competent person's report of the montana platinum group metal mineral assets for sibanye gold

ADVISORS TO THE MINERAL BUSINESS

Prepared on behalf of SIBANYE GOLD LIMITED

COMPETENT PERSON’S REPORT ON THE MONTANA PLATINUM GROUP METAL MINERAL ASSETS OF SIBANYE GOLD LIMITED, UNITED STATES OF AMERICA

FINAL

The Mineral Corporation

Report No. C-SGL-CPR-1743-1067 November 2017

P O Box 1346, Cramerview 2060, South Africa Homestead Office Park, 65 Homestead Avenue, Bryanston 2021

Telephone: +27 11 463-4867 Facsimile: +27 11 706-8616 e-mail: [email protected]

© Copyright Mineral Corporation Consultancy (Pty) Ltd

This document is for the use of SIBANYE GOLD LIMITED only and may not be transmitted to any other party, in whole or in part, in any form without the written permission of Mineral Corporation Consultancy (Pty) Limited

THE MINERAL CORPORATION

mailto:[email protected]

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© Mineral Corporation Consultancy (Pty) Ltd Report No. C-SGL-CPR-1743-1067, November 2017 COMPETENT PERSON’S REPORT ON THE MONTANA PLATINUM GROUP METAL MINERAL ASSETS OF SIBANYE GOLD LIMITED, UNITED STATES OF AMERICA

EFFECTIVE DATE AND COMPETENT PERSON’S LIST

SRC9.1(i); SV1.0;ESG1.1.1; JSE12.9(c)

The effective date for this report, being the release date of the half year update for Stillwater Mining Company operations, is 31 July 2017. The following Competent Persons (CPs) and Competent Valuators (CVs) contributed to this report and the technical work underlying it:

Role Name

The Mineral Corporation Lead Competent Person - Mineral Resources

Coniace Madamombe

The Mineral Corporation Lead Competent Person - Mineral Reserves

Jonathan Buckley

The Mineral Corporation Competent Valuator

John Murphy

Stillwater Competent Person - Mineral Resource Estimation

Jennifer Evans


James Dahy


Michael Koski

Stillwater Competent Person - Mineral Reserves Estimation

Brent LaMoure

DISCLAIMER SV1.15

This report has been compiled by The Mineral Corporation for Sibanye Gold Limited in accordance with the scope of work determined by Sibanye Gold Limited. The report provides the results of an independent review of the Stillwater platinum group metal mining and ore processing operations (Stillwater Mining Company) in Montana owned by Sibanye Gold Limited, in the form of a Competent Person’s Report intended for submission to the JSE Limited. The report is intended to

be read in its entirety along with the appendices referred to throughout. In the preparation of this report, The Mineral Corporation has exercised reasonable skill, care and diligence. The opinions, findings and estimates contained herein are those of The Mineral Corporation and are based on information provided to The Mineral Corporation by Stillwater Mining Company on behalf of Sibanye Gold Limited. The Mineral Corporation’s reasonable enquiries found no reason to doubt the completeness, accuracy or reliability of the information provided and The Mineral Corporation accepts no liability for the accuracy or completeness of the information and data provided by Sibanye Gold Limited and Stillwater Mining Company. The Mineral Corporation’s opinions, findings and estimates reflect various techno-economic conditions, assumptions and interpretations (metal prices, currency exchange rates and other conditions) are as at the effective date of this report. These can change significantly over a relatively short period of time and with new information. As such, the information and opinions in this report may also be subject to change. This CPR contains forward-looking statements, which are based on the estimates by Stillwater as of 31 July 2017. The

estimates and statements have been reviewed by The Mineral Corporation and found to be reasonable. However, the estimates and statements are subject to known and unknown risks and other factors that may cause the actual results to differ materially from those anticipated in the forward-looking statements. The Mineral Corporation accepts no liability or responsibility whatsoever for, or in respect of, any use of or reliance upon this report by any third party or if it is used by Sibanye Gold Limited out of context or for any purposes other than that originally intended.

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EXECUTIVE SUMMARY JSE12.9(h)(xi): JSE12.9(h)(xii)

Introduction and Purpose Sibanye Gold Limited (SGL) is an independent mining group domiciled in South Africa, and listed on both the Johannesburg Stock Exchange (JSE or JSE Limited) and New York Stock Exchange (NYSE). On 4 May 2017, SGL announced on the JSE Stock Exchange News Service (SENS) the conclusion of the acquisition of Stillwater Mining Company (Stillwater) (the Transaction). Following the SENS announcement, SGL commissioned Mineral Corporation Consultancy (Pty) Limited (The Mineral Corporation) to compile an independent Competent Person’s Report (CPR), incorporating a Competent Valuator’s Report (CVR), for Stillwater’s mining and ore beneficiation operations and mining claims in Montana (the Montana Assets), located in the United States of America (USA), for submission to the JSE. The CPR and CVR comply with the requirements of the 2016 edition of the South African Code for the Reporting of Exploration Results, Mineral Resources and Mineral Reserves (the SAMREC Code), the 2016 edition of the South African Code for the Reporting of Mineral Asset Valuation (the SAMVAL Code) and Section 12 of the JSE’s Listing Requirements. Project Outline The Montana Assets, which are discussed in this CPR, are platinum group metal (PGM) mining and ore beneficiation assets wholly owned by SGL. These assets include Stillwater Mine (including the Blitz section), East Boulder Mine, integrated concentrator plants at Stillwater and East Boulder Mines and the surrounding PGM mining claims located near Nye as well as a metallurgical complex situated in Columbus. The map below shows the locations of the Montana Assets.

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The Montana Assets are located in a region where regional economic infrastructure for PGM mining (power, road and

water infrastructure) is well established. The mining and ore processing operations have been in existence for decades and are well-supported by mine infrastructure. Topography in the vicinity of the mines is rugged and elevation exceeds 5 000ft (1 524m) above mean sea level. Climate conditions are mainly characterised by freezing temperatures and low precipitation in winters and warm wet summers. Heavy snows, stream flooding or forest fires may affect mine site access, but these have not significantly hindered operations since mining commenced at Stillwater and East Boulder Mines. Subsequent to the Transaction, the Montana Assets became part of the United States Region Assets in the SGL Group Structure, which is illustrated below.

Independence, Capability and Competence The CPR and CVR have been prepared by The Mineral Corporation based on the information, Mineral Resource and Mineral Reserve estimates and Life of Mine (LoM) Plans provided by Stillwater and SGL. The Mineral Corporation has independently reviewed the technical and economic information as well as the Mineral Resource and Mineral Reserve

estimates prepared by Stillwater for the CPR. The Lead Competent Person with responsibility for reporting Mineral Resources and the compilation of this CPR is Coniace Madamombe. The Mineral Resource estimates for Stillwater and East Boulder Mines have been prepared by Jim Dahy, Jennifer Evans and Michael Koski, who are fulltime employees of Stillwater. The Lead Competent Person with responsibility for reporting Mineral Reserves is Jonathan Buckley. The Mineral Reserve estimates for Stillwater and East Boulder Mines have been prepared by Brent Lamoure. The Competent Valuator responsible for Mineral Asset Valuation is John Murphy. Guided by the definitions of competence provided by the SAMREC Code and the SAMVAL Code, the Competent Persons and Competent Valuator are appropriately experienced and qualified for the tasks performed. Legal Aspects and Tenure There are a number of federal and state mining-related laws and regulations governing mining in the USA. The Mining Law of 1872 is, however, the overarching federal law governing the purchase, exploration, discovery and extraction of mineral deposits. The Federal Land Policy and Management Act of 1976 (FLPMA) contains provision for the documentation and maintenance of all Mining Claims and Mill and Tunnel Sites, which are various forms of title and tenure in the USA.

The clarity in the regulatory framework facilitates compliance and maintenance of title and tenure permitting, which are achieved through the payment of maintenance fees and completion of the requisite Annual Assessment Work. Stillwater holds or leases 1 674 Patented and Unpatented Lode, Placer, Tunnel or Mill Site Claims in the Stillwater, Sweet Grass and Park Counties of south-central Montana, encompassing over 26 000 acres (10 522ha) and for an indefinite period. Most of the Mining Claims (1 537) cover the J-M Reef, which is the PGM deposit targeted for mining by Stillwater, while other claims provide servitude for the establishment of surface infrastructure and reef access adits. Of the 1 537 claims covering the J-M Reef, 898 are subject to royalty payments, which have varied between a total of $22.8 million in 2014 and $15.1 million in 2016 resulting from metal price changes. Stillwater also purchased several land parcels some of which are currently used for the operations while others are earmarked for future use. The Columbus Metallurgical Complex is situated on private land owned by Stillwater. The Mineral Corporation has identified no material issues relating to the title permitting and surface ownership that would prevent the achievement of the LoM Plans for Stillwater and East Boulder Mines. The Montana Assets comply with all title permitting requirements of the Federal and State Governments.

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Geological Setting

The Montana Assets are based on the exploitation of the J-M Reef, which occurs in the exposed part of the Stillwater Complex along the northern margin of the Beartooth Mountains of south-central Montana and north-western Wyoming. The Stillwater Complex is a layered igneous complex resulting from magma intrusion through regional transverse faults into highly deformed Archaean sedimentary rocks at approximately 2.7Ga and emplaced as a lopolith. Much of the shallow dipping part of the Stillwater Complex (approximately 1 700 square miles or 4 400km2) lies buried under a thick sedimentary cover, with a small component exposed due to the 20 000ft (6 000m) uplift (Beartooth Uplift) associated with the northward verging Horseman Thrust Fault system. The Horseman Thrust Fault system is responsible for the current steep dips (35o to 90o towards north and northeast) of the stratigraphic units in the exposed part of the Stillwater Complex. The stratigraphic sequence of the Stillwater Complex is subdivided (from bottom upwards) into the Basal Series, Ultramafic Series, Lower Banded Series, Middle Banded Series and Upper Banded Series. Much of the area covered by the Stillwater Mining Claims is underlain by the Lower Banded Series that hosts the J-M Reef as well as, to a lesser extent, the Ultramafic and Middle Banded Series.

The J-M Reef is a magmatic reef type PGM deposit defined as the Pd-Pt rich stratigraphic interval, mainly occurring within a troctolite (OB-I zone) of the Lower Banded Series. Palladium (Pd) and platinum (Pt) are the main PGMs, both constituting between 0.6oz per ton (opt) to 0.8opt (20g/t to 25g/t) over a variable thickness ranging from 3ft to 9ft (0.9m-2.7m) and averaging 6ft (1.8m). Ratios of Pd to Pt in metallurgical concentrate are known to range from 3.1:1 (in situ 3.4:1) at Stillwater Mine to 3.5:1 (in situ 3.6:1) at East Boulder Mine. Other associated PGMs such as rhodium (Rh), iridium (Ir), ruthenium (Ru) and osmium (Os), and gold (Au) occur in low abundances and are generally not evaluated by Stillwater. The visual identification of the J-M Reef is facilitated by the presence of approximately 0.25% to 3% visible disseminated copper-nickel sulphide minerals within a complex cumulate of silicate minerals. Pd occurs primarily (80%) as a solid-solution in pentlandite as well as in sulphides (15%) and moncheite (5%). Pt occurs primarily (67%) in sulphides (e.g. cooperite and braggite), as a metal alloy (25%) and in moncheite (8%).

Evaluation of the J-M Reef The J-M Reef package is laterally continuous and located at a consistent stratigraphic level in the Stillwater Complex, which facilitates the accurate prediction of the reef even from sparse drillhole information. Macro-continuity of the J-M Reef is supported by geostatistical evidence and is well-understood from historical drilling and mining. The macro-continuity is interrupted by faults, dykes and sills.

Unlike other magmatic PGM deposits, the J-M Reef is characterised by high variability in grade and thickness over short ranges, with the variability being more pronounced at Stillwater Mine where localised reef zones containing anomalous metal and tonnage quantities (ballrooms) occur. This variability necessitates the sampling of the reef through closely spaced (50ft or 15m) drillholes, with only the mineralisation quantified using this closely spaced drillhole data being classified as Measured Mineral Resources and that in the 1 000ft (305m) envelope around Measured Mineral Resources being classified as Indicated Mineral Resources. Reef facies or geological domains have been delineated based on the micro-variability of the mineralisation.

The steep dipping nature of the exposed part of the Stillwater Complex and the rugged terrain limits the amount of surface drilling completed on Stillwater’s Mining Claims. Most of the drilling is completed from underground drill stations situated 50ft (15m) apart along footwall lateral drifts. A single radial drillhole fan is established at each drill station consisting of a sub-horizontal hole directed to drill perpendicular through the reef, typically four up holes and two down holes. The footwall lateral drifts are spaced 300ft to 400ft (91m to 122m) vertically and situated approximately 100ft to 200ft (30m to 61m) from the J-M Reef plane. Additional underground drillhole information is generated through development drilling.

Surface drilling information, collected at a drillhole spacing ranging from 1 000ft to 2 000ft (305m to 610m), generates the primary information that is utilised to plan underground access drives used for underground drilling and as well as to confirm the presence of the J-M Reef in areas classified as Inferred Mineral Resources. All drill cores are logged by Stillwater Geologists and mineralised intersections are sampled and analysed at the laboratory situated within the Columbus Metallurgical Complex. All drillhole collars are surveyed by the Mine Surveyors and downhole surveys are completed on a selected number of holes per each drill station. This is acceptable as experience has shown no material drillhole deviation.

The Mineral Corporation is satisfied with the density, distribution and reliability of the drillhole data generated at Stillwater and East Boulder Mines, which has been utilised to produce the current Mineral Resource estimates. This data is of sufficient quality to be relied upon, having been subjected to rigorous internal validations.

Exploration Extensive exploration work spanning decades has been completed on the Stillwater Complex. Much of the early exploration was driven by state and academic research institutions and associated historical exploration data is publicly available. Additional information was generated from exploration and mining activities completed by Stillwater and predecessor companies, which included geophysical (aeromagnetic and gravity) and soil geochemical surveys, surface mapping, diamond drilling, sampling and laboratory analyses. This facilitated the delineation of the J-M Reef mineralisation mined at Stillwater and East Boulder Mines since 1986 and 2002, respectively.

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Drillhole data is the primary data utilised for Mineral Resource estimation, and this consists of collar and downhole survey,

lithological and analytical data. Drillhole spacing at Stillwater and East Boulder Mines ranges from 50ft (15m) in well drilled areas to between 1 000ft and 2 000ft (305m to 610m). The techniques and approaches employed for the data collection, processing and validation are in line with industry best practice. The drillhole data is stored in the secure ORE QMS database, which is stored on Stillwater’s Information Technology central server. Geological Modelling Three-dimensional (3D) geological modelling for Stillwater and East Boulder Mines is completed for evaluation cuts of the Main Zone of the J-M Reef. The evaluation cuts are determined for each J-M Reef drillhole intersection through a process called “zone picking”. The cuts are determined from the hangingwall contact of the J-M Reef based on a composite cut-off grade of at least 0.20opt (6.86g/t) Pt + Pd for the Farwest and 0.30opt (10.29g/t) Pt + Pd for Off-shaft areas of Stillwater Mine and 0.20opt (6.86g/t) for Pt + Pd for East Boulder Mine. Intersections that do not satisfy these cut-off criteria and the evaluation cuts are identified in the evaluation dataset using standardised codes. The Main Zone evaluation cuts provide an outline of potentially economic portions of the J-M Reef that can be modelled for reporting as Mineral Resources. Structural interpretation precedes 3D modelling of the Main Zone and identifies major faults and intrusive dykes that intersect, offset or replace the J-M Reef. Geological interpretation is completed in Vulcan™ software along section lines spaced 50ft (15m) and parallel to the plane of the underground drillhole fans. This interpretation is only performed in areas supported by Mineral Resource and Mineral Reserve definition drilling – i.e. where drill stations are spaced 50ft (15m) intervals. A polygon is manually digitised to outline the limits of the Main Zone from one hole to the next and from one drill fan to the next. The Main Zone polygons are terminated or offset when they intersect a fault or dyke, which ensures that explicit geological losses are accounted for during 3D modelling. A solid (3D) model triangulation is constructed in Vulcan™ software by joining each of the polygons and closing at the end-plates created during section interpretation. Block models are built within the enclosure of the Main Zone wireframe models using 10ft by 10ft (3m by 3m) block dimensions in the plane of the J-M Reef. The third dimension (Y dimension) of each of the blocks aligns closely to and represents the estimate of true thickness of the Main Zone as provided by the wireframe. Estimation Data processing and analysis techniques are completed to determine the appropriate estimation technique. Statistical data analysis identifies anomalous data points that would have undue influenced on the overall estimates. The anomalous data points are capped to reduce their impact on the overall estimates. For Stillwater Mine, several high-grade samples still occur after grade capping and these are dealt with by tightening the estimation search range in the areas where these samples are located. Estimation of grades into the block models is achieved via first-pass ordinary kriging interpolation using search parameters aligned to variogram parameters. A parallel check estimation process is completed via the Inverse Distance Weighting (IDW) interpolation technique using a power of three. Validation of the ordinary kriging estimates is achieved by comparing these estimates with the IDW estimates and composite data. Tonnage estimates are derived from the application of an average specific gravity estimate of 0.086 ton/ft3 (2.76t/m3) to the modelled volume. The use of an average specific gravity estimate for density determination is not consistent with industry practice, but historical tonnage reconciliation in the mined out areas suggests that the specific gravity estimate used has led to the understating of tonnage by up to 6%. Mineral Resources are reported at a minimum true mining width of 6.5ft (2.0m) for Stillwater Mine and 7ft (2.1m) for East Boulder Mine based on the assumption of 100% mining through the ramp and fill method. Main Zone blocks with widths that are less than the minimum mining width are adjusted by incorporating low-grade material from the footwall, which results in a decrease in grade over these areas. The cut-off grades indicated above are applied to the block model to produce tonnage and grade estimates for Measured Mineral Resources. In situ regional averages (means) per reef facies and per area of the mine for the Measured Mineral Resource areas are determined and applied to the Indicated and Inferred Mineral Resource areas, where drillhole information is sparse. This estimation practice has been in place since 2002 and benefits from the macro-continuity of the J-M Reef. The approach is supported by geostatistical evidence and historical experience at the mines. Mine Design and Geotechnical Stillwater and East Boulder Mines are mature mining operations exploiting the J-M Reef via the overhand cut-and-fill (C&F), ramp-and-fill (R&F) and sub-level long hole open stoping methods. The mechanised R&F stoping method is utilised at least 85% of the time at the mines, followed by sub-level long hole open stoping method (0% to 20%). The usage of C&F mining is limited to a few areas (up to 3%) of Stillwater Mine. Both underhand and overhand R&F methods are employed, with the more cost effective being the overhand type, which uses un-cemented sandfill, preferred and utilised where ground conditions permit. Hydraulic sandfill, which is mainly used, consists of the coarse fraction of the plant tailings. Cemented tailings paste fill is utilised in less stable areas mined using the undercut R&F method. Development ramp grades do not exceed 18%.

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For areas mined via sub-level long hole open stoping, support pillars are left in place at approximately 80ft (24m) to

100ft (30m) intervals on the reef. Having been in operation for decades, Stillwater and East Boulder Mines have accumulated extensive geotechnical information that informs the understanding of regional and local geotechnical conditions. This is also facilitated by the development of ground support measures for prevailing and anticipated rock mass conditions in stopes and development drives. The ground classification and support measures at the mines are suited to ambient rockmass conditions and the mining methods employed. There is limited geohydrological data available at Stillwater and East Boulder Mines. Therefore, the accurate assessment of groundwater levels and impacts to ground conditions in the mine areas has not been completed. The Mineral Corporation noted that the mines are generally dry in the upper levels. Groundwater flows associated with faults were observed in the adits at the Blitz section of Stillwater Mine. A comprehensive geohydrological study, incorporating both Stillwater and East Boulder Mines, has been commissioned. Grade Control Grade control is achieved through face evaluation and chip sampling. The grade control procedure is well entrenched and produces invaluable information that guides mining. Furthermore, geological maps and the detailed reef descriptions produced from the process form valuable additional inputs to Mineral Resource evaluation, mine planning and Mineral Reserve estimation. Life of Mine Planning and Scheduling Mine planning is based on the ten-year and 25-year planning ranges. Both the Ten-year LoM Plan and the 25-year (Strategic) LoM Plan envisage mining from Stillwater and East Boulder Mines. Stillwater Mine consists of the current section and Blitz section, with the Blitz section being an expansion programme currently under development. Stillwater Mine has a current RoM ore production level of 60 000 ton (55 000t) per month, based on the mining of the current section. Input from the Blitz section, which is expected in late 2017, will result in projected RoM ore production from the mine reaching a steady state level of 106 000 ton (96 000t) per month in 2023. The development results to date, delivery schedules for drilling, loading and hauling equipment, available capital funding and the production build-up for the Blitz section indicate that the planned production increase for Stillwater Mine should be achieved. East Boulder Mine is currently operating at the steady state RoM ore production level of approximately 55 000 ton (50 000t) per month. Mine planning utilises historical technical parameters. Dilution is applied to account for minimum mining width adjustment and overbreak the Main Zone block model. The application of a minimum true mining width adjustment per mining method results in the initial dilution applied to the block models. For most (85%) of the areas mined, minimum mining widths of 6.5ft (2.0m) and 7ft (2.1m) associated with the R&F method are used at Stillwater and East Boulder Mines, respectively. An additional 1ft (0.3m) dilution due to overbreak is added to the block model true widths for Stillwater and East Boulder Mines. This additional dilution is more than would typically be generated by widening the stoping excavations to fit the operating envelope of the various types of equipment utilised. Appropriate mining widths and dilution factors are applied to the reminder of the areas earmarked for mining through the C&F and sub-level long hole open stoping methods. Other mine planning factors employed include ore loss factors of up to 25% of broken reef material, Mine Call Factors averaging 90%, stoping factors varying from 200 tons to 700 tons (181t to 635t), development factors varying from 25 ton to 140 ton (23t to 127t) per miner per month and 60ft (18m) advance per miner per month, with higher factors used for East Boulder Mine. Annual mine production and development schedules are completed utilising various software programs including MS ExcelTM, AutoCADTM and VulcanTM. Initially, the scheduling includes all primary development (footwall lateral drifts) to access the stope blocks identified through Mineral Resource and Mineral Reserve definition drilling, which generates Measured Mineral Resources. Thereafter, the development design and scheduling is extended to the end of the ten-year period. Beyond the ten-year window, the primary annual development rates required are derived through the utilisation of historical ratios (e.g. ore tons per foot of lateral development for a 300ft or 91m lift). The scheduling of the stoping is dependent on the completion of the footwall access and diamond drilling to form an outline of the stopable area in terms of grade and tonnage and the mill feed requirements. Each stope block is subjected to an economic test, which results in the determination of a net profit and, ultimately, a Net Present Value of the planned stope and payback period. The process followed to convert the Measured Mineral Resources into Proven Mineral Reserves is based on historical performance and reconciliations, and is aligned with industry best practice at an accuracy level of ±10%. A similar process is followed to convert Indicated Mineral Resources to Probable Mineral Reserves, but the lower level of confidence and geological knowledge for Indicated Mineral Resources compared to Measured Mineral Resources places the accuracy level to approximately ±20%.

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An economic viability test (ORET test) is completed for the Ten-year LoM Plans for the operations. The ORET model

underpinning the July 2017 Mineral Reserve estimates projects positive undiscounted net LoM pre-tax cash flows for Stillwater and East Boulder Mines, which indicate that the LoM Plans are economically viable under the set of economic parameters utilised. Stillwater also develops detailed long-term (25-year) LoM Plans and Budgets to demonstrate the overall economic viability of the mines and for strategic decision making. Mining Infrastructure, Bulk Services Supplies and Logistics Stillwater and East Boulder Mines have the necessary mining infrastructure for the planned mining operations. This includes key mining infrastructure such as shafts, underground footwall drives, ore conveyancing facilities and workshops. Surface infrastructure such as ancillary buildings, concentrators, workshop and warehouse, changing facilities, headframe, hoist house, paste plant, water treatment, storage facilities and offices is also present. All structures and tailings management facilities are located within Mine Operating Permit areas. Underground mine services infrastructure such as maintenance workshops, ventilation, water pumping, sandfill plants and power infrastructure are in place. Upgrades and new installations of power and ventilation infrastructure are in progress at Stillwater Mine following the introduction of the Blitz section. Key access infrastructure under construction at the Blitz section includes the 5 000E and 5 600E Footwall Drive and the Benbow Decline. The Benbow Decline is expected to reach the 5 600 Level in 2018 and connect to the 5 600E Footwall Lateral Drift in 2019. These access drives are also critical to the ventilation and ore production ramp up plans of the Blitz section. Metallurgical Processing and Tailings Disposal Stillwater and East Boulder Concentrators and the Columbus Metallurgical Complex have all been operating sustainably for several years and the sampling, laboratory and metallurgical testing techniques, which are employed for process management and metal accounting, are well-entrenched and achieving the desired results. Ore processing is based on the conventional flotation technique, with metallurgical amenability predictions (including budget tonnage throughput rates and metallurgical recoveries) utilised for the LoM Plan production schedule based on historical experience. The Stillwater Concentrator currently operates at a production level of 750 000 ton (680kt) per year and a 75% utilisation in alignment with RoM production. The excess capacity will be used to process ore from the Blitz section. A plant capacity upgrade is planned to be completed in 2021 to accommodate the increased production profile resulting from the Blitz section reaching steady state production levels. The East Boulder Concentrator currently operates at a production level of 670 000 ton (608kt) per year based on a 75% utilisation, which is necessitated by the mine’s current RoM production level. There is excess capacity to process additional tonnage if this is required. Independent calculations by The Mineral Corporation based on the current production plans indicate that both concentrator plants have sufficient tailings storage facilities until the 2027 to 2028 period but this timeframe is two to three years earlier than currently envisaged by Stillwater. A new tailings storage facility will be required at Stillwater Mine while an additional elevation lift will be sufficient for East Boulder Mine. It is recommended that technical studies for the required tailings storage facility capacity upgrades already planned by Stillwater should commence immediately given the potential long lead time (five to seven years) for approval of environmental permits in Montana and likely two years of construction. The smelter consists of a 150 ton (136t) per day primary submerged arc furnace and a smaller 100 ton (91t) per day submerged arc furnace operating in a slag cleaning duty in series with the primary furnace. The smelter processes a blended feedstock consisting of the concentrate from Stillwater and East Boulder Concentrators and recycle autocatalytic material from the onsite recycling sample plant to produce a converter matte containing PGMs. The current operational methods and capacities for the smelter are adequate until the steady state ore production from the Blitz section occurs. Smelter plant capacity upgrades are planned to cater for the increased production output at Stillwater Mine and Concentrator. The converter matte from the smelter is treated at the base metal refinery, which has a production (feed) capacity of approximately 4 300 ton (3 900t) of matte per annum. The base metal refinery produces various products, but PGM filtercake and copper cathode (550 tons or 498t per year) are the main revenue generating products. The base metal refinery is currently operating below capacity and has sufficient capacity to accommodate the planned production increase from the development of the Blitz section. A minor bottleneck identified in the copper electrowinning circuit, which constraints the production capacity at the base metal refinery, will be addressed during the 2018 to 2019 period. Accordingly, the elimination of the bottleneck will ensure that there is sufficient capacity to accommodate the planned production increase from the Blitz section. Steady state production at the Blitz section will be achieved in 2023. All metallurgical processes in place at Stillwater ore processing, smelting and refining facilities are appropriate, well proven and have operated successfully for several years. Infrastructure at these plants has been well-capitalised and recapitalised as required to ensure sustainable performance for the required capacities. The plants have secure water and power

supplies.

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Human Resources and Safety

Stillwater has a total labour complement of 1 449, with 822 employees based at Stillwater Mine and Concentrator, 403 employees based at East Boulder Mine and Concentrator, 219 based at the Columbus Metallurgical Complex and the remainder based at the corporate office. The LoM Plan labour complement for Stillwater Mine is set to increase to an average of 1 120 when the Blitz section reaches steady state production. The management for the Stillwater operations is composed of appropriately qualified staff members. Stillwater has maintained a low staff turnover reflected in a 5.6% attrition rate against a target attrition rate of 8% per annum between 2016 and 2017. Both Stillwater and East Boulder Mines have good safety records, which have been achieved through the implementation of the Guide, Educate and Train (GET) Safe Safety and Health Management System. A comprehensive safety and induction training system is in place to ensure that all new and returning members of staff have proper training prior to commencement of job responsibilities. Environmental and Social Issues Several federal and state environmental and social-related laws and regulations govern mining in the USA, and these are strictly enforced by various federal and state agencies. These regulatory agencies can approve, deny or conditionally approve applications for mining or modification of permits. Stillwater has complied with all the federal and state environmental and social laws governing its mining and ore processing and beneficiation facilities in Montana. Stillwater and East Boulder Mine Complexes both have valid Operating Permits that regulate the activities at these operations. Similarly, the smelter at the Columbus Metallurgical Complex and the tailings storage facilities at the mines have the requisite permits for their operation. Geochemical studies and operational environmental monitoring data demonstrate that waste rock mined at Stillwater and East Boulder Mines has negligible potential to generate acid or acid mine drainage. Notable environmental factors relate to increased nitrate loading in the Stillwater and East Boulder Rivers, but there is currently no evidence that this has a negative impact on fauna and flora. A number of mitigation measures are being explored to remedy this issue. Tailings storage facilities are lined and water reclamation is achieved through the use of subdrains. Technical studies required for the tailings storage facility upgrades should commence immediately in view of the long wait period for environmental permit approvals. The proposed rule by the Environmental Protection Agency (EPA) under Section 108(b) for the Comprehensive Environmental Responsibility, Compensation, and Liability Act (CERCLA), which will establish financial responsibility requirements for owners and operators of hardrock mining facilities, is another potentially material environmental issue that will become clear when the rule has been promulgated. Closure and post closure reclamation costs of $21.2 million and $17.4 million have been determined by the Montana Department of Environmental Quality (MDEQ) for Stillwater and East Boulder Mines, respectively. The costs are valid for the five-year periods 2014 to 2018 for East Boulder Mine and 2016 to 2021 for Stillwater Mine, and respective rehabilitation bonds are in place as surety for these costs. With the planned tailings storage facility capacity upgrades at Stillwater and East Boulder Mines and the expansion project at Stillwater Mine, the reclamation costs are likely to be revised upwards by the MDEQ in 2018/2019 for East Boulder Mine and 2021/2022 for Stillwater Mine. The reclamation costs will only be adjusted upward in the budgets after the surety revisions by the MDEQ have determined the top up amounts required. Stillwater has a progressive and highly effective Good Neighbour Agreement, which establishes formal opportunities for specific local and regional environmental non-governmental organisations to participate in decisions that may impact the local communities, economies or the environment. A significant component of the Good Neighbour Agreement is aimed at ensuring public safety and security. The Good Neighbour Agreement is a legally binding contract between Stillwater, the Northern Plains Resource Council, Cottonwood Resource Council and Stillwater Protective Association. Stillwater has committed to provide funds that meet a wide range of community needs, and to working with federal and local administrations, organisations, community and conservation groups to ensure the mines and associated infrastructure are managed responsibly. Capital and Operating Costs The capital costs for Stillwater and East Boulder Mines and Concentrators are separated into Category 1 (for sustaining LoM production) and Category 2 (for improved productivity, environmental management and social/administration issues). The Stillwater Mine budget includes separate capital costs for the Blitz section until 2021 and, thereafter, the Blitz section costs are captured as part of the Stillwater Mine operations. The total annual capital bill for Stillwater Mine and Concentrator varies from approximately $100 million to $180 million between 2018 and 2022 to cater for Blitz development and the planned plant and underground infrastructure upgrades and installations, but decreases gradually to approximately $40 million in 2029. Capital expenditure for East Boulder Mine and Concentrator varies between $19 million and $27 million per annum for the same five-year period. Annual capital expenditure ($100 thousand to $6 million) has been allowed for the Columbus Metallurgical Complex to account for the few upgrades identified and to sustain the planned operations.

ix


Operating costs are based on historical experience with direct mining cash costs currently being $386/oz and $366/oz

Pd + Pt for Stillwater and East Boulder Mines, respectively. Current surface operating costs (combined surface facilities and Columbus Metallurgical Complex) of $115/oz and $135/oz Pd + Pt have been apportioned between Stillwater and East Boulder Mines, respectively. Market Studies Market studies completed for this report suggest that the market fundamentals for palladium and platinum are in place, with a palladium deficit forecast in the short to medium term. Platinum price, which has been depressed in the last three years, is beginning to show signs of recovery. Demand for these metals is dependent on their usage in the auto-catalyst sector (gasoline and diesel powered automobiles). The market studies indicate that global demand for vehicles is forecast to increase in the foreseeable future. Mineral Resource and Mineral Reserve Statement The Mineral Resource and Mineral Reserve estimates for Stillwater and East Boulder Mines as at 31 July 2017 are provided in the table below. The Mineral Resource estimates are reported inclusive of Mineral Reserves and on the assumption of 100% mining via the ramp and fill underground mining method which is the predominant method used at Stillwater and East Boulder Mines. However, Mineral Resource to Mineral Reserve conversion and the Mineral Reserve estimates in the table consider other underground mining methods employed at these mines. The Mineral Resources estimates have been compiled by Jim Dahy and Jennifer Evans, with assistance from Mr Michael Koski, all of whom are Senior Geologists, employees of and Mineral Resource Competent Persons for Stillwater. The estimation of Mineral Resources has been supervised and validated by Coniace Madamombe who is a Senior Geologist, Director of The Mineral Corporation and Lead Competent Person for Mineral Resource estimates in this CPR. The Mineral Reserve estimates have been compiled by Brent LaMoure, who is a Senior Mining Engineer, an employee of and Mineral Reserves Competent Person for Stillwater. The estimation of Mineral Reserves has been supervised and validated by Jonathan Buckley, who is a Senior Mining Engineer at The Mineral Corporation and Lead Competent Person for Mineral Reserve estimates in this CPR. Only the Measured and Indicated portions of the Mineral Resources within the LoM Plan have been included in the Mineral Reserve estimates. No Inferred Mineral Resources have been included in Mineral Reserve estimates. The estimates are based on detailed LoM Plans constructed internally by Stillwater personnel utilising Modifying Factors and capital and operating costs informed by historical experience at the mines. Furthermore, the estimates have been independently reviewed and validated by The Mineral Corporation.

Imperial

Mineral Resources Mineral Reserves

Category Mine Million Ton Pd + Pt

(Moz) Grade (opt) Category Million Ton Pd + Pt (Moz) Grade (opt)

Measured

Stillwater 4.4 2.8 0.62

Proved

3.2 1.9 0.6

East Boulder 4.0 1.8 0.44 2.9 1.1 0.38

Subtotal/Average 8.5 4.5 0.54 6.1 3.0 0.5

Indicated


Probable

16.7 9.8 0.59

East Boulder 32.4 14.7 0.45 23.9 9.4 0.39


Inferred


East Boulder 48.1 21.9 0.46

Subtotal/Average 102.0 49.4 0.48

All Total/Average 165.0 80.8 0.49 All 46.7 22.2 0.48

Metric

Category Mine Tonnage (Mt) Pd + Pt

(Moz)

Pd + Pt Grade

(g/t) Category Tonne (Mt) Pd + Pt (Moz) Pd + Pt Grade (g/t)

Measured


Proved

2.9 1.9 20.56

East Boulder 3.6 1.8 15.22 2.6 1.1 13.17


Indicated

Stillwater 20.2 12.1 18.71

Probable

15.1 9.8 20.11

East Boulder 29.4 14.7 15.55 21.7 9.4 13.46


Inferred

Stillwater 48.9 27.5 17.48

East Boulder 43.6 21.9 15.65



x


Risk Assessment

Section 9.3 of the CPR provides a detailed discussion of the main risks identified by The Mineral Corporation through technical review of the information supplied by Stillwater for this report. Any material decreases in metal prices and a potential huge financial burden arising from the implementation of the rule proposed by the EPA are the only potentially material issues identified by The Mineral Corporation. Most of the issues identified are minor operational issues that should not be ignored as they can potentially become material issues in the long term. Valuation On 9 December 2016, SGL announced through the JSE SENS that it had entered into a definitive agreement to acquire all of the outstanding common stock of Stillwater for US$2.2 billion in aggregate. In a follow up statement on 4 May 2017 through the JSE SENS, SGL announced the conclusion of the acquisition. At the time of the Transaction, Stillwater included the Montana Assets (the subject of this CPR), Marathon Project in Canada and Altar Project in Argentina. The Montana PGM Assets of Stillwater Mining Company comprised East Boulder Mine and Stillwater Mine including its expansion into the Blitz section, integrated concentrators, smelter, recycling plant and the BMR. The scope of work for this valuation comprises an independent valuation of the Mineral Resources and Mineral Reserves of Stillwater and East Boulder Mines (the Mineral Assets), informed by the content of the CPR on the Montana PGM Mineral Assets of SGL. The Mineral Assets comprise Mineral Resources and Mineral Reserves that are included in the 25-year LoM Plans for East Boulder and Stillwater Mines as well as the Inferred Mineral Resources outside of the 25-year LoM Plan footprints. The valuation is presented on a 100% ownership basis. The Mineral Assets have been valued using the Income and Market Approaches and in accordance with the SAMVAL Code requirements. The Market Approach has been premised on the analysis of market trading multiples for comparable listed PGM producers (Anglo American Limited, Impala Platinum Limited, Lonmin plc and Northam Platinum Limited) in relation to the PGM content of their Mineral Resource and Mineral Reserve Statements and the determination of enterprise value per equivalent Pt ounce (EV/ePt ounce). This methodology is appropriate given the paucity of comparable operating Mineral Asset transactions for assets of similar stature in the last five years. The mean EV/ePt ounce and the EV/ePt ounce at the lower and upper 90% confidence levels have been determined from the data for comparable companies indicated. The value of Inferred Mineral Resources has been discounted by 50% owing to the fact that these Mineral Resources cannot be converted to Mineral Reserves and based on experience. Furthermore and for East Boulder in particular, the Inferred Mineral Resources may be many decades away from contributing to mining realisation, which will occur only after successful future upgrading to Indicated and Measured Mineral Resources. The Income Approach has been based on the application of a 5% real discount rate to the post-tax (effective 25.9% company tax), pre-interest and pre-financing free cash flows for Stillwater and East Boulder Mines to derive Net Present Value (NPV) results. The 5% discount rate is SGL’s weighted average cost of capital as at 31 July 2017. The cash flows employed have been based on the 25-year LoM Plans for the two mines. The planned production at Stillwater Mine as per the 25-year LoM Plan occurs in the current section and the Blitz section. The 25-year LoM Plan for Stillwater Mine includes a proportion of Inferred Mineral Resources to the east of the currently defined Measured and Indicated Resources in the Blitz section. The Inferred Mineral Resources are scheduled for mining over the 15-year period after 2026, where these contribute approximately 30% of the total planned tonnage to the mill in the 25-year LoM Plan for Stillwater Mine. Accordingly, the contribution from the Blitz section has been curtailed to 18-years for the purposes of the valuation of Stillwater Mine. A discounted cash flow scenario for Stillwater Mine, which considers the 25-year LoM for the current section of Stillwater Mine, while permitting an 18-year LoM contribution to the overall Stillwater LoM Plan from the Blitz section, has been prepared. This scenario, which produces the preferred Income Approach result for Stillwater Mine, recognises the reasonable but yet to be realised expectation that a proportion of the Inferred Mineral Resources in the Blitz area will be upgraded to Indicated and Measured Resources as the basis for additional Mineral Reserves as progressive underground development permits additional underground Mineral Resource and Mineral Reserve definition drilling. A discounted cash flow model for Stillwater Mine with mining from the Blitz section unconstrained until the end of the 25-year LoM and another with mining from the Blitz section constrained to 2026 have also been prepared for comparison. The Mineral Corporation is of the view that the Income Approach results offer a reasonable and fair valuation result, which accurately represents the technical aspects and economic parameters of the Mineral Assets where LoM Plans are available. The Market Approach results have been adopted for the valuation of the Inferred Mineral Resources outside of the 25-year LoM Plan footprints only. The 31 July 2017 results of the Income Approach and Market Approach valuations carried out by The Mineral Corporation and the preferred valuation are highlighted in the table and figure below. The Income Approach result for East Boulder Mine is the NPV at a 5% discount rate (NPV5%) of $810.7 million, to which the Market Approach valuation result of $51.5 million for Inferred Mineral Resources beyond the 25-year LoM Plan is added to define a preferred valuation result for East Boulder Mine of $862.2 million. The preferred valuation for Stillwater Mine is the Income Approach valuation

result of the NPV5% of $1 850.1 million.

xi


It is concluded that the Income Approach valuation results for Stillwater and East Boulder Mines are the basis for the

preferred Mineral Asset value for the Combined Montana PGM Mineral Assets, and this amounts to $2 731 million.

