of Russia’s invasion of Ukraine could be contributing to depressed prices, said Miller, who took over as CEO on Oct. 1.
But the bigger hit is coming from lower-than-expected economic growth in China, the CEO added.
The lower prices are hitting earnings for producers that were returning bumper dividends to investors just a year ago.
(By Felix Njini; Editing by Kirsten Donovan and Sharon Singleton)
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