Lac gets $48 for Stillwater

A one-third interest in the Stillwater platinum-palladium operation in Nye, Mont., is being sold by LAC Minerals (TSE) for $48 million(C) to its two project partners.

Operator of the mine, which opened in 1987 and where palladium is mined in a 3:1 ratio to platinum, is the Stillwater Mining Co. Manager of the project is Chevron Resources. Stillwater Mining Co. is owned equally by LAC, Chevron and Manville Sales Corp.

Under the agreement, Chevron and Manville will each have a 50% interest in the project. Completion of the purchase is subject to the approval of Manville’s board of directors. If Manville’s board is not in agreement, LAC’s interest will be bought by Chevron giving it a two-thirds interest.

The Stillwater operation is located 80 miles southwest of Billings. Initial production in March, 1987, was 500 tons per day; it was expanded to 700 tons per day in August, 1987. Projected is a production rate of 1,000 tons per day by the early 1990s.

Manville geologists are credited with first uncovering the Stillwater deposit in the early 1970s. Chevron joined Manville in the exploration effort in 1979, with LAC entering the picture in 1985 by purchasing the interest of now defunct Anaconda Mineral.

It was reported (N.M. Magazine, Oct/87) the mine cost $41 million (US) to bring into production. That cost was spread over a 20-year period from initial discovery to the point when production began in 1987.

Stillwater is the only primary producer of platinum group metals in North America and is therefore to have some strategic value. The Soviet Union and South Africa together account for close to 95% of world platinum production and 90% of palladium production according to figures supplied by Canada’s department of Energy, Mines and Resources.

Canada, which ranks third as a producer of platinum group metals, accounts for all its production as a byproduct of nickel-copper ores, largely from the Sudbury basin.