Competent Persons’ Statement The Lead Competent Persons for Mineral Resources and Mineral Reserves can confirm that this Executive Summary is a true reflection of the full CPR.

C o st A ppro ach M arket A ppro ach Inco me A ppro ach

East Boulder Mine, 25 year plan $ million NA $ 808.7 $ 810.7 $ 862.2 *

Stillwater Mine per 25 year plan, with 18 years of Blitz section $ million NA $ 905.8 $1 850.1 $1 850.1

Combined Montana Assets $ million NA $1 714.5 $2 679.6 $2 731.2 **

* East Boulder Mine includes $51.5 million for Inferred Mineral Resources beyond 25 Year LoM Plan

** Combined Montana Assets also include NOL tax benefit of $18.9 million

Preferred Result

$ MillionMineral Asset Units

$ millio ns

$685.7 $1 200.1 $1 714.5

$3 943.6$2 957.3$2 283.6

$2 916.8$2 268.7$1 812.4

$3 483.2$2 679.6$2 113.7

0.00

1.00

2.00

3.00

4.00

$ 0 $ 500 $1 000 $1 500 $2 000 $2 500 $3 000 $3 500 $4 000 $4 500

US$ millions

Market Method Results

based on EV and ePt

Income Method ResultsReal NPV at 7.5%, 5.0%, 2.5% discount rate

Montana Mineral Assets, Mineral Reserves

Montana Mineral Assets DCF for 25-year LoM Plan

Montana Mineral AssetsDCF for Blitz 10-year LoM and 25-year LoM Plans for East Boulder and Stillwater Mines

Preferred value: $2 731 million

Montana Mineral Assets DCF for 25-year LoM Plan and 18 year LoM for Blitz Section


TABLE OF CONTENTS

EFFECTIVE DATE AND COMPETENT PERSON’S LIST .................................................................................................... i DISCLAIMER ............................................................................................................................................................. i EXECUTIVE SUMMARY .............................................................................................................................................. ii 1 INTRODUCTION .......................................................................................................................................... 1

1.1 Background and Purpose of Report ..................................................................................................... 1 1.2 Scope of Work .................................................................................................................................. 2 1.3 Sources of Information ...................................................................................................................... 2 1.4 Capability and Independence ............................................................................................................. 2 1.5 Reliance on Other Experts and Third Parties ........................................................................................ 3 1.6 Site inspection by Competent Persons and Competent Valuator............................................................. 4 1.7 Materiality ........................................................................................................................................ 4 1.8 Units and Currencies ......................................................................................................................... 5 1.9 Reporting Code Compliance ............................................................................................................... 5 1.9.1 Overview .................................................................................................................................... 5 1.9.2 Mineral Resources and Mineral Reserves ........................................................................................ 5 1.9.3 Mineral Asset Valuation ................................................................................................................ 6

2 PROJECT OUTLINE ...................................................................................................................................... 7 2.1 Property Description and Location ...................................................................................................... 7 2.1.1 SGL Group Overview .................................................................................................................... 7 2.1.2 Montana Assets ........................................................................................................................... 7 2.1.3 CPR Scope .................................................................................................................................. 7 2.2 Access, Proximity to Population Centres and Regional Infrastructure ..................................................... 8 2.3 Topography ...................................................................................................................................... 8 2.3.1 Stillwater Mine, Hertzler Tailing Storage Facility .............................................................................. 8 2.3.2 East Boulder Mine ........................................................................................................................ 9 2.3.3 Stillwater and East Boulder Mines Topo-cadastral Map .................................................................. 10 2.4 Climate .......................................................................................................................................... 10 2.5 Fauna and Flora .............................................................................................................................. 10 2.6 Political, Economic and Social Context ............................................................................................... 11 2.7 Legal and Permitting Overview ......................................................................................................... 11 2.7.1 Mining Related Legislation .......................................................................................................... 11 2.7.2 Mining Claim and Permitting ....................................................................................................... 11 2.7.3 Environmental and Social Related Legislation ............................................................................... 13 2.7.4 State of Montana Legislation and Regulations ............................................................................... 14 2.7.5 Federal Legislation and Regulations ............................................................................................. 15 2.7.6 Other Federal Regulatory Authorities ........................................................................................... 16 2.8 Title and Surface Rights................................................................................................................... 16 2.8.1 Title ......................................................................................................................................... 16 2.8.2 Surface Ownership ..................................................................................................................... 17 2.8.3 Conclusions ............................................................................................................................... 17 2.9 Royalties ........................................................................................................................................ 19 2.10 Liabilities ........................................................................................................................................ 19 2.11 Legal Proceedings ........................................................................................................................... 19 2.12 Social............................................................................................................................................. 19

3 PROJECT HISTORY .................................................................................................................................... 21 3.1 Ownership History .......................................................................................................................... 21 3.2 Previous Exploration and Mine Development ..................................................................................... 21 3.3 Previous Mineral Resource Estimates ................................................................................................ 22 3.4 Previous Mineral Reserve Estimates .................................................................................................. 22 3.5 Adjacent Properties ......................................................................................................................... 23

4 GEOLOGICAL SETTING, MINERALISATION AND DEPOSIT TYPES .................................................................. 24 4.1 Geological Setting ........................................................................................................................... 24 4.1.1 Background ............................................................................................................................... 24 4.1.2 Regional Geology and Stratigraphy .............................................................................................. 24 4.1.3 Regional Geological Structure ..................................................................................................... 26 4.2 Nature of, and Controls on, Mineralisation ......................................................................................... 27 4.2.1 Local Geology ............................................................................................................................ 27 4.2.2 PGM Mineralisation, Nature and Style of the J-M Reef ................................................................... 28 4.3 Geological Model ............................................................................................................................. 28 4.4 Deposit Types and Mineralisation ..................................................................................................... 29 4.4.1 J-M Reef Deposit Type, Stratigraphy and Persistence .................................................................... 29


4.4.2 Mineralogy and Grades ............................................................................................................... 31 4.5 Nature of J-M Reef on the Stillwater Property .................................................................................... 32 4.5.1 Nature of the J-M Reef at Stillwater and East Boulder Mines .......................................................... 32 4.5.2 Data Density, Distribution and Reliability ...................................................................................... 37

5 EXPLORATION DATA/INFORMATION .......................................................................................................... 38 5.1 Data Acquisition .............................................................................................................................. 38 5.1.1 Data Acquisition Overview .......................................................................................................... 38 5.1.2 Drilling ...................................................................................................................................... 39 5.1.3 Core Logging ............................................................................................................................. 39 5.1.4 Downhole Surveys ..................................................................................................................... 41 5.2 Sampling ........................................................................................................................................ 41 5.2.1 Sample method, collection, capture and storage ........................................................................... 41 5.2.2 Sample Preparation and Analysis ................................................................................................. 42 5.2.3 Sampling Governance ................................................................................................................ 44 5.3 Database Management .................................................................................................................... 45 5.4 Quality Assurance and Control ......................................................................................................... 45 5.4.1 Overview .................................................................................................................................. 45 5.4.2 Repeat Data .............................................................................................................................. 46 5.4.3 Blanks Data ............................................................................................................................... 48 5.4.4 Standards Data .......................................................................................................................... 49 5.4.5 Independent Re-assaying ........................................................................................................... 51 5.5 Bulk Density ................................................................................................................................... 52 5.6 Bulk-Sampling and/or Trial-Mining .................................................................................................... 52 5.7 Survey Data ................................................................................................................................... 52 5.8 Data Verification, Audits and Reviews ............................................................................................... 53 5.9 Metallurgical Sampling and Testwork ................................................................................................ 58

6 MINERAL RESOURCES ESTIMATES ............................................................................................................. 59 6.1 Background .................................................................................................................................... 59 6.2 Geological Model and Interpretation ................................................................................................. 59 6.2.1 Evaluation Cut Determination ...................................................................................................... 59 6.2.2 Geological Modelling of the J-M Reef ........................................................................................... 60 6.3 Estimation and Modelling Techniques ............................................................................................... 65 6.3.1 Evaluation Cut Data Compositing and Analysis .............................................................................. 65 6.3.2 Block Modelling ......................................................................................................................... 69 6.4 Estimation ...................................................................................................................................... 70 6.4.1 Grade and Tonnage Estimation for Measured Mineral Resources .................................................... 70 6.4.2 Grade and Tonnage Estimation for Indicated and Inferred Mineral Resources .................................. 73 6.5 Reasonable Prospects for Eventual Economic Extraction ..................................................................... 73 6.6 Mineral Resource Classification Criteria ............................................................................................. 73 6.7 Mineral Resource Statement ............................................................................................................ 77 6.8 Mineral Resource Reconciliation ....................................................................................................... 77

7 TECHNICAL STUDIES ................................................................................................................................ 78 7.1 Introduction ................................................................................................................................... 78 7.2 Mine Design ................................................................................................................................... 79 7.2.1 Mining Method Overview ............................................................................................................ 79 7.2.2 R&F .......................................................................................................................................... 79 7.2.3 Overhand C&F ........................................................................................................................... 81 7.2.4 Sub-level Extraction and Sub-level Development ........................................................................... 82 7.3 Geotechnical................................................................................................................................... 83 7.3.1 Background ............................................................................................................................... 83 7.3.2 Geological Setting and Geomechanical Characterisation ................................................................. 83 7.3.3 Rock Strengths .......................................................................................................................... 84 7.3.4 Rock Quality Indicators .............................................................................................................. 84 7.3.5 Stress field ................................................................................................................................ 85 7.3.6 Seismicity.................................................................................................................................. 86 7.3.7 Mining Methods ......................................................................................................................... 88 7.3.8 Support Designs ........................................................................................................................ 88 7.3.9 Validation of Rockmass Behaviour ............................................................................................... 90 7.3.10 Development Support ................................................................................................................ 91 7.3.11 Surface and Subsidence Control .................................................................................................. 92 7.3.12 Backfill specifications.................................................................................................................. 92 7.3.13 Conclusions and Recommendations ............................................................................................. 93 7.4 Geohydrology ................................................................................................................................. 94


7.4.1 Background ............................................................................................................................... 94 7.4.2 Hydraulic Conductivity ................................................................................................................ 95 7.4.3 Highlights of Groundwater Study ................................................................................................. 96 7.4.4 Geohydrological Study Recommendations .................................................................................... 97 7.4.5 Conclusions ............................................................................................................................... 97 7.5 Grade Control ................................................................................................................................. 97 7.5.1 Background ............................................................................................................................... 97 7.5.2 Face Evaluation ......................................................................................................................... 98 7.5.3 Face Estimation ......................................................................................................................... 98 7.5.4 Chip Sampling ........................................................................................................................... 99 7.5.5 Conclusions ............................................................................................................................. 100 7.6 Modifying Factors.......................................................................................................................... 100 7.6.1 Mining Factors for Stillwater Mine .............................................................................................. 100 7.6.2 Mine Planning Criteria for Stillwater Mine ................................................................................... 101 7.6.3 Mining Factors for East Boulder Mine ......................................................................................... 102 7.6.4 Mine Planning Criteria for East Boulder Mine .............................................................................. 103 7.7 Life of Mine Planning and Scheduling .............................................................................................. 104 7.7.1 Introduction ............................................................................................................................ 104 7.7.2 Mineral Resources to Reserves Conversion ................................................................................. 104 7.7.3 Life of Mine Planning and Budgeting .......................................................................................... 106 7.8 Stillwater Mine Operations ............................................................................................................. 108 7.8.1 Background ............................................................................................................................. 108 7.8.2 Mineral Resource Geometry ...................................................................................................... 108 7.8.3 Key Operational Infrastructure .................................................................................................. 108 7.8.4 Mineral Resource Access .......................................................................................................... 109 7.8.5 Mine Historical Production ........................................................................................................ 111 7.8.6 Stillwater Mine Deep Mining ...................................................................................................... 111 7.8.7 Mining Equipment Criteria......................................................................................................... 112 7.8.8 LoM Production Schedule.......................................................................................................... 114 7.8.9 Mine Logistics .......................................................................................................................... 116 7.8.10 Mine Services .......................................................................................................................... 117 7.8.11 Office Facilities ........................................................................................................................ 122 7.9 East Boulder Mine Operations ........................................................................................................ 123 7.9.1 Introduction ............................................................................................................................ 123 7.9.2 Mineral Resource Geometry ...................................................................................................... 123 7.9.3 Key Operational Infrastructure .................................................................................................. 123 7.9.4 Mineral Resource Access .......................................................................................................... 123 7.9.5 Mine Historical Production ........................................................................................................ 124 7.9.6 Mining Equipment Criteria......................................................................................................... 124 7.9.7 LoM Production Schedule.......................................................................................................... 124 7.9.1 Mine Logistics .......................................................................................................................... 126 7.9.2 Mine Services .......................................................................................................................... 127 7.9.3 Offices .................................................................................................................................... 129 7.10 Metallurgical Processing and Recovery ............................................................................................ 130 7.10.1 Process Samples ...................................................................................................................... 130 7.10.2 Metallurgical Amenability .......................................................................................................... 132 7.10.3 Processing Methods ................................................................................................................. 132 7.10.4 Metallurgical Testwork ............................................................................................................. 148 7.10.5 Deleterious Elements ............................................................................................................... 148 7.10.6 Processing Technology ............................................................................................................. 148 7.10.7 Processing Logistics ................................................................................................................. 148 7.10.8 Plant Surface Infrastructure ...................................................................................................... 149 7.11 Stillwater Human Resources and Safety .......................................................................................... 149 7.11.1 Overview ................................................................................................................................ 149 7.11.2 Mining Operation Safety Performance ........................................................................................ 150 7.11.3 Mines Safety and Health Administration Citations ........................................................................ 150 7.11.4 Diesel Particulate Matter Compliance ......................................................................................... 151 7.11.5 Labour Complement ................................................................................................................. 151 7.11.6 Management Structure ............................................................................................................. 152 7.11.7 Manpower Remuneration and Retention .................................................................................... 153 7.11.8 Collective Bargaining ................................................................................................................ 153 7.11.9 Employee Housing and Transport .............................................................................................. 153 7.12 Environmental Studies ................................................................................................................... 153


7.12.1 Environmental Modifying Factors ............................................................................................... 153 7.12.2 Material Environmental Factors ................................................................................................. 154 7.12.3 Other Environmental Factors..................................................................................................... 157 7.12.4 Environmental Studies .............................................................................................................. 158 7.12.5 Permits and Permitting Status ................................................................................................... 158 7.12.6 Environmental Compliance Management .................................................................................... 160 7.13 Market Review of Palladium and Platinum ....................................................................................... 161 7.13.1 Introduction ............................................................................................................................ 161 7.13.2 Palladium ................................................................................................................................ 163 7.13.3 Platinum ................................................................................................................................. 167 7.14 Capital and Operating Costs ........................................................................................................... 171 7.14.1 Capital Costs ........................................................................................................................... 171 7.14.2 Mining Operating Costs ............................................................................................................ 175 7.14.3 Plant and Ore Processing Cost .................................................................................................. 175 7.14.4 Environmental and Social ......................................................................................................... 176 7.15 Economic Criteria and Analysis ....................................................................................................... 182 7.15.1 Background ............................................................................................................................. 182 7.15.2 Taxation ................................................................................................................................. 182 7.15.3 Mineral Reserve Economic Viability Testing ................................................................................ 182

8 MINERAL RESERVE ESTIMATES ................................................................................................................ 183 8.1 Estimation and Modelling Techniques ............................................................................................. 183 8.1.1 Mineral Resource Estimate ........................................................................................................ 183 8.1.2 Historical Tonnage and Metal Content Reconciliation ................................................................... 183 8.2 Mineral Reserve Classification Criteria ............................................................................................. 185 8.3 Mineral Resource and Mineral Reserve Statement ............................................................................ 189 8.3.1 Reconciliation with Previous Estimates ....................................................................................... 190 8.4 Audits and Reviews ....................................................................................................................... 190

9 OTHER RELEVANT DATA AND INFORMATION ............................................................................................ 192 9.1 Catalytic Converter Business .......................................................................................................... 192 9.2 Planned Exploration and Expenditure .............................................................................................. 194 9.3 Risk Assessments .......................................................................................................................... 194

10 MINERAL ASSET VALUATION ................................................................................................................... 198 10.1 Introduction and Scope ................................................................................................................. 198 10.2 Previous Mineral Asset Valuations ................................................................................................... 198 10.3 Cost Approach Valuation Result ...................................................................................................... 198 10.4 Income Approach Valuation Results ................................................................................................ 198 10.4.1 Background ............................................................................................................................. 198 10.4.2 Revenue and Cost Inputs ......................................................................................................... 198 10.4.3 Taxation ................................................................................................................................. 199 10.4.4 Working Capital ....................................................................................................................... 199 10.4.5 Abridged Cash Flow Models ...................................................................................................... 199 10.4.6 Income Approach Valuation Results and Sensitivity Analysis ........................................................ 205 10.5 The Market Approach .................................................................................................................... 208 10.5.1 Methodology ........................................................................................................................... 208 10.5.2 Market Approach Valuation Results ............................................................................................ 211 10.6 Additional Considerations ............................................................................................................... 214 10.6.1 Valuation of Inferred Mineral Resources Beyond the current 25-year LoM Plan for East Boulder ...... 214 10.7 Valuation Summary and Conclusions ............................................................................................... 215 10.8 Historic Verifications, Audits and Reviews ........................................................................................ 216 10.9 Risk Assessment ........................................................................................................................... 217

11 INTERPRETATION, CONCLUSIONS AND RECOMMENDATIONS .................................................................... 217 12 REFERENCES .......................................................................................................................................... 219 13 SIGNATURE PAGE ................................................................................................................................... 221


LIST OF FIGURES

Figure 1: The location of Stillwater’s Montana Assets ............................................................................................................... 1 Figure 2: Montana Assets in the SGL Group Structure .............................................................................................................. 2 Figure 3: Topography in the vicinity of Stillwater Mine ............................................................................................................. 9 Figure 4: Topography in the vicinity of East Boulder Mine ........................................................................................................ 9 Figure 5: Stillwater Mineral Title and Tenure map .................................................................................................................. 18 Figure 6: The regional geology of the Stillwater Complex (after Montana Bureau of Mines and Geology) ................................. 25 Figure 7: Stratigraphic section of the Stillwater Complex (modified after McCallum, 2002)....................................................... 26 Figure 8: The 7 500W Cross section through the Stillwater Mine (after Behre and Dolbear, 2017) ........................................... 27 Figure 9: The original layering in the Stillwater Complex ........................................................................................................ 29 Figure 10: Typical stratigraphic sequence and Pd-Pt grade profiles of the J-M Reef ................................................................... 31 Figure 11: J-M Reef reconstruction at Stillwater Mine .............................................................................................................. 32 Figure 12: West to east schematic section showing variability in stratigraphy ........................................................................... 34 Figure 13: Major geological and PGM grade trends for Stillwater Mine ...................................................................................... 35 Figure 14: Geological domains of the J-M Reef at Stillwater Mine ............................................................................................. 36 Figure 15: Geological domains of the J-M Reef at East Boulder Mine ........................................................................................ 36 Figure 16: Diamond drilling strategy ....................................................................................................................................... 37 Figure 17: Core logging template utilised by Stillwater ............................................................................................................. 40 Figure 18: Geology sample laboratory processes ..................................................................................................................... 43 Figure 19: Stillwater Mine Mean Deviation plots for repeat data ............................................................................................... 47 Figure 20: East Boulder Mine Mean Deviation plots for repeat data .......................................................................................... 47 Figure 21: Stillwater Mine blank sample data .......................................................................................................................... 48 Figure 22: East Boulder Mine blank sample data ..................................................................................................................... 49 Figure 23: Laboratory Standard MF-14 analysis ....................................................................................................................... 50 Figure 24: Laboratory Standard MF-15 analysis ....................................................................................................................... 50 Figure 25: Mean Deviation results for DDH41276 Pd and Pt ..................................................................................................... 51 Figure 26: Drillhole layout for Stillwater Mine .......................................................................................................................... 55 Figure 27: Drillhole layout for East Boulder Mine ..................................................................................................................... 56 Figure 28: Section across Stillwater Mine looking west and showing the dip of the J-M Reef...................................................... 57 Figure 29: Section across East Boulder Mine looking northwest and showing the dip of the J-M Reef ......................................... 58 Figure 30: Drill section interpretation ...................................................................................................................................... 61 Figure 31: Subareas and drillhole intersections of the Main Zone at Stillwater Mine................................................................... 63 Figure 32: Subareas and drillhole intersections of the Main Zone at East Boulder Mine .............................................................. 64 Figure 33: Scatter plot of composite length vs. Pd + Pt grade for Stillwater Mine ...................................................................... 65 Figure 34: Scatter plot of composite length vs. Pd + Pt grade for East Boulder Mine ................................................................. 66 Figure 35: Example of a Stillwater Mine variogram – DOL Upper variogram .............................................................................. 67 Figure 36: Example of an East Boulder Mine variogram - Frog Pond East variogram ................................................................. 67 Figure 37: Histogram plot of Pd + Pt for Stillwater Mine Composites ........................................................................................ 68 Figure 38: Histogram plot of Pd + Pt for East Boulder Mine Composites ................................................................................... 69 Figure 39: Modelled grades at minimum mining width for Stillwater Mine ................................................................................. 72 Figure 40: Modelled grades at minimum mining width for East Boulder Mine ............................................................................ 72 Figure 41: Mineral Resource classification for Stillwater Mine ................................................................................................... 75 Figure 42: Mineral Resource classification for East Boulder Mine .............................................................................................. 76 Figure 43: Overhand R&F mining method with sand backfill ..................................................................................................... 80 Figure 44: Undercut R&F mining method using paste backfill ................................................................................................... 80 Figure 45: Overhand AlimakTM C&F stoping ............................................................................................................................. 81 Figure 46: Overhand conventional C&F stoping ....................................................................................................................... 81 Figure 47: Sub-level long hole open stoping with subsequent backfilling .................................................................................. 82 Figure 48: Q-ratings for all Stillwater and East Boulder Mines .................................................................................................. 84 Figure 49: Test sites for in situ stress measurements at Stillwater Mine .................................................................................... 85 Figure 50: Test sites for in situ stress measurements at East Boulder Mine ............................................................................... 86 Figure 51: Peak ground acceleration for the state of Montana (USGS) ...................................................................................... 87 Figure 52: Fault age population within the state of Montana (USGS) ........................................................................................ 87 Figure 53: Plan view of ground types for a stope block 5 500E 10300 ...................................................................................... 89 Figure 54: Section view of ground types for a stope block 5 500E 10300 .................................................................................. 89 Figure 55: Primary and secondary development rib support ..................................................................................................... 91 Figure 56: Primary and secondary development back support .................................................................................................. 92 Figure 57: Concept flowsheet for modified paste fill ................................................................................................................ 93 Figure 58: Hydrological drillholes along adits at the Blitz section of Stillwater Mine ................................................................... 95 Figure 59: Reported and measured values of hydraulic conductivity ......................................................................................... 96 Figure 60: Generalised stratigraphic sequence used to guide grade control .............................................................................. 98 Figure 61: Typical minimum width reef mark-up...................................................................................................................... 99 Figure 62: Chip sampling spacing ........................................................................................................................................... 99 Figure 63: Underground mine layouts for Stillwater and East Boulder Mines ........................................................................... 110 Figure 64: LoM RoM ore production schedule for sections of Stillwater Mine ........................................................................... 114 Figure 65: Metal (Pt+ Pd) ounces production schedule for sections of Stillwater Mine ............................................................. 115


Figure 66: LoM Pt + Pd grades for sections of Stillwater Mine ................................................................................................ 115 Figure 67: LoM RoM ore and Pd + Pt ounces production schedule for the mining areas at Stillwater Mine................................ 116 Figure 68: LoM RoM ore production schedule for East Boulder Mine ....................................................................................... 125 Figure 69: Metal (Pt + Pd) ounces production schedule for East Boulder Mine ........................................................................ 125 Figure 70: LoM Pt + Pd grades for East Boulder Mine ............................................................................................................ 126 Figure 71: LoM RoM ore production schedule for mining blocks at East Boulder Mine .............................................................. 126 Figure 72: Laboratory process flow for smelter samples......................................................................................................... 131 Figure 73: Base Metal Refinery laboratory processes ............................................................................................................. 132 Figure 74: Block flow diagram of the Stillwater Concentrator ................................................................................................. 134 Figure 75: Stillwater Concentrator operational data ............................................................................................................... 134 Figure 76: Stillwater Concentrator operational data ............................................................................................................... 135 Figure 77: Hertzler TSF calculated elevation profile ............................................................................................................... 137 Figure 78: East Boulder Concentrator simplified block flow .................................................................................................... 139 Figure 79: East Boulder Concentrator operational data .......................................................................................................... 139 Figure 80: East Boulder Concentrator operational data .......................................................................................................... 140 Figure 81: East Boulder TSF calculated elevation profile ........................................................................................................ 141 Figure 82: A simplified block flow diagram of the smelter ...................................................................................................... 143 Figure 83: Smelter operational data ...................................................................................................................................... 143 Figure 84: Smelter operational data ...................................................................................................................................... 144 Figure 85: A simplified block flow diagram of the BMR ........................................................................................................... 146 Figure 86: BMR operational data .......................................................................................................................................... 146 Figure 87: BMR operational data .......................................................................................................................................... 147 Figure 88: MSHA assessed penalties for Stillwater mining operations (MSHA, 2017) ................................................................ 151 Figure 89: Conceptual plan for the Lewis Gulch TSF .............................................................................................................. 155 Figure 90: Conceptual plan for the Dry Fork Waste Rock Storage Facility ............................................................................... 156 Figure 91: Primary global Palladium and Platinum production 2015-2016 ............................................................................... 161 Figure 92: Primary global Palladium production 2016 (after Johnson Matthey, 2017, The Mineral Corporation Research, 2017) 162 Figure 93: Primary global Platinum production 2016 (after Johnson Matthey, 2017, The Mineral Corporation Research, 2017).. 162 Figure 94: Palladium ETF and price trends (after Johnson Matthey, 2017, The Mineral Corporation Research, 2017) ................ 164 Figure 95: Palladium demand and supply balance (after Johnson Matthey, 2017) ................................................................... 165 Figure 96: Palladium price trend 2004 to 2017 (The Mineral Corporation Research, 2017) ...................................................... 165 Figure 97: Palladium price forecast reference points .............................................................................................................. 166 Figure 98: Platinum ETF and price trends (After Johnson Matthey, 2017, The Mineral Corporation Research, 2017 .................. 168 Figure 99: Platinum demand and supply balance (after Johnson Matthey, 2017)..................................................................... 169 Figure 100: Platinum price trend 2004 to 2017 (The Mineral Corporation Research, 2017) ........................................................ 170 Figure 101: Platinum price forecast reference points ............................................................................................................... 171 Figure 102: Stillwater Mine (including Blitz) and Concentrator capital schedule ......................................................................... 172 Figure 103: East Boulder Mine and Concentrator capital schedule ............................................................................................ 174 Figure 104: Mineral Reserve classification for Stillwater Mine ................................................................................................... 187 Figure 105: Mineral Reserve classification for East Boulder Mine .............................................................................................. 188 Figure 106: Comparison of the historical Mineral Reserve estimates for Stillwater and East Boulder Mines ................................. 191 Figure 107: Recycle Laboratory Processes............................................................................................................................... 193 Figure 108: East Boulder Mine sensitivity analysis ................................................................................................................... 206 Figure 109: Stillwater Mine Scenario A, including Blitz as per the 25-year LoM Plan, sensitivity analysis ..................................... 206 Figure 110: Stillwater Mine Scenario B, with Blitz mining constrained to 10 years, sensitivity analysis ........................................ 207 Figure 111: Stillwater Mine Scenario C, with Blitz mining constrained to 18 years, sensitivity analysis ........................................ 207 Figure 112: EV ($ millions) plotted against ePt oz ................................................................................................................... 211 Figure 113: East Boulder Mine Market Approach results .......................................................................................................... 212 Figure 114: Stillwater Mine Market Approach results ............................................................................................................... 213 Figure 115: Montana PGM Mineral Assets, Market Approach results, on an ePt ounce basis....................................................... 213 Figure 116: Montana PGM Mineral Assets, Market Approach results, on an ePt ounce basis....................................................... 214 Figure 117: Valuation summary .............................................................................................................................................. 216


LIST OF TABLES

Table 1: Competent Persons and Technical appointed internally by Stillwater .......................................................................... 3 Table 2: Site visit details for the Competent Persons, Technical Experts and Competent Valuator ............................................. 4 Table 3: Operating Permit Details for Stillwater and East Boulder Mines ................................................................................ 14 Table 4: Summary of Stillwater Mineral Title and Tenure ...................................................................................................... 17 Table 5: Claims subject to royalties ..................................................................................................................................... 19 Table 6: Historical production for Stillwater and East Boulder Mines ...................................................................................... 22 Table 7: Historical Reserves for Stillwater and East Boulder Mines ......................................................................................... 23 Table 8: Historical surface and adit exploration drillholes (after Behre and Dolbear, 2017) ..................................................... 38 Table 9: Expected values for the standards .......................................................................................................................... 49 Table 10: Tonnage and grade reconciliation statistics for Stillwater and East Boulder Mines ..................................................... 52 Table 11: Standardised variogram parameters ....................................................................................................................... 67 Table 12: Search parameters employed for grade estimation .................................................................................................. 70 Table 13: Comparison of modelled and composite grades ....................................................................................................... 71 Table 14: Mineral Resource Statement for Stillwater and East Boulder Mines as at 31 July 2017............................................... 77 Table 15: Mining method frequency of use at Stillwater and East Boulder Mines ...................................................................... 79 Table 16: Operating and planned depths below surface .......................................................................................................... 83 Table 17: Rock types constituting the footwall, reef and hangingwall ...................................................................................... 83 Table 18: Typical rock strengths for the footwall, J-M Reef and hangingwall ............................................................................ 84 Table 19: ISRM grading for the footwall, J-M Reef and hangingwall ........................................................................................ 84 Table 20: Q rating classification and distribution .................................................................................................................... 85 Table 21: Horizontal to vertical stress ratios and stress orientations for Stillwater Mine ............................................................ 86 Table 22: Stress magnitudes and orientations, East Boulder Mine ........................................................................................... 86 Table 23: Regional and local/stope extraction ratios ............................................................................................................... 88 Table 24: Ground support classes for stopes and footwall....................................................................................................... 90 Table 25: Ground support classes for stopes and back areas .................................................................................................. 90 Table 26: Design specifications for cemented paste and sandfill.............................................................................................. 93 Table 29: Planning parameters for development .................................................................................................................. 101 Table 30: Planning parameters for primary development ...................................................................................................... 101 Table 31: Planning parameters for secondary development .................................................................................................. 102 Table 32: East Boulder Mine Mining Factors ......................................................................................................................... 103 Table 33: Planning parameters for stoping ........................................................................................................................... 103 Table 34: Planning parameters for development .................................................................................................................. 103 Table 35: Planning parameters for primary development ...................................................................................................... 104 Table 36: Planning parameters for secondary development .................................................................................................. 104 Table 37: Stillwater’s planning cycle .................................................................................................................................... 106 Table 38: Production statistics ............................................................................................................................................. 111 Table 39: Current mechanised mining equipment ................................................................................................................. 112 Table 40: Blitz section development equipment deployment schedule ................................................................................... 113 Table 41: Blitz section production equipment deployment schedule ...................................................................................... 113 Table 42: Blitz section 2017 equipment procurement schedule ............................................................................................. 114 Table 43: Ventilation districts and identities of intake fans and exhaust portals ..................................................................... 118 Table 44: Total number of dewatering pumps and power required ........................................................................................ 119 Table 45: Production Statistics ............................................................................................................................................ 124 Table 46: Mechanised mining equipment ............................................................................................................................. 124 Table 47: Service water capacity underground East Boulder Mine ......................................................................................... 128 Table 48: Summary of 2E prill split data .............................................................................................................................. 147 Table 49: Safety performance ............................................................................................................................................. 150 Table 50: Stillwater manpower figures ................................................................................................................................. 152 Table 51: Summary of existing environmental studies .......................................................................................................... 158 Table 52: Palladium price forecast reference points .............................................................................................................. 166 Table 53: Platinum price forecast reference points ............................................................................................................... 170 Table 54: Blitz section 2018-2021 capital provision summary for mechanised units ................................................................ 173 Table 55: BMR capital expenditure schedule for the 2018 to 2026 period .............................................................................. 174 Table 56: Mining costs for Stillwater and East Boulder Mines ................................................................................................ 175 Table 57: Stillwater Mine Surface Costs ............................................................................................................................... 176 Table 58: East Boulder Mine Surface Costs .......................................................................................................................... 176 Table 59: Stillwater environmental management costs ......................................................................................................... 177 Table 60: Stillwater Mine and Hertzler TSF environmental management costs ....................................................................... 177 Table 61: East Boulder Mine environmental management costs ............................................................................................ 177 Table 62: Columbus Metallurgical Complex environmental management costs ....................................................................... 178 Table 63: Stillwater and East Boulder Mines reclamation costs .............................................................................................. 179 Table 64: Reserves reconciliation ........................................................................................................................................ 184 Table 65: Mineral Resource and Mineral Reserve Statement as at 31 July 2017 ..................................................................... 189 Table 66: December 2016 Reserve Statement for Stillwater and East Boulder Mines .............................................................. 190 Table 67: Summary of 2E prill split data .............................................................................................................................. 193


Table 68: Metal price and inflation forecast .......................................................................................................................... 199 Table 69: East Boulder Mine cost profile .............................................................................................................................. 199 Table 70: Stillwater Mine cost profile ................................................................................................................................... 199 Table 71: Abridged cash flow for 25-year LoM Plan for East Boulder Mine ............................................................................. 201 Table 72: Scenario A Abridged cash flow for 25-year LoM Plan for Stillwater Mine ................................................................. 202 Table 73: Scenario B: Abridged cash flow for Stillwater Mine with Blitz section constrained to a 10-year LoM Plan .................. 203 Table 74: Abridged Cash Flow for Stillwater Mine with 18 years of Blitz Section contribution .................................................. 204 Table 75: Income Approach results ..................................................................................................................................... 205 Table 76: Metal price forecast ............................................................................................................................................. 207 Table 77: Combined Mineral Asset NPV5% sensitivity to palladium and platinum price variation ............................................... 208 Table 78: PGM producing companies, and their contained Mineral Resources and inclusive Mineral Reserves .......................... 208 Table 79: Listed PGM producing companies, and their contained Pt, Pd, Rh and Au grades for Mineral Resources and inclusive

of Mineral Reserves ............................................................................................................................................. 208 Table 80: Six month trailing average metal prices ................................................................................................................ 209 Table 81: Metallurgical recovery factors ............................................................................................................................... 209 Table 82: Montana Mineral Assets expressed in terms of ePt content .................................................................................... 209 Table 83: V $ per ePt ounce in the total Mineral Resource and in the Mineral Reserve ........................................................... 209 Table 84: EV $ per ePt ounce for Mineral Reserves and for Mineral Resources including only 50% of Inferred Mineral Resource210 Table 85: Mean EV/ePt ounce and the 90% confidence limits about the mean for each category of Mineral Resources and

Mineral Reserves ................................................................................................................................................. 211 Table 86: East Boulder Mine Market Approach results on an ePt ounce basis ......................................................................... 212 Table 87: Stillwater Mine Market Approach results on an ePt ounce basis .............................................................................. 212 Table 88: Montana Mineral Assets Market Approach results, on an ePt ounce basis ............................................................... 213 Table 89: Consolidated Market Approach results .................................................................................................................. 214 Table 90: East Boulder Mine, Inferred Mineral Resources beyond the 25-year LoM Plan footprint ........................................... 215 Table 91: Market Approach Results applied to East Boulder Mine's Inferred Mineral Resource ................................................ 215 Table 92: Consolidated Income Approach results and identified preferred values ................................................................... 215 Table 93: Consolidated Market Approach Results ................................................................................................................. 216 Table 94: Valuation summary (31 July 2017) ....................................................................................................................... 216

LIST OF APPENDICES Appendix 1: Competent Person’s and Competent Valuator’s Certificates and Qualifications ..................................................... 222 Appendix 2: Qualifications of Technical Experts ..................................................................................................................... 236 Appendix 3: Glossary of Terms ............................................................................................................................................. 241 Appendix 4: List of Abbreviations and Symbols ..................................................................................................................... 243 Appendix 5: List of Chemical Symbols ................................................................................................................................... 247 Appendix 6: List of Units ...................................................................................................................................................... 248 Appendix 7: Stillwater Mine Current Permit Summary and Status ........................................................................................... 249 Appendix 8: East Boulder Mine Current Permit Summary and Status ...................................................................................... 256 Appendix 9: Smelter Current Permit Summary and Status ..................................................................................................... 262 Appendix 10: Current Water Rights Summary and Status ........................................................................................................ 262 Appendix 11: SAMREC Code Table 1 References ..................................................................................................................... 265 Appendix 12: SAMVAL Code Table 1 References ..................................................................................................................... 275 Appendix 13: JSE Section 12 References ................................................................................................................................ 279 Appendix 14: SAMESG Code References ................................................................................................................................. 281

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1 INTRODUCTION

1.1 Background and Purpose of Report SV1.2;SV1.3; JSE12.9(e);JSE12.9(h)(i);JSE12.9(h)(iii)

Sibanye Gold Limited (SGL) is an independent mining group domiciled in South Africa, and listed on both the Johannesburg Stock Exchange (JSE or JSE Limited) and New York Stock Exchange (NYSE). On 4 May 2017, SGL announced on the JSE Stock Exchange News Service (SENS) the conclusion of the acquisition of Stillwater Mining Company (Stillwater) (the Transaction). Following the SENS announcement, SGL commissioned Mineral Corporation Consultancy (Pty) Limited (The Mineral Corporation) to compile an independent Competent Person’s Report (CPR), incorporating a Competent Valuator’s Report (CVR), for Stillwater’s mining and ore beneficiation operations and mining claims in Montana (the Montana Assets), United States of America (USA), for submission to the JSE. Accordingly, the CPR and CVR were required by SGL to comply with the requirements of the 2016 edition of the South African Code for the Reporting of Exploration Results, Mineral Resources and Mineral Reserves (the SAMREC Code), the 2016 edition of the South African Code for the Reporting of Mineral Asset Valuation (the SAMVAL Code) and Section 12 of the JSE’s Listing Requirements. This CPR relates to the Montana Assets, which are platinum group metal (PGM) mining and ore beneficiation assets wholly owned by SGL. These assets include Stillwater Mine (including the Blitz section), East Boulder Mine, integrated concentrator plants at Stillwater and East Boulder Mines and the surrounding PGM mining claims located near Nye as well as a metallurgical complex situated in Columbus (Figure 1). The Columbus Metallurgical Complex consists of a smelter, base metal refinery (BMR), PGM recycling plant and an analytical laboratory. Subsequent to the Transaction, the Montana Assets have become part of the United States Region Assets in the SGL Group Structure (illustrated in Figure 2). This CPR excludes the remainder of SGL Mineral Assets shown in Figure 2.

Figure 1: The location of Stillwater’s Montana Assets

2


Figure 2: Montana Assets in the SGL Group Structure

1.2 Scope of Work The scope of work required The Mineral Corporation to compile and sign-off a CPR prepared in accordance with the SAMREC Code, the SAMVAL Code and Section 12 of the JSE’s Listing Requirements. In order to accomplish this, The Mineral Corporation was required to complete an independent review of the procedures employed for PGM Mineral Resource and Mineral Reserve estimation and to express an opinion as to the validity of those estimates and the reporting thereof, with respect to and in compliance with the SAMREC Code. This necessitated, inter alia, the review of the following: Data acquisition process; Integrity of the geological database; Three-dimensional geological and structural modelling; Mineral Resource estimation, classification and reporting; Mineral Resource to Reserve Modifying Factors; Mine planning process;

Techno-economic studies that support the Life of Mine (LoM) Plans from which the PGM Mineral Reserves are derived.

Furthermore, The Mineral Corporation applied income, cost and market approaches, as appropriate, to arrive at a valuation of the mineral assets.

1.3 Sources of Information SRC3.1(iii); SV1.19

Most of the technical information relating to the Montana Assets resides with Stillwater and SGL. Unless otherwise stated (Section 12), all the information referred to in this report has been provided by Stillwater and SGL.

1.4 Capability and Independence SRC9.1(i); SRC9.1(ii);SV1.0;JSE12.9(c)

This report has been prepared by The Mineral Corporation, which is an independent technical advisory and consulting firm providing Mineral Resource evaluation, mining engineering, mine planning, metallurgical and mine/project valuation services to the mining industry and is based in Johannesburg, South Africa. The Mineral Corporation has extensive experience in the preparation of CPRs, due diligence studies, fatal flaw analyses, independent technical reviews and the evaluation of PGM and base metal mining and ore processing operations. The technical personnel of The Mineral Corporation are registered with various organisations including the Southern African Institute of Mining and Metallurgy (SAIMM), the Engineering Council of South Africa (ECSA), the Geological Society of South Africa (GSSA) and the South African Council for Natural Scientific Professions (SACNASP). The Mineral Corporation has received, and will receive, professional fees for its preparation of this report. Neither The Mineral Corporation nor any of its Directors, staff and sub-consultants who contributed to this report has any material interest in SGL or in the Montana Assets reviewed.

3


The Mineral Corporation places reliance on the Executives of Stillwater and SGL that all technical information

supplied to The Mineral Corporation is valid. Although this data has been verified to the extent possible, The Mineral Corporation does not accept any responsibility for information used in the Competent Person’s Report which, unknown to The Mineral Corporation, was factually incorrect or inaccurate, and for any actions that may arise as a consequence thereof. The Mineral Corporation also places reliance on Stillwater and SGL that information relating to the legal aspects of Stillwater and SGL and the status of corporate transactions and prospecting, mining and surface rights are accurate at the time of compilation of this CPR. While The Mineral Corporation has reviewed documents relating to Mineral Title for each of the reviewed mineral assets, The Mineral Corporation is not a legal firm and offers no opinion regarding the underlying legal validity of the documents reviewed. The Mineral Corporation has not carried out any independent environmental investigations. Existing Environmental Impact Statements (EISs), Environmental Management Plans (EMPs) and Permits were supplied by Stillwater and have been reviewed by The Mineral Corporation. The Lead Competent Person with responsibility for reporting Mineral Resources and the compilation of this CPR is Coniace Madamombe (MSc, BSc Hons, Pr Sci Nat, MGSSA, MBA). Coniace is a Professional Geologist with 14 years experience in the mining industry. He has previously generated technical reports and Mineral Resource statements in accordance with the SAMREC Code. The Lead Competent Person with responsibility for reporting Mineral Reserves is Jonathan Buckley (MSc, BSc Hons, Pr Eng, FSAIMM). Jonathan has 30 years of operational, technical and executive experience in the southern African Mining industry. He has previously generated technical reports and Mineral Reserve statements in accordance with the SAMREC Code. John Murphy (BSc Hons, Pr Sci Nat, FGSSA, MBA) is the Competent Valuator as defined by the SAMVAL Code, by way of qualifications and relevant experience spanning some 26 years in the base metal, precious metal and energy minerals business. The curricula vitae of Coniace Madamombe, Jonathan Buckley, John Murphy and other members of The Mineral Corporation technical team who have contributed to this report are listed in Section 13 of this report. Drafts of this report were provided to SGL and Stillwater for the purpose of confirming both the accuracy of factual material and the reasonableness of assumptions applied.

1.5 Reliance on Other Experts and Third Parties SRC9.1(i); SRC9.1(ii); SRC3.1(iii); JSE12.9(c)

A list of the Competent Persons and Technical Experts appointed internally by Stillwater and their areas of responsibility are summarised in Table 1. The technical work reported by these Competent Persons forms the basis of the estimates, opinions and conclusions contained in this report, and for which The Mineral Corporation has undertaken a review of this work (as defined by the SAMREC Code). Table 1: Competent Persons and Technical appointed internally by Stillwater

Name Position Area of Responsibility Academic and Professional Qualifications

Brent LaMoure Director of Planning for

Montana Operations

Competent Person

Mineral Reserves

Bachelor of Science - Mining Engineering Mining and Metallurgical Society of America -

Qualified Professional Member (Mining and Ore Reserves- 01363QP)

Michael Koski Chief Geologist Competent Person

Mineral Resources - Overall

Bachelor of Arts - Geology

American Institute of Professional Geologists - Certified Professional Geologist (CPG – 11321)

James Dahy Senior Resource Geologist Competent Person Mineral Resource Estimation -

Stillwater Mine

Bachelor of Arts - Geology, Master of Science - Geology

American Institute of Professional Geologists - Certified Professional Geologist (CPG – 10991)

Jennifer Evans Senior Resource Geologist Competent Person Mineral Resource Estimation - East Boulder Mine

Bachelor of Science - Geology American Institute of Professional Geologists - Certified Professional Geologist (CPG – 11669)

Paul Holick Senior Development

Geologist Technical Expert - Exploration

Master of Science - Geology American Institute of Professional Geologists -

Certified Professional Geologist (CPG – 11776)

Dee Bray Manager of Operations Technical Expert - Mining Bachelor of Science - Mining Engineering

4


Name Position Area of Responsibility Academic and Professional Qualifications

Greg Roset Vice President - Smelting & Recycling Operations

Technical Expert - Smelting Master of Science - Metallurgical Engineering

Dave Shuck Vice President - Refinery & Laboratory

Technical Expert - Refinery Bachelor of Science - Metallurgical Engineering

Randy Weimer Corporate Environmental

Manager

Technical Expert - Environmental and

Governmental Affairs

Bachelor of Science - Environmental Engineering

Jeff Sargent Corporate Concentrator

Manager Technical Expert - Concentrator High School Diploma, Industry Experience

Kris Koss Vice President Human

Resources and Safety

Technical Expert - Human

Resources High School Diploma, Industry Experience

Matt Knight Human Resources Manager Technical Expert - Human

Resources

Bachelor of Science - Geologic Engineering,

Master of Science - Economic Geology

Robert Larson Chief Surveyor Technical Expert - Survey Associates Degree in Arts, Industry Experience

Justus Deen Manager of Strategic

Projects Technical Expert - Ventilation

Bachelor of Science - Geology, Master of Science –

Mining Engineering

Mark Ferster Geotechnical Engineer Technical Expert - Rock Mechanics

Bachelor of Science - Geologic Engineering

John Marjerison Chief Engineer Technical Expert - Mine Engineering

Bachelor of Science - Mining Engineering

Bracken Spencer

Infrastructure Engineering Technical Expert - Mine Infrastructure

Bachelor of Science - Mining Engineering and Master of Projects Engineering and Management

Ashlee Voller Financial Planning Analyst Technical Expert - Cost Modelling

Bachelor of Business Administration, Master of Business Administration

The Mineral Corporation has also reviewed an independent technical report compiled by Behre Dolbear in February 2017 accompanying the 31 December 2016 Annual Report for Stillwater.

1.6 Site inspection by Competent Persons and Competent Valuator SRC1.1(iii); SRC4.5(viii);SV1.0

Confirmatory site visits were undertaken to the operating mines, concentrators and Columbus Metallurgical Complex during which the various Stillwater technical staff members were interviewed and additional information requested. Table 2 lists the site visits undertaken by The Mineral Corporation’s Lead Competent

Persons, Competent Valuator and Technical Specialists/Experts. Table 2: Site visit details for the Competent Persons, Technical Experts and Competent Valuator

Name Discipline Responsibility Dates Site Visit Description

Coniace

Madamombe

Geology and Mineral

Resources

Lead Competent Person -

Mineral Resources

17/06/2017 -

24/06/2017

Stillwater (including Blitz) and East Boulder

Mines

Jonathan Buckley

Mining Lead Competent Person - Mineral Reserves

17/06/2017 - 24/06/2017

Stillwater (including Blitz) and East Boulder Mines

Edward Legg Mining and Surface Infrastructure and

Logistics

Technical Expert - Mining and Surface Infrastructure and

Logistics

10/07/2017 - 14/07/2017

Stillwater (including Blitz) and East Boulder Mines, Stillwater and East Boulder

Concentrators and Metallurgical Complex

Russell Heins Process Engineering Technical Expert -

PGM ore processing

10/07/2017 -

14/07/2017

Stillwater and East Boulder Concentrators

and Metallurgical Complex

Trevor Rangasamy

Geotechnical and Rock Engineering

Technical Expert - Geotechnical and Rock Engineering

10/07/2017 - 14/07/2017

Stillwater (including Blitz) and East Boulder Mines

Tobby Wright Environmental Management and

Compliance

Technical Expert - Environmental, Permitting

and Social

11/07/2017 - 14/07/2017

Stillwater (including Blitz) and East Boulder Mines, Stillwater and East Boulder

Concentrators and Metallurgical Complex

John Murphy Valuation Competent Valuator -

Mineral Asset Valuation

17/06/2017 -

24/06/2017

Stillwater (including Blitz) and East Boulder

Mines

1.7 Materiality The Mineral Corporation’s technical review has been directed towards the identification of errors, omissions or oversights in the technical work undertaken, that could have a material effect on estimates, proposed mine plans, production profiles, costs or valuations. The SAMREC Code advises that, as a rule of thumb, an issue should be considered material if it results in an economic outcome different to that currently envisaged by 10% or more.

5


1.8 Units and Currencies SRC5.6(iii); SRC5.6(iv); SRC5.6(vi)

United States of America (USA or US) imperial units are utilised for all measurements and reporting of quantities at the Montana Assets. Accordingly, mainly USA imperial units are utilised throughout this CPR, with the equivalent metric unit provided on a supplementary basis, where relevant. A glossary of definitions and abbreviations is tabulated in Appendix 3 and Appendix 4. Monetary values in this CPR are stated in US Dollars (US$ or $), unless otherwise stated. No exchange rates have been used as the metal prices, costing and valuations are quoted in US$. However, the South African Rand (ZAR) to US$ exchange rate has been used for Mineral Asset Valuation based on the Market Approach. The prevailing exchange rates at the announcement of the financial results for the companies considered for the Market Approach valuation have been utilised.

1.9 Reporting Code Compliance SV1.4; SV1.10; JSE12.9(e)

1.9.1 Overview This CPR complies with the requirements of the SAMREC Code (2016) (including Table 1), the SAMVAL Code (2016) (including Table 1: Mineral Asset Valuation: Reporting and Assessment Criteria per Appendix A of the SAMVAL Code), the South African Guideline for the Reporting of Environmental, Social and Governance Parameters within the Solid Minerals and Oil and Gas Industries (the SAMESG Guideline (2017)) and Section 12 of the JSE’s Listing Requirements, as indicated by the blue text beneath the headings in this CPR (i.e. SRC, SV,

ESG, JSE12).

1.9.2 Mineral Resources and Mineral Reserves SRC4.4(i); SRC4.5; SRC6.2; SRC6.3; JSE12.9(e)

The SAMREC Code (2016) provides definitions of Mineral Resources and Mineral Reserves as well as Mineral Resource and Mineral Reserve Classifications. The methodologies for the estimation, classification and reporting of Mineral Resources and Mineral Reserves employed for preparing reports on Mineral Resources and Mineral Reserves in this CPR are based on criteria developed from historical experience at the mining operations of the Montana Assets, guided by the SAMREC Code (2016) definitions and guidelines.

The SAMREC Code (2016) provides the following definitions for Mineral Resource and Mineral Reserve utilised in this CPR:

Mineral Resource: A Mineral Resource is a concentration or occurrence of solid material of economic interest in or on the Earth’s crust in such form, grade or quality and quantity that there are reasonable prospects for eventual economic extraction. The location, quantity, grade, continuity and other geological characteristics of a Mineral Resource are known, estimated or interpreted from specific geological evidence and knowledge, including sampling.

Mineral Reserve: A Mineral Reserve is the economically mineable part of a Measured and/or Indicated Mineral Resource. It includes diluting materials and allowances for losses, which may occur when the material is mined or extracted and is defined by studies at Pre-Feasibility or Feasibility level as appropriate that include application of Modifying Factors. Such studies demonstrate that, at the time of reporting, extraction could reasonably be justified. The reference point at which Mineral Reserves are defined, usually the point where the ore is delivered to the processing plant, must be stated. It is important that, in all situations where the reference point is different, such as for a saleable product, a clarifying statement is included to ensure that the reader is fully informed as to what is being reported.

Extensive exploration resulted in the delineation of the Johns-Manville (J-M) Reef outcrop over a 28-mile (45km) strike length. However, Mineral Resources and Mineral Reserves have been reported for areas that are sufficiently drilled and for which the J-M Reef characteristics have been determined from detailed logging, sampling and chemical analyses. Mineral Reserves are determined from detailed Life of Mine (LoM) Plans derived from the conversion of Indicated and Measured Mineral Resources and achieved through the application of Modifying Factors based on historical experience at the current operations.

The SAMREC Code (2016) provides the following classifications and definitions for Mineral Resources and Mineral Reserves categories utilised in this CPR:

Inferred Mineral Resource: An Inferred Mineral Resource is that part of a Mineral Resource for which quantity and grade or quality are estimated on the basis of limited geological evidence and sampling. Geological evidence is sufficient to imply but not verify geological and grade or quality continuity. An Inferred Resource has a lower level of confidence than that applying to an Indicated Mineral Resource and must not be converted to a Mineral Reserve. It is reasonably expected that the majority of Inferred

Mineral Resources could be upgraded to Indicated Mineral Resources with continued exploration.

6


Indicated Mineral Resource: An Indicated Mineral Resource is that part of a Mineral Resource for which

quantity, grade or quality, densities, shape and physical characteristics are estimated with sufficient confidence to allow the application of Modifying Factors in sufficient detail to support mine planning and evaluation of the economic viability of the deposit. Geological evidence is derived from adequately detailed and reliable exploration, sampling and testing and is sufficient to assume geological and grade or quality continuity between points of observation.

Measured Mineral Resource: A Measured Mineral Resource is that part of a Mineral Resource for which

quantity, grade or quality, densities, shape, and physical characteristics are estimated with confidence sufficient to allow the application of Modifying Factors to support detailed mine planning and final evaluation of the economic viability of the deposit. Geological evidence is derived from detailed and reliable exploration, sampling and testing and is sufficient to confirm geological and grade or quality continuity between points of observation. A Measured Mineral Resource has a higher level of confidence than that applying to either an Indicated Mineral Resource or an Inferred Mineral Resource. It may be converted to a Proved Mineral Reserve or to a Probable Mineral Reserve.

Probable Mineral Reserve: A Probable Mineral Reserve is the economically mineable part of an Indicated,

and in some circumstances, a Measured Mineral Resource. The confidence in the Modifying Factors applying to a Probable Mineral Reserve is lower than that applying to a Proved Mineral Reserve.

Proved Mineral Reserve: A Proved Mineral Reserve is the economically mineable part of a Measured

Mineral Resource. A Proved Mineral Reserve implies a high degree of confidence in the Modifying Factors. Geoscientific knowledge and confidence in the physical and chemical attributes of the J-M Reef are primarily based on the interpretation of extensive drillhole and historical mining information mostly accumulated after the 1980s. The geoscientific knowledge and confidence increase in well drilled areas and towards areas for which the J-M Reef has been exposed through mining, and diminish in sparsely drilled areas and away from mining operations. A classification scheme (primarily based on drillhole spacing and distance from mining infrastructure/operations but including other factors) has been used to classify Mineral Resources into the various categories.

Probable and Proved Mineral Reserves are derived from the application of Modifying Factors to Indicated and Measured Mineral Resources, respectively.

1.9.3 Mineral Asset Valuation The SAMVAL Code recognises three approaches to mineral asset valuation, two of which must be applied during any given valuation exercise. These have been utilised as appropriate to the mineral assets in the valuation section of this CPR. The valuations presented herein are mineral asset valuations and, therefore, do not constitute a company valuation of the Montana Assets. The SAMVAL Code describes the valuation approaches as follows: Income Approach: The Income Approach relies on the ‘value-in-use’ principle and requires determination

of the present value of future cash flows over the useful life of the Mineral Asset. It provides an indication of value by converting future cash flows to a single current capital value. For the estimation of Market Value, the present value capitalisation shall be generated using a discount rate derived from market conditions. The Income Approach is most often applied to properties in development or production.

Market Approach: The Market Approach relies on the ‘willing buyer, willing seller’ principle and requires

that the monetary value obtainable from the sale of the mineral asset is determined as if in an arm’s-length transaction. The application of certain logic in Mineral Asset Valuation, such as ‘gross in situ value’ simply determined from the product of the estimate of mineral content and commodity price(s), is considered unacceptable and inappropriate. Provides an indication of value by comparing the subject property with identical or similar properties for which the price information is available. The Market Approach is also known as the sale comparison approach. The Market Approach is widely adopted for exploration projects or dormant properties, but can also be applied to properties in production.

Cost Approach: The Cost Approach relies on historical and/or future amounts spent on the mineral asset,

and is a valuation approach based on the economic principle that a buyer will pay no more for an asset than the cost to obtain an asset of equal utility, whether by purchase or by construction and includes methods based on expenditures. The Cost Approach is considered appropriate for the valuation of projects in the exploration category.

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2 PROJECT OUTLINE

2.1 Property Description and Location SRC1.1;SRC1.2; JSE12.9(h)(ii)

2.1.1 SGL Group Overview SGL is an independent mining group domiciled in South Africa, which owns and operates a portfolio of gold operations and projects in South Africa, PGM operations in South Africa, Zimbabwe and the USA, and PGM exploitation project in Canada and a base metal project in Argentina. SGL is listed on both the JSE and NYSE. The Transaction, the conclusion of which was announced by SGL on 4 May 2017 via SENS, resulted in the ownership of Stillwater by SGL. The Stillwater assets under consideration in the CPR and CVR are Montana Assets, which include mining and ore beneficiation operations and mining claims in Montana. The remainder of SGL operations and exploration projects are excluded from the CPR and CVR.

2.1.2 Montana Assets The Montana Assets comprise PGM mining and ore beneficiation assets located in Montana. These assets include Stillwater Mine (consisting of the current Stillwater mining operations and the Blitz section brownfield expansion), East Boulder Mine, integrated Stillwater and East Boulder concentrator plants and the surrounding PGM mining claims located near Nye as well as a metallurgical complex situated in Columbus (Figure 1). The Montana Assets are part of the Unites States Region Assets in the SGL Group Structure (Figure 2). Stillwater and East Boulder Mines are underground mines exploiting the J-M Reef and are situated approximately 13 miles (21km) apart. Stillwater Mine has been in production since 1986 and was the epicentre for future PGM mining and ore processing operations at the time. Production at East Boulder Mine started in 2002 and the mining operations have continued uninterrupted until 2008. Production was halted in 2008 for a month due to a drop in PGM prices in 2008, but resumed following organisational restructuring in 2008 and continued uninterrupted to date. Stillwater and East Boulder Mines have steady state Run of Mine (RoM) ore monthly production levels of approximately 60 000 ton (55 000t) and 55 000 ton (50 000t), respectively. Ore production is set to increase to 104 000 ton (95 000t) per month at Stillwater Mine when the Blitz section reaches steady state production levels. The RoM ore from the mines is processed at the surface concentrator plants adjacent to the Stillwater and East Boulder Mine shafts. The Stillwater Concentrator can process approximately 1 million ton (0.9Mt) of RoM ore while the East Boulder Concentrator can process up to 850kton (771kt) per year. The metallurgical complex in Columbus consists of a PGM recycling facility, smelter, base metal refinery and an analytical laboratory. The smelter processes PGM concentrate from the Stillwater and East Boulder Concentrators and PGM bearing catalytic converter material from the recycling facility to produce matte. The matte is processed at the base metal refinery whose nameplate production (feed) capacity is approximately 4 300 ton (3 900t) per annum. PGM-bearing catalytic converter material is either purchased from or toll processed on behalf of third parties.

2.1.3 CPR Scope SRC1.1(i)

This CPR contains Mineral Resource and Mineral Reserve estimates for Stillwater and East Boulder Mines, which are ongoing, mature mines exploiting the J-M Reef. Ore produced by the mines is processed at integrated concentrator plants situated at the mines, with concentrate from these ore processing facilities beneficiated further at the smelter and base metal refinery. There are areas between the mines for which the J-M Reef outcrop has been mapped and the reef has been intersected by limited historical drilling. However, Mineral Resource estimates are only reported for the Stillwater and East Boulder Mines. These Mineral Resource estimates underpin the Mineral Reserve estimates reported for the mines. The Mineral Reserve estimates are based on detailed LoM Plans constructed internally by Stillwater personnel utilising Modifying Factors and capital and operating costs informed by historical experience at the mines. The current Mineral Resource and Mineral Reserve estimates have been independently reviewed and validated by The Mineral Corporation.

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2.2 Access, Proximity to Population Centres and Regional Infrastructure SRC1.1(ii); SRC1.2(i)

The Montana Assets are situated in three geographic clusters, namely Stillwater Mine, East Boulder Mine and Columbus Metallurgical Complex. Stillwater Mine is located near Nye in Stillwater County while the East Boulder Mine is located south of Big Timber in Sweet Grass County. Both counties are located in Montana. The Boe Ranch, which is owned by Stillwater, is located northwest of the East Boulder Mine while the Hertzler Tailings Storage Facility (TSF) is located approximately 5 miles (8km) north-northeast of the Stillwater Mine (Figure 1). Stillwater Mine is located approximately 30 miles (48km) southwest of Absarokee and 4 miles (6km) south-southwest of Nye, which have human populations of approximately 1 150 (Suburban Stats, 2017b) and 270, respectively. The mine is accessed from Absarokee by the mainly unpaved County Road 420, which passes the Hertzler Ranch TSF, or via the paved State Highway 78 and State Highway 419 and Nye Road. East Boulder Mine is located approximately 25 miles (40km) south of Big Timber, which has a human population of approximately 1 641 (Suburban Stats, 2017a). The mine is accessed from Big Timber via the paved State Highway 298 and the unpaved East Boulder Road maintained by Stillwater. The metallurgical complex is located in Columbus, which has a human population of 1 893 (Suburban Stats, 2017b) and is located approximately 42 miles (68km) west of the town of Billings. Billings is located adjacent the US Interstate Highway 90. Electrical power to both Stillwater and East Boulder Mines is provided via the local electrical grid. East Boulder Mine has one 69kV power line owned by Park Electric. Park Electric is a local power co-operative that relays power from the Northwestern Energy grid. Stillwater Mine has one 50kV power line owned by Northwestern Energy, who was in the process of adding a second 100kV powerline during The Mineral Corporation’s site visit. The second powerline will ensure sufficient energy for increased production arising from the Blitz section expansion.

2.3 Topography SRC1.1(ii)

2.3.1 Stillwater Mine, Hertzler Tailing Storage Facility Stillwater Mine is located in a steep-sided mountainous valley (Figure 3) where elevations exceed 5 000ft above mean sea level (ftamsl) (1 524mamsl). The valley drainage hosts the Stillwater River, which originates in a valley of the Beartooth Mountains within the Custer Gallatin National Forest between Miller Mountain and Wolverine Peak, approximately 25 miles (42km) to the south of the Stillwater Mine. The Stillwater River generally flows from south to north and to the northeast after leaving the mountains near the town of Nye, approximately 3.5 miles (5.6km) downstream of the Stillwater Mine. It is a tributary to the Yellowstone River, which it joins approximately 35 miles (56.3km) downstream of the Stillwater Mine. The Hertzler TSF is located approximately 5 miles (8km) north-northeast of the Stillwater Mine on a relatively flat bluff formed by an old glacial moraine deposit west of the Stillwater River. The Hertzler TSF sits approximately 170ft (52m) above the Stillwater River at an elevation of approximately 4 900ftamsl (1 494mamsl).

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Figure 3: Topography in the vicinity of Stillwater Mine

2.3.2 East Boulder Mine East Boulder Mine is located in a steep-sided mountainous valley (Figure 4) where the elevation exceeds 6 200ft (1 890mamsl). The valley drainage hosts the East Boulder River, which originates in a valley of the

Beartooth Mountains within the Custer Gallatin National Forest between Chrome Mountain and Iron Mountain, approximately 8.5 miles (13.5km) to the south of the East Boulder Mine. The East Boulder River generally flows from south to north, but East Boulder Mine is located in the upper third of a roughly 3-mile (4.8km) reach where the river flows west-northwest around Long Mountain before resuming its northward flow to join the Boulder River approximately 8 miles (12.9km) downstream of the East Boulder Mine.

Figure 4: Topography in the vicinity of East Boulder Mine

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2.3.3 Stillwater and East Boulder Mines Topo-cadastral Map SRC1.2(iii)

Surface topography for Stillwater’s mining operations is surveyed using a Leica GPS either mounted on a drone or via ground based surveys. The coordinate system employed for the surveys is based on the North American Datum of 1983 (NAD83) State Plane. There are adequate survey controls employed for the topographic survey at Stillwater and East Boulder Mines. Details of the surveys are discussed in Section 5.7 and a topo-cadastral map of the Stillwater mining claims on the Stillwater Complex is shown in Figure 5.

2.4 Climate SRC1.1(ii)

Stillwater and East Boulder Mines are situated in a region where summer temperatures range from average highs of around 76°F (24°C) to 82°F (29°C) to winter average lows of approximately 12°F (-11°C) to 20°F (-6°C). Extreme highs can reach 91°F (33°C) and extreme lows can reach -15oF (-26°C). East Boulder Mine tends to experience cooler overall temperatures due to its higher elevation. Monthly average precipitation ranges from highs of 3 inches to 4 inches (75mm to 100mm) in May to lows of 1 inch to 1.4 inches (25mm to 35mm) in late summer (July and August). Rainfall typically increases from March to May, decreases to lows around June through September, with a short period of increased precipitation occurring around October due to autumn storms. Freezing temperatures in winter and snow can pose adverse operating conditions, although mine site personnel have indicated that avalanches from the steep mountain slopes have never directly affected operations. However, snow can impact on mine site access, especially to the Benbow Decline at Stillwater Mine. This decline is roughly at a similar elevation as East Boulder Mine, which is 1 500ft higher than the elevation for the remainder of Stillwater Mine, and is accessed via a steep dirt road. Snow removal and road maintenance by Stillwater have effectively been used to maintain mine access even in winter storms. However the combination of storm conditions and temporary loss of grid power and the need to move a number of personnel from the mine, could potentially pose challenges. Winter winds can move winter ice on the TSF pond surfaces and cause water storage pond and TSF liner damage, but these operational impacts from climate have been successfully mitigated through routine inspections and facilities maintenance. The Mineral Corporation notes that, although the mine sites experience a wide range of climatic conditions, mining has often proceeded all year round. Heavy snows, stream flooding or forest fires are the only significant environmental factors affecting site access but these have not significantly hindered operations since mining commenced at Stillwater and East Boulder Mines.

2.5 Fauna and Flora SRC1.1(ii)

The 1985 Environmental Impact Statement (EIS) for Stillwater Mine identified thirteen vegetation types in the study area, along with water and disturbed areas with no vegetation (MDEQ and USFS, 1985). These vegetation types include: stony grassland, sagebrush and skunkbush shrubland, drainage bottomland, riparian woodland, ravine aspen-chokecherry, open forest-meadow understory, open forest-rocky understory, Douglas-fir forest, Lodgepole pine forest, sub-alpine forest and cultivated hay land. Timber resources in the mine area are described generally as being of low commercial value “…due to poor quality timber and the rugged terrain's limits on harvest operations…” (MDEQ and USFS, 1985).

Wildlife studies indicate that the mine areas support diverse and abundant wildlife populations including bird, mammal, reptile, amphibian and aquatic species. The mine areas provide winter ranges for elk, mule deer and bighorn sheep. In addition, the mine area habitats also host moose, black bear, mountain goats and mountain lions. Wildlife habitat types correspond closely to vegetation types previously described. Both the Bald Eagle and American Peregrine Falcon, which were identified as listed species in the 1985 EIS, have been de-listed due to the recovery of their populations. The Stillwater River and East Boulder River are the principal resources that may be adversely affected by mining operations at Stillwater and East Boulder Mines, but historical and cultural resources are also known to exist within the current and planned mine disturbance areas. The river waters are of high quality and, although they have measurable loading of nitrate and dissolved solids from mining operations, there has not been evidence of adverse impacts on aquatic or terrestrial wildlife populations. The Stillwater River and East Boulder River are both considered "substantial fishery resources” and host brown trout, rainbow trout, brook trout and mountain whitefish (MDEQ and USFS, 1985). Both rivers have good insect and periphyton diversities and

densities.

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2.6 Political, Economic and Social Context SRC1.2(ii); ESG4.5.1; ESG4.5.2

The USA is a first world country made up of 50 states and located in North America. The country became a nation when it gained its independence in 1776. It has a mature democracy, which has seen the smooth changeover of government and ruling parties since 1776, with the two main parties being the Democratic Party and Republican Party. It has a strong governing system and institutions that ensure effective governmental checks and balances. The US legal system is based on federal law, augmented by laws enacted by state legislatures and local laws passed by counties and cities. Individuals’ rights and freedoms are enshrined in the first ten amendments of the US Constitution (Bill of Rights). The Constitution is the supreme law and, together with other laws, applies to everyone in the USA, irrespective of citizenship or immigration status. Each state has the power to establish its own system of criminal and civil laws. The US judiciary is independent of the Government and consists of the Supreme Court (the highest Court), the Court of Appeals and the District Courts. The size of the USA economy, measured in terms of Gross Domestic Product (GDP), is approximately $18.6 trillion (OECD, 2017), which makes it the largest economy in the world. The country has maintained a stable real annual GDP growth rate of approximately 2.1% since the Global Recession of 2008 and 2009, and a gradual decline in unemployment rate from 10.5% in 2010 to 4.5% in 2017 (OECD, 2017). Inflation rate is currently 1.7% and on a downward trend since the 2016 high of 2.1% (Statbureau, 2017)). The USA follows a free-market economic system in which private businesses play a dominant role in the economic activity of the country. Except for major interventions in private businesses facing bankruptcy during the 2008 to 2009 Global Recession, the US Government generally plays a limited but critical role in economic decision making, which includes providing services and goods that the market cannot provide effectively, such as national defence, security, social welfare assistance for low-income families and interstate infrastructure (telecommunications, highways and airports). The country has well established and maintained economic infrastructure. Government also provides incentives to encourage the production and consumption of certain types of products, and discourages the production and consumption of others. It sets general guidelines for doing business and makes policy decisions that affect the economy as a whole. Government also establishes safety guidelines that regulate consumer products, working conditions and environmental protection. Important players in the USA economy include individual people, business and labour organisations as well as social institutions.

2.7 Legal and Permitting Overview SRC1.2(ii);SRC1.5(i); ESG4.3.1

2.7.1 Mining Related Legislation In the USA, the major federal law governing minerals is the Mining Law of 1872 (May 10, 1872). This law proclaimed all valuable mineral deposits belonging to the USA and allowed for citizens (including corporates) of the USA to explore for, discover and purchase these mineral deposits. The Federal Land Policy and Management Act of 1976 (FLPMA) did not amend the 1872 law, but affected the documenting and maintenance of all claims. Persons holding existing claims are required to record their claims and all new claims are required to be recorded with the Bureau of Land Management (BLM). The purpose of the FLPMA is to provide BLM with information on the locations and number of Mining Claims, Mill and Tunnel Sites.

2.7.2 Mining Claim and Permitting

2.7.2.1 Overview In the USA, a Mining Claim provides a corporate entity with the right to extract minerals from a portion of land. There are two categories of Mining Claims applicable in the various states, which differ predominantly based on the surface ownership. These two categories are defined as follows: Unpatented Mining Claims are claims where the rights to the Federal Land are restricted to the extraction

and development of a mineral deposit; and Patented Mining Claims are claims where Federal Government has passed the title of the portion of land

to the claimant, thereby making it private property. A person may mine and remove minerals without a patent. However, a mineral patent gives exclusive title to the minerals as well as the land, which means that the claimant owns the land as well as the minerals.

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Mining Claims are also permitted as Lode Claims or Placer Claims. These types of mineral permits and Mill Sites

and Tunnel Sites are described as follows: Lode Claims: Deposits subject to Lode Claims include classic veins or vein type deposits that have well

defined boundaries. Federal Statutes limit their size to a maximum of 450m in length and a maximum width of 180m (90m on either side of the vein).

Placer Claims: Placer Claims are defined as "... including all forms of deposit, excepting veins of quartz, or

other rock in-place." In other words, every deposit, not located with a Lode Claim, should be appropriated by a placer location. The maximum size of a claim for a company is 8ha per claim.

Mill Sites: A Mill Site must be located on "non-mineral lands" and may not be located next to Lode or

Placer Claims. A Mill Site allows for the construction of mining related infrastructure. The maximum allowable size is 2ha.

Tunnel Sites: A Tunnel Site is similar to servitude as it is a right of way under Federal Land. It is used for

access to Lode Mining Claims or to conduct exploration i.e. following of a mineral deposit along strike. A Tunnel Site can be up to 1 000m in length.

2.7.2.2 Legal Compliance and Title Maintenance Compliance and maintenance in the USA is straightforward in terms of the legal framework for title and tenure permitting. Compliance and maintenance can be achieved through payment of maintenance fees and completing the required Annual Assessment Work. An annual maintenance fee per claim is required to be paid on or before 1 September of the year preceding an assessment year. Placer Claims over 8ha must pay an additional US$155 per year for each 8ha or portion thereof. A First Half Final Certificate (FHFC) can be issued for claims. The issuance of a FHFC on a claim signifies that the BLM has finished with the paper work portion of the process and the claim does not need the annual maintenance fee payment until the patent is issued or the claim is withdrawn from the patent process. Annual Assessment Work is necessary to maintain claims. The assessment work must be performed within the

period defined as the Assessment Year and submitted for record to the BLM. Assessment work includes, but is not limited to, drilling, excavations, driving shafts and tunnels, sampling (geochemical or bulk), road construction on or for the benefit of the Mining Claim and geological, geochemical and geophysical surveys. For operations involving more than 2ha, a detailed Plan of Operation must be filed with the appropriate BLM field office. Assessment work is not a requirement for owners of Mill or Tunnel Sites. However, the owners must file an Annual Notice of intent to hold the site.

2.7.2.3 Transfer of Interest If required, a change of ownership for claims can be made through the completion of a Transfer Document. The Transfer Document must include the claim names and BLM serial numbers, and should be filed with BLM and the appropriate County Recorder. A notarised copy of the transfer is a requirement of the State.

2.7.2.4 Conclusion The legal framework for mining in the USA appears to be straightforward and stringently monitored. However, it should be noted that obtaining the permits and approvals needed to build a mine takes an average of seven years, which is amongst the longest wait time in the world, and is costly. Therefore, it should not be taken for granted that all matters with regards to title permitting and approvals will run efficiently and smoothly.

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2.7.3 Environmental and Social Related Legislation ESG4.1.1; ESG4.5.1; JSE12.9(h)(viii); ESG4.4.1

Mining in the USA is highly regulated by both State and Federal Governments and should only be conducted via a formal process. Both State and Federal Governments have robust processes of public engagement in mine permitting. Operations at the Stillwater and East Boulder Mines are regulated by both the State of Montana and the Federal Government agencies, which include the following: State agencies: Montana Department of Environmental Quality (MDEQ) and Department of Natural

Resources and Conservation (DNRC); and Federal agencies: Custer Gallatin National Forest (CGNF), US Environmental Protection Agency (EPA),

US Bureau of Alcohol, Tobacco and Firearms (ATF), US Army Corps of Engineers, US Federal Communications Commission (FCC) and US Nuclear Regulatory Commission (NRC).

These regulatory agencies can approve, deny or conditionally approve applications for mining or modifications of permits. For the State of Montana, changes to or denial of a permit must be directly related to a specific state law or regulation and is not discretionary (USFS, 2002: Section 1.4). The US Forest Service (USFS) may deny mining proposals, although this authority is limited by Federal Law. Several laws allow the USFS to reasonably regulate mining to minimise adverse environmental impacts on National Forest Service (NFS) surface resources and to ensure compliance with applicable environmental laws and regulations. These laws include the 1872 Mining Law (as amended), related regulations in Title 36 of the US Code of Federal Regulations (CFR) Part 228A, the 1897 Organic Administration Act, the 1955 Multiple Use Mining Act, the 36 CFR 228 Locatable Minerals Regulations, Subpart A, the 1972 Clean Water Act (CWA) and the 1973 Endangered Species Act (ESA). The USFS can reasonably regulate mining but cannot prohibit or unreasonably restrict operations that are otherwise in compliance with the law. If analysis done under the National Environmental Policy Act (NEPA) and/or other analyses show that a proposed mining activity can operate in a way that is compliant with the applicable environmental laws, the USFS cannot prohibit or deny the proposal on NFS lands subject to compliance with the 1872 Mining Law. The proposals or agency alternatives, if approved, must comply with all

applicable federal and state air and water quality laws and regulations. Mine Operating Permits applicable to Stillwater mining operations are issued by the State of Montana (MDEQ, Hard Rock Mining Program) with concurrence from the CGNF. The Mine Operating Permits are based on the Plans of Operations (PoO) submitted by the permittee and reviewed by both the State agencies and the CGNF, and the EIS developed by the CGNF for the permittee, the findings of which are documented in a Records of Decision (RoD). When mining operations are well established and have maintained good standing with the regulatory agencies (as is the case for Stillwater and East Boulder Mines), regulatory approval for continued operations and mine expansion is considered viable, with relatively low risk of agency denial. However, the initial permitting processes are robust, lengthy and carry substantial associated costs. Public approval of regulatory decision making (referred to as “social licensing” or “social license to operate” (SLO)) has become a critical component of corporate social responsibility globally, and is an important aspect of mining permitting in the USA. Social licencing has assumed an elevated profile as non-governmental organisations and citizens have become increasingly vocal and engaged in the scoping and review of mining permits. The Montana Assets comply with all the title and environmental and social permitting requirements of the Federal and State Governments.

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2.7.4 State of Montana Legislation and Regulations

2.7.4.1 Montana Metal Mine Reclamation Act Stillwater and East Boulder Mines both have valid Mine Operating Permits, namely Permit Numbers #00118 and #00149, respectively (Table 3). DEQ administers the Montana Metal Mine Reclamation Act (MMRA), under which Stillwater has its two operating permits. The MMRA’s purpose is to ensure that lands and surface waters affected by mining and exploration receive the greatest reasonable degree of protection, balanced with the value mining brings as a beneficial activity to the economy of Montana for the needs of society (MDEQ and USFS, 2012a). As stated above, denial of permits and permit amendments applications are not discretionary and must be based on a reasonable basis that the proposed action cannot comply with legal requirements. The Mine Operating Permits for both mines have been amended and revised on several times to align the permits with changes in plans of operations (mine plans) that occur from time to time. Table 3: Operating Permit Details for Stillwater and East Boulder Mines

Mine Permit Number Date of Issue Category Expiry

Stillwater #00149 February 1990 Hardrock Mine Permit Perpetuity

East Boulder #00118 December 1992 Hardrock Mine Permit Perpetuity

Permit applications or permit amendment requests are submitted to both CGNF and MDEQ for technical review. Once technical reviews have been completed and all issues and requests for additional information have been resolved, the combined Montana Environmental Policy Act (MEPA) and National Environmental Policy Act (NEPA) public review and comment processes must be implemented, as discussed below. For approvals, CGNF concurs with the State technical review, co-authors the MEPA/NEPA document and publishes a RoD while the MDEQ issues the actual Mine Permit or Permit Amendment. New Mine Permits can take five to ten years to approve, depending on the technical complexity, environmental sensitivity and public concern of the proposed action. Permit amendments can take two to five years depending on these same factors. A newly approved Hardrock Mine Permit or amendment to an approved permit cannot be implemented unless and until other associated permits and plans have been approved (e.g. air quality). The MDEQ also sets reclamation bonding under MMRA. The agency is required to review the bond amount for

all active and permitted mines annually, and comprehensively every five years. If a bond is determined to be insufficient, the mining company is required to submit an additional amount.

2.7.4.2 Montana Environmental Policy Act The Montana Environmental Policy Act (MEPA) was promulgated in 1971 to provide a public process that ensures the identification of significant impacts on the human environment and input from others before State decision making. The term "human environment" includes biological, physical, social, economic, cultural and aesthetic components of the environment. This State Act parallels the Federal NEPA, the requirements of which are implemented by the CGNF via the regulation in 36 Code of Federal Regulations (CFR) Part 220. The regulations linked with these two acts require assessment of potential environmental impacts associated with proposed actions (i.e. mining permit applications and associated amendments) to support informed decision making and public input. MEPA and NEPA reviews of the impacts of a proposed decision on the human environment help determine whether the State can accommodate these statutory rights to development in a way that does not conflict with the public's constitutional rights. The review can also help agencies avoid unintended environmental consequences.

The environmental reviews required by these acts have been and are expected to continue to be coordinated efforts between the State and USFS, and result in shared documents such as Environmental Impact Statements (EISs), or Environmental Assessments (EAs), rather than independent and duplicative processes and documents. These reviews are based on applicant submittals, which include technical design documents, characterisation of before, after and on-going operational environmental conditions and proposed monitoring and compliance standards. The environmental baseline data addressed in these reviews can include the topics of surface water, groundwater, air quality, aquatic and terrestrial wildlife and ecology, socioeconomic impacts and transportation impacts, as well as historical and cultural resources. Public scoping, data collection, data assessment and resolution of public comments can take several years (three years to more than five years) to complete.

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2.7.4.3 Montana Water Quality Act and other Statutes The Water Quality Act (WQA) was promulgated as Title 75 (Environmental Protection), Chapter 5 (Water Quality) of the Montana Code Annotated (MCA). MDEQ also administers several sections of the Federal Clean Water Act (CWA) pursuant to an agreement between the State of Montana and the EPA. The WQA provides a regulatory framework for protecting, maintaining and improving the quality of water for beneficial uses under which MDEQ has developed water quality classifications and standards, as well as a permit system to control discharges into state waters. Mining operations must comply with Montana’s regulations and Federal regulations and standards (whichever is more stringent) for surface water and ground water. Discharge of surface waters is regulated by Montana Pollutant Discharge Elimination System (MPDES) permits, which cover such discharges as excess adit water and mine stormwater. MPDES permits expire every five years and must be renewed or terminated, with applications for renewal made 180 days prior to permit expiration. All permit requirements remain in force while permits are under renewal review.

2.7.4.4 Other State Regulatory Authorities DEQ administers the Clean Air Act (CAA) of Montana as this programme has been delegated to the State by the EPA. A facility must obtain an Air Quality Permit before construction or a change in operation, unless a permit is

not required under Administrative Rules of Montana (ARM) 17.8.705. The owner or operator of a new or altered source that requires an Air Quality Permit must utilise Best Available Control Technology in designing pollution control systems. The applicant must also demonstrate that the project would not violate Montana or National Ambient Air Quality Standards (MDEQ and USFS, 2012a). The DNRC administers several acts that apply to mining development in Montana. The DNRC regulates water rights for diversion and beneficial use of waters of the State. Water rights relate to, among other areas, industrial water rights, mining water rights, livestock water rights and irrigation water rights. The DNRC must approve easements across State lands for access roads and pipelines. In addition, dams that exceed a certain height, length or retention capacity would be classified as high-hazard dams and subject to design review and approval, which would be regulated under MMRA, rather than a DNRC Dam Safety Permit. After the Reclamation Bond is released, such a structure would be subject to the DNRC oversight and regulation.

2.7.5 Federal Legislation and Regulations

2.7.5.1 National Environmental Policy Act The National Environmental Policy Act (NEPA) was promulgated in January 1970 and requires Federal agencies to assess the environmental effects of their proposed actions prior to making decisions on Federal actions, including permit applications and adopting Federal land management actions. The NEPA process requires Federal agencies to evaluate the environmental and related social and economic effects of their proposed actions and to provide opportunities for public review and comment on those evaluations. The NEPA process is documented in several forms. A Categorical Exclusions (CatEx) is a list of actions an agency has determined as not individually or cumulatively affecting the quality of the human environment (40 CFR §1508.4). A CatEx requires no additional environmental assessment, but rather identifies which actions still require permitting. EAs are concise public documents that include the need for a proposal, a list of alternatives and a list of agencies and persons consulted in the proposal's drafting. These are required to determine the significance of the proposal's environmental outcomes and to look at alternatives of achieving the agency's objectives. An EA may not require public input. If an EA establishes no substantial effects on the environment, the agency must produce a Finding of No Significant Impact (FoNSI). If an EA establishes that there may be substantial effects on the environment, the agency must prepare an EIS although, when the scope of a proposed action is reasonably anticipated to have substantial effects on the environment, an EIS may be initiated without a preceding EA. Public comment in EIS scoping and review of the Draft and Final EIS are required by NEPA. Formal documentation of FoNSI, EA and EIS findings and preferred alternatives are published as a RoD. EA and EIS development, review and approvals by the Federal agencies are robust and lengthy processes that can take between one and ten years, depending on the complexity and sensitivity of the proposed action. Applicants typically collect much of the baseline environmental data, which can take a year or two to design, implement and compile for consideration by the agencies.

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2.7.5.2 Clean Air Act The CAA was promulgated in 1963 and significantly amended in 1970, 1977 and 1990. Its regulations are codified in 40 CFR, Subchapters C, Parts 50-97. The CAA regulates air emissions from stationary and mobile sources and authorises EPA to establish National Ambient Air Quality Standards (NAAQS) to protect public health and public welfare and to regulate emissions of hazardous air pollutants.

The CAA has been delegated in the State of Montana to the MDEQ Air Quality Bureau. Air Quality Permits are issued by the MDEQ under Title V of the CAA for major air pollutant source, which are those that have actual emissions or the potential to emit at or above the major source threshold for any “air pollutant”, which is typically 100 tons (91t) per year total emission, 10 tons (9.1t) per year for a single hazardous air pollutant (HAP) or 25 tons (22.7t) per year for any combination of HAP. Air emission sources with lower actual or potential emission rates than the major source thresholds are permitted as a minor source under Title I of the CAA. Minor Source Permits typically have lesser or no monitoring requirements than Major Source Permits. Both Major and Minor Source Permit applications require air emissions modelling based on the project specific activities, consistent with the PoO.

2.7.5.3 Clean Water Act The original Federal legislation for water protection in the USA was enacted in 1948 (Federal Water Pollution Control Act), but this Act was significantly reorganised and expanded in 1972 and became the CWA. The CWA sets the regulatory structure for administrating pollutant discharges to waters of USA and regulating quality standards for surface waters. The EPA or States to which EPA has delegated authority (e.g. Montana) sets waste water standards for industry and water quality standards for contaminants in surface waters. The CWA, as implemented by the State of Montana, requires a Montana Pollution Discharge Elimination System (MPDES) Permit for control of stormwater discharge to surface waters, as well as groundwater quality monitoring and ground water quality protection standards. When groundwater or surface water quality impacts above the set standards are determined, corrective action is required to mitigate these impacts, such as is being performed at both Stillwater and East Boulder Mines.

2.7.5.4 US Forest Service Regulations The USFS regulations for locatable mineral mining are governed by Title 36 CFR Part 228, Subpart A, which requires operator submittal of a PoO for all operations to the District Ranger who determines whether any operation is causing or will likely cause significant disturbance of surface resources. Furthermore, the USFS

implements the NEPA process to assess alternatives to the proposed action, associated environmental impacts and potential mitigations under the requirements of 36 CFR Part 220. While the MDEQ issues mine permits, the USFS performs concurrent technical reviews with the MDEQ of permit or amendment applications and, once all issues and information requests are resolved and NEPA requirements are met, the USFS concurs with the MDEQ approval of the permit and publishes a RoD documenting its NEPA environmental review findings.

2.7.6 Other Federal Regulatory Authorities Other Federal agencies with regulatory authority over the Stillwater and East Boulder Mines’ operations include the US Bureau of Alcohol, Tobacco and Firearms (ATF) (which regulates the use and storage of explosives), the US Army Corps of Engineers (which regulates activities that involve disturbances in waterways), the US Federal Communications Commission (FCC) (which issues Frequency Modulation (FM) radio frequency licences for site communications) and the US Nuclear Regulatory Commission (NRC), which issues license for radiological materials in nuclear density gauges.

2.8 Title and Surface Rights SRC1.5(i);SRC1.5(iii);SRC1.5(iv);SRC4.3(iv); SRC5.1(i);SV1.5;JSE12.9(h)(iv);ESG4.3.2;ESG4.2.1;ESG4.3.3

2.8.1 Title Stillwater holds or leases 1 674 Patented and Unpatented Lode, Placer, Tunnel or Mill Site Claims in the Stillwater, Sweet Grass and Park Counties of south-central Montana as shown in Figure 5. The 1 674 claims encompass over 26 000 acres (10 522ha) in two separate contiguous blocks situated east and west of the Stillwater River, and cover the following:

The entirety of the known J-M Reef apex; Areas to the north for the construction of ventilation and other shafts to the surface from lower levels in

the northward-dipping J-M Reef; The east end of the Stillwater Complex; East Boulder Mine's access adits and the plant site; A leased group of claims east of the Stillwater Valley that cover a portion of the Basal Series (Copper (Cu)

and Nickel (Ni) and targets that are beyond the scope of this CPR); and A leased group of claims west of the Stillwater Valley that cover a portion of the Ultramafic Series

(chromite claims).

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Of the 1 674 claims, 1 468 claims are filed on an annual basis with the BLM and County Offices. Stillwater also

pays a maintenance fee to the BLM ($155 per claim) each year to keep the 1 468 claims valid. Table 4 presents a summary of Stillwater's Mining Claims (both leased and held) as of the end of July 2017. The Mouat Basal Zone Lease covers 59 claims over the copper and nickel occurrences in the Stillwater Complex located in the Benbow and Stillwater Valley areas. Of the 59 claims, 57 are Lode Claims (33 Patented), one is an Unpatented Placer Claim and one is a Patented Mill Site Claim. The Mouat Mountain View Lease covers 77 claims over the of the chromite zones in the Stillwater Valley, of which 70 are Lode Claims (one Patented), two are Unpatented Mill Site Claims, one is an Unpatented Tunnel Site and four are Unpatented Placer Claims. Mouat 'A' Claim Lease covers 28 Lode Claims (nine of which have been issued a FHFC), one Unpatented Mill Site Claim and four Placer Claims. The Mouat 'B' Claim Lease covers 145 Lode Claims of which 36 are Patented Claims. Table 4: Summary of Stillwater Mineral Title and Tenure

County Type No of Claims Status Lease Agreement

Park Lode Claims 33 Unpatented -

Sweet Grass

Mill Site Claims 133 Unpatented -

Lode Claims 712 116 Patented 1 claim subject to the Mouat Basal Zone Lease

612 Unpatented 17 claims subject to the Mouat Basal Zone Lease

Sweet Grass/Park Lode Claims 17 Unpatented

Sweet Grass/Stillwater Lode Claims 26

3 Patented 1 claim subject to the Mouat 'B' claim

13 Unpatented 11 claims subject to the Mouat 'B' claim

Stillwater

Tunnel Site 2 Unpatented 1 claim subject to the Mouat Mt View Lease

Placer Claims 11

9 Unpatented (1 application for patent submitted)

4 claims subject to the Mouat 'A' claim 4 claims subject to the Mouat Mt View Lease 1 claim subject to the Mouat Basal Zone Lease

2 Patented -

Mill Site Claims 192 191 Unpatented

1 claims subject to the Mouat 'A' claim 2 claims subject to the Mouat Mt View Lease

1 Patented 1 claim subject to the Mouat Basal Zone Lease

Lode Claims 548

20 Applied for patent 20 claims subject to the Mouat Mt View Lease

9 Final Certificate 9 claims subject to the Mouat 'A' claim

75 Patented 35 claims subject to the Mouat 'B' claim

32 claims subject to the Mouat Basal Zone Lease 1 claim subject to the Mouat Mt View Lease

444 Unpatented

98 claims subject to the Mouat 'B' claim 19 claims subject to the Mouat 'A' claim

7 claims subject to the Mouat Basal Zone Lease 49 claims subject to the Mouat Mt View Lease

Total Number of Claims 1 674

2.8.2 Surface Ownership SRC1.1(ii); SRC1.5(i); SRC1.5(ii); SRC1.5(iii)

Stillwater is the holder of both Patented and Unpatented Mill Site and Tunnel Claims, which cover the predominant Stillwater surface infrastructure. In addition to the Mill Site and Tunnel Claims, Stillwater owns several land parcels that have been purchased over the years. Of these parcels, some are currently used for the operations while others are earmarked for future use.

2.8.3 Conclusions From the documentation reviewed, The Mineral Corporation has identified no material issues with regards to the title permitting and surface ownership that would prevent the achievement of the LoM Plans for Stillwater and East Boulder Mines. The Montana Assets comply with all title and environmental permitting requirements of the Federal and State Governments.

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Figure 5: Stillwater Mineral Title and Tenure map

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2.9 Royalties SRC1.5(ii); SRC1.6(i); SRC5.6(vii)

Of the 1 674 Stillwater-controlled claims, 1 537 occur on the J-M Reef. Of the 1 537 claims, 898 are subject to royalty payments (Table 5). Stillwater made royalty payments of $15.1 million in 2016, $16.1 million in 2015 and $22.8 million in 2014. The differing royalty amounts in each year reflect changes in metal prices, the number of troy ounces produced and the mining claims where the production occurred – which are the variables considered in the royalty calculations. Table 5: Claims subject to royalties

County No of Claims on the

J-M Reef Number subject to royalty

Park 34 34 Claims subject to 5% Franco-Nevada Royalty

Sweet Grass 854 636 Claims subject to 5% Franco-Nevada Royalty

Stillwater 649 85 Claims subject to 0.35% Mouat Royalty 48 Claims subject to 5% Franco-Nevada Royalty 95 Claims subject to 0.35% Mouat Royalty and 5% Franco-Nevada Royalty

2.10 Liabilities SRC1.7(i);ESG4.3.4;ESG4.3.6

Stillwater has indicated that there are no liabilities in relation to the Montana Assets discussed in this CPR. Accordingly, no liabilities are reported in this CPR.

2.11 Legal Proceedings SRC1.5(iv);ESG4.3.5;ESG4.3.6

Stillwater has indicated that there are no legal proceedings in relation to the Montana Assets discussed in this CPR. It should, however, be noted that Stillwater may be involved in various non-material legal matters such as employment claims, third party subpoenas and collection matters on an on-going basis.

2.12 Social SRC5.1(i);SRC4.3(v); SRC5.2(ix);SRC5.5(iv);SRC5.5(v);ESG4.1.1;ESG4.5.3;ESG4.6.1; JSE12.9(h)(vii)

The social licence to operate (SLO) mining operation can be described as the recognition or approval by local communities and stakeholders of the operations. The concept has evolved from the notion of Corporate Social

Responsibility and is based on the idea that mining companies need not only government permission but also social permission to mine. Stillwater has a progressive and, so far, highly effective Good Neighbour Agreement (GNA; Stillwater et al., 2014), which establishes formal opportunities for specific local and regional environmental non-governmental organisations (NGO) to participate in decisions that may impact the local communities, economies or the environment. The GNA is a legally binding contract between the Stillwater, the Northern Plains Resource Council, Cottonwood Resource Council and Stillwater Protective Association. The Agreement is binding on future owners and managers of Stillwater. Northern Plains Resource Council is a grassroots conservation and family agriculture group focused on protecting eastern Montana’s water quality, family farms and ranches. Prior to 2000, people who owned land near the mines were concerned about the effects of mining activities on their property and quality of life. As a result, the Northern Plains Resource Council filed several lawsuits against the Montana Department of Environmental Quality to require strict enforcement of environmental standards relating to the operations at the mines. In 2000, the parties to the GNA negotiated the agreement to extend

protections beyond state requirements to protect property, water and area communities, while allowing PGM mining operations to proceed. The GNA provides for citizen oversight of mining operations to guarantee protection of the area’s quality of life and productive agricultural land and allows for local communities to have access to critical information about mining operations and the opportunity to address potential problems before they occur. The GNA has also established clear and enforceable water quality standards that go beyond the state requirements. As part of this procedure, citizens may attend all mine-related water quality inspections and sampling events and are provided with quarterly water quality reports. A provision is also made for citizens to conduct independent water quality sampling if necessary.

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A significant component of the GNA is aimed at ensuring public safety and security by restricting mine traffic

and monitoring Stillwater’s adherence to the permitted traffic volumes and speed limits. In order to meet traffic requirements, the GNA provides for carpooling and busing as preferable means to transport mine employees to and from the mines. This provides the mine workers, many of whom work 10-hour to 12-hour shifts, seven days in a row, with rest time, and keeps tired drivers off the road. Other aspects of the GNA include: Establishing conservation easements on Stillwater owned ranches along the Boulder and Stillwater Rivers;

and Preventing any mine sponsored housing occurring outside existing communities.

Stillwater has also committed to provide funds that meet a wide range of community needs including, but not limited to, youth services, education, cultural events, community projects and emergency services. Based on the information reviewed, it appears that Stillwater is committed to working with federal and local administrations, organisations, community and conservation groups to ensure the mines and accompanying infrastructure are managed responsibly.

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3 PROJECT HISTORY

3.1 Ownership History SRC1.4(i); SRC1.4(ii); SV1.6

Stillwater has an extensive history with roots that can be traced back to the late 19th century. Prior to the discovery of the J-M Reef in the fall of 1973, Lode Claims were staked by Johns-Manville Corporation (Manville) primarily to cover soil geochemical and geophysical anomalies. The Stillwater Complex-wide contour soil sampling programme completed in 1974 prompted a claim staking blitz as Pd and Pt were discovered in the J-M Reef. By the end of 1978, Manville controlled 1 022 Lode Claims covering the J-M Reef. In 1979, a Manville subsidiary (Manville Products) entered into a partnership agreement with Chevron USA Inc. (Chevron) to develop PGMs discovered in the J-M Reef. In 1983, Anaconda Minerals (Anaconda) became a third member of the joint venture. However, Anaconda sold its stake to LAC Minerals Ltd (LAC) in 1985. Manville, Chevron and LAC explored and developed the Stillwater property and commenced underground mining in 1986 at Stillwater Mine. By 1989, many changes had taken place and Manville and Chevron were the only shareholders, with equal shareholding. In 1992, Stillwater was incorporated followed by transfer of all Chevron and Manville assets, liabilities and operations at the Stillwater Mine property to Stillwater on 1 October 1993. As a result, Chevron and Manville each received a 50% ownership interest in the Stillwater’s stock. In September 1994, Stillwater redeemed Chevron’s entire 50% ownership. Stillwater completed an initial public offering in December 1994, which enabled Manville to dispose of a portion of its shares, thereby reducing its ownership percentage to approximately 27%. In August 1995, Manville sold its remaining ownership interest in Stillwater to institutional investors. Production at East Boulder Mine commenced in 2002. On 23 June 2003, Stillwater completed a stock purchase transaction with MMC Norilsk Nickel (Norilsk Nickel), whereby a subsidiary of Norilsk Nickel became a majority stockholder of the company. On that date, all the stockholders entered into a Stockholders’ Agreement governing the terms of Norilsk Nickel’s investment in the company. In December 2010, Norilsk Nickel disposed of its entire ownership interest in Stillwater through a secondary offering of Stillwater shares in the public market. From 2010, Stillwater operated as a NYSE listed company until May 2017 when it was delisted following the acquisition by SGL. Currently, Stillwater is a wholly owned SGL company and is part of the United States Region Assets of SGL.

3.2 Previous Exploration and Mine Development SRC1.4(ii)

Since 1883, the Stillwater Complex and adjacent areas have been known to contain copper, nickel and chromium deposits. The Stillwater Complex was first geologically mapped and described in the 1930s by Princeton University Geologists operating out of their base camp in Red Lodge. Chromite was mined during World War II and processed at a plant on the site of the current Stillwater Mine surface facilities. Sulphides containing PGMs were discovered in the early 1930s, but significant exploration did not start until the 1960s by two separate groups, namely Anaconda Minerals Company (Anaconda) exploring for Cu-Ni and Manville exploring for PGMs. In 1973, Manville Geologists identified the J-M Reef. In 1983, the Stillwater Mining Company, a partnership between Chevron Resources Company, Manville and Anaconda was formed to pursue exploration westward and eastward along the J-M Reef from both the surface and underground at the Minneapolis Adit. In 1998, a drillhole located in the Stillwater River Valley at Stillwater Mine intersected the major thrust splay underlying the Stillwater Mine. An additional deep drillhole further to the west allowed further delineation of the J-M Reef at depth and of the bounding thrust fault. These deep drillholes allowed the projection of thrust fault positions that currently define the lower limits of estimated Mineral Resources and Mineral Reserves in areas near the deep drilling.

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Commercial underground mining at Stillwater and East Boulder Mines began in 1986 and 2002, respectively.

The development of the mines was spurred by a surge in platinum prices due to social and political instability in South Africa, which affected global supplies. Stillwater Mine was originally planned to produce approximately 500 ton (456t) of RoM ore per day, which was revised upwards to 1 000 ton (907t) and 2 500 ton (2 270t) of RoM ore per day. Steady state production of 2 500 ton (2 270t) of RoM ore per day was reached in 2001. However, with the development of the East Boulder Mine and the pressure put on the work force following the recruiting of Stillwater employees by other mining camps during the worldwide mineral commodity prices boom at the time, production could not be maintained at the steady state level. This was further exacerbated by labour unrest at the mines in 2007 and the PGM price drop in 2008, which led to organisational restructuring. Since then, production at the mines has continued without major interruptions. The production history for Stillwater and East Boulder Mines since 2002 is summarised Table 6. Most of the exploration by Stillwater has focused at the brownfield areas within the Stillwater and East Boulder Mine footprints. Further exploration is planned in the area between Stillwater and East Boulder Mines, over which historical soil sampling and drilling data has indicated the presence of the J-M Reef. Table 6: Historical production for Stillwater and East Boulder Mines

Year Stillwater Mine East Boulder Mine Total

Tons Tonnes Pd +Pt Ounces Tons Tonnes Pd +Pt Ounces Tons Tonnes Pd +Pt Ounces

2016 683 173 619 764 346 204 589 882 535 132 233 696 1 273 055 1 154 896 579 900

2015 675 838 613 110 333 511 537 400 487 521 217 175 1 213 238 1 100 631 550 686

2014 703 054 637 800 361 841 478 297 433 904 195 700 1 181 351 1 071 704 557 541

2013 765 144 694 127 390 415 437 389 396 793 175 150 1 202 533 1 090 920 565 565

2012 672 605 610 177 405 988 418 804 379 933 150 903 1 091 409 990 110 556 891

2011 736 432 668 080 411 436 394 784 358 142 145 427 1 131 216 1 026 222 556 863

2010 708 172 642 443 375 627 383 931 348 296 147 969 1 092 103 990 739 523 596

2009 726 949 659 477 422 112 358 310 325 053 144 510 1 085 259 984 531 566 622

2008 690 065 626 017 375 188 372 714 338 121 155 707 1 062 779 964 137 530 895

2007 639 659 580 289 386 362 530 053 480 856 200 845 1 169 712 1 061 145 587 207

2006 739 377 670 752 440 863 540 910 490 705 212 959 1 280 287 1 161 457 653 822

2005 709 661 643 794 403 450 501 651 455 090 198 032 1 211 312 1 098 884 601 482

2004 728 217 660 628 430 259 485 390 440 339 187 995 1 213 607 1 100 966 618 254

3.3 Previous Mineral Resource Estimates SRC1.4(iii)

Until May 2017, Stillwater was listed on the NYSE and therefore employed the Securities and Exchange Commission Industry Guide 7 (SEC Guide 7) for public disclosure requirements of its public mining operations as required by NYSE. The SEC Guide 7 does not provide disclosure guidelines for Mineral Resources and therefore there are no historical Mineral Resource estimates compiled for Stillwater and East Boulder Mines. Accordingly, a discussion of historical Mineral Resource estimates and performance statistics on actual production for past and current operations could not be provided for this CPR.

3.4 Previous Mineral Reserve Estimates SRC1.4(iv)

Due to its listing on the NYSE until May 2017, Stillwater has been reporting Reserves for Stillwater and East Boulder under the SEC Guide 7 reporting regime. The Reserves were compiled and categorised following the SEC Guide 7 requirements and using Modifying Factors based on historical experience and economic parameters guided by actual and 12-quarter trailing averages where relevant. Stillwater has traditionally reconciled the estimates with actuals to recalibrate the mining factors employed for the conversion. This is discussed further in Section 7.

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Table 7: Historical Reserves for Stillwater and East Boulder Mines

Mine Category

Imperial Metric

Tonnage (Million Ton)

Pd + Pt (Moz)

Pd + Pt Grade (oz/ton)

Tonnage (Mt)

Pd + Pt (Moz)

Pd + Pt Grade (g/t)

2016

Stillwater Proven 3.2 1.9 0.59 2.9 1.9 20.33

Stillwater Probable 15.1 8.6 0.57 13.7 8.6 19.43

Stillwater Subtotal/Average 18.3 10.5 0.57 16.6 10.5 19.58

East Boulder Proven 2.8 1.1 0.39 2.5 1.1 13.51

East Boulder Probable 24.6 9.6 0.39 22.3 9.6 13.45

East Boulder Subtotal/Average 27.3 10.7 0.39 24.8 10.7 13.46

All Total/Average 45.7 21.2 0.46 41.4 21.2 15.92

2015

Stillwater Proven 3.2 1.9 0.59 2.9 1.9 20.39

Stillwater Probable 12.1 6.9 0.57 11.0 6.9 19.55

Stillwater Subtotal/Average 15.3 8.8 0.58 13.9 8.8 19.73

East Boulder Proven 2.6 1.1 0.4 2.4 1.1 13.71

East Boulder Probable 25.5 9.9 0.39 23.1 9.9 13.37

East Boulder Subtotal/Average 28.1 11.0 0.39 25.5 11.0 13.4


3.5 Adjacent Properties SRC1.3(i)

Stillwater controls the J-M Reef along its known strike length, and the J-M Reef is the only PGM-bearing layer in the Stillwater Complex that can be economically exploited, given current and expected economic conditions. There is no relevant adjacent property information to be discussed in this CPR.

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4 GEOLOGICAL SETTING, MINERALISATION AND DEPOSIT TYPES

4.1 Geological Setting SRC2.1(i); SV1.7;JSE12.9(h)(v)

4.1.1 Background Large layered igneous complexes such as the Stillwater Complex in the USA, Bushveld Complex in South Africa, the Great Dyke in Zimbabwe, Sudbury in Canada and Norilsk in Russia are prime exploration and mining targets for PGMs, ferrochromium and base metal mineralisation. The Montana Assets are based on the exploitation of the J-M Reef, which occurs in the exposed part of the Stillwater Complex (Figure 6) along the northern margin of the Beartooth Mountains of south-central Montana and north-western Wyoming. Lithological units in the exposed part of the Stillwater Complex have northerly to north-easterly steep dips. Much of the Stillwater Complex, which is estimated to cover a plan area of 1699 square miles (4 400km2) and characterised by shallow dips, occurs to the north and northeast of the exposed smaller part and under thick sedimentary cover of Palaeozoic and Mesozoic ages. The regional geology of the exposed part of the Stillwater Complex (Figure 6) is fairly well understood from state (US Geological Survey or USGS) and private sector driven regional and local exploration and mining as well as academic research spanning decades. The following description of regional geology and geological structure of the Stillwater Complex is based on overviews provided by Page and Zientek (1985), Zientek et al. (1985) and McCallum (2002).

4.1.2 Regional Geology and Stratigraphy The Stillwater Complex is a large layered igneous complex resulting from magma intrusion through regional transverse faults into highly deformed Archaean sedimentary rocks at approximately 2.7Ga. The magma intrusion and emplacement were accompanied by fractionation and accumulation of magmatic crystals that gave rise to the conspicuous magmatic layering observed in the complex. The magmatic layering is reflected in the changes in mineralogy, mode, grain size and texture across the stratigraphic profile of the complex. However, the overall texture of the lithological units in the Stillwater Complex is typified by subhedral to euhedral cumulate grains in a framework of post-cumulus interstitial material including oikocrysts. The mineralogical, modal, grain size and textural variations formed the basis for subdividing the Stillwater Complex into five major series (from bottom upwards) as follows: the Basal Series, Ultramafic Series, Lower Banded Series, Middle Banded Series and Upper Banded Series (Figure 7; McCallum, 2002). The Ultramafic Series (UMS) is further subdivided into the Bronzitite Zone and Peridotite Zone. A uniform and laterally extensive bronzitite cumulate layer, which is underlain by norite units and subordinate anorthosite, gabbro and peridotite units, dominates the Basal Series. Overlying the 525ft (160m) thick Basal Series is the Peridotite Zone of the Ultramafic Series, which is characterised by cyclic units of peridotite, harzburgite and bronzitite. Layers of massive and disseminated chromite, referred to as A to K (from bottom upwards), occur in the peridotite member of the cyclic units (Figure 7). The thickness of chromitite layers range from a few inches to 3ft (millimetres to 1m), and only layers G and H have been exploited at Mountain View by other parties. Given that Stillwater targets only the PGM mineralisation in the J-M Reef, the geology and exploitation of the chromitite mineralisation in the Stillwater Complex will not be discussed further in this CPR. The overlying Bronzitite Zone is relatively uniform consisting of bronzitite. The thickness of the Ultramafic Series ranges from 2 756ft to 6 562ft (840m to 2 000m). The contact between the Bronzitite Zone and Lower Banded Series has been mapped over much of the Stillwater Complex. The Lower Banded Series consists of norite and gabbronorite units and minor olivine-bearing cumulates that host the target J-M Reef. The series has been subdivided into Norite I (N-I), Gabbro-norite-I (GN-I), Olivine-bearing-I (OB-I), Norite-II (N-II), Gabbronorite-II (GN-II) and Olivine-bearing-II (OB-II) zones. It is to be noted that the J-M Reef is generally confined to the OB-I (troctolite) zone, but not restricted to a particular stratigraphic position within this zone. The overlying Middle Banded Series consists of anorthosite, olivine gabbro and troctolite units, which constitute the Anorthosite Zones I and II (AN-I and AN-II), separated by OB-III and OB-IV. A second but low-grade PGM-bearing zone (referred to as the Picket Pin deposit) occurs in the upper part of AN-II, approximately 9 850ft (3 000m) above the J-M Reef, and is traceable at this stratigraphic position over 14 miles (22km). It consists of podiform and lenticular concentrations of sulphide minerals in anorthosite. The Picket Pin deposit has not been mined but is the subject of exploration and evaluation by other parties outside of Stillwater mineral tenement and is therefore not discussed further in this CPR. The Upper Banded Series consists of gabbronorite units and minor troctolite and norite units making up OB-V and GN-III subzones.

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Figure 6: The regional geology of the Stillwater Complex (after Montana Bureau of Mines and Geology)

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Figure 7: Stratigraphic section of the Stillwater Complex (modified after McCallum, 2002)

4.1.3 Regional Geological Structure The Stillwater Complex, which was emplaced as a lopolith (Figure 8), was intruded by felsic and mafic dykes in separate phases until approximately 1.6Ga, after which it was subjected to subsidence, faulting rotation, tilting and erosion. Subsequent extensive marine and continental sedimentation resulted in the burial of the Stillwater Complex. There were repeated phases of deformation of the Stillwater Complex and the underlying and overlying sedimentary rocks, the most notable being the Laramide Orogeny. The Laramide Orogeny, which started in the Late Cretaceous and lasted until the Early Tertiary, involved northward verging thrusting (Horseman Thrust Fault system) that resulted in the 20 000ft (6 000m) of uplift (Beartooth Uplift; Figure 8) and erosion, which exposed the small part of the Stillwater Complex mapped in the Beartooth Mountains. The flat-lying part of the Stillwater Complex occurs at significant depth below surface, which makes the exploitation of the J-M Reef in this part of the complex uneconomic.

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Figure 8: The 7 500W Cross section through the Stillwater Mine (after Behre and Dolbear, 2017)

Most of the regional faults affecting the Stillwater Complex have mainly been ascribed to the Laramide Orogeny, and these have been grouped according to trends as follows:

Northwest to southeast striking thrust faults; East to west striking south dipping steep reverse faults; East to west trending vertical faults; and Northeast to southwest steep dipping transverse faults.

4.2 Nature of, and Controls on, Mineralisation SRC2.1(ii); SV1.7

4.2.1 Local Geology Much of the area covered by the Stillwater Mining Claims is underlain by the Lower Banded Series that hosts the J-M Reef as well as, to a lesser extent, the Ultramafic and Middle Banded Series. It is also noted that most of what is known about the J-M Reef is based on mining experience at Stillwater and East Boulder Mines, an extensive exploration and evaluation drilling database owned by Stillwater, mapping of mine adits and surface mapping. Accordingly, the local geology and stratigraphy as described in the geological logs of drillcore recovered at Stillwater and East Boulder Mines is broadly similar to the descriptions of the OB-I stratigraphy provided in Figure 7. Most of the drilling, which is conducted from underground, is collared in development drifts situated in the immediate footwall of the J-M Reef and target the OB-I hosting the J-M Reef. Furthermore, the underground drillholes are extended into the hangingwall to assess geotechnical conditions of the hangingwall material.

A complete stratigraphic profile of the OB-I zone intersected at Frog Pond near East Boulder Mine is approximately 394ft (120m) thick and consists of ten olivine bearing members (O1 to O10) composed of coarse-grained to pegmatitic peridotite and troctolites. These members are interlayered with norite, gabbro-norite and minor anorthosite units in the footwall of the J-M Reef. Available geological information indicates some degree of local lateral variation of the OB-I zone at Stillwater Mine and, to a lesser extent, at East Boulder Mine. The lateral variability is reflected in the thinning and absence of certain units across basement highs and lows. Troctolite layers are known to grade into norite layers along strike, with individual layers also known to pinch out. Furthermore, local unconformities and onlapping sequences have been interpreted. Stillwater geological personnel have developed a model to describe the variation in the stratigraphic sequences and mineralisation styles (reef facies) at local levels and to define facies boundaries (Section 4.4).

The local geological structure for Stillwater and East Boulder Mines mimics the regional structure discussed in Section 4.1.3. Of note are the two splays of the Horseman Thrust Fault system and the South Prairie Fault, which have been identified from surface and underground exploration drilling at Stillwater Mine. The first of the two splays is a high-angle reverse fault termed the Horseman Thrust and the second is a lower-angled thrust referred to as the Blind Thrust. The Horseman Thrust Fault forms the regional lower limit of the currently exploitable uplifted portion of the J-M Reef at Stillwater and East Boulder Mines. The South Prairie Fault is a prominent west-northwest striking regional thrust fault associated with a displacement of at least 1 660ft

(505m) between the southern and northern fault blocks.

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Locally at Stillwater and East Boulder Mines, several major cross faults (striking northwards) offset the J-M Reef

by between 200ft to 1 500ft (61m to 457m). These faults are known from surface and underground mapping and drilling. Stillwater geological personnel have indicated that all the major fault systems encountered during mining at the Stillwater and East Boulder Mines did not present major interruptions to continued mining of the J-M Reef. However, the large offsets indicated above have necessitated re-establishment as mining operations approach the faults, and additional support requirements due to deteriorating ground conditions associated with the faults, but with minimal effect on remobilisation. The reviews of underground geological maps for Stillwater and East Boulder Mines compiled by Stillwater geological personnel indicated the presence of diabase and felsic dykes that cut across and offset the J-M Reef. These dykes are understood to be common across the Stillwater Complex and have also been mapped in the West Fork and Frog Pond adits. Furthermore, a number of these dykes are known from surface mapping, underground drilling and mapping. A 30ft (9m) contact alteration zone typically occurs along these dykes and this alteration zone is commonly associated with poor ground conditions. It is understood that the poor ground conditions associated with these dykes does not present significant obstacles to mining. In addition, the dykes are sometimes associated with increased groundwater seepage into the mining operations, but this seepage has also not presented significant geotechnical challenges to the mining operations to date. It is understood that the emplacement of the dykes displaced the J-M Reef, but did not affected the tenor of the PGM mineralisation in the J-M Reef along these structures.

4.2.2 PGM Mineralisation, Nature and Style of the J-M Reef The J-M Reef is a world class PGM deposit and is the prime exploration and mining target for Pd-Pt mineralisation mined at Stillwater and East Boulder Mines. It is a typical stratiform magmatic reef type PGM deposit located primarily within the OB-I, which thickens and thins dramatically along strike. It has some lithological and stratigraphic similarities to the Merensky Reef of the Bushveld Complex, but also has some fundamental differences. Unlike the Merensky Reef, the J-M Reef is not potholed, but shows a higher degree of variability in grades and thickness at a local level with PGM bearing sulphide often transgressing into footwall rocks. In addition, the J-M Reef has PGM grades that are significantly higher than the Merensky Reef grades and the grade does not drop as the reef thickens. For evaluation purposes, the J-M Reef is defined as the Pd-Pt rich stratigraphic interval mainly occurring within a troctolite or olivine-rich rock (OB-I zone) of the Lower Banded Series. It is characterised by a variable thickness ranging from 3ft to 9ft (0.9m to 2.7m) and averaging 6ft (1.8m), but locally forms keel shaped footwall zones, which transgress the footwall mafic rocks, commonly reaching thicknesses of 18ft (6m) and greater. Pd and Pt are the main PGMs, with Pd being the more significant of the two (in situ Pd:Pt ratio of 3.4:1 to 3.6:1). Other associated PGMs such as Rh, Ir, Ru and Os, and Au occur in low abundances (close to analytical instrument detection limits) and are generally not evaluated. The J-M Reef contains approximately 0.25% to 3% visible disseminated copper-nickel sulphide minerals, predominantly chalcopyrite, pyrrhotite and pentlandite, with microscopic PGM minerals and Pt-Fe alloys within a complex cumulate of olivine, plagioclase, bronzite and augite.

4.3 Geological Model SRC2.1(iii); SV1.7

The J-M Reef is a magmatic reef type PGM deposit hosted by a layered ultramafic to mafic igneous complex – the Stillwater Complex. It is generally accepted that the Stillwater Complex formed by the gradual cooling of an enormous subterranean intrusion through transverse faults, and that the complex was initially formed as a lopolith (Figure 9). As is typical of such intrusions, gradual cooling led to fractional crystallisation, the formation of layers of crystals with similar geochemical properties and subsidence. As discussed in Sections 4.1.2 and 4.1.3, marine and continental sedimentation led to the deep burial of the Stillwater Complex while the Horseman Thrust Fault system led to the exposure of portion of the complex mapped in the Beartooth Mountains.

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Figure 9: The original layering in the Stillwater Complex

The layering in the exposed part of the Stillwater Complex is remarkably distinct across the stratigraphic sequence (Figure 7) and continuous over long strike ranges as indicated in Figure 6. Of importance to the exploration targeting of PGM mineralisation is the first major olivine sequence within the Banded Series above the contact of the Ultramafic Series. This horizon of troctolites and anorthosites (OB-I) exists 600ft to 1 450ft (183m to 442m) above the ultramafic contact, which is where the PGM-bearing J-M Reef is located. The J-M Reef is identified by the occurrence of disseminated chalcopyrite, pyrrhotite and pentlandite within a specific stratigraphic sequence along this contact. PGM mineralisation occurs in association with these sulphide minerals in the OB-I zone. The fact that the mineralisation sometimes cuts across lithological boundaries in the OB-I zone has led to the ascription of a late-stage magmatic fluid migration process to the origin of the J-M Reef mineralisation. The exploration and Mineral Resource evaluation strategy employed for the J-M Reef by Stillwater is premised on this geological model. Techniques employed for regional and local exploration include aeromagnetic and soil geochemical surveys, surface mapping, excavation of adits and sampling, drilling and sampling. With PGM minerals not identifiable visually based on stratigraphy and copper-nickel sulphides, all samples collected from the intersections identified visually as the J-M Reef are analysed at the laboratory. The association between PGM minerals and sulphide minerals within the OB-I zone and relatively consistent footwall, reef and hangingwall lithological sequences facilitate the visual delineation of the J-M Reef. Laboratory analysis provides the data required to confirm the presence of the J-M Reef and to determine the PGM tenor of the reef.

4.4 Deposit Types and Mineralisation SRC2.1(iv);SRC2.1(v);SRC2.1(vi);SRC2.1(vii); SV1.7

4.4.1 J-M Reef Deposit Type, Stratigraphy and Persistence The outcrop of the J-M Reef has been traced for approximately 28 miles (45km) of strike length in the exposed part of the Stillwater Complex in the Beartooth Mountains. The lateral and down dip continuity of the J-M Reef reflects its origin as a tabular magmatic deposit within the Lower Banded Series of the Stillwater Complex. The attitude of the J-M Reef varies at a sub-regional level, with sub vertical to vertical dips towards north and northeast. At Stillwater Mine, the dip of the J-M Reef northwards varies from approximately vertical in the eastern part to approximately 62° in the central part and between 45° and 50° in the Upper West sector of the mine. However, at East Boulder Mine, dips are less variable and are, on average, 50° towards northeast. At a local scale, the continuity of the J-M Reef is interrupted by geological structures such as mafic and felsic intrusive dykes and sills, and faults. There are clear lithological and textural differences between the reef and the dykes, which facilitate the identification of dykes in drill cores and during mining. Locally, the intrusive geological structures may display sill-like behaviour where they cause reef splitting, but with no material negative impact to mining operations.

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It is assumed by Stillwater geological personnel that the down dip continuity of the J-M Reef in the exposed

part of the Stillwater Complex is terminated by thrust faults relating to the Horseman Thrust Fault system. These faults have been intersected by deep drillholes at Stillwater Mine, and the drillhole intersections of the faults have been used to constrain the depth limit of the Mineral Resources and Mineral Reserves reported for Stillwater Mine. However, similar deep drilling at East Boulder Mine has not intersected these faults and the location of the faults is currently unknown. Available deep drilling information at East Boulder Mine suggests that the elevation of these thrust faults decreases towards the west from Stillwater Mine, which indicates that a deeper Mineral Resource depth limit is applicable for East Boulder Mine. The stratigraphy of the J-M Reef (as well as the immediate footwall and hangingwall lithologies) is relatively consistent at a high level and is fairly well understood from the extensive drilling and mining undertaken at Stillwater and East Boulder Mines. Overall, the stratigraphic sequence consists of bronzitite, norite and gabbro-norite units in the footwall, troctolite or olivine-bearing rock units as the reef and anorthosite, norite, gabbro-norite and troctolite units in the hangingwall. The basal contact of the J-M Reef is conformable, but irregular, with the irregularity depicted by local depressions and highs in the plane of the reef. It is common for the hangingwall contact to cut across lithological contacts. Stillwater geological personnel employ typical hangingwall textures to delineate the top contact of the J-M Reef for sampling purposes, and these textures include rounded cumulus olivines, oikocrysts and fine to medium grained intercumulus pyroxene, as well as micro-rhythmic layering. These textures differ from J-M Reef textures, which are typified by pegmatoidal pyroxene, adcumulus pyroxene surrounding anhedral olivine and coarse grained intercumulus pyroxene. It is noted that the textural changes in footwall, J-M Reef and hangingwall lithologies provide important additional markers to guide the visual delineation of the J-M Reef. In general, PGM mineralisation in the J-M Reef occurs at the following levels relative to the base of the reef package: Footwall Zone in GN-I immediately below the lower contact of the reef package; Basal Zone straddling the basal contact of the reef package; Main Zone; and Upper Zone.

Locally at Stillwater Mine, these zones coalesce to form thickened zones referred to as ballrooms. Ballrooms are important to the economics of the J-M Reef as they contain significant (anomalous) tons and Pd-Pt metal ounces. The difficulty in predicting the location of or constraining the limits of ballrooms is noted. Mineral Resource and Mineral Reserve definition drilling information based on 50ft (15m) drillhole spacing is employed to confirm their presence, but this is not sufficient to accurately constrain the limits of ballrooms. The actual dimensions of a ballroom can only be ascertained during mining. Studies of ballrooms completed internally by Stillwater geological personnel to date have not identified any meaningful trends in the orientation, size and distribution of ballrooms. This impedes the predication and modelling of ballrooms in areas earmarked for future mining. Overall, wider than normal J-M Reef intercepts from surface drillholes and initial underground drillholes in areas earmarked for mining are interpreted as indicative of the existence of ballrooms at Stillwater Mine. It is noted that ballrooms have not as yet been encountered at East Boulder Mine where there is less variability in the J-M Reef, with zones of thickened reef generally accompanied with increases in PGM grade. The Main and Upper Zones of the J-M Reef tend to have the highest PGM grades eastwards in the Stillwater

Mine area but the Main, Basal and Footwall Zones are the most mineralised zones towards west from Stillwater Mine. Owing to the variability in the thickness and PGM grade of the J-M Reef, the hangingwall textural contact, which is always present along the strike lengths of the J-M Reef, is considered to be the most reliable marker. In addition, the reappearance of olivine cumulates or sulphide minerals above GN-I usually marks the lower boundary of the reef package. Accordingly, drilling information should facilitate accurate delineation of the J-M Reef in space and it is unlikely that the J-M Reef will be incorrectly identified during logging and inaccurately correlated during modelling and evaluation by Stillwater geological personnel. Examples of the J-M Reef stratigraphic sequence intersected by drillhole DDH41276 at Stillwater Mine and DDH2017-0064 at East Boulder Mine and the associated Pd-Pt grade profile are shown in Figure 10.

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Figure 10: Typical stratigraphic sequence and Pd-Pt grade profiles of the J-M Reef

4.4.2 Mineralogy and Grades The ore mineralogy of the J-M Reef is dominated by disseminated chalcopyrite, pyrrhotite and pentlandite, with minor pyrite, moncheite, cooperite, braggite, kotulskite, Pt-Fe alloy and various arsenides. Pd, which is the dominant PGM in the J-M Reef, occurs primarily (80%) as a solid-solution in pentlandite as well as in sulphides (15%) and moncheite (5%). Pt occurs primarily (67%) in sulphides, as a metal alloy (isoferroplatinum, 25%) and in moncheite (telluride mineral, 8%). Average in situ Pd-Pt grades of 0.6oz per ton (opt) to 0.8opt (20g/t to 25g/t) occur over the average thickness of the J-M Reef of 6ft (1.8m). At Stillwater Mine, the average in situ Pd:Pt ratio is 3.4:1 while at East Boulder Mine the ratio is 3.6:1. Other PGMs, Au and base metals (Cu and Ni) occur in accessory amounts and are not evaluated at Stillwater and East Boulder Mines. It is, however, noted that East Boulder Mine is generally characterised by lower PGM abundances and higher Cu and Ni abundances than Stillwater Mine, which indicates a west to east variation in PGM and base metal grades at a sub-regional level. This variation is also observed at a local scale as is the case in the Dow sector of Stillwater Mine (Figure 14), where Cu and Ni abundances similar to those at East Boulder Mine have been identified.

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4.5 Nature of J-M Reef on the Stillwater Property SRC2.1(iv); SV1.7

4.5.1 Nature of the J-M Reef at Stillwater and East Boulder Mines Being a magmatic reef type deposit, the J-M Reef package is laterally continuous and located at a consistent stratigraphic level in the Stillwater Complex. Accordingly, the presence and relative location of the J-M Reef at a mine scale can be predicted relatively accurately even from sparse drillhole information, such as that generated from surface drilling. Geostatistical and statistical studies completed over the years (e.g. Rendu, 2002) indicate that the Pd-Pt mineralisation is broadly continuous and predictable throughout the J-M Reef, except when the continuity is interrupted by faults, dykes and sills. It is noted, however, that the regularity of the mineralisation differs from that displayed by other magmatic PGM deposits such as Merensky Reef for which thickness and PGM grades are less variable at a stope level. Stillwater Geologists have studied the variability of the reef at a micro (stope) level and utilised the findings of these studies to delineate reef domains (reef facies) for Stillwater and East Boulder Mines. The studies have identified a direct link between reef facies and changes in local reef geology. The reef facies distribution within Stillwater Mine has been characterised into sectors of geologic domains with similar PGM grades and above cut-off grade reef percentage signatures. It is speculated that these sectors relate back to the original deposition of the mineralisation and the local reef environment within which the PGM bearing sulphides concentrated. The Main Zone of the J-M Reef is targeted for evaluation and mining. Figure 11 depicts the Main Zone block model generated from over 41 000 drillholes, which represents the J-M Reef geometry at Stillwater Mine. The model has the major transverse faults taken out and the original reef surface restored by stitching back together and rotating back the various fault blocks to a sub-horizontal original configuration. From the review of the restored model, dramatic changes in the form of the J-M Reef were noted along the exposed 30 000ft by 8 000ft (9 144m to 2 438m) area of the drilled reef. Some of the most dramatic features include a 2 000ft (610m) long depression zone (Dow Meadow Depression; Figure 12) and a hinge point where the J-M Reef changes dip, more likely associated with a “basin” within the magma chamber at the time of deposition. It was also noted that the stratigraphic sequence of the reef package varies from west to east whereby the footwall rocks show an unconformable relationship with the J-M Reef package rocks, and the olivine-rich reef package pinches and swells (Figure 12).

Figure 11: J-M Reef reconstruction at Stillwater Mine

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Areas of similar geology, PGM grade and mineralisation continuity (i.e. trends) were determined from these

analyses, and these are depicted in Figure 13. A relationship between PGM distribution and the depression (Dow Meadow Depression) and other geological features was observed. Similar variation in the amount of Cu-Ni sulphide minerals (chalcopyrite and pentlandite) found in association with the PGM minerals across these domains was noted and utilised to refine the boundaries of the reef domains for Stillwater Mine, which are shown in Figure 14. Overall, it was observed that the western domains have a higher percentage of Cu and Ni and lower PGM grades than the eastern domains. A similar analysis was completed for East Boulder Mine and this concluded that the reef in this area is less variable than at Stillwater Mine. Available drillhole information at East Boulder Mine has been used to delineate the dominant reef facies defined in the area called Frog Pond West and a second reef facies identified in a small area called Frog Pond East (Figure 15). In both cases, the drill intercepts in the different blocks were used to estimate average grades and tonnages reported in the Mineral Resources and Reserve Statements in this CPR. The major geological trends and reef types are constantly analysed at Stillwater and East Boulder Mine as more drillhole information is generated from close spaced drilling to define recognisable trends that be utilised to predict reef characteristics in less drilled areas where Mineral Resources are delineated.

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Figure 12: West to east schematic section showing variability in stratigraphy

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Figure 13: Major geological and PGM grade trends for Stillwater Mine

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Figure 14: Geological domains of the J-M Reef at Stillwater Mine

Figure 15: Geological domains of the J-M Reef at East Boulder Mine

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4.5.2 Data Density, Distribution and Reliability The Mineral Resource estimates contained in this CPR are based on an extensive drillhole database consisting of underground and surface drillhole data. Owing to the rugged topography characterising the Beartooth Mountains and the steep dipping nature of the J-M Reef, the most dominant dataset is the underground drillhole data. Surface drilling is only completed in areas where topography allows access and drilling activities can be safely completed. Surface drilling information generates the primary information that is utilised to plan underground access drives to be utilised for underground drilling. The overall spacing utilised for the surface drillholes ranges between 1 000ft to 2 000ft (305m to 610m). For follow up underground drilling, Stillwater employs 50ft (15m) drill station spacing for Mineral Resource and Mineral Reserve definition drilling, which generates additional information required to upgrade Indicated Mineral Resources to Measured Mineral Resources at both Stillwater and East Boulder Mines. The drill stations are situated in footwall lateral drifts, which are spaced 300ft (91m) vertically and situated approximately 100ft to 150ft (30m to 46m) from the J-M Reef plane. From each underground drill station situated in a footwall lateral drift (Figure 16), a single radial drillhole fan is established consisting of a sub-horizontal hole directed to drill perpendicular through the reef, typically four up holes and two down holes. Additional underground drillhole information is generated through development drilling.

Figure 16: Diamond drilling strategy

All drillholes are logged by experienced Stillwater geological personnel and mineralised drillhole intersections are sampled and analysed at the laboratory. Furthermore, all drillhole collars are surveyed while drillhole traverse surveys are completed on selected drillholes to assess and quantify any deviation. Standards procedures are available for the execution of this work, with internal sign-off procedures and structures in place specifying areas of responsibilities and oversight. The short-range variability in the thickness and PGM grades of the J-M Reef is noted. Minimal long-range variability has been observed at the mines, with the grade and thickness estimates over long ranges generally approaching regional averages. The Mineral Corporation is satisfied with the density, distribution and reliability of the drillhole data generated at Stillwater and East Boulder Mines, which has been utilised to produce the current Mineral Resource estimates. This data is of sufficient quality to be relied upon, having been subjected to rigorous internal validations.

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5 EXPLORATION DATA/INFORMATION

5.1 Data Acquisition SRC3.1(i); SRC3.1(ii); SV1.8

5.1.1 Data Acquisition Overview Exploration work completed on the Stillwater Complex, which led to the discovery of the J-M Reef in the 1970s, and subsequent PGM Mineral Resource and Mineral Reserve evaluation and mining, spans decades. Much of the early exploration was driven by the USGS and academic research institutions, and the geological information generated is publicly available, for instance, from the following organisations and their websites: Montana State Library website (http://geoinfo.msl.mt.gov/msdi.as), Montana Bureau of Mines and Geology (https://www.mbmg.mtech.edu/gmr/gmr.asp) and USGS (https://www.usgs.gov). Additional information was generated from exploration and mining activities completed by Stillwater and predecessor companies, which included geophysical (aeromagnetic and gravity) and soil geochemical surveys, surface mapping, diamond drilling, sampling and laboratory analyses.

Kleinkopf (1985) interpreted the Bouger gravity-anomaly map of the historical data collected mainly by the USGS and US Defence Mapping Agency. The gravity data was based on helicopter and ground surveys, with an estimated precision of 2mGal. From the interpretation, it was noted that the Stillwater Complex occurs as a high-gradient gravity zone in the Beartooth Mountains, which is defined by -175mGal to -155mGal contours. In addition, the study provided indications of the orientation at depth of the exposed part of the Stillwater Complex.

Blakely and Zientek (1985) described the results of the aeromagnetic survey completed by Anaconda in 1978 to map the extent of the exposed part of the Stillwater Complex, the main magnetic lithological units and geological structures. The aeromagnetic survey campaign was based on 853ft (260m) helicopter flight line spacing at a mean terrain clearance of 249ft (76m). Mafic and ultramafic lithological units of the Stillwater Complex associated with magnetic anomalies of between 50nT to 300nT were delineated. The magnetic survey data is available at the USGS in the form of digital maps.

Geological information generated by public institutions as well as that generated by Stillwater and predecessor companies over the years provide the basis for the current understanding of the regional and local geology of the Stillwater Complex and the J-M Reef. It is understood that data relating to 944 drillholes (Table 8), which were drilled between 1969 and 1995 from surface and adits at the Frog Pond and West Fork adits over 28 miles (45km) along the strike of the J-M Reef, were utilised at the time to delineate the currently known strike length of the J-M Reef. This historical drillhole data was also used to quantify the mineralisation for the sectors indicated in Table 8, which are bounded by geological characteristics, mainly major fault offsets. The historical exploration drilling conducted at Stillwater Mine was utilised to determine the location of the Horseman Thrust Fault that cuts off the J-M Reef mineralisation at depth, which forms the lower boundary on the estimated Mineral Resources at Stillwater Mine. Table 8: Historical surface and adit exploration drillholes (after Behre and Dolbear, 2017)

Sector* Number of Holes

Tecate 13

Boulder West 28

Boulder East 52

Frog Pond West 104

Frog Pond Adit (in Frog Pond West) 94

Frog Pond East 59

Brass Monkey West 46

Brass Monkey East 83

West Fork West 41

West Fork East 99

West Fork Adit (in West Fork East) 95

Dow 38

Stillwater West 88

Stillwater East 74

Blitz 30

Total Drillholes 944

*Sectors listed from west to east

Surface drilling ceased from 1995 until 2010 when it was resumed at the Blitz section of Stillwater Mine.

http://geoinfo.msl.mt.gov/msdi.as

https://www.mbmg.mtech.edu/gmr/gmr.asp

https://www.usgs.gov/

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Since the drilling of the 944 holes, underground diamond drilling has become the primary source of geological

data at Stillwater and East Boulder Mines that is utilised for Mineral Resource estimation and discussed further in this CPR. Data relating to grade control chip samples collected from underground faces is not utilised for Mineral Resource estimation.

5.1.2 Drilling SRC3.2(i); SV1.8

Limited diamond drilling is completed from surface owing to the steep dipping nature of the J-M Reef, limited access and safety considerations given the rugged terrain at the Stillwater and East Boulder Mines. The bulk of the on-going exploration and evaluation drilling at both mines consists of driving the primary development footwall lateral drifts and drilling advance probe holes from these lateral drifts to ensure that the J-M Reef is being appropriately followed. There are typically two to five drill rigs active at any one time at each of Stillwater and East Boulder Mines. The diamond drilling is based on the standard tube BQ-size drill bit to recover 1.4 inches (36.5mm) diameter drill cores. Most of the exploration drillholes for Mineral Resource evaluation are not oriented as this is not necessary given the style of the mineralisation and the overall attitude of the J-M Reef, which is fairly well understood. The bulk of the underground diamond drilling at Stillwater and East Boulder Mines is achieved by making use of a drilling strategy discussed in Section 4.5.2 and illustrated in Figure 16. This drilling is mainly aimed at increasing the confidence in the geological knowledge to a level that permits the estimation of Measured Mineral Resources, delineation of new Mineral Resource boundaries and estimation of Indicated Mineral Resources. At each drill station, a single radial drillhole fan is established to drill through the J-M Reef and perpendicular to its strike. Furthermore, a sub-horizontal hole directed to drill perpendicular through the reef, typically four up-holes and two down holes are drilled. It is also common for the mines to drill probe and off-angle drillholes as local geological conditions and the need for geotechnical and groundwater data warrant. In a typical year, diamond drilling generates approximately 0.5 million feet (150km) of drillcore at Stillwater and East Boulder Mines. The Mineral Corporation is satisfied with the density, distribution and reliability of the drillhole data generated at Stillwater and East Boulder Mines, which has been utilised to produce the current Mineral Resource estimates. This data is of sufficient quality to be relied upon, having been subjected to rigorous internal validations.

5.1.3 Core Logging SRC3.2(ii); SRC3.2(iii); SRC3.2(iv); SV1.8

Drill core is placed in core trays during the drilling operation. On completion of drilling, the core trays are transported from the drill sites to core storage facilities located on surface at both Stillwater and East Boulder Mines. The storage facilities have storage racks and logging stations, where core logging is undertaken. Core logging is guided by a Core Logging Manual (standard operating procedure) and only undertaken by trained Geologists. The Core Logging Manual provides standardised codes and nomenclature for describing lithological units and textures for all known rocks in the Stillwater Complex stratigraphic sequence. Furthermore, core logging is undertaken for the entire rock core recovered for each drillhole and includes the identification of the J-M Reef intersections as well as intervals directly above and below the J-M Reef for sampling.

The Core Logging Manual instructs all Geologists to fill out the header information on the diamond drillhole (DDH) log when starting a new hole to allow a seamless handover of the core logging and sampling to other Geologists using the work already completed. Logging, which is both qualitative and quantitative, is completed on paper log sheets, with the log details captured manually in the Core Logger system and for onwards electronic transmission into the Ore QMS database. After electronic capture, the paper logs are kept until the information in the Ore QMS is fully validated and archived on Stillwater’s central Information Technology (IT) server. Typical information captured on the log sheets is shown in Figure 17. All the information needed to fill out the header of the log sheets is found on the driller’s log sheet, which is handed over to the Geologists together with the core trays. The Geologists are required to check the information on the driller’s log sheets against the original drilling proposal, and this information includes the drillhole identification number, inclination and total length.

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Figure 17: Core logging template utilised by Stillwater

Geological logging is aimed at capturing in detail the fundamental geological characteristics of rock types intersected by drillholes and the internal variability for each unit against corresponding depth intervals. While logging the lithologies and structures in the core, occurrences of sulphide minerals are noted by way of marking with a yellow lumber crayon. Elevated sulphide mineral abundances are denoted with bold lines and trace sulphide mineralisation is marked using a dashed line. The Geologists estimate the proportion of sulphide mineral as a percentage of the total sample volume. Trace sulphide mineralisation is referred to using the following terminology: trace minus (barely visible pyrite); trace (fleck or two of chalcopyrite, pyrrhotite or pentlandite); and trace plus (few sulphides flecks up to 0.25% of sample volume). The logged data for each drillhole is captured manually into the Core Logger electronic system from which it is exported electronically to the Ore QMS database. The capture at Stillwater Mine uses bar code sheets containing codes for all the common parameters for the rocks intersected by drillholes at Stillwater and East Boulder Mines, which include rock type, mineralisation, alteration, geotechnical data and other prescribed information, and the associated distance (depth) intervals (from and to) along the drillhole. However, at East Boulder Mine, the capture utilises inbuilt drop-down lists. In addition, the Geologists are encouraged to capture any other pertinent information, which may indicate a new trend in the stratigraphy or type of J-M Reef mineralisation. In the Ore QMS environment, information for each drillhole is entered on a new page within the database, and the database is designed to ensure that all required data is entered before the entries can be saved. For East Boulder Mine, digital photographs of most of the sampled core are taken and kept in the files and on separate disks. These photographs provide additional back up records of the sampled horizons, but these are rarely utilised. However, no digital photographs are taken at Stillwater Mine as this has not been deemed to be necessary. The absence of core photography at Stillwater Mine is not seen as a material issue with regards to Mineral Resource evaluation. Geotechnical logging is completed on probe and Mineral Resource and Mineral Reserve definition drillholes. The Mineral Resource and Mineral Reserve definition drillholes at Stillwater Mine that are considered for geotechnical logging include first down hole and up hole at a drill station, sill holes and holes identified as high-grade mineralisation at the time of logging. Furthermore, drill core for straight-ahead and south-directed probe holes are geotechnically logged. Typically, two footwall zones, the J-M Reef and three hangingwall zones are geotechnically logged. At East Boulder Mine, geotechnical information is collected on all drillholes, with one footwall zone, reef and one hangingwall zone geotechnically logged. In general, geotechnical logging involves the determination of core recovery, Rock Quality Designation (RQD), fracture frequency, number of joint sets, joint roughness, joint alteration, nature of fracture fill and Point Load Index. This information is stored in the Ore QMS database and utilised for rock engineering. There are no material issues identified with regards to core logging at Stillwater and East Boulder Mines, with core processing and logging procedures entrenched at the mines and in line with industry best practice.

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5.1.4 Downhole Surveys SRC3.1(v); SRC3.2(v); SV1.8

Downhole surveys at Stillwater Mine are completed for probe holes designed to intersect the J-M Reef ahead of the footwall lateral advance and probe holes drilled straight ahead to check for ground conditions for development advance as well as for the few holes drilled oblique to the J-M Reef plane from a single location to cover a wide area. The surveys are completed using a magnetic multi-shot downhole survey tool (isCompassTM), with accuracies of ±0.15o and ±0.35o on inclination and azimuth measurements, respectively. At East Boulder Mine, down hole surveys are completed on all probe holes as well as horizon holes and positive 150ft (46m) holes on each definition drillhole fan. These surveys are completed using a Reflex EZ-TRACTM tool that has an accuracy of ±0.25o on inclination and ±0.35o on azimuth. In poor ground conditions where the downhole survey tool could be at risk, the mines will survey only the first 50ft (15m) into the hole. However, the entire hole is surveyed at 50ft (15m) depth intervals from bottom of the hole towards the collar when it is situated in an area characterised by good ground conditions. Experience with drillhole deviation at Stillwater and East Boulder Mines has shown up to 5ft (1.5m) of deviation on 300ft to 400ft (91m to 122m) long holes and up to 10ft (3m) on the longer 600ft to 650ft (183m to 198m) probe holes. In general, the mines minimise the drilling of Mineral Resource and Mineral Reserve definition obliquely given that even 5ft (1.5m) of deviation can become exaggerated with off-section drilling. The mines also survey the collar co-ordinates, azimuth and inclination of each hole and these surveys are completed by the Mine Surveyors. Experience at the mines has shown that downhole surveys on Mineral Resource and Mineral Reserve definition holes do not significantly improve the modelling of the J-M Reef for as long as the holes are surveyed at the collar for azimuth and inclination. Accordingly, the mines do not complete downhole surveys for each drillhole. There are no material issues identified with regards to downhole deviation and the approach at Stillwater and East Boulder Mines to complete downhole profiles for selected holes. The extent of drillhole deviation is considered insignificant and the downhole surveying of selected drillhole is appropriate.

5.2 Sampling

5.2.1 Sample method, collection, capture and storage SRC3.3(i); SRC3.3(ii); SRC3.3(iii); SRC3.3(iv); SRC3.3(v); SRC3.3(vi); SRC3.3(vii); SV1.8

The procedure at Stillwater and East Boulder Mines is to sample all mineralised intersections. For this sampling, it is critical to break the sample intervals taking into account variations in sulphide mineralisation abundance and lithology. This facilitates efficient assessment of the analytical results of the sampled section. A break in sampling should always occur at the hangingwall contact. Furthermore, given the coarse-grained nature and the high nugget character of the J-M Reef, the entire core sample (instead of a split sample) is submitted to the laboratory for analysis. At East Boulder Mine, one drillhole for every 500ft (152m) of footwall lateral is split with one half submitted for laboratory analysis. Samples are taken in 0.5ft to 3ft (15cm to 91cm) segments, with sampling extended 3ft (91cm) and 1ft (30cm) into the footwall and hangingwall of the mineralised intersection at Stillwater and East Boulder Mines, respectively. Sampling may be extended further into the footwall zones that are mineralised. While sample lengths are expected to range from 0.5ft to 3ft (15cm to 91cm), this can be varied when sampling large waste gaps where the sample interval can be extended to 4ft (122cm) or when ground conditions are so poor that only a fraction of the drilled core was recovered, in which case the full 5ft (150cm) between running blocks is

taken. If a mineralised interval is less than 0.5ft (15cm) in length, a sample is extended into the adjacent waste rock. The laboratory requires a minimum sample size equivalent to 0.5ft (15cm) in length for BQ-size drill core. A waste gap of less than 10 inches (25cm) between mineralised zones should be sampled. No sample preparation is performed at the core storage facilities, and the core samples are sent to the laboratory for analysis subsequent to sampling and packaging. The dip of the J-M Reef varies from almost vertical at Stillwater Mine to 35o at East Boulder Mine towards north and northeast, respectively. Given the drilling strategy employed at the mines (Figure 16), the J-M Reef plane is intersected by drillholes at apparent angles, which means that the intersection thickness recorded in logs and samples is an apparent thickness. During modelling, the Geologists determine the true thickness of the J-M Reef drillhole intersections using lithological dips recorded during logging and the drillhole collar co-ordinates, azimuth and inclination supplied by Mine Surveyors.

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Extensive drilling completed at Stillwater and East Boulder Mines generates a large quantity of drill core, which

makes permanent retention of drill core impractical. Accordingly, all unmineralised drill core intersections are discarded after laboratory analysis of the mineralised intersections, data validation and geological model updates, which are performed on an on-going basis. Pulp sample rejects for drillholes in mined out areas are discarded at Stillwater Mine whereas all pulps are retained at East Boulder Mine. Core recovery data is captured during geotechnical logging and this data is stored in the database as part of the geotechnical dataset. Core recoveries are determined for each drill run on a pull by pull basis. Typically, core recovery at Stillwater and East Boulder Mines is over 95%, with significant core loss mainly associated with fault zones. Cases of re-drilling holes due to poor recovery are infrequent. From a few cases of historical experience, it is noted that re-drill (second attempts) are often associated with poor recoveries, which makes the re-drills unnecessary. The assessment of potential relationships that may exist between sample recovery and grade has not been done as sample recovery of 100% in the mineralised zones is achieved most of the time. Furthermore, there have not been any issues in the history of the mines to warrant this assessment.

5.2.2 Sample Preparation and Analysis SRC3.4(i); SRC3.4(ii); SRC3.4(iii); SV1.8

5.2.2.1 Background The analytical laboratory serving Stillwater’s mining and metallurgical operations is located at the metallurgical complex in Columbus. The laboratory has facilities for sample preparation, chemical analysis (via fire assay and instrumental techniques) and generation functions, and is equipped with the Laboratory Information System (LIMS) software, which allows for effective and efficient management of samples and associated data. The analytical laboratory was automated with both Wavelength Dispersive and Energy Dispersive X-Ray Fluorescence (XRF) instrumentation as well as robotic sample preparation facilities in 2011. It handles exploration drilling and grade control samples as well as samples from the concentrators, smelter and base metal refinery. This section describes the analysis of drill core (geological) samples recovered from exploration and evaluation drilling, which underpin the Mineral Resource estimates contained in this CPR. The laboratory is owned and operated by Stillwater and is not accredited. It is, however, subjected to periodic external checks on internal samples by a group of six international accredited laboratories, while umpire analyses are performed on filter cake (final product) and recycle materials as required when a variance outside contractual limits arises. The Mineral Corporation inspected the laboratory facilities and interviewed key laboratory personnel during the site visit, and could not identify any issues in the sample preparation and analytical equipment and methods utilised by the laboratory for geological samples. The absence of accreditation is not considered to be a material issue. Drill core samples originating from Stillwater and East Boulder Mines are transported by Geologists in the cargo holds of the personnel transports to the laboratory where they are received and checked against the Geologists’ sample submission sheets. Any samples identified as missing, surplus or mislabelled are reported to the Geologists for rectification.

5.2.2.2 Sample Preparation and Analysis The laboratory undertakes sample preparation of all drill core samples submitted for analysis by the Geologists. The sample preparation and analytical process flow employed for the geological samples is summarised in Figure 18. Drill core samples submitted to the laboratory, typically 4.4lb to 11lb (2kg to 5kg) in mass, are received and checked after which they are dried at a temperature of 221°F (105°C) for approximately two hours. After drying, the samples are organised into sets containing on average 20 samples and assigned tags with bar codes. The barcoded sample labels are scanned and logged into the LIMS. The samples are run through a primary and secondary jaw crusher producing material grading 100% passing 0.25 inches (6.35mm). The processes utilised for sample size reduction after crushing are performed by robotic equipment, thereby minimising the potential for bias or sampling error. The crushed material is split down to approximately 0.40lb to 0.44lb ((180g to 200g) using a Jones riffle splitter, and introduced into the robotic sample preparation system (HPM1500). This system sequentially pulverises each sample to achieve 95% passing 150-mesh size (i.e. 100µm particle size) in an automated grinding mill. Grind tests are performed quarterly to ensure the correct grind size is achieved.

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Figure 18: Geology sample laboratory processes

A portion of the pulverised material is weighed, mixed with binder and loaded into an automated pellet press.

The remaining sample material is taken to the fire assay balance room. An X-Ray Fluorescence (XRF) analysis is performed on the pressed pellet. The fire assay (FA) process comprises the following steps: Fusing the primary and standards samples with a Pb-based flux at 2 084°F (1 140°C); Separating the Pb to form a Pb button; Cupellation to form a precious metal bead (PbFA-collection); and Bead digestion in aqua regia.

Bead digestion is followed by metal content determination via Inductively Coupled Plasma Optical Emission Spectrometry (ICP-OES) analysis of the digestion solution. Silver (Ag) is introduced into the flux as a co-collector to help collect the precious metals in the geology samples and other low-grade samples. However, when hydrochloric acid is added to produce the aqua regia needed to digest the PGMs, the Ag precipitates. As a result, a portion of the Rh in the sample co-precipitates with the Ag, resulting in poor Rh recovery that may affect the Rh abundance reported for a sample. Geological samples for Stillwater, for which Pd and Pt are the only PGMs analysed, the PbFA collection technique is appropriate. Balances used for charging fire assay samples are tested for accuracy, each shift using certified check weights. Furthermore, a third party performs preventative maintenance and calibration annually on the scales. All analytical results are reported directly into the LIMS via the instrumentation and forwarded to the Geologists electronically. Accordingly, the risk of data capture error is minimised. The XRF analysis produces results for 15 elements (Pd, Pt, Cu, Ni, Fe, S, Mg, Ca, Si, Al, Na, K, Cr, Ti and Mn), from which the LIMS reports only the elements of significance (Pd and Pt). For the PbFA collection and ICP-OES, only Pt, Pd and Au values are determined and the Pd and Pt values reported. The Pd data reported from the XRF analysis is compared with the Pd data based on the PbFA collection technique before the analytical reports are finalised. Any discrepancies are investigated and rectified before the report is finalised.

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Both XRF and fire assay analytical techniques are defined as total analysis and the results produced reflect

extractable values of the target metals (Pd and Pt) reported in the Mineral Resource Statement. The instrument lower detection limits (LDL) for the analytical processes employed have been indicated as 5ppb for Pd and 10ppb for Pt. The quality assurance and control (QA/QC) procedures for the laboratory processes involved in the analysis and handling of the geological samples were reviewed by The Mineral Corporation. This details the location and specific analytical procedures to be used to maintain analytical accuracy and precision. Laboratory standards and blanks are included in each sample batch and any anomaly identified in the quality control samples is addressed as required. There are no commercially available independent standards of the J-M Reef mineralisation. As a result, the laboratory manufactures its own internal standards, which it sends out to external laboratories periodically for check certification.

5.2.3 Sampling Governance SRC3.5(i); SRC3.5(ii); SRC3.5(iii); SRC3.5(iv); SV1.8

During the site visit, The Mineral Corporation interviewed Geologists responsible for core processing, logging and sampling, and inspected core storage facilities and selected sampled drillcores. From this, it was noted that standard operating procedures (manuals) governing the collection, processing and storage of geological data utilised for Mineral Resource estimation are in place and well entrenched at Stillwater and East Boulder Mines. These manuals are aligned with industry best practice and designed to standardise outcomes as well as to ensure quality in the data capturing, processing and storage. Core logging and sampling functions are executed and supervised by suitably experienced geological personnel. The reporting and supervision structures in place allow for the validation of data collected, which should lead to the detection of material errors before the entries in the database are finalised. Extensive on the job training of new Geologists, who will eventually be responsible for logging and sampling, is an additional governance step that the mines employ. Diamond drilling crews are required to keep the recovered drill core clean all the time. Furthermore, the drill core recovered is placed in core trays sequentially according to drilling depth, and the trays are transported by the drilling crews to surface storage facilities once drilling has been completed. Core recovery is one of the key metrics employed to assess the performance of a driller, with any significant core loss resulting from the driller’s negligence necessitating a re-drill of the hole. Core recoveries are determined for each drill run on a pull by pull basis. In general, these are over 95%. Experience at the mines has shown that the BQ-size core recovered is sufficient for laboratory analysis for as long as a minimum sample of 0.5ft (15.2cm) is adhered to, and this is being done. There is no risk of contamination, selective losses or high grading associated with the diamond drilling at Stillwater and East Boulder Mines. Core accounting and depth reconciliations are performed on all recovered drill cores prior to marking, and these are intended to reflect, as much as is possible, the accurate depth at any point. The drill core is marked and sampled by appropriately experienced geological personnel. Surface core storage facilities at Stillwater and East Boulder Mines are secure and accessed by authorised geological personnel. Furthermore, the facilities are part of the surface infrastructure at the mine sites, which are fenced off to prevent unauthorised entry by the public and animals, with access restricted to Stillwater employees.

Drill core samples are assigned unique sample identification numbers and tags before they are transported to the laboratory by Geologists. The samples for each drillhole are submitted to the laboratory on the same day that the sampling takes place, failing which they should be submitted during the morning of the following day. The Geologists prepare sample submission sheets that accompany the samples. Both the samples and the sample submission sheets are placed in customised bins from which they are received by the laboratory personnel. Stillwater subjects its operations to internal and external technical and governance audits. The scope of these audits includes detailed process audits of data collection, processing and storage, geological modelling and estimation and reporting. No material issues have been reported from these audits, with recommendations for continuous improvement included in the audit reports from time to time. Audits by external parties are completed every year, with the last external audit undertaken by Behre and Dolbear in February 2017 for the December 2016 public reporting.

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Internal auditing is a continual process and includes the following:

Review of sample results from the laboratory for abnormal Pt/Pd ratios or abnormally high grades before

any assays are accepted into the Ore QMS database; Comparison between visual sulphide mineral estimates made during the core logging and assayed grades

after the assay results are accepted into the Ore QMS database. Occurrences of sulphide minerals with no associated/expected Pt and Pd values or high Pt and Pd values where there are no visible sulphide minerals are noted and investigated;

QA/QC involving the assaying of ten waste blanks per month and repeat samples included in sample batches submitted to the laboratory as well as assessment of the analytical data on an on-going basis. Details of the QA/QC procedures employed are presented in Section 5.4.

If any of these steps show indications of possible problems, the samples are sent to the laboratory for re-assaying. The results are recorded, and any issues are reported to the laboratory for rectification. Based on the foregoing, there are no material issues regarding sampling governance.

5.3 Database Management SRC3.5(iii); SV1.8

The Ore QMS database was created in 2006 for the storage and management of the diamond drill core data. It is an in-house built database designed to standardise information gathering during exploration and Mineral Resource and Mineral Reserve definition drilling. Diamond drillhole header information, lithological, geotechnical, structural, analytical, and mineralisation data are imported electronically from the Core Logger system. In addition, it has library tables, key fields and codes that serve as validation tools to ensure that correct data is entered into the database. The Ore QMS database is stored on the central IT server and has rigorous controls to ensure security and integrity of the data. These controls include password protection and access restrictions. Furthermore, data stored in the database can only be modified or deleted by authorised senior geological personnel. The central IT server is backed up regularly based on Stillwater’s Information Management Systems procedures, and backups of the database are available to the relevant geological personnel. The diamond drillhole data stored in the Ore QMS database is exported to VulcanTM modelling software, which provides additional backup. The Mineral Corporation concludes that there are no material issues with regards to data handling, storage and validation. There are sufficient provisions to ensure the security and integrity of the data stored in the database.

5.4 Quality Assurance and Control SRC3.6(i); SV1.8

5.4.1 Overview As indicated in Section 5.2.3, Stillwater has well established standard operating procedures for standardising geological data gathering and for ensuring the integrity of the data collected. For quality assurance, the main processes of the data collection and processing are performed or supervised by experienced Geologists guided by the standard operating procedures. In addition, Stillwater implements an analytical quality control protocol based on measuring the extent of contamination and analytical precision at the laboratory. Accordingly, batches of samples sent to the laboratory include routine “blank” samples (hangingwall and footwall anorthosite) and

pulps from previous samples (repeats). Repeats are included in sample batches at a ratio of one repeat sample per every 20 to 40 primary samples at Stillwater and East Boulder Mines, and the repeat samples include both high and low-grade pulp samples. Every sample batch will have at least one blank sample, with the submission of at least ten blank samples to the laboratory targeted every month at each mine. In the absence of commercially available certified reference material of the J-M Reef, the geological personnel rely on the analytical results of internally generated standards (MF-14 and MF-15) introduced into geological sample streams by the laboratory personnel to monitor the accuracy of the laboratory analytical procedures. The standards are inserted in the sample streams at a frequency of one standard per 20 samples in a batch. Analysis of the repeat and blank analytical data is an on-going process and any issues identified are investigated and rectified by the geological and laboratory personnel. QA/QC reports compiled by the geological personnel and reviewed by The Mineral Corporation indicate that the inclusion of blank and repeat samples in sample batches has been done since 2006. It is noted that sample batches analysed before 2006 did not

include blank and repeat samples as this practice was acceptable at the time.

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The previous external audits of QA/QC protocols by Behre and Dolbear (2017) concluded that the QA/QC

procedures employed by Stillwater provide assurance that the assays are reliable. However, the audit recommended the following minor improvements to the QA/QC procedure: Submission of a few pulps to an independent third-party laboratory at least twice a year as a check on the

internal laboratory and to provide additional confidence in the results; and Analysis of pulps by third-party laboratories.

Stillwater has adopted these recommendations and has commissioned a programme involving the assaying of ten pulps twice a year by an external laboratory, including six samples from Stillwater Mine and four samples from East Boulder Mine. The Mineral Corporation has also reviewed the blank, repeat and standards sample data for Stillwater Mine and East Boulder Mines as part of the independent review for this CPR, and the findings of the review are discussed in Sections 5.4.2 to 5.4.4. During the site visit, The Mineral Corporation also submitted sample pulps for drill hole DDH41276 (randomly selected) to the laboratory as part of the independent checking of analytical data for this CPR, and the results of this exercise are discussed in Section 5.4.5.

5.4.2 Repeat Data Owing to the nugget effect of the Pd-Pt mineralisation of the J-M Reef, Stillwater considers re-assaying pulps (repeat assaying) to produce “duplicate” samples as opposed to splitting the primary samples to generate field duplicates. The Mineral Corporation has assessed the original and repeat sample data collected since 2006 using the Mean Deviation method, with the percent Mean Deviation calculated as follows:

% 𝑀𝑒𝑎𝑛 𝐷𝑒𝑣𝑖𝑎𝑡𝑖𝑜𝑛 =100 𝑥(

(𝑂𝑟𝑖𝑔𝑖𝑛𝑎𝑙 𝑆𝑎𝑚𝑝𝑙𝑒 − 𝐷𝑢𝑝𝑙𝑖𝑐𝑎𝑡𝑒)2

)

((𝐷𝑢𝑝𝑙𝑖𝑐𝑎𝑡𝑒 + 𝑂𝑟𝑖𝑔𝑖𝑛𝑎𝑙 𝑆𝑎𝑚𝑝𝑙𝑒)/2)

Using this method, tolerance limits for precision are placed on ±10% Mean Deviation such that % Mean Deviation values falling within the ±10% tolerance limits are interpreted as indicative of acceptable analytical precision and vice versa. In addition, a negative value indicates under-reporting of the original value and vice

versa. There were 1 100 and 1 731 repeat samples with repeat analytical data for Stillwater and East Boulder Mines, respectively. The % Mean Deviation data for Pd + Pt for the Stillwater and East Boulder Mines is shown in Figure 19 and Figure 20, respectively. The Mineral Corporation notes that, in general, % Mean Deviations tend to be greater for samples with element abundances close to the instrument analytical detection limits and smaller at higher element abundances. As a result, the distribution of samples when plotted on a graph of % Mean Deviation vs. mean of the sample pairs often defines a ‘trumpet shape’ as observed in Figure 19 and Figure 20.

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Figure 19: Stillwater Mine Mean Deviation plots for repeat data

Figure 20: East Boulder Mine Mean Deviation plots for repeat data

Approximately 77% and 93% of the repeat sample data show acceptable precision for Stillwater and East Boulder Mines, respectively. The geological personnel at Stillwater and East Boulder Mines re-submitted the repeat samples showing unacceptable precision to the laboratory for further analysis. In most of these cases, the second and third analyses were comparable, which suggests that the problem was related to sample selection and labelling (i.e. sample swapping and mislabelling) by the geological personnel or in the laboratory’s sample preparation room rather than poor precision by the laboratory.

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Based on the foregoing, The Mineral Corporation is of the view that the laboratory’s analytical data shows

overall acceptable precision and that the data can be used for Mineral Resource estimation. It is, however, recommended that the potential sample handling issues (particularly at Stillwater Mine) be investigated further for remediation.

5.4.3 Blanks Data The blank material utilised at Stillwater and East Boulder Mines has no certified value, and the blank sample data has only been analysed visually on plots to identify anomalous values that may suggest overwhelming contamination or sample swapping (Figure 21 and Figure 22). The blank data for Stillwater and East Boulder Mines consisted of 1 456 and 553 data points, respectively.

Figure 21 shows the blanks data for Stillwater Mine and that the majority (99%) of the Pt + Pd values plot within the range of 0g/t to 7g/t, with sample data points above 7g/t interpreted to be obvious outliers. Internal investigations by the geological personnel attributed these outliers to incorrect data entry.

Figure 22 shows the blanks data for East Boulder Mine and that the majority (99%) of this data plots below 6g/t Pt + Pd, with data points above 6g/t interpreted to be obvious outliers. Internal investigations attributed the outliers to either sample swapping or the presence of sulphide mineralisation within the blank samples.

The Mineral Corporation notes that the “blank” material (hangingwall and footwall anorthosite) utilised by Stillwater and East Boulder Mines appears to have elevated levels of Pd and Pt and is not suitable for use as a blank for monitoring contamination in the sample preparation and analytical procedures at the laboratory. In the absence of certified values for Pd and Pt for the blank utilised, little can be said about the meaning of the available blank sample data. It is, however, noted that most of the sample data is below Mineral Resource grades for both mines, which discounts the presence of overwhelming cross sample contamination that would influence Mineral Resource grades reported. The few outliers identified can be attributed to sample swapping or contamination. Based on the foregoing, The Mineral Corporation recommends the use of certified blank material with insignificant levels of Pd and Pt to monitor contamination and sample swapping at the laboratory.

Figure 21: Stillwater Mine blank sample data

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Figure 22: East Boulder Mine blank sample data

5.4.4 Standards Data Stillwater’s analytical laboratory in Columbus utilises internal standards to assess accuracy of the analytical procedure employed for geology samples. The laboratory inserts one standard sample per every 20 samples in the sample stream. The Mineral Corporation has procured the standards sample data from the laboratory to assess the level of accuracy to which the geology samples have been analysed. The laboratory provided data for standards material MF-14 (3 133 samples) and MF-15 (4 672 samples) as well as the expected values. It was noted that MF-14 was utilised for sample batches analysed in 2015 and MF-15 was used in 2016 and 2017. The expected values for MF-14 and MF-15 are presented in Table 9. Table 9: Expected values for the standards

Name of Standard Expected Pd (g/t) Expected Pt (g/t) Pd + Pt (g/t)

MF-14 17.82 4.99 22.81

MF-15 7.58 1.57 9.15

The Mineral Corporation has analysed the standards data using the % Error Deviation method, whereby the % Error Deviation is calculated as follows:

% 𝐸𝑟𝑟𝑜𝑟 𝐷𝑒𝑣𝑖𝑎𝑡𝑖𝑜𝑛 = 100 𝑥 (𝑋_𝑒𝑥𝑝𝑒𝑐𝑡𝑒𝑑 – 𝑋_𝑎𝑛𝑎𝑙𝑦𝑠𝑒𝑑)

𝑋_𝑒𝑥𝑝𝑒𝑐𝑡𝑒𝑑

X_analysed is the analytical result of the standard by the laboratory and X_expected is the expected value for the standard. Furthermore, a negative % Error Deviation value represents under-reporting of the analysed sample with reference to the expected value and a positive value represents over-reporting. Using the Error Deviation method, The Mineral Corporation sets a ±10% tolerance limit and considers a % Error Deviation value falling within the ±10% tolerance limit to have been reported within acceptable accuracy limits. The % Error Deviation data MF-14 and MF-15 for standard samples are shown in Figure 23 and Figure 24, respectively.

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Figure 23: Laboratory Standard MF-14 analysis

Figure 24: Laboratory Standard MF-15 analysis

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From the review of Figure 23 and Figure 24, the following commentary can be made:

Approximately 96% of Pd and 93% of Pt % Error Deviation data for MF-14 plot with the ±10% tolerance limit;

Approximately 95% of Pd and 90% of Pt % Error Deviation data for MF-15 plot with the ±10% tolerance limits;

Outliers are noted for MF-15 data, which show poor accuracy on those samples; There is consistent but insignificant over-reporting of Pd (Error Deviation = 5.5%) and under-reporting of

Pt (Error Deviation = 3.7%) in MF-14 during 2015; There is consistent but insignificant over-reporting of Pt (Error Deviation = 2.1%) and no obvious bias in

the reporting of Pd (Error Deviation = 0.2%) in MF-15, which shows a reversal of the trends from 2015.

Based on the observations summarised above, it is concluded that the standards sample data reviewed broadly shows acceptable levels laboratory accuracy. Accordingly, the analytical data for the sample batches analysed together with these standards is deemed acceptable for inclusion in the database for Mineral Resource estimation. The accuracy of the sample analytical procedure is better for the higher-grade material (MF-14) than for lower-grade material (MF-15). It is recommended that the laboratory considers the concurrent use of low and high-grade standards. It is also recommended that the geological personnel at Stillwater and East Boulder Mines consider procuring the standards material from the laboratory for the independent checking of the accuracy by the laboratory.

5.4.5 Independent Re-assaying The Mineral Corporation submitted pulps for drillhole DDH41276 for analysis at the laboratory. The analytical results from this exercise and the original results have been provided to The Mineral Corporation. The objective of the exercise was to independently check the analytical data for DDH41276 in the database against the repeat analysis to ensure that the two datasets contain Pt and Pd grades of the same order of magnitude.

This data was assessed in terms of % Mean Deviation (discussed in Section 5.4.2) and the results of this assessment are shown in Figure 25 for Pt and Pd, respectively. At grades above 2g/t, the % Mean Deviations for Pd and Pt plot within the ±10% tolerance limit. The graph also shows significant scatter for original and repeat Pd and Pt data less than 2g/t and overall higher values in the original samples analysed. Further regression analysis of the data indicated regression coefficients (R2) for original and repeat Pt and Pd data pairs of 0.9527 and 0.993, respectively, which shows strong correlation between the datasets. Based on the % Mean Deviation data and correlation between original and repeat datasets, The Mineral Corporation is satisfied that the primary objective of this exercise has been achieved and the Pt and Pd grades of the original and repeat analysis are of the same order of magnitude.

Figure 25: Mean Deviation results for DDH41276 Pd and Pt

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5.5 Bulk Density SRC3.7(i); SRC3.7(ii); SRC3.7(iii); SRC3.7(iv); SV1.8

The bulk density (specific gravity) estimate utilised for the estimation of tonnage at Stillwater and East Boulder Mines is based on the Archimedes determination method. An average specific gravity estimate of 0.086ton/ft3 (2.76t/m3) was determined in 2000 from a limited dataset of J-M Reef intersections and has since been utilised for all the in situ tonnage estimates for Stillwater and East Boulder Mines. A parallel density determination using the pycnometer method at the laboratory produced specific gravity estimates that were on average 5% higher than those determined through the Archimedes method. It was decided to adopt the lower average specific gravity determined through the Archimedes method. It is standard practice at Stillwater and East Boulder Mines to undertake reconciliations of actual and estimated tonnage for Mineral Reserves. The reconciliation statistics produced since 2012 indicate that the estimates and actual tonnages are aligned and do not differ materially (Table 10). Higher than estimated tonnages are realised at Stillwater Mine. Accordingly, the tonnage estimates contained in this CPR, which are based on the average specific gravity of 0.086 ton/ft3 (2.76t/m3) are acceptable. Table 10: Tonnage and grade reconciliation statistics for Stillwater and East Boulder Mines

Year Stillwater Mine Tonnage Reconciliation East Boulder Mine Tonnage Reconciliation

(%) (Estimate-Actual)/Estimate (%) (Estimate-Actual)/Estimate

2016 -4% -2%

2015 0% 5%

2014 -3% -2%

2013 -7% -1%

2012 -8% 0%

Average -6% 0%

While the reconciliation data shows relatively good correlation between estimated and actual tonnage, The Mineral Corporation notes that the practice of using an average specific gravity from a limited dataset is not consistent with industry best practice. During the site visit, The Mineral Corporation recommended routine

determinations of specific gravity on all the J-M Reef samples prior to submission to the laboratory to generate data that can be used to improve the tonnage estimates. In July 2017, Stillwater commissioned an on-going programme for specific gravity measurements using the Archimedes method. Currently, preliminary specific gravity data collected on mineralised material intersected by horizontal drillholes indicate an average specific gravity estimate of 0.089 ton/ft3 (2.86t/m3) for both Stillwater and East Boulder Mines, which is on average 4% higher than the specific gravity utilised since 2000. This dataset is insufficient to draw overreaching conclusions and the lower specific gravity estimate utilised over the years has been used for the current estimates. Furthermore, the dataset does not permit the assessment of a grade vs. specific gravity relationship. The Mineral Corporation accepts the conservative stance adopted by Stillwater.

5.6 Bulk-Sampling and/or Trial-Mining SRC3.8(i); SRC3.8(ii); SRC3.8(iii); SRC3.8(iv); SV1.8

There has not been any bulk sampling and/or trial mining completed at Stillwater and East Boulder Mines, which have been in operation since 1986 and 2002, respectively. Accordingly, a description of bulk sampling and/or trial mining at these mines is not relevant for this CPR.

5.7 Survey Data SRC3.1(v); SV1.8

The underground coordinate system employed at the Stillwater and East Boulder Mines is based on the North American Datum of 1927 (NAD27) State Plane, with a 20o clockwise rotation for alignment with the roughly east to west strike direction of the J-M Reef. The NAD 1983 (NAD83) coordinate system is used for all surface surveys, and there is a conversion in place to work between these two coordinate systems. At Stillwater Mine, Leica total stations are used for underground surveying, with three of the total stations being TS06 one-second instruments and the fourth being a Leica 1200 fully robotic one-second instrument. All the survey instruments are reflectorless and have internal memory for job storage. At East Boulder Mine, two TS06 one-second total stations are used for surveying, with a phone and phone application used for data collection.

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Survey controls employed at Stillwater and East Boulder Mines are primarily doubled, direct right angle survey

points as well as a small amount of re-sectioning. Primary control points have tagged sequential numbers and, currently, there are more than 19 000 points at Stillwater Mine and more than 5 000 at East Boulder Mine. Temporary points are hung from ground support and number over 200 000. Control points are generally advanced at 100ft to 200ft (30.5m to 61m) spacing. Groundlines, back spans and sill angles are collected while advancing control. At the distance of approximately 2 000ft (610m), a closed loop traverse is performed. The results of the traverse must close within established parameters (less than 1ft per 50 000ft or 0.3m per 15 240m) and errors are balanced and applied to the control database. Surveying of underground diamond drill holes consists of placing a rod into the drill collar to a depth of 2ft (60cm) and collecting survey points at the collar and end-point of the rod. From this data, the information is processed and stored in the database showing drillhole collar co-ordinates, azimuth and inclination. Initial control and collar locations of surface drillholes are established by GPS; Leica GS14 at Stillwater Mine and Leica 950 at East Boulder Mine. After drilling, a total station is used to survey the drillhole collar, azimuth and inclination. Direction for development headings are design dependent. Linear drives greater than 500ft (152m) utilise McGarf sidewall lasers whereas those less than 500ft (152m) and radius designs use grade chains or removable sleeved McGarf lasers. An as-built stope survey is performed typically once a month and when the stope cut is mined out (stopped). All data collected each day is processed, stored and saved in a database. The survey database is read-only for all Stillwater employees except for survey personnel. Surface topography, waste and tailings dumps and stock piles are surveyed using the Leica GPS. Tailings impoundments are surveyed using the Leica GPS, a HydroLiteTM echofinder and a HyDrone-G2-RCV-TM remote controlled boat drone. Due to the extreme weather in winter months, the surface surveys are only conducted generally in the summer months when weather conditions are favourable. Stillwater and East Boulder Mines each have a Chief Surveyor that has oversight on all traverse work and responsible for calculating the closed loop surveys in Traverse PC Land Surveying software and survey sign-off.

5.8 Data Verification, Audits and Reviews SRC3.1(ii); SRC3.1(iv); SRC3.1(iii); SRC3.1(vii);SRC3.1(viii); SV1.8

Internally generated exploration and Mineral Resource and Mineral Reserve definition drillhole data is the primary data utilised for geological modelling and Mineral Resource estimation at Stillwater and East Boulder Mines. Supplementary information utilised for Mineral Resources evaluation includes internally generated underground geological and geotechnical maps, surface topographic surveys (wireframes), historical mining information and title information as well as relevant geological information collected and stored by the state institutions (Montana State Library, Montana Bureau of Mines and Geology and USGS), which is available in the public domain. Tonnage and grade estimation for both mines is based on validated drillhole data collected by Stillwater and stored in the Ore QMS database. The primary elements of the drillhole database relevant for geological modelling and Mineral Resources evaluation are as follows: Survey data: drillhole collar co-ordinates, azimuth, dip and down hole surveys;

Lithological data: descriptions of rock type, mineralisation, alteration and geological structures; and Analytical data: chemical analyses for Pd and Pt for each sample of the J-M Reef analysed.

As of 30 June 2017, the diamond drill database for Stillwater Mine contained data for 39 682 drillholes totalling 8.88 million feet (2 640km) and 220 688 sampled intervals. The database for East Boulder Mine contained data for 8 107 drillholes totalling 2.37 million feet (712km) and 55 030 sampled intervals. The locations of the drillholes are shown in Figure 26 and Figure 27. Lithological data is acquired through the logging of drill core recovered from surface and underground drilling. The logging is undertaken by trained Geologists, who are familiar with the J-M Reef, footwall and hangingwall stratigraphy and rock types, and these Geologists are supervised by appropriately experienced Geologists. Furthermore, the logging is guided by a standard operating procedure, which standardises data gathering and the type of detail required for each drillhole log. Logging is also guided by existing drillhole information and any deviation from the expected rock types and stratigraphic sequence are investigated further by the Geologists supervising the logging.

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Survey data is collected by experienced Mine Surveyors and the data is audited by and signed-off by the Chief

Surveyors as discussed in Section 5.7. Analytical data is assessed on an on-going basis using the QA/QC procedures discussed in Section 5.4. This data is received electronically from the laboratory and imported electronically into the database, where it is integrated with the relevant lithological and survey data. The imports into the database and validations are performed by experienced geological personnel. The data is validated for missing data and incorrect entries through spot checks completed on strip logs (logs of the integrated data). The drillhole database is periodically checked using a Vulcan™ program script that automatically checks for missing, overlapping or inverted assay intervals during data import. Additional validations include visual checks in the Vulcan™ environment. These visual checks include comparisons of survey database entries against surveyed three-dimensional (3D) models of the footwall lateral drifts to validate that drillhole collar co-ordinates, azimuth and inclination. Downhole metal profiles for each drillhole are compared against expected profiles for each geological domain and any discrepancies are investigated further and addressed. Detailed analysis of all the historical drilling data by Stillwater during 2004 identified several drillhole intervals in the geological database that were sampled but not assayed. These intervals penetrated the J-M Reef but did not contain visible sulphide minerals or were visually estimated at less than cut-off and were coded “-9” (the no assay code). It was decided that these intervals represented real data and that the absence of sulphide minerals indicates a zero grade. A grade of 0.00opt was assigned to all intervals with the “-9” grade code irrespective of the fact that grades across these intervals are not necessarily 0.00opt. Whereas the inclusion of the zero grade data points slightly lowered the grade of the composites and of local areas of the final block models, it had little or no effect on the final grade and tonnages estimated. The independent auditing of the drillhole databases for Stillwater and East Boulder Mines is part of the routine external audits completed from time to time. Dips of the mineralised intercepts and the drillhole, collar azimuth and inclination are important for the accurate calculation of true dip, given the dips of the J-M Reef (35o to vertical) and the drilling strategy employed at both Stillwater and East Boulder Mines (Figure 28 and Figure 29). Both apparent and true widths of the J-M Reef are known, but Mineral Resource estimates in this CPR are reported based on the true width. For drillhole composites, the dip captured in logs is utilised for dip correction whereas a trigonometrical calculation is performed using the X and Z points for true dip calculation in the block model.

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Figure 26: Drillhole layout for Stillwater Mine

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Figure 27: Drillhole layout for East Boulder Mine

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Figure 28: Section across Stillwater Mine looking west and showing the dip of the J-M Reef

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Figure 29: Section across East Boulder Mine looking northwest and showing the dip of the J-M Reef

5.9 Metallurgical Sampling and Testwork SRC5.3(iii); SV1.8

A description of metallurgical sampling and testwork is not relevant to Stillwater and East Boulder Mines, which have ore processing plants that have been processing RoM ore from the mines for many years. A detailed description of the processing of ore from Stillwater and East Boulder Mines is provided in Section 7.10.

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6 MINERAL RESOURCES ESTIMATES

6.1 Background Until May 2017, Stillwater was listed on the NYSE and therefore employed the SEC Guide 7 for public disclosure requirements of its public mining operations as required by NYSE. The SEC Guide 7 does not provide disclosure guidelines for Mineral Resource, but provides the following definitions and classification scheme for Reserves: Reserve: That part of a mineral deposit which could be economically and legally extracted or produced at

the time of the reserve determination. Proven (Measured) Reserves: Reserves for which (a) quantity is computed from dimensions revealed in

outcrops, trenches, workings or drill holes, grade and/or quality are computed from the results of detailed sampling and (b) the sites for inspection, sampling and measurement are spaced so closely and the geologic character is so well defined that size, shape, depth and mineral content of reserves are well- established.

Probable (Indicated) Reserves: Reserves for which quantity and grade and/or quality are computed from

information similar to that used for proven (measured) reserves, but the sites for inspection, sampling, and measurement are farther apart or are otherwise less adequately spaced. The degree of assurance, although lower than that for proven (measured) reserves, is high enough to assume continuity between points of observation.

Following the SEC Guide 7 requirements, Stillwater compiled and reported Reserves estimates for Stillwater and East Boulder Mines. Stillwater also quantified the mineralised material outside of the Reserve boundaries that could have been classified as Mineral Resources under the SAMREC Code at the time and quantified this as mineralised material inventory. This CPR is prepared for submission to the JSE following the acquisition of Stillwater by SGL (Section 1.1). Accordingly, the compilation and reporting of Mineral Resources and Mineral Reserves in this CPR followed the guidelines and requirements of the SAMREC Code and Section 12 of JSE’s Listing Requirements. The Mineral Resource and Mineral Reserve estimates for Stillwater and East Boulder Mines have been classified and

reported following the SAMREC Code definitions and guidelines reproduced in Section 1.9.2 of the CPR. It is to be noted that there are no historical Mineral Resources for Stillwater and East Boulder Mines. Three-dimensional geological modelling of the J-M Reef and the Mineral Resource estimation for Stillwater and East Boulder Mines have been completed internally by Stillwater staff. The process flow employed for data analysis, 3D geological modelling and Mineral Resource estimation are broadly similar for Stillwater and East Boulder Mines. The geological models and estimates have been independently reviewed by The Mineral Corporation.

6.2 Geological Model and Interpretation SRC4.1(i); SRC4.1(ii); SRC4.1(iii); SRC4.1(iv); SRC4.1(v); SRC4.1(vi)

6.2.1 Evaluation Cut Determination Three-dimensional geological modelling for Stillwater and East Boulder Mines is completed for evaluation cuts of the J-M Reef determined through a process called “zone picking”. This is completed by development Geologists when the analytical data for a specific area of drilling has been validated in the database. The aim of zone picking is to identify the mineralised reef (Main Zone) over a drillhole interval for 3D modelling and estimation. The determination of evaluation cuts is premised on the exploitation of the J-M Reef via underground mining methods. The geotechnical and geometallurgical characteristics of the J-M Reef are well understood from decades of mining at Stillwater and East Boulder Mines. Zone picking entails scanning the lithological record of a drillhole to identify the hangingwall of the J-M Reef package. From the hangingwall contact, the underlying mineralised zone is identified and delineated using a composite cut-off grade of at least 0.20opt Pt + Pd for the Farwest and 0.30opt (10.29g/t) Pt + Pd for Off-shaft areas of Stillwater Mine and 0.20opt (6.86g/t) for Pt + Pd for East Boulder Mine. For intersections with grades below the cut-offs, a single sub-grade assay is flagged at the hangingwall contact. If no assay was collected because of total lack of any sulphide minerals in the drillcore, a 1ft (30cm) blank interval is input and flagged at the hangingwall contact of the J-M Reef. Zone picking also includes the simultaneous review of all neighbouring drillholes in a particular drill section and drill sections to ensure smooth extension of the zone picks between drillholes and drill sections.

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The occurrence of the Main Zone at or near the hangingwall covers about 90% and 80% of the drill sections

analysed at Stillwater and East Boulder Mines. The balance of the intersections is made up of areas of mafic intrusions, faults or other geological features, and such intersections require the diligence and experience of the development Geologist to select a zone pick or to resolve. In addition to the Main Zone picks described above, there are localised areas at Stillwater Mine with footwall mineralisation that is distinct from the Main Zone. These mineralised footwall zones tend to be of similar grade sometimes extending across several drill sections, but often short-lived. There is also a faulted zone with repeated Main Zone occurrences on the eastern side of the Stillwater Mine. Sub-area OSE provides an example where the Main Zone is duplicated because of the South Prairie Fault, which is a west-northwest striking regional thrust fault with at least 1 660ft (506m) displacement between the northern and southern fault blocks. These mineralised footwall zones and repeated Main Zones are flagged with unique numbers, which permits the separate assessment and modelling of these zones. The evaluation cut determination employed for Stillwater and East Boulder Mines is appropriate for the nature and style of the J-M Reef and is in accord with industry practice. The extensive databases for Stillwater and East Boulder Mines have been utilised for 3D geological modelling and estimation of the J-M Reef.

6.2.2 Geological Modelling of the J-M Reef

6.2.2.1 Structural and Drill Section Interpretation The Main Zone evaluation cuts delineated through zone picking provide an outline of potentially economic portions of the J-M Reef that can be modelled for reporting as Mineral Resources. Structural interpretation precedes 3D Modelling of the Main Zone. Structural modelling at both Stillwater and East Boulder Mines has identified several major faults and intrusive dykes that intersect, offset or replace the J-M Reef in places. Of note are the regional South Prairie Fault and Horsemann Fault identified at Stillwater Mine. All the known major geological structures are modelled independently in Vulcan™ for incorporation in the final geological model. The drillhole database contains standardised rock codes for dyke and fault intercepts, which are used to construct models for each geological structure. Faults are modelled as planes in the 3D space using both drilling data and geological mapping information for the footwall lateral drifts were possible. Dykes are modelled similarly, but as 3D solids. Both dykes and faults are projected to beyond the limit of drilled J-M Reef where necessary. Geological interpretation of the Main Zone starts with the creation of section lines at 50ft (15m) spacing, and parallel to the plane of the underground drillhole fans. Drill section interpretation is only performed in areas supported by Mineral Resource and Mineral Reserve definition drilling – i.e. drill station spaced 50ft (15m) intervals. Each section line is viewed and interpreted in Vulcan™, and a polygon is manually digitised to outline the limits of the Main Zone from one hole to the next and from one drill fan to the next. Figure 30 shows a typical drill section with the Main Zone outline in red. The polygon is not constructed in true section, but rather so that each node is attached to the drillhole trace even if it is a few feet off section on either side. The sections are viewed with a 25ft (7.6m) window (half the drill station spacing) on each side to incorporate adjacent information and improve the interpretation. Furthermore, as interpretative work progresses from section to section, the previous section is displayed to ensure a continuous flow of the resultant shape. The polygons are extended to just beyond the last drillhole at the top and bottom of the section. In addition, the polygons are terminated or offset when they intersected a fault or dyke, which would have been modelled as described above.

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Figure 30: Drill section interpretation

The final product of this interpretative work is a series of near continuous polygons spaced approximately 50ft (15m) apart that outline the limit of the Main Zone throughout the drilled portion of the J-M Reef at each of Stillwater and East Boulder Mines. In areas where the J-M Reef is terminated or there is a lack of drillhole information, an “end plate” polygon is built by making a copy of the last drillhole supported polygon and moving it 25ft (7.6m) along strike. This “half the drill spacing rule” is always used except where a modelled fault or dyke could be used to truncate the Main Zone shape. Copies of the digitised drawings and associated files are archived and backed up on the central IT server.

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There are no flaws or material issues in the structural and drill section interpretation employed for Stillwater

and East Boulder Mines. The approaches adopted for the interpretation are suited to the density of drillhole information as well as the nature and style of the J-M Reef.

6.2.2.2 Wireframe Modelling A solid (3D) model triangulation is constructed in Vulcan™ by joining each of the polygons and closing at the end-plates. Three-dimensional modelling of the shape of the Main Zone is facilitated by the persistent continuity and regularity of the hangingwall contact of the JM Reef package over most of the Stillwater and East Boulder Mines. Topographic wireframe surface modelled using LandSat digital data forms the up-dip limit of the Main Zone 3D model. The 3D Model of the Main Zone is terminated against the surface topographic wireframe. In some cases, it is easier to build the 3D model of the Main Zone as separate pieces between major dykes or faults rather than as one solid. In such areas, the 3D model is constructed to extend just slightly across or into the solid wireframe of the geological structure. A final step of the solid modelling involves trimming the Main Zone solid model against the wireframe of the geological structures and removing the portions of the Main Zone wireframe inside dyke wireframe models or beyond fault wireframes. This modelling approach ensures the continuity of the Main Zone model and necessary termination of the model against dyke and fault wireframe models. In addition, losses due to dykes and fault zones are automatically excluded from the Main Zone 3D model as explicit losses. There are no flaws or material issues in the solid modelling of the Main Zone and the modelling of known geological structures at Stillwater and East Boulder Mines. Owing to the large area drilled at the Stillwater Mine and the varying strike, dip and mineralisation facies of the J-M Reef, the total Mineral Resource area is broken into manageable but geologically distinct sub-areas for efficient modelling and grade estimation. The sub-areas delineated are Dow-Upper (DOWU), Dow-Lower (DOWL), Upper West East (UWE) Off-shaft, West Lower (OSW-L), Off-shaft West Upper (OSW-U), Off-shaft East-West (OSE-W), Off-shaft East-East (OSE-E) and Blitz West (BLITZ_W) (Figure 31), and the boundaries of these sub-areas are reviewed on an on-going basis. The break between UWE and OSW-L and OSW-U is the 9 000 West Fault, which has been modelled from drillhole data and footwall drift mapping. There is a significant change in the orientation of the J-M Reef and offset across this fault. On the east side, the OSE-W and OSE-E 3D models are separated by the 4 000 East Fault, which is also associated with a marked change in orientation and displacement of the J-M Reef. The break between OSEW and OSW-U sub-areas is based on a historical administrative break at the zero Easting on the mine grid. During 2007 the OSW sub-area was divided into the OSW_L and OSW_U sub-areas. In 2015, the Blitz-West sub-area and 3D model was incorporated into Stillwater Mine utilising information from the eastern end of the OSEE sub-area. From 2017 onwards, the Blitz-West 3D model will continue to increase in size with additional Mineral Resource and Mineral Reserve definition drilling. Currently, only two major modelling sub-areas are defined for East Boulder Mine, which are Frog Pond East and Frog Pond West (Figure 32).

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Figure 31: Subareas and drillhole intersections of the Main Zone at Stillwater Mine

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Figure 32: Subareas and drillhole intersections of the Main Zone at East Boulder Mine

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6.3 Estimation and Modelling Techniques SRC4.2(i); SRC4.2(ii); SRC4.2(iii); SRC4.2(iv)

6.3.1 Evaluation Cut Data Compositing and Analysis

6.3.1.1 Compositing The Main Zone evaluation cut data for each drillhole is length composited in Vulcan™ using the drillhole collar survey, azimuth, inclination and analytical data for each mineralised (zone pick) interval. Within Vulcan™, this process is referred to as compositing by geology code, and this results in new X, Y, and Z collar co-ordinates, single composite values for Pt, Pd and Pd + Pt and thickness for each drillhole Main Zone intersection. Mineralised footwall zones and repeated Main Zone intersections are composited using their unique identifier codes. Each drillhole composite interval of the Main Zone, mineralised footwall or repeated Main Zone is tagged with the same GEOCOD value as in the evaluation cut data before compositing. The composite data is utilised for grade estimation. For the current Mineral Resource estimates, the composite datasets for Stillwater Mine and East Boulder Mines contained 38 663 and 8 058 Main Zone intervals, respectively.

6.3.1.2 Composite Thickness vs. Grade Relationship Scatter plots of composite thickness against Pd + Pt values are generated to assess if there is no correlation between sample length and PGM grade. Figure 33 and Figure 34 show no correlation between composite thickness and grade for Stillwater and East Boulder Mines estimates, which indicates that these variables are independent. Accordingly, the length weighted composite data can be used for grade estimation, with each composite given equal weight regardless of sample length.

Figure 33: Scatter plot of composite length vs. Pd + Pt grade for Stillwater Mine

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Figure 34: Scatter plot of composite length vs. Pd + Pt grade for East Boulder Mine

6.3.1.3 Variography Modelling Geostatistical estimation and variogram parameters for the J-M Reef modelled at Stillwater and East Boulder Mines are not updated each year, but are checked periodically as new areas are developed and Mineral Resource and Mineral Reserve definition drillhole data increases. The current Measured Mineral Resource estimates for Stillwater and East Boulder Mines are based on geostatistical parameters derived from the variogram modelling performed in December 2015. The variogram modelling was performed in VulcanTM Version 8.1.4 for both Stillwater and East Boulder Mines. The 2015 variogram modelling included the assessment of trends in the composite data for the estimation variable, namely Pd + Pt. It was concluded that the grade populations at the mines exhibited isotropic behaviour. Accordingly, normalised omni-directional spherical variograms for each of the sub-areas at Stillwater and East Boulder Mines were modelled. The Mineral Corporation has reviewed the modelled variograms for Stillwater and East Boulder Mines and concluded that the variograms demonstrated the achievement of second

order stationarity and that estimation through ordinary kriging interpolation is appropriate. The variograms are characterised by nugget to sill ratios of 20% and 10% for Stillwater and East Boulder Mines (Figure 35 and Figure 36), respectively, and short ranges (12ft to 600ft or 4m to 183m). The variogram parameters for the modelled variograms are summarised in Table 11. It is to be noted that longer ranges (1 600ft or 488m) were modelled for the Main Zone at Stillwater Mine in 2002 by Rendu using declustered (regularised) (2 000ft x 200ft or 610m x 61m reef slice averages) means of thickness and grades to model the macro-continuity of the Main Zone.

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Figure 35: Example of a Stillwater Mine variogram – DOL Upper variogram

Figure 36: Example of an East Boulder Mine variogram - Frog Pond East variogram

Table 11: Standardised variogram parameters

Mine Sub-area Nugget

Structure 1 Structure 2 Structure 3

Sill Range

(ft) Range

(m) Sill

Range (ft)

Range (m)

Sill Range

(ft) Range

(m)

Stillwater Mine

Blitz West 0.2 0.3 25 8 0.4 70 21 0.15 250 76

Off-shaft West U 0.2 0.5 15 5 0.2 125 38 0.13 360 110

Off-shaft West L 0.2 0.5 15 5 0.2 120 37 0.1 370 113

Off-shaft East W 0.2 0.5 16 5 0.2 110 34 0.12 360 110

Off-shaft East E 0.2 0.5 16 5 0.2 90 27 0.09 350 107

Upper West E 0.2 0.5 30 9 0.2 130 40 0.08 570 174

Dow Lower 0.2 0.6 12 4 0.1 60 18 0.06 330 101

Dow Upper 0.2 0.4 15 5 0.3 65 20 0.1 290 88

East Boulder Mine Frog Pond West 0.1 0.8 30 9 0 160 49 0.12 600 183

Frog Pond East 0.1 0.7 50 15 0.2 150 46 0.06 600 183

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6.3.1.4 Grade Capping/Cutting Further statistical analysis of the Stillwater and East Boulder Mines composite data by Stillwater Geologists identified a few outliers (high grade samples) (Figure 37 and Figure 38) that would have an undue influence on the overall estimates. It is also noted that the histograms exhibit positive skew. In order to reduce the effect of these high-grade values in the grade estimation runs, a capping grade was applied in the Vulcan™ kriging routines. With modelling and estimation completed per sub-area, it was decided by Stillwater to apply individual capping grades to each of the sub-areas rather than a single capping grade to the entire population. Capping grades were determined from the review of the data distributions, and the cap was applied at the 99th percentile of the datasets. For East Boulder Mine, the Pd + Pt grade cap was set at 2.03opt (69.60g/t) for the Frog Pond East sub-area and 1.83opt (62.74g/t) for the Frog Pond West sub-area. For Stillwater Mine, each of the eight sub-areas was assigned a Pd + Pd capping grade as follows: 2.24opt (76.80g/t) for Dow Upper; 3.20opt (109.71g/t) for Dow Lower;

4.05opt (138.86g/t) for Upper West East; 5.35opt (183.43g/t) for Off-shaft West Upper; 4.77opt (163.54g/t) for Off-shaft West Lower; 4.84opt (165.94g/t) for Off-shaft East West; 5.75opt (197.14g/t) for Off-shaft East East; and 3.38opt (115.89g/t) for Blitz_West.

Figure 37: Histogram plot of Pd + Pt for Stillwater Mine Composites

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Figure 38: Histogram plot of Pd + Pt for East Boulder Mine Composites

6.3.2 Block Modelling Block models are constructed in VulcanTM for each of the eight sub-areas at Stillwater Mine and the two sub-areas at East Boulder Mine, and within the enclosure of the Main Zone wireframe models. Accordingly, block modelling is only performed for areas supported by Mineral Resource and Mineral Reserve definition drillhole data and for which Measured Mineral Resources are reported. Owing to similarities in the drillhole spacing, both mines employ similar block modelling approaches and block dimensions. Each block model is constructed using the same template with only the name, origin point and extents changed. All blocks in the models are 10ft by 10ft (3m by 3m) in the plane of the J-M Reef – i.e. the X-Z plane. The block models are rotated to conform to the approximate strike and dip of the J-M Reef. The limits of each of the block models are set to totally encompass the Main Zone model. The third dimension (Y dimension) of each of the blocks for each model aligns closely to and represents the estimate of true thickness of the Main Zone as provided by

the wireframe. The Main Zone thickness (Y dimension) and the resolution in the Y dimension within each 10ft by 10ft (3m by 3m) block is 0.5ft (15cm). It is noted that blocks are also constructed outside of the Main Zone and such blocks are based on 10ft by 10ft by 100ft (3m by 3m by 30m) dimensions in the X, Z and Y directions. The block models already exclude geological losses, which are accounted for during the 3D modelling of the Main Zone and known geological structures. Blocks within and outside the Main Zone wireframes for each sub-area are distinguished by default codes denoting waste blocks, Main Zone blocks, repeated Main Zone or low-grade footwall mineralisation. There are no material issues with the block modelling approach employed at Stillwater and East Boulder Mines, with the block dimensions well suited to the drillhole spacing.

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6.4 Estimation SRC4.2(i); SRC4.2(ii); SRC4.2(iii); SRC4.2(iv); SRC4.2(v); SRC4.2(vi);SRC4.5(ii)

6.4.1 Grade and Tonnage Estimation for Measured Mineral Resources Composite values of Pd + Pt are estimated directly into the block models for each of the sub-area via ordinary kriging interpolation in VulcanTM for both Stillwater and East Boulder Mines. A parallel check estimate in VulcanTM is achieved via Inverse Distance Weighting (IDW) interpolation using a power of three. The estimates by the two interpolation methods are identified in the block models. For the current estimates, Stillwater Mine utilised VulcanTM Version 9.1.2 while East Boulder Mine used VulcanTM Version 10.1. The ordinary kriging interpolation is based on a single search and the search parameters summarised in Table 12 as well as the respective variogram parameters in Table 11. Reconciliation work completed over the years by Stillwater on modelled grades at Stillwater Mine showed that, even with the application of grade caps, some remaining high-grade samples were having an undue effect on the estimated block grades. In order to reduce this effect, a high yield limit was applied in the kriging plan. The high yield limit has the effect of giving a limited range of influence to samples above the grade threshold and all block estimates outside of this limited range are not influenced by the high-grade sample. The following high yield limit factors and respective maximum search distances derived from the reconciliation work have been used at Stillwater Mine: Dow Lower: not used; Dow Upper: not used; Upper West East: 2.20opt (75.43g/t) Pt + Pd at 30ft (9m); Off-shaft West Upper: 3.00opt (102.86g/t) Pt + Pd at 40ft (12m); Off-shaft West Lower: 3.00opt (102.86g/t) Pt + Pd at 40ft (12m); Off-shaft East West: 2.50opt (85.71g/t) Pt + Pd at 40ft (12m); Off-shaft East East: 2.50opt (85.71g/t) Pt + Pd at 40ft (12m); and Blitz_West: 2.00opt (68.57g/t) Pt + Pd at 40ft (12m).

There were no high yield limit factors used at East Boulder Mine where grades are relatively less variable than at Stillwater Mine. The Mineral Corporation agrees with the approach adopted by Stillwater to limit the search distance around high-grade samples rather than cutting the high samples further as these high-grade intersections are real. Estimates are completed for Pd + Pt only, and co-products or by-products which occur at low abundances are not estimated. There have been no deleterious elements identified in the J-M Reef since the start of mining and ore processing operations at Stillwater and East Boulder Mines. Table 12: Search parameters employed for grade estimation

Mine Sub-area Search Distance Number of Samples

(ft) (m) Minimum Maximum

Stillwater Mine

Blitz_West 200 61 4 21

Off-shaft West U 200 61 4 21

Off-shaft West L 200 61 4 21

Off-shaft East W 200 61 4 21

Off-shaft East E 200 61 4 21

Upper West E 200 61 4 21

Dow Lower 300 91 4 21

Dow Upper 300 91 4 21

East Boulder Mine Frog Pond West 160 49 2 15

Frog Pond East 150 46 2 15

In addition to a parallel check estimation run achieved via IDW interpolation, the ordinary kriging estimates are also compared to composite data for each sub-area as indicated in Table 13. This comparison shows that the modelled grades are generally lower than the associated raw composite grade, which is expected considering the application of grade capping and high yield limit to the dataset utilised for estimation. However, the grades estimates and the composite grades are comparable.

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Table 13: Comparison of modelled and composite grades

Sub-area Mean Pd + Pt (opt) Mean Pd + Pt (g/t)

Composite Data Ordinary Kriging Composite Data Ordinary Kriging

Dow Upper 0.628 0.42 21.53 14.40

Dow Lower 0.695 0.577 23.83 19.78

Off-shaft West 0.783 0.651 26.85 22.32

Off-shaft East West 0.82 0.63 28.11 21.60

Off-shaft East East 0.783 0.63 26.85 21.60

Blitz_West 0.693 0.66 23.76 22.63

Frog Pond East 0.501 0.502 17.18 17.21

Frog Pond West 0.618 0.618 21.19 21.19

An additional check of the distribution of estimated grades within Main Zone blocks is done visually. Several drill sections and level plans are reviewed with both the raw composite data and the block model grades plotted. Checks are made to ensure that the blocks and proximal composites have similar grades. Furthermore, the grade transitions from high to low between drillholes or groups of holes are checked for reasonableness. No material issues were identified from these checks. Owing to the limited specific gravity datasets for Stillwater and East Boulder Mines, the average specific gravity estimate of 0.086 ton/ft3 (2.76t/m3) for the Main Zone is applied to the modelled volume to generate tonnage estimates for each sub-area. As indicated in Section 5.5, a programme of routine specific gravity determinations recently commissioned will result in an expanded specific gravity dataset that may permit the modelling of specific gravity utilised for tonnage estimation. Preliminary results from the programme suggest that the average specific gravity currently used for tonnage estimation is conservative. A tonnage check is used to confirm that the block model correctly represents the wireframe models of Main Zone. The default specific gravity is applied to the modelled wireframe volumes for the tonnage estimation.

Mineral Resources are reported at minimum true mining width based on 100% mining through the ramp and fill method (Section 7.2). Accordingly, block with widths that are less than the minimum mining width are adjusted by incorporating low-grade material from the footwall, which results in a decrease in grade over these areas. The modelled grades for the Stillwater and East Boulder Mines’ block models (after the application of a minimum mining width adjustment) are shown in Figure 39 and Figure 40, respectively. The minimum true mining width at Stillwater Mine is 6.5ft (2.0m) and at East Boulder Mine is 7ft (2.1m). There is no issue with the approach adopted by Stillwater to report grades at the minimum mining width, which is aligned with industry practice.

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Figure 39: Modelled grades at minimum mining width for Stillwater Mine

Figure 40: Modelled grades at minimum mining width for East Boulder Mine

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6.4.2 Grade and Tonnage Estimation for Indicated and Inferred Mineral Resources The thickness and grades of the J-M Reef are highly variable at a local level at Stillwater and East Boulder Mines. Grades and tonnages are modelled for the well drilled areas where Measured Mineral Resources are reported. For mineralisation classified as Indicated and Inferred Mineral Resources, in situ average thickness and grades (regional means) of the J-M Reef per geological domain (reef facies) are assigned for the estimation of in situ tonnage and grades, and these are employed at no cut-off grade. The modelled regional means for each reef facies are utilised for this purpose. The Mineral Corporation has reviewed the geostatistical evidence and results of reconciliation work completed by Stillwater, which supports this estimation approach, and concluded that the approach is plausible. Furthermore, the low to medium risk in grade and tonnage estimates is mitigated by the use of regional averages based on close spaced drillhole data per geological domain. The rationale for the estimation methodology employed for Indicated and Inferred Mineral Resources is discussed further in Section 6.6. The application of a minimum mining width and grade cut-offs results in the exclusion of certain parts of the J-M Reef in the modelled areas. Ratios of material above to material below cut-off after the application of a minimum mining width to the block models are well constrained for each reef facies at Stillwater and East Boulder Mines. However, the methodology employed for the estimation of tonnage and grades for Indicated and Inferred Mineral Resources does not permit the application of cut-off grades. Other than explicit geological losses, no other geological losses are applied to the tonnage estimates. Experience at the mines is that unknown geological structures do not necessarily lead to geological losses as these are mined through. Instead, these tend to have a dilution effect and the application of cut-off grades leads to the exclusion of low-grade material from the estimates.

6.5 Reasonable Prospects for Eventual Economic Extraction SRC4.3(i); SRC4.3(ii); SRC4.3(iii); SRC4.3(iv); SRC4.3(v); SRC4.3(vi); SRC4.3(vii); SRC4.3(viii); SRC4.3(ix)

Mineral Resources for Stillwater and East Boulder Mines are delineated in areas adjacent to current mining operations and close to mining infrastructure (i.e. shafts, underground infrastructure, powerlines, water and mine access roads). Stillwater is legally permitted to mine the J-M Reef in these areas and has continued to fulfil the regulatory requirements that has enable it to retain the mineral title for PGMs, as well as environmental and social permits required for the mining and ore processing operations.

The location, quantity, grade, continuity and other geological characteristics and geotechnical parameters of the J-M Reef in these areas are well understood from extensive diamond drilling and laboratory analysis of the mineralised intersections, geological modelling, mining and ore processing. The cut-off grades, ratio of material above to below cut-off in a geological domain, underground mining methods and conventional flotation ore processing technology employed for the J-M Reef mineralisation are well constrained and established at the Stillwater and East Boulder Mines.

The quantities and grades of the delineated J-M Reef mineralisation are sufficient to support Stillwater’s long-term production requirements. Furthermore, the economic exploitation of the J-M Reef mineralisation in these areas has been assessed in 25-year (Strategic) Life of Mine Plans for Stillwater and East Boulder Mines. Mining parameters, production schedules, metallurgical parameters, capital and mining and ore processing operating costs employed for the planning are based on historical experience at the current operations. Details of the mine plans and economic parameters utilised are discussed in Section 7.

Stillwater has in a place a marketing strategy for its products and this is based on historical experience as well as assumptions of demand and supply, which are utilised for business planning. Similarly, metal price forecasts are based on trailing averages and price growth rates utilised for business planning.

There are no apparent material risks that would prevent the eventual exploitation of the J-M Reef mineralisation included in the Mineral Resource estimates for Stillwater and East Boulder Mines. Based on the foregoing, there are reasonable prospects for eventual economic extraction of the J-M Reef mineralisation underpinning the Mineral Resources estimates for Stillwater and East Boulder Mines reported in this CPR.

6.6 Mineral Resource Classification Criteria SRC4.4(i)

Stillwater has adopted the Mineral Resource reporting terminology and guidelines provided by the SAMREC Code, which are reproduced in Section 1.9.2 of this CPR. Mineral Resources have been classified into Inferred, Indicated and Measured categories depending on the level of geoscientific knowledge and confidence. Although Stillwater did not report Mineral Resources in its public disclosures of the operations at Stillwater and East Boulder Mines under the SEC Guide 7 reporting regime, it has always had geological models of the J-M Reef underpinning the Reserves estimates reported, which were constructed from extensive drillhole data.

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Geological block models have been constructed for the areas with average drillhole spacing of approximately

50ft by 50ft (15m x 15m). This drillhole spacing represents the optimal drillhole spacing that provides sufficient data for the achievement of the highest level of geoscientific knowledge and confidence in the geological and grade continuity of the J-M Reef. Mineralisation in these areas was historically converted to the “Proven Reserve” category through the application of Modifying Factors and based on detailed stope designs. The boundary for the Proven Reserve was placed 25ft (7.6m) away from the last line of drillholes. For the current Mineral Resource estimates, mineralisation delineated and quantified from drillhole spacing of 50ft by 50ft and located close to underground mining infrastructure has been classified as Measured Mineral Resources.

J-M Reef mineralisation delineated from sparse (up to 2 000ft or 610m spacing) drillhole data – mainly surface diamond drillhole data – was historically quantified as mineralised material inventory. Part of the mineralised material located within 1 000ft (305m) from the Proven Reserve boundary and close to underground infrastructure and mining operations was converted to Probable Reserves using in situ regional average thickness and grades (regional means) of the J-M Reef per geological domain (reef facies). The regional means for each reef facies were estimated through modelling of the closely spaced drillhole data from areas where Proven Reserves were delineated. This estimation methodology has been utilised for the current tonnage and grade estimates for the mineralisation delineated outside the Measured Mineral Resource boundary. For the current Mineral Resource estimates, mineralisation delineated within the 1 000ft (305m) envelope surrounding the Measured Mineral Resource boundary has been classified as Indicated Mineral Resources. The balance of the mineralisation within the drilled portions of Stillwater Mine and East Boulder Mine footprints has been classified as Inferred Mineral Resources. The rationale for using the 1 000ft boundary around the Measured Mineral Resources to delineate the limit of Indicated Mineral Resources is informed by a detailed geostatistical study completed by Rendu (2002) and historical experience from the mining of the J-M Reef at Stillwater and East Boulder Mines, as well as consideration of the SAMREC Code guidelines for the classification of Indicated Mineral Resources. The SAMREC Code requires that Indicated Mineral Resource estimates should be estimated with sufficient confidence to allow the application of Modifying Factors in sufficient detail to support mine planning and evaluation of the economic viability of the deposit under assessment. For the 2002 geostatistical study, Rendu subdivided the J-M Reef at Stillwater Mine into 2 000ft long (610m along strike) and 200ft high (61m in the vertical plane) quadrants. Rendu computed average thickness and grades for drillholes in each quadrant and applied a combination of a 0.3opt (10.29g/t) Pd + Pt cut-off grade and a 6ft (1.8m) minimum mining width to determine the ratio of material above to material below economic cut-off. Average thickness and grades were computed for each slice to generate declustered means, which were analysed both statistically and geostatistically. From the statistical analysis of the declustered data, Rendu determined an estimation error of ±15% at the 80% confidence level on the estimation of one-year production (approximately 1.1 million tons or 1Mt) coming from the deepest (furthest) part of the Probable Reserve (Indicated Mineral Resource) to be acceptable error. This implies that only 20% of the time will one year of production from the furthest part of an Indicated Mineral Resource be overestimated by ±15%. Variogram models with long ranges of 1 600ft (488m) were modelled from the declustered data. The study concluded that, provided that the presence and geological continuity of the J-M Reef has been demonstrated (e.g. from sparse surface drilling), the grade, thickness and cut-offs can be projected over distances of approximately 1 600ft (485m) vertically. Guided by geological confidence and knowledge, historical experience and findings of on-going tonnage and

metal ounces reconciliation at the mines, Indicated Mineral Resources have been estimated for the mineralisation within the 1 000ft (305m) envelope surrounding Measured Mineral. Figure 41 and Figure 42 show the Mineral Resource classification maps for Stillwater and East Boulder Mines, respectively. The Mineral Corporation has interrogated the results of Rendu’s work, Stillwater’s reconciliation results and available drillhole data, and found the recommendations by Rendu still to be valid. The Mineral Corporation agrees with the conservative stance adopted by Stillwater to limit Indicated classification to 1 000ft (305m) from definition drilling data even though geostatistical evidence supports a longer range. Furthermore, The Mineral Corporation notes that Stillwater has been able to generate LoM Plans in the areas classified as Indicated Mineral Resources, which have permitted the reporting of Probable Mineral Reserves. The Mineral Corporation has also interrogated the ratios of Proven Reserve to “Probable Reserves” reported historically, which average 22% for Stillwater Mine and 11% for East Boulder Mine. This indicates consistency in Stillwater’s ability to upgrade Probable Mineral Reserves reported for the mines, with no material tonnage and grade risks. It is, therefore, concluded that the classification scheme employed is well reasoned and backed up by geostatistical evidence and historical experience.

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Figure 41: Mineral Resource classification for Stillwater Mine

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Figure 42: Mineral Resource classification for East Boulder Mine

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6.7 Mineral Resource Statement SRC4.5(i); SRC4.5(ii); SRC4.5(iii); SRC4.5(iv); SRC4.5(v); SRC4.5(vii); SRC4.5(viii); SRC4.5(ix); SV1.9; JSE12.9(h)(ix)

The Mineral Resource estimates for Stillwater and East Boulder Mines (as at 31 July 2017) are summarised in Table 14. These estimates are in situ estimates reported at a minimum mining width of 6.5ft (2.0m) applicable for the ramp-and-fill underground mining method at Stillwater and East Boulder Mines. Furthermore, Measured Mineral estimates are reported at cut-off grades of 0.30opt (10.29g/t) Pd + Pt for Stillwater Mine and 0.20opt (6.86g/t) Pd + Pt for East Boulder Mine, which were derived through historical economic assessments accompanying LoM planning. The Mineral Resource estimates in Table 14 are reported inclusive of Mineral Reserves. Indicated and Inferred Mineral Resource estimates are in situ regional averages estimated from Mineral Resource and Mineral Reserve definition drilling data (Section 6.4.2) and are reported at no cut-off grade. As discussed in Section 6.4.2, the application of a cut-off grade is only possible after Mineral Resource and Mineral Reserve definition drilling. The Mineral Resource estimates for Stillwater and East Boulder Mines have been compiled internally by Jim Dahy and Jennifer Evans, respectively, assisted by Michael Koski. The estimation has been under the supervision of Coniace Madamombe. Jim, Jennifer and Michael are Senior Geologists and employees of Stillwater while Coniace is a Senior Geologist and Director of The Mineral Corporation.

No metal equivalents are reported as these are irrelevant to the Stillwater operations. Table 14: Mineral Resource Statement for Stillwater and East Boulder Mines as at 31 July 2017

Imperial Metric

Category Mine/Parameter Tonnage (Million Ton) Pd + Pt (Moz) Pd + Pt Grade (opt) Tonnage (Mt) Pd + Pt Grade (g/t)

Measured

Stillwater 4.4 2.8 0.62 4.0 21.26

East Boulder 4.0 1.8 0.44 3.6 15.22

Subtotal/Average 8.5 4.5 0.54 7.7 18.39

Indicated

Stillwater 22.2 12.1 0.55 20.2 18.71

East Boulder 32.4 14.7 0.45 29.4 15.55


Inferred

Stillwater 53.9 27.5 0.51 48.9 17.48

East Boulder 48.1 21.9 0.46 43.6 15.65


All Total/Average 165.0 80.8 0.49 149.7 16.78

6.8 Mineral Resource Reconciliation SRC4.5(vi)

There are no historical Mineral Resource estimates compiled for Stillwater and East Boulder Mines in recent years and, therefore, no Mineral Resource reconciliation has been performed for this CPR.

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7 TECHNICAL STUDIES

7.1 Introduction SRC5.1(i)

This CPR contains Mineral Reserve estimates for Stillwater and East Boulder Mines, which are mature mining operations exploiting the J-M Reef. The estimates are based on detailed LoM Plans constructed internally by Stillwater personnel utilising Modifying Factors and capital and operating costs, which are informed by historical experience at the mines. Furthermore, the estimates have been independently reviewed and validated by The Mineral Corporation. Stillwater Mine, which has operated continuously since 1986, has a RoM monthly ore production level of 60 000 ton (54 000t). Since 1986, one section of Stillwater Mine has accounted for all the RoM ore produced by the mine and processed at the Stillwater Concentrator. A step change in production output required for Stillwater Mine necessitated the introduction of a second section referred to as the Blitz section. Development of the Blitz section commenced in 2011 with the excavation of access adits and has been ongoing until to date. Ore production from the Blitz section is expected to commence in the third quarter of 2017, gradually ramping up to a steady state monthly production level of approximately 46 000 ton (42 000t) in 2023. Accordingly, RoM ore production at Stillwater Mine is set to increase to 106 000 ton (96 000t) per month when the Blitz section reaches steady state production levels. The Mineral Corporation has reviewed the development results to date, delivery schedules for drilling, loading and hauling equipment, available capital funding and the production build-up (seven years) for the Blitz section. From this review, The Mineral Corporation concluded that the planned production increase at Stillwater Mine should be achieved. East Boulder Mine is currently operating at the steady state monthly RoM ore production level of approximately 55 000 ton (50 000t). Mineral Reserves are estimated for each of the sub-areas at Stillwater Mine already indicated. For East Boulder Mine, Mineral Reserves are reported for the Frog Pond West and Frog Pond East sub-areas. The conversion of Mineral Resources to Reserves follows a methodology that was developed in 1990 and adjusted as required over the years as more geological and mining information became available. The methodology takes into account the different reef facies and the sub-areas that exist at the mines, and the fact that a single set of parameters within a sub-area can be used to confidently project surface and underground drilling for Mineral Resource estimates. It is to be noted that mining experience and reconciliation between Mineral Reserve estimates and actual production figures have demonstrated robustness of the methodology in making estimates of tonnages and ounces that have been reported as Mineral Reserves over the years. Mineral Reserves for Stillwater and East Boulder Mines have been independently audited by Behre and Dolbear since 1990. Measured Mineral Resources, which are delineated by drillhole information based on closely spaced Mineral Resource and Mineral Reserve definition drilling, are converted to Proved Mineral Reserves. Indicated Mineral Resources, which are defined as the mineralisation contained within a 1 000-foot (305m) distance from the Measured Mineral Resource boundary, are converted to Probable Mineral Reserves. Both categories of Mineral Reserves are reported at economic cut-off grades of 0.20opt (6.86g/t) Pt + Pd for the Farwest and 0.30opt (10.29g/t) Pt + Pd for Off-shaft areas of Stillwater Mine and 0.20opt (6.86g/t) for Pt + Pd for East Boulder Mine. Typically, Probable Mineral Reserves constitute a larger portion of the total Mineral Reserves. However, as mine development opens up an area, Mineral Resource and Mineral Reserve definition drilling is completed to increase the geological knowledge and confidence in the Indicated Mineral Resource areas, which is required for the upgrading of Probable to Proved Mineral Reserves. The general methodology employed for Mineral Reserve estimation is summarised as follows: Construct a 3D geological block model for the reef channel based on the Main Zone evaluation cut data,

with grade estimated through ordinary kriging interpolation; Apply minimum mining widths depending on the mining method used, and additional mining dilution to

the Main Zone block model, which generates a diluted block model; Apply current economic cut-off grades per sub-area to the diluted block model; Generate development and stope designs in Indicated and Measured Mineral Resource areas; Apply appropriate additional technical Modifying Factors, which include extraction ratios and mining losses

based on the mining method and historical extraction factors for each sub-area; Perform a stope economic evaluation using technical and economic parameters utilised for business

planning; Produce a LoM production schedule; Complete an economic viability test of the LoM Plan; and Categorise and report Mineral Reserve estimates.

The details of each these steps are discussed further in later sections.

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The Mineral Corporation reviewed the mine design, planning, scheduling, budgeting process and financial

valuation process and found these to contain all the necessary elements and assumptions required of industry standard mine planning and economic assessment.

7.2 Mine Design SRC5.1(i);SRC5.2(i); SRC5.2(ii);SRC5.2(v);SRC5.2(vii); SRC5.2(vi);JSE12.9(h)(vii)

7.2.1 Mining Method Overview Stillwater and East Boulder Mines employ similar types of mining methods. The three principal mining methods are the following: Overhand cut-and-fill (C&F) stoping, utilising either conventional AlimakTM or raise boring to create

accesses. The stopes are also known as captive stopes; Ramp-and-fill (R&F) as both overhand and underhand C&F; and Sub-level extraction (SLE) by long hole open stoping with subsequent backfill.

The J-M Reef outcrops on the Stillwater Mining Claims, but the attitude and thickness of the reef preclude economic exploitation through open pit mining methods. Considerable tonnage is produced from the development of the sub-levels in the reef, which is carried separately as sub-level development (SLD) tonnage. The percentage distribution (frequency of use) of the three mining methods within each of the mines since 2016 is shown in Table 15. The mining method mix is adjustable and is largely driven by mineralisation grade and dilution. Typically, higher-grade mineralisation is extracted using C&F methods whereas low-grade mineralisation is extracted by the open stoping method. Except for open stoping, the C&F methods use high quality sandfill or paste fill. Table 15: Mining method frequency of use at Stillwater and East Boulder Mines

Mining Method Frequency of use at Stillwater

Mine Frequency of use at East

Boulder Mine

Conventional C&F 3% 0%

Mechanised R&F 89% 80%

Open stoping 8% 20%

7.2.2 R&F R&F stopes are the predominant mining method (85%) at the Stillwater and East Boulder Mines. While the primary method is by overhand mining, some undercut R&F is used. Of the R&F stopes, overhand R&F stopes constitute 90% and underhand R&F stopes account for 10%. The two different applications, as practiced at the mines, are illustrated in Figure 43 and Figure 44. The backfill for the overhand R&F is un-cemented sandfill, while the backfill for the underhand C&F is a paste backfill. Where ground conditions permit, the overhand method is preferred as it is more cost effective. Where less stable ground conditions dictate, undercut R&F is applied, and the more expensive paste backfill must be used. Up to 12% cement is used in the paste fill, as needed, to provide a stable overhead cemented paste material when the underhand method is used. Mine policy does not allow development ramp grades to exceed 18%. Most of the R&F stopes are drilled by breast holes using single-boom drill jumbos, and the broken rock is loaded by small 1.5 cubic-yard and 2.5 cubic-yard (1.1m3 and 1.9m3) load-haul-dump (LHD) units (produced by Joy Global, now Komatsu Mining).

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Figure 43: Overhand R&F mining method with sand backfill

Figure 44: Undercut R&F mining method using paste backfill

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7.2.3 Overhand C&F Several variations of C&F have been practiced at Stillwater Mine, two of which are illustrated in Figure 45 and Figure 46.

Figure 45: Overhand AlimakTM C&F stoping

Figure 46: Overhand conventional C&F stoping

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The other variation of captive-overhand C&F stoping involves using a raise-bored access hole, rather than an

Alimak™ raise climber, which remains captive to the stope. Un-cemented sandfill (cycloned mill tailings material) is used for the backfill material. All the Stillwater Mine’s C&F stopes use hand-held jackleg drills for drilling and electric slushers for moving the broken ore from the headings to the ore passes. This equipment remains in the captive stope as it advances upward. Captive C&F stopes represent 3% of the current total stope volumes.

7.2.4 Sub-level Extraction and Sub-level Development Where the reef and hangingwall are competent and the Main Zone has good continuity, sub-level open stoping using relatively shorter “long holes” compared to other mining districts can be applied. This extraction method is illustrated on Figure 47. The sub-levels are driven on the reef plane at 25ft (7.6m) to 50ft (15.2m) intervals. Considerable tonnage is generated by driving sub-levels in the reef, which is accounted for as SLD and is included with R&F tonnage as a combined mining method. SLE accounts for approximately 8% of the stoping volumes.

Figure 47: Sub-level long hole open stoping with subsequent backfilling

In the SLE method, the sub-level sills are driven with narrow single-boom jumbos. The long holes are drilled by long hole pneumatic drill rigs. Once the sub-levels are advanced, a drop raise is drilled from the upper sub-level to the lower sub-level and blasted at the end of the stope over the full width of the reef at that point. Blast holes are then drilled downward on a pattern between the sub-levels and blasted toward the open cavity of a slot raise. Support pillars are left in place on approximately 80ft (24m) to 100ft (30m) intervals on the reef in the stope to minimise hangingwall failure and ore dilution. The broken ore is mucked from the sub-level below, using remote controlled, diesel-powered load-haul-dump (LHD) units, and the broken ore is then trammed to the nearest ore pass. Presently at Stillwater Mine, the R&F methods are used mine wide and the sub-level stoping is used predominantly in the Upper West areas. The captive C&F stopes are used in all areas where there are isolated remnants of Mineral Reserve blocks.

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7.3 Geotechnical SRC5.2(viii); JSE12.9(h)(vii)

7.3.1 Background Stillwater and East Boulder Mines constitute the two main geotechnical ground control districts. The Blitz section is an extension of Stillwater Mine and hence provides similar geotechnical characteristics to the current section of the mine, which is currently being mined. Both Stillwater and East Boulder Mines have been operational for decades and hence: Regional and local geotechnical conditions are well established and known; The mining methods applied are tried and tested; and Ground support measures are understood for prevailing and anticipated rockmass conditions.

The J-M Reef is mined at depth ranges shown in Table 16. From an operating and planned depth perspective, the mines can be described as follows:

Old section of Stillwater Mine: Shallow to intermediate, onset of stress fracturing deeper than 1 000mbs, joint and structural lineament influences on stability and tensile zone effects less than 1 000mbs;

Blitz section of Stillwater Mine: Shallow to intermediate depth of mining environment, joint and structural lineament influences on stability, tensile zone and, in deeper areas, stress fracturing combines with micro fractures to stimulate mobilisation effects; and

East Boulder Mine: Predominantly shallow environment. The dip of the J-M Reef is variable between 35o and 50° at East Boulder Mine to 40° to 90° degrees at Stillwater Mine, while thickness varies in general from approximately 3ft to 10ft (1m to 3m). Table 16: Operating and planned depths below surface

Mine Depth (m) Depth (ft)

Minimum Maximum Average Minimum Maximum Average

Stillwater Mine Current section 15 2 250 1 117 49 7 382 3 665

Blitz section 15 1 677 1 350 49 5 502 4 429

East Boulder Mine 15 1 300 642 49 4 265 2106

7.3.2 Geological Setting and Geomechanical Characterisation The J-M Reef and its immediate hangingwall and footwall consist of varying assemblages of norite, anorthosite, leucotroctolite and peridotite, and the lithostratigraphic units are shown in Table 17. Mafic dykes traverse the hangingwall, footwall or J-M Reef. The dyke material is generally blocky, slick and akin to the nature of the jointed host rock. Table 17: Rock types constituting the footwall, reef and hangingwall

Zone Lithology

Hangingwall

Leucotroctolite

Anorthosite

Peridotite

Ragged Norite

J-M Reef

Anorthosite

Leucotroctolite

Troctolite

Peridotite

Footwall

Norite

Gabbronorite

Melanogabbro

Joint sets at the mines form mostly parallel to the hangingwall. There are both shallow and steeply dipping cross structures that combine to form wedges in the backs and ribs of stopes. Larger structural lineaments generally strike parallel to micro-structures.

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7.3.3 Rock Strengths The uniaxial compressive strengths (UCS) of the rock units contained within the J-M Reef and the immediate hangingwall and footwall are shown in Table 18. The International Society for Rock Mechanics (ISRM) grading for the intact strength of all domains is strong rock (R4; Table 19). The differentiation of intact rock strength and rock quality of the J-M Reef and adjacent footwall and hangingwall rocks is limited and, hence, a universal approach is adopted for design, using the lowest strength and hangingwall quality. Table 18: Typical rock strengths for the footwall, J-M Reef and hangingwall

Domain Uniaxial Compressive Strength (MPa)

Hangingwall 65.41

J-M Reef 61.93

Footwall 84.01

Mean 70.45

Table 19: ISRM grading for the footwall, J-M Reef and hangingwall

ISRM Grade Term UCS

(MPa) Is50

(Mpa) Field Estimate of Strength

R6 Extremely strong >250 >10 Rock material only chipped under repeated hammer blows and rings when struck

R5 Very strong 100-250 4-10 Requires many blows of a geological hammer to break intact rock specimens

R4 Strong 50-100 2-4 Handheld specimens broken by a single blow of a geological hammer

R3 Medium strong 25-50 1-2 Firm blow with geological pick indents rock to 5mm and knife just scraps surface

R2 Weak 5-25 Knife cuts material but too hard to shape into triaxial specimens

R1 Very weak 1-5 Material crumbles under firm blows of geological pick and can be shaped with knife

R0 Extremely weak 0.25-1 Indented by thumbnail

7.3.4 Rock Quality Indicators The Q system implemented by the Norwegian Geotechnical Institute (NGI) is exclusively used to classify the rock mass at Stillwater and East Boulder Mines. Values obtained for Stillwater and East Boulder Mines typically range between 1 and 13 (Figure 48). Based on 28 case histories, the rock mass can be classified as poor to good. Approximately 50% of the rockmass falls within the fair classification, 25% within the good classification and 25% within the poor category (Table 20). The stress reduction factors (SRFs) used to calculate the Q-ratings have a mean value of 1.88 and a standard deviation of 0.47. Joint water conditions range from dry (SRF = 1.0) to medium inflow (SRF = 0.66).

Figure 48: Q-ratings for all Stillwater and East Boulder Mines

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Table 20: Q rating classification and distribution

Case Extremely good Very good Good Fair Poor Very poor Extremely poor Exceptionally poor

Rating >100 40-100 10-40 4-10 1-4 0.1-1 0.01-0.1 0.001-0.01

2.3 x

11 x

3.7 x

7 x

11 x

5.7 x

7 x

5 x

11 x

11 x

1.3 x

4.5 x

12 x

2.7 x

4.8 x

10.3 x

1.6 x

7 x

11 x

7 x

5.3 x

2.4 x

9.7 x

6 x

2 x

2 x

10 x

9 x

Number 0 7 13 8 0 0 0

Percentage 0 25.00 46.43 28.57 0 0 0

7.3.5 Stress field Measurements of in situ stress were conducted at the mines in 1997, 2002 and 2016 using hollow inclusion stress cells. The initial (1997 and 2002) stress measurements were conducted under mountain and valley terrains within Stillwater Mine (Figure 49), whereas the most recent (2016) measurement was performed within East Boulder Mine at test sites indicated in Figure 50.

Figure 49: Test sites for in situ stress measurements at Stillwater Mine

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Figure 50: Test sites for in situ stress measurements at East Boulder Mine

A summary of the magnitude and orientation of in situ stress measurements is presented in Table 21 and Table 22 for Stillwater and East Boulder Mines, respectively. The results indicate that the horizontal to vertical stress ratios vary depending on surface topography and are typically: 1.5 to 1.9 for valley areas at Stillwater Mine; 0.8 to 1.9 for mountain areas at Stillwater Mine; and 2.4 to 3.3 for East Boulder Mine.

The stress orientations and magnitudes are used as primary input parameters for numerical assessments of

development and stope stability, local and regional sequencing and support design. The stress ratios are consistent with typical industry values for shallow to intermediate operations and are not viewed as anomalous. Table 21: Horizontal to vertical stress ratios and stress orientations for Stillwater Mine

Horizontal to vertical Stress Ratio Stress Orientations

Ratio Valley Mountain 1 Mountain 2 Orientation Valley Mountain 1 Mountain 2

East-West:

North-South 0.8 1.9 0.8 S1 (Azimuth, dip) 28.5 (8, 9) 39.4 (264, 14) 24.2 (146, -14)

East-West: Vertical

1.5 1.4 1 S2 (Azimuth, dip) 21.4 (276, 9) 27.9 (235, -75) 15.2 (109, 73)

North-South: Vertical

1.9 0.7 1.3 S3, (Azimuth, dip) 14.2 (323, -78) 20.0 (353, -7) 10.9 (234, 10)

Table 22: Stress magnitudes and orientations, East Boulder Mine

Principal Stress Normal Stress

Variable Major Intermediate Minor Variable North-South East-West Vertical

Magnitude (MPa) 42.16 17.79 12.91 Magnitude (MPa) 39.51 14.95 19.39

Dip 9 81 0 Shear Stress North-South:East-West East-West:Vertical Vertical:North-South

Azimuth 164 347 255 Magnitude (MPa) -7.38 1.03 -3.55

7.3.6 Seismicity At current mining depths (<4 265ft or 1 300mbs) at the Stillwater and East Boulder Mines, the propensity for mining induced seismicity (strong ground motion) is low. The probability of natural earthquake induced strong ground motion is also low based on the USGS prediction of peak ground acceleration for the state of Montana being less than 0.02g using a 10% probability for a 50-year recurrence period (Figure 51). The largest natural earthquake recorded within the last six years was a 2.6 Richter Magnitude (ML) in western Montana. Of the remaining four natural earthquakes recorded by the national network within a 100km radius of Stillwater and East Boulder Mines, none had magnitudes exceeding 2.0. According to the USGS, the probability of fault slip in

the state of Montana based on available fault age data is low (Figure 52).

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Stillwater and East Boulder Mines use the USGS sites to monitor seismicity. A detailed seismic rollout strategy is

yet to be planned, but seismic monitoring will be incorporated into future LoM strategic planning.

Figure 51: Peak ground acceleration for the state of Montana (USGS)

Figure 52: Fault age population within the state of Montana (USGS)

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7.3.7 Mining Methods

7.3.7.1 Background Three mining methods are employed by the mines, namely captive C&F, mechanised R&F and post fill open stoping (OS). Captive C&F stopes are exclusively overhand whilst mechanised R&F stopes are both overhand and underhand. Underhand stopes are supported with paste fill and applied in poor fragmented ground conditions. Except for open stoping, the C&F methods use high quality sandfill or paste fill. Full descriptions of the mining methods are already provided in Section 7.2 and, hence, only those aspects pertaining to geotechnical design are alluded to in this section.

7.3.7.2 Mechanised R&F Stoping The underhand R&F accounts for 10%. The lowest stope elevation is accessed by a slashing ramp and the reef is sliced upwards after uncemented sandfill is placed. Slice heights vary between 8ft and 12ft (2.4m and 3.7m). A back stope, with height of approximately 20ft (6m) is created on the final lift, which poses logistical backfill placement challenges. This final lift either remains open or is post backfilled.

In poor ground conditions where stope back conditions pose untenable fall of ground risks, underhand R&F is practiced. The highest stope elevation is accessed by a ramp, and lifts are progressively mined from the top downwards. After each slice, cemented paste fill is poured into the stope and allowed to cure, and the subsequent undercut is developed. The process continues from the top downwards until the strike and dip extent of the reef in the stope boundary is depleted.

7.3.7.3 Captive C&F Stoping Variations of captive overhand C&F involves using a raise-bored access hole or an Alimak™ raise climber, which remains captive to the stope. Un-cemented sandfill (cycloned mill tailings) is used as the backfill material.

7.3.7.4 Open Stoping Where the reef and the hangingwall are competent and the reef is continuous, sub-level open stoping using relatively short “long holes” (compared to other mining districts) can be applied. Support pillars are left in place on approximate 80ft to 100ft (24m to 30m) intervals on the reef in the stope to minimise hangingwall failure and ore dilution.

7.3.7.5 Stope Extraction Ratios The regional and local areal extraction ratios for Stillwater and East Boulder Mines are shown in Table 23. The regional or macro extraction ratios, computed from actual data, are low due to large volumes of reef material being left unmined, since this falls below the cut-off grades. The local or stope scale extraction ratios reported in Table 23 are based on anecdotal evidence and stope geometries gleaned from mine plan scrutiny. Table 23: Regional and local/stope extraction ratios

Scale Area Stillwater

East Boulder Old Section Blitz Section

Regional Extraction percentage (%) 40 40 50

Local

Captive C&F (%) 85 90 NA

Mechanised R&F (%) 90 90 95

Open stopes (%) 60 60 60

7.3.8 Support Designs

7.3.8.1 Captive and Mechanised C&F Stope Support Design Methods Geotechnical information is collected from Mineral Resource and Mineral Reserve definition drilling, development cover holes and historical data and converted to Q-ratings. The Q-ratings are domained, contoured and classified according to ground type. The ground type domains are superimposed onto planning files. The ground class definition, ground support requirements and areas prone to anomalous rock-related risks are then identified for every planned stope within a “Stope Proposal” document, abstracts of which are shown in Figure 53 and Figure 54.

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Figure 53: Plan view of ground types for a stope block 5 500E 10300

Figure 54: Section view of ground types for a stope block 5 500E 10300

Three ground classes (Class I, II, and III) have been defined for both mines, with each class being assigned a specific ground support type. Ground support is divided into stope footwall, back and hangingwall. Predefined ground support measures are advocated to stope walls based on the geotechnical character derived from the definition drilling. The ground support class system related to the stope walls is described in Table 24 and Table 25.

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Table 24: Ground support classes for stopes and footwall

Class Ground description Support measures

I Good ground 1 bolt per 6ft (1.8m) advance, 5ft (1.5m) long friction bolts

II Large blocky ground with geological features within 6ft (1.8m)

8ft (2.4m) rebars on 6ft (1.8m) centres and 5ft (1.5m) friction bolts between rebar on 6ft by 3ft (1.83m x 0.9m) centres, installation of screen mesh optional

III Small blocky ground due to jointing and geological features within 6ft (1.8m)

Two rows of 8ft (2.4m) rebars on 6ft (1.8m) centres and 5ft (1.5m) friction bolts between rebar on 6ft by 3ft (1.83m x 0.9m) centres, installation of screen mesh mandatory

Table 25: Ground support classes for stopes and back areas

Class Ground description Support measures

I Good ground up to 12ft (3.7m) wide

Systematic friction bolts on 3ft (0.9m) centres

II Fair ground up to 12ft (3.7m) wide Two rows of fully encapsulated 8ft (2.4m) rebars per 8ft (2.4m) advance and 5ft (1.5m) friction bolts between rebar on 3ft (0.9m) centres, installation of screen mesh required

III Fair ground up to 12ft (3.7m) wide Two rows of fully encapsulated 8ft (2.4m) rebars on 0.9m centres and 5ft (1.5m) friction bolts between rebar on 3ft (0.9m) centres, installation of screen mesh required or mats in captive stopes

7.3.8.2 Open stope support design methods Between 8% and 20% of RoM ore extraction is planned from open stopes. Stope dimensions are small at 25ft to 50ft (8m to 15m) vertical level separations and 20ft to 30ft (6m to 9m) strike spacing. Sill and rib pillars are designed using the following empirical rules: Vertical pillar thickness to horizontal excavation span ratio of 2:1 in short-term production headings; and Vertical pillar thickness to horizontal excavation span ratio of 2.5:1 in long-term (LoM) headings.

The excavation ratios have been developed through an empirical and pragmatic approach to pillar design, and stable excavations have resulted. It is, however, noted that Stillwater and East Boulder Mines have not pursued a more detailed engineering investigation into pillar designs to derive optimal designs.

7.3.9 Validation of Rockmass Behaviour

7.3.9.1 Computational Assessments Computational assessments have been carried out using finite difference methods to quantify the rockmass response to mining. The results of numerical modelling are used to:

Assess stope sequencing and their effects on abutment stresses; Validate abutment (sill) pillar dimensions; Determine the potential for stress effects on the rock mass; and Estimate the seismic response of the rock mass to mining.

The latest assessment was conducted at East Boulder Mine in 2016 using the FLAC3DTM software program.

7.3.9.2 On-mine Overview of Stope Performance Assessment of ground quality of the excavations is handled primarily by mine personnel. These individuals are trained in the geotechnical basics on an annual basis (minimum) and are, therefore, relied upon to perform basic checks on ground quality or changes in ground conditions as part of their daily inspection of the work areas. Geotechnical Engineering personnel are then requested to assess areas as necessary and/or on a discretionary basis. The following minimum excavation inspections are conducted:

Shift inspections by mine operations personnel and Shift Bosses; Weekly inspections by mine operations/support leadership; Periodic inspections by the Geotechnical Engineer; and Periodic inspections by external geotechnical consultants.

For East Boulder Mine, the following geotechnical programme is planned: External consultants will be engaged to perform window mapping and to re-analyse the East Boulder Mine

primary and secondary ground support systems in 2017; and Multiple Position Borehole Extensometer (MPBX) instrumentation attached to data loggers are planned to

be installed into footwall lateral drifts where they intersect reef access drifts as well as the reef and access drift intersections, to understand rockmass performance as mining progresses.

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7.3.9.3 External Oversight Functions Stillwater and East Boulder Mines routinely engage the services of external consultants to provide geotechnical oversight functions related to ground support performance, stope performance and design. Independent consultants have been engaged at least once per year for the past 17 years. Recent oversight consulting has included: Geomechanical analysis of the East Boulder Mine by Agapito Associates Inc., (2016); Unspecified consulting services by SRK Consulting (2016); and Rock Engineering audit on Stillwater Mine by Langston and Associates (2016).

7.3.10 Development Support Resin grouted rebars and friction bolts are used in development support at spacings dictated by the ground class. The Type I, II and III ground support classes are analogous to good, fair and poor ground, respectively (Figure 55 and Figure 56). At intersections, where the radial span exceeds 20ft (6m), cable anchors are installed. More than 80% of excavations are either shotcreted or meshed. Support design and practice is based on the following:

Ground quality assessments based primarily on the Q-rating system; Utilisations of Barton’s and Unal’s empirical bolt length calculations; Wedge analysis utilising site-specific geological structure, joint condition and other parameters; Stereonet analysis or Rocscience UnwedgeTM software analysis to determine key block stability; Grimstad and Barton’s support design graph; Numerical analysis that quantifies field stresses imposed by excavating; Fallout potential heights considered within span design, but are generally approximated at one third to

half of the back span; and Poor ground quality in C&F is given guidance to advance with smaller rounds (depth and span), and these

excavations are recommended for shorter (time) usage. Poor or very poor ground quality excavations typically have a specific ground control plan submitted for each specific and sometimes unique situation.

Figure 55: Primary and secondary development rib support

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Figure 56: Primary and secondary development back support

7.3.11 Surface and Subsidence Control Regulatory permits have been issued to Stillwater by the Department of State Lands, State of Montana regarding the minimum size of crown pillar to be left between surface and the initiation of stoping activities. The chronology of permitted restrictions is listed below:

1986: 20ft to 50ft (6m to 15m) crown pillar for mining below surface terrain that does not contain water courses at Stillwater Mine;

1992: 20ft to 50ft (6m to 15m) crown pillar for mining below surface terrain that does not contain water courses at East Boulder Mine;

1998: 200ft (61m) crown pillar for mining below surface terrain that is directly below a water course at Stillwater and East Boulder.

Compliance to these regulations is strict and appropriately sized buffer zones have been incorporated into all working and strategic plans at the mines.

7.3.12 Backfill specifications The backfill placed utilises hydraulic sandfill comprising a coarse fraction of the tailings in the majority (90%) of stopes whilst 10% of stopes use cemented tailings paste to provide sufficient backfill strengths to support underhand mining. Patterson and Cooke (P&C) was commissioned in 2014 to provide a scoping level design for the extension of backfill systems to accommodate the planned Blitz section of Stillwater Mine. P&C provided a concept level backfill flowsheet to service the current section of Stillwater Mine and the Blitz section (Figure 57). The design specifications for the scoping level cemented paste and sandfill are described in Table 26. These recommended specifications have since been adopted and implemented by Stillwater at Stillwater and East Boulder Mines.

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Figure 57: Concept flowsheet for modified paste fill

Table 26: Design specifications for cemented paste and sandfill

Medium Description PGM Mill Tailings Binder (Cement)

Paste Cemented Sand

Backfill production

Minimum 65 ton/hr 45 ton/hr

Nominal 80 ton/hr 55 ton/hr

Maximum 100 ton/hr 75 ton/hr

Design Concentration

Minimum 72%m 70%m

Nominal 73%m 71%m

Maximum 73%m 72%m

Cement Content Nominal 12% 12%

Ratio of sandfill to underhand fill, by weight (tons) Un-cemented sandfill: 90% of total fill. Underhand fill: 10%of total fill

Unconfined compressive strength (UCS) target 3-day: 70psi/ft

7-day: 150psi

Paste friction pressure gradient

Modified: 0.128psi/ft (target)

Nominal: 0.16psi/ft at 80 ton/hr, 73%m in 6-inch schedule 80 pipe

Maximum:0.20psi/ft in 6-inch schedule 80 pipe

Sand friction gradient Cemented: 0.094psi/ft nominal at 150gpm in 3-inch schedule 40 pipe

7.3.13 Conclusions and Recommendations Stillwater and East Boulder Mines have been in operation for decades and have progressively developed mining methods, ground classification and support measures that are suited to ambient rockmass conditions. A wealth of geotechnical data exists for the mines upon which appropriate stope sizes and support practices can be technically designed through detailed engineering, and implemented.

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7.4 Geohydrology SRC5.2(viii); JSE12.9(h)(vii)

7.4.1 Background Stillwater has recently commissioned Itasca Denver, Inc. (Itasca) to complete groundwater studies at its mines, and this work is currently in progress. This section describes the results of the Blitz Dewatering Project Phase II work performed by Itasca in 2016. The specific objectives of the Phase II work conducted by Itasca were as follows: Establish instrument boreholes with testing manifolds and data logging pressure transducers to

automatically record water pressure; Perform hydraulic tests on manifold-equipped boreholes (flow and shut-in tests); Analyse the hydraulic-test results to determine the hydraulic properties of the rock mass intersected by

the drillholes; Interpret the geochemical and isotopic sampling results in terms of the potential source and age of

groundwater in the vicinity of the Blitz section development; Develop analytical models using site-specific hydraulic properties and water levels for the refined

prediction of groundwater inflows to mine tunnels and workings; Refine the preliminary Water Management Plan (WMP) developed in Phase I; and Provide recommendations for on-going hydrological data collection and recording.

The study was conducted between mid-September 2016 and early February 2017 and involved the following: Instrumenting underground drillholes to automatically record water pressures; Performing hydraulic (flow and shut-in) tests at eleven different locations and collecting groundwater

samples for geochemical and isotopic analyses at the ends of the flow tests; Analysing and interpreting the geochemical and isotopic results in terms of the potential source and age

of groundwater; Developing analytical models based on site-specific hydraulic properties and water levels, and using those

models to estimate inflow rates to the development drifts and future production areas; Refining the preliminary WMP developed during Phase I; and Providing recommendations for continuing hydrogeological work to support the Blitz expansion over the

next several years of mining. Locations for diamond drillholes that were equipped with monitoring manifolds during Phase II are shown in Figure 58. A total of ten hydrological holes were instrumented to record water pressures and tested by Itasca to determine flow rates and hydraulic conductivity (K) values, along with two probe holes that were tested but not utilised for long-term pressure measurements. These installations augment the drillholes previously instrumented during Phase I and bring the total number of actively monitored locations to ten; seven on the 5 600E footwall lateral drift and three on the 5 000E Tunnel Boring Machine Drift 1. All of the instrumented drillholes were sampled for water chemistry and isotopic analyses, along with one of the non-instrumented probe holes. Water-pressure time-series data was automatically recorded by pressure transducers equipped with dataloggers at each of the instrumented drillholes. Hydraulic flow and shut-in tests were conducted during

drilling using a special drill-collar manifold constructed by Itasca. The drill-collar manifold apparatus included a manual pressure gauge for water-pressure readings and a valve for regulating the flow through the manifold. Discharge from the manifold during a flow test was routed into a tank with graduated volume markings and timed to make flow measurements. Each instrumented location was retested post-drilling, and after installing monitoring manifolds (equipped with data logging transducers) as well as allowing the water pressures to re-equilibrate following the perturbations caused by drilling.

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Figure 58: Hydrological drillholes along adits at the Blitz section of Stillwater Mine

7.4.2 Hydraulic Conductivity The average hydraulic conductivity (K) values computed from the two types of testing (flow and shut-in/recovery) vary between approximately 0.0049ft and 4ft (0.0015m and 1.22m) per day and are consistent with a range of values for fractured igneous and metamorphic rocks in the published literature (Freeze and Cherry, 1979), as illustrated in Figure 59. The average K values are the best estimates of the K values of the rockmass near the drillholes. The full-hole-length tests (i.e. the tested interval from the end of the surface casing to total depths) provide a good representation of the “effective K” value of the overall rockmass, which includes both the occasional high-permeability fracture zones and the predominant less-fractured bulk rockmass of very low permeability. The geometric mean K value for all the full-hole-length tests of both types (flow and shut-in/recovery) is 0.079ft (0.024m) per day. Since the bulk of the water flow in the rockmass is taking place along discontinuities (i.e. in the fractured zones created by faulting), the average K values computed from the flow and shut-in tests are primarily controlled by the density, aperture size and persistence of the discontinuities intersected by the drillholes.

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Figure 59: Reported and measured values of hydraulic conductivity

7.4.3 Highlights of Groundwater Study Itasca summarised its groundwater study findings as follows: The water pressures in the rockmass adjacent to the drifts are highly variable and range from

approximately 50ft (15m) to nearly 1 250ft (381m) H2O (approximately 0.15MPa to 3.74MPa). All the instrumented drillholes exhibited sustained linear drawdowns and fluctuations related to nearby mining activities or drilling and testing other holes, which indicates that there is effective and wide-spread hydraulic connectivity between different parts of the groundwater system;

The flow-rate and pressure-recovery behaviours observed during these tests are consistent with a semi-confined groundwater system responding to the stresses imposed by the tests;

The average K values computed from the flow and shut-in testing results vary between approximately 0.0049ft and 4ft (0.0015m and 1.22m) per day and are consistent with a range of values for fractured

igneous and metamorphic rocks in the published literature. The geometric mean K value for all of the full-hole-length tests of both types (flow and shut-in/recovery) is 0.079ft (0.024m) per day. There is no apparent correlation between the estimated K values and the different lithological units encountered in the instrumented drill holes, nor are there indications of trends or grouping of K values according to location along the drifts;

The chemistry and isotopic analyses of water samples indicated that inflows to the various drifts and the proximal groundwater are derived from modern recharge (60 years old or less) and are linked to the surface-water system. The eastern-most portions of the two major development drifts at the Blitz section appear to have increasing contributions of slightly older water and to be sourced by recharge from higher elevations than other parts of the drifts;

The estimated long-term steady inflow rates to the 5 600E footwall lateral drift (not including the production areas) are between approximately 70G and 400G per minute (considering both methods);

Analytical modelling based on the method of Perrochet, and considering both major development drifts and the prospective production areas, predicted inflow rates as high as approximately 1 500G per minute by the end of the 25-year period of mining of the Blitz section. This estimate is sensitive to the assumed specific storage (Ss) parameter value as well as to the assumed mining schedule and number of

production areas;

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The updated WMP constitutes a balanced system of groundwater exclusion and removal methods,

optimised for both grouting effectiveness and water-disposal efficiency. The main elements of the WMP are gravity-fed drains, passive collection systems (sumps), and both curtain and targeted-feature grouting of flow zones;

The South Prairie Fault has been identified as a hydrogeologically important feature in the immediate vicinity of the reef and future production areas. This fault appears to be assisting mining efforts in the Nye Creek Basin by limiting southward-directed groundwater flow across the fault into the development drifts and future production areas in that basin. However, this situation may be different in the basins to the east of the Nye Creek Basin, due to a possible reversal of groundwater flow directions in the headwater portions of those eastern basins.

7.4.4 Geohydrological Study Recommendations Itasca’s recommendations for continuing hydrogeological study work to support the Blitz section include the following items: Conduct hydraulic tests of probe holes drilled prior to drift advancement whenever possible;

Establish instrument drillholes to record water-pressure time-series data and conduct flow and shut-in tests in at least two locations per geographic basin. Conduct additional monitoring/testing as warranted if the new basins exhibit notably different groundwater conditions, such as persistent significant water hits on the south side of the South Prairie Fault;

When starting to develop production areas, evaluate the water inflows from definition drillholes and convert appropriate holes into drain holes for depressurisation/dewatering purposes. It is important that dedicated drain holes and other nearby drillholes should not be grouted to ensure effective removal of water from the area(s) of interest;

Wherever possible, drain holes should be manifolded together to collect the discharge water into a smaller number of flow points that can be easily monitored and maintained. Whether manifolded together or not, all drain holes should be set up to record the line pressures and discharges (cumulative volumes rather than instantaneous rates) from separate/individual areas. A systematic plan for water collection and monitoring of flow and water quality in the discharge system should be developed and implemented; and

Continue to monitor the existing instrumented locations and any new ones established in the future for as long as possible. Itasca recommends at least one full year of monitoring in as many locations as possible

to help identify possible seasonal effects of recharge to the groundwater system.

7.4.5 Conclusions The Mineral Corporation accepts the results and recommendations of the geohydrology work which was completed for the Blitz section by Itasca as well as endorses the expanded geohydrological studies currently under way at Stillwater and East Boulder Mines. In the absence of geohydrological data for these operations, The Mineral Corporation has relied on site visit observations and discussions with mine personnel to assess the impact of groundwater at the mines. The Mineral Corporation made the following observations pertaining to water ingress at the mines: For both Stillwater and East Boulder Mines, underground workings 200ft to 330ft (61m to 100m) below

surface are dry with no noticeable inflows emanating from porous medium flow; At depths shallower than 200ft to 330ft (61m to 100m), groundwater flow was observed only in tunnel

boring machine adits predominantly due to discrete fracture flow; and The fractures that act as conduits for flow in shallow areas of the mines are shear and fault zones and not

necessarily rock micro-structures such as tension gashes and joints.

7.5 Grade Control SRC5.2(viii)

7.5.1 Background Grade control at Stillwater and East Boulder Mines is undertaken by Geologists guided by a Grade Control Manual (standard operating procedure). The grade control process involves face evaluation, face estimation, chip sampling and laboratory analysis and data interpretation. The Grade Control Manual identifies the methodology for executing these task as well as the essential markers that should be utilised by the Geologists for grade control mark up. These markers, which are indicated in Figure 60, are described as follows: Gabbro/Norite Zone 1 contact with Troctolite/Anorthosite 1: Gabbro/norite contact with olivine rocks can

be a useful marker. The sections must be used to determine the reef specifics, but when suddenly in footwall rocks, turn or slab north looking for this contact;

Pegmatoidal Rocks (poC): Pegmatoidal rocks generally are not found in the hangingwall. Their presence usually indicates the rock is not hangingwall;

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Mottled Anorthosite (oik) or Hangingwall Anorthosite (pC): This anorthosite has well defined

clinopyroxene and orthopyroxene oikocrysts about 2 inches to 4 inches (5cm to 10cm) that give the rock a distinctive mottled appearance from a distance. This rock type is a distinctive unit marking the hangingwall;

Spotted Anorthosite (HW LpoC): This unit is the most reliable hangingwall marker, and continuous reefs are seldom found stratigraphically above this unit. Sometimes referred to as “Spot” or “Dalmatian rock”, it has sub-rounded olivine, which is usually uniformly distributed over the unit;

Buckshot (oC): It is 12 inches to 24 inches (0.3m to 0.6m) thick and has masses of small sub-rounded olivine, which gives it the buckshot texture. This unit is weaker than rocks that generally surrounds it and was highly faulted during the Laramide Orogeny.

Figure 60: Generalised stratigraphic sequence used to guide grade control

7.5.2 Face Evaluation The Grade Control Geologist starts by systematically checking for sulphide minerals working from the footwall to the hangingwall, dotting or circling sulphide minerals in white paint in order to define the morphology of the

sulphide mineral distribution. This may take several passes over the face and ribs. Sulphide minerals are sometimes hard to see on glossy wet rock and will suddenly show as the rock dries. The footwall and hangingwall ribs are checked at least as far back as the last marked face. Once all visible sulphide minerals have been noted, the mineralisation is outlined in white paint. The Geologist notes the rock types on the face and ribs, making note of dip angles and stratigraphic relationships of the current face to the previous face (i.e. fault contact or lithologic contact). Painting marks at contacts, faults in face and ribs is a useful way to visualise rock relationships. Then the stope is washed down as far back as necessary in order to get a full understanding of the local geology.

7.5.3 Face Estimation Face estimation is an informal calculation of width-weighted grades using face intervals. Face intervals can be broken down into intervals of sulphide distribution and reef width. The estimation includes the whole face, including dilution wedges in hangingwall and footwall.

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Figure 61 shows a typical minimum width reef mark-up. A blue line is painted to define the hangingwall pick at

the poCP /LpoC contact. A white line is painted to define the pC/poCP contact. The pbC and pC combined intervals will not carry Pd + Pt content greater than or equal to 0.5opt (17.1g/t). Then the minimum mining width (MW) is painted, based on the mucking equipment, and the word “ORE” is inscribed on the face to indicate the reef (Figure 61). Included in the mark-up are arrows painted to define the reef.

Figure 61: Typical minimum width reef mark-up

7.5.4 Chip Sampling Sampling is broken out into units in order from the hangingwall to the footwall. Sample inclusions should be broken out into logical major breaks in mineralisation, major faults and, where possible, rock type changes. A chip is taken using a rock pick every 1ft (0.3m) upwards on lithological dip and staying within that unit.

In order to obtain a representative sample of the face, sample intervals should not exceed 3ft (0.9m) in width and a sample should be least 10lb (4.5kg). An example of chip sample spacing is shown in Figure 62. Each round should be sampled when there are I-drifts and sills, as well as in areas where it is difficult to identify sulphide minerals or that are highly faulted. Obvious waste material should not be sampled, but the interval should be in the computer entry as a dummy sample. A zero grade is assigned to the waste interval.

Figure 62: Chip sampling spacing

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7.5.5 Conclusions The Mineral Corporation notes that the grade control procedure employed is well entrenched and producing the desired results. Geological maps and the detailed reef descriptions produced from the process form valuable inputs to Mineral Resource evaluation and Mineral Reserve estimation.

7.6 Modifying Factors SRC5.1(ii);SRC5.2(ii); SRC5.2(ix);SV1.10; JSE12.9(h)(vii)

7.6.1 Mining Factors for Stillwater Mine The mining methods applied are based on the true width of the reef. The minimum mining width for each method is indicated in Table 27. These minimum mining width criteria remained the same for the 2017 estimates and they have not changed over the past five years. The planned total dilution in these minimum mining widths varies from 17% to 40% depending on reef widths and ground conditions. Table 27: Stillwater mining factors

Sub-area Method/Process Horizontal Width (ft) True Width (ft) Horizontal Width (m) True Width (m)

Off-shaft West Upper

Slusher 5.7 5.0 1.7 1.5

R&F 7.4 6.5 2.3 2.0

Sub-development 7.4 6.5 2.3 2.0

Sub-extraction 5.1 4.5 1.6 1.4

Off-shaft West Lower

Slusher 5.7 5.0 1.7 1.5

R&F 7.4 6.5 2.3 2.0



Off-shaft East-West

Slusher 5.7 5.0 1.7 1.5

R&F 7.4 6.5 2.3 2.0



Off-shaft East-East

Slusher 5.5 5.5 1.7 1.7

R&F 7.0 7.0 2.1 2.1



Blitz West

Slusher 5.5 5.0 1.7 1.5

R&F 7.2 6.5 2.2 2.0



Upper West East

Slusher 6.3 5.0 1.9 1.5

R&F 7.5 6.0 2.3 1.8



Dow Upper

Slusher 6.5 4.5 2.0 1.4

R&F 7.9 5.5 2.4 1.7



Dow Lower

Slusher 6.5 4.5 2.0 1.4

R&F 7.9 5.5 2.4 1.7



Large mineralised extensions into the footwall of the reef package, referred to as ballrooms, are occasional geological features that are a significant contributors to RoM ore production. The strike and dip of the J-M Reef is variable. Similarly, the geotechnical conditions vary from good to poor, and all headings require ground support to varying degrees. Over the past few years, more of the reef has been mined utilising the R&F method. Currently, the R&F method accounts for 89% of RoM ore production, with the SLE method contributing 8% and conventional C&F method contributing 3% of RoM ore production.

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Dilution of ore beyond that which is planned is a persistent challenge in every precious metal mine and

Stillwater Mine is not an exception. It is understood that, in the earlier years, there was considerably more dilution from overbreak in the R&F stopes than there is today. Furthermore, the SLE method tends to yield more dilution because the reef structure sometimes undulates or thins and swells vertically. The mine has attempted to reduce dilution by changing sub-level intervals. Currently, sub-level spacing of 30ft (9m) is being used. In order to keep the reef hangingwall stable, support pillars are left in place after the stope has been blasted. When open stopes are left with the support pillars in place, the calculated extraction is approximately 90%. Thus, there are more pillar losses and more dilution from this method than in R&F or conventional C&F. As indicated previously, the true widths for each block model are adjusted for the mining method. The minimum horizontal mining width is driven by the type of equipment to be employed to extract the reef. In the case of R&F, this horizontal width is 7.4ft (2.3m). Thus, allowing for the reef average dip this converts to a minimum required true width of 6.5ft (2.0m). To this minimum true width, an unplanned overbreak of 1ft (0.3m) is added giving a total combined true width of 7.5ft (2.3m). Table 27 summarises the true widths utilised (inclusive of the 1ft of dilution) in the Mineral Resource to Reserve conversion for the various mining methods utilised in each of the sub-areas at Stillwater Mine. In effect, this is a conservative approach that adds additional dilution, which is more than would be generated by widening the stoping excavations to fit the operating envelope of the various types of equipment utilised. The primary dilution and additional dilution 1ft (0.3m) are accounted for in the Stope Proposals, and the dilution flows through into the LoM production schedule in terms of tonnage and the final diluted grade to mill. This process is repeated for each mining sub-area per mining methods.

7.6.2 Mine Planning Criteria for Stillwater Mine Stillwater Mine has added approximately 8 000ft (2 438m) of primary footwall lateral development in 2016. Currently, the mine covers 32 000ft (9 754m) of strike length. Stoping and development LoM planning and scheduling criteria, using Area 1 as an example, are detailed in Table 28 to Table 31. All data utilised in the development of the LoM schedule is based on historical data gathered since the inception of the mine. The efficacy of this approach is demonstrated by the fact the mine, in general, has been attaining its annual targeted ounces (Pt + Pd) for the last three years. Table 28: Planning parameters for stoping

Mining Method

Stoping

Stoping total tons per miner per month

Stoping total tonne per month

Percentage ore Mining mix

(Source)

C&F (Captive) 205 186 90% 3%

R&F 450 408 70% 89%

Sub-level extraction 315 286 100% 8%

Sub-level development 426 386 75% 0%

Pillar extraction 315 286 100% 0%

Table 29: Planning parameters for development

Area

Development

Ore Tons per foot of footwall

Ore tonne per metre of footwall

Ore grade (ounces per ton)

Percentage MCF

Off-shaft 62 186 0.72 89%

Off-shaft East 53 159 0.70 90%

Lower Far West 131 392 0.51 90%

Far West 109 326 0.48 90%

Depression Zone 26 78 0.66 90%

Blitz Zone 49 147 0.70 90%

Table 30: Planning parameters for primary development

Area

Primary Development

Advance Factor

Number of crews

Advance feet per month

Tons per foot

Advance metres per month

Tonnes per metre

Off-shaft 0.96 1 60 13 17 39

Off-shaft East 0.96 1 60 13 17 39

Lower Far West 0.90 1 60 13 17 39

Far West 0.90 1 60 13 17 39

Depression Zone 0.90 1 60 13 18 39

Blitz Zone 0.96 1 60 13 17 39

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Table 31: Planning parameters for secondary development

Mining Method

Secondary Development

Foot per month

Foot per ton Tons mined

per foot Metre per

tonne Tonne mined per

metre

C&F (Captive) 58 0.016 63 0.005 200

R&F 58 0.018 56 0.006 167

Sub-level development 58 0.010 100 0.003 333

7.6.3 Mining Factors for East Boulder Mine The principal stoping method at East Boulder Mine is R&F stoping (combined with the SLD production). However, SLE stopes also contribute a significant tonnage while a minor amount of RoM ore comes from conventional C&F stopes. The mine has a cyclone tailings sand plant but no paste backfill plant, which prevents the use of the underhand C&F mining approach at East Boulder Mine. The 8 200 Level Sand Plant was the latest to be put on-line in 2016.

Prior to 2003, almost all production was by the sub-level long hole stoping method. Initially, sub-levels were based on a 43ft (13.1m) sub-level interval. This was modified to 35ft (10.7m) vertical sub-level interval in an effort to reduce dilution. The nominal sill width is currently 8ft (2.4m), with a minimum stoping width of 7.5ft (2.3m). The change to pneumatic long hole drills from hydraulic electric drills allowed a reduction in the size of the sill drifts and also in the size of the drilled holes, which reduced overbreak. In 2003, R&F stoping was introduced to East Boulder Mine to provide more flexible and efficient extraction in areas of the J-M Reef lacking the uniform width best exploited with sub-level stoping. From 2005 to 2007, there was an increase in conventional C&F stoping in an effort to increase the overall production grade, but the associated decrease in productivity led to a decrease in the usage of this method between 2008 and 2011 and an increase in usage of the SLD and SLE methods. The mine increased sub-level extraction in 2016 to increase productivity. The sub-level extraction method relies upon long hole stope drilling and blasting of the reef, and breaks more ore per foot of drillhole than the R&F or conventional C&F methods. Consequently, the sub-level extraction increased from 8% of production in 2011 to 20% of production in 2017. Conventional C&F decreased from 30% of tonnage produced to 0% in 2017. R&F production tonnage increased to 80% of total production in 2017. As at the Stillwater Mine, the selection of mining methods is constrained by geotechnical conditions that require that the ribs and the “shanty shaped” back of all openings that workers access must have ground support installed. Ground support is required during all sub-level development, but is labour intensive and time consuming. The extensive use of jacklegs for ground support in the stopes increases exposure to injuries and the mine is actively working to reduce this. Several years ago, the mine ordered a prototype low profile bolter, which has not been put into use due to design problems. A second bolting system, called a CMAC, has been successfully tested and being deployed at the mine in an effort to take the jackleg out of the miners’ hands. The unit is designed to install bolts in a nominal stoping width of 6.5ft (2.0m). Table 32 presents the minimum true mining widths for the mining methods used at East Boulder Mine. The mining widths vary in different sub-areas of the mine due to differences in the average thickness and dip of the J-M Reef from area to area and to the mining method applied. In East Boulder Mine, the J-M Reef dips approximately 50° to the northeast; however, the dip may flatten to as little as 35° in the far west area of the 6 500 Level footwall lateral drift. Minimum mining width criteria for East Boulder Mine have not changed since December 2016, as confirmed by the mine staff. As indicated previously, the true widths for each model are adjusted for the mining method. The R&F requires a minimum horizontal width of 7.4ft (2.3m). Taking into account the average dip of the reef, the minimum required true width is 7ft (2.1m) in the case of the R&F to which a 1ft (0.3m) of unplanned overbreak (dilution) is added. Table 32 summarises the various widths utilised in the conversion of Mineral Resources to Reserves. This is a conservative approach that adds more dilution than would be generated by just widening the stoping excavations to fit the operating envelope for various equipment used. The primary dilution and additional dilution is accounted for in the Stope Proposals, and flows through into the LoM schedule in terms of tonnage and the final diluted grade to the mill. This process is repeated for each mining area per mining methods.

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Table 32: East Boulder Mine Mining Factors

Method

Minimum true broken width (ore + waste)

Constant dilution added above minimum mining

width

Tonnage Recovery

Internal Pd + Pt cut-off grade

ft m ft m % opt g/t

Sub-Level-Development (7.0+1.0) = 8.0 2.4 1.0 0.3 100 0.2 6.9

Sub-Level-Panel (4.0+1.0) = 5.0 1.5 1.0 0.3 75 0.3 10.3

Ramp & Fill (7.0+1.0) = 8.0 2.4 1.0 0.3 100 0.2 6.9

Slusher (4.5+1.0) = 5.5 1.7 1.0 0.3 100 0.0 0.0

Backstope (4.0+1.0) = 5.0 1.5 1.0 0.3 75 0.3 10.3

7.6.4 Mine Planning Criteria for East Boulder Mine In 2016, East Boulder Mine added 2 388ft (728m) of footwall lateral development in the Frog Pond West

sector, approximately 3 612ft (1 101m) of primary development and 1 370ft (418m) of secondary development to access additional Mineral Reserves. Starting in 2004, East Boulder Mine resumed the extension of the portal level footwall lateral to the west, followed by Mineral Resource and Mineral Reserve definition diamond drilling. During 2008, a tunnel boring machine (TBM) was used to extend the footwall lateral. In October 2010, the TBM was reactivated to extend the footwall lateral and continued through 2013 to complete its work at Graham Creek at about mine grid -83 500 (ft) Easting. The TBM unit is currently parked on an indefinite basis. The planning criteria per stoping method employed within the various geographical areas in the mine are summarised in Table 33 to Table 36. All data utilised in the development of the LoM production schedule is based on historical data gathered since the inception of the mine. The mine has been attaining its annual targeted ounces production for the last three years, which indicates the efficacy of this approach. Table 33: Planning parameters for stoping

Mining Method

Stoping

Stoping total tons per miner per month

Stoping total tonne per month

Percentage ore Mining mix

(Source)

C&F (Captive) 236 214 100% 3%

R&F 567 514 85% 55%

Sub-level extraction 708 643 100% 23%

Sub-level development 567 514 85% 19%

Pillar extraction NA NA NA NA

Table 34: Planning parameters for development

Area

Development

Ore tons per foot of footwall

Reserve grade (ounces per

ton)

Ore tonne per metre of footwall

Reserve grade (g/t)

Percentage MCF

Frog Pond West 142 0.41 452 13.89 94%

Frog Pond East 74 0.37 225 12.64 94%

Lower Frog Pond East 74 0.37 225 12.69 94%

Lower Frog Pond West 142 0.40 452 13.77 94%

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Table 35: Planning parameters for primary development

Area

Primary Development

Advance Factor

Number of crews

Advance feet per month

Tons per foot

Advance metres per

month

Tonnes per metre

Frog Pond West 0.95 1 60 13 18 40

Frog Pond East 0.95 1 60 13 18 40

Lower Frog Pond East 0.90 1 60 13 18 40

Lower Frog Pond West 0.90 1 60 13 18 40

Table 36: Planning parameters for secondary development

Mining Method

Secondary Development

Foot per month

Foot per ton

Tons mined per foot

Metre per month

Metre per tonne

Tonnes mined per metre

C&F (Captive) 60 0.011 91 18 0.004 250

R&F 60 0.025 40 18 0.008 125

Sub level extraction 60 0.030 33 18 0.010 100

Sub level development 60 0.030 33 18 0.010 100

Pillar extraction 60 0.000 0 18 0.000 0

7.7 Life of Mine Planning and Scheduling SRC5.2(i); SRC5.2(ii); SRC5.2(iii); SRC5.2(iv); SRC5.2(v); SRC5.2(vi); SRC5.2(vii); SRC5.2(viii); SRC5.2(ix)

7.7.1 Introduction Stillwater’s Ten-year LoM Plan and 25-year (Strategic) LoM Plan envisage mining from the Stillwater and East Boulder Mines. Stillwater Mine consists of two mining sections, namely the current section and Blitz section, with the Blitz section being an expansion programme currently under development. The LoM scheduling and Mineral Reserves for Stillwater Mine reported in this CPR account for both sections. East Boulder Mine also consists of two sections, namely East Boulder section and Lower East Boulder section. However, the Lower East Boulder section is still in the concept stage and its development is subject to the outcome of a technical study. Therefore, the Lower East Boulder section is not scheduled as part of the current LoM production and is excluded from the reported Mineral Reserves.

7.7.2 Mineral Resources to Reserves Conversion

7.7.2.1 Mineral Resource Model Definition Prior to commencing the planning process at Stillwater and East Boulder Mines, the first stage is to define the Mineral Resources to be converted to Mineral Reserves. The Mineral Resource model will identify the tonnages, grades and content available for conversion – these being Indicated and Measured Mineral Resources. An outline of the methodology adopted by the Stillwater to establish the Mineral Resources (Measured and Indicated) available for conversion is presented below. Geological and Mineral Resource models at true width and cut-off grades are defined for each identified mining area as a first step. In the case of Stillwater Mine, cut-off grades of 0.20opt (6.86g/t) Pt + Pd for the Farwest and 0.30opt (10.29g/t) Pt + Pd for the Off-shaft areas of the mine are applied to the block model. In the case of East Boulder Mine, a cut-off grade of 0.20opt (6.86g/t) is applied to the block model. The process followed is that a minimum true width, based on the R&F method, is defined in the Measured Mineral Resource block model. Minimum mining widths for Stillwater and East Boulder Mines are 6.5ft (2.0m) and 7ft (2.1m), respectively. For areas where the true channel (reef) width is less than these minimum mining widths, the true width is adjusted to match the minimum mining width by incorporation of low grade material from the footwall. Therefore, the block models for Mineral Resources will have diluted grades. To each diluted grade block model, a grade cut-off is applied, which eliminates blocks with grades below cut-off from the Measured Mineral Resources available to be converted to Mineral Reserves. In situ regional tonnage and grade estimates from these models, which are based on definition drilling data, are applied to the Indicated Mineral Resource areas. The outcomes of this step are Measured and Indicated Mineral Resource estimates and outlines.

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Although the R&F method is the most common mining method at Stillwater and East Boulder Mines, there are

other methods utilised in less than 20% of the mine areas, which need to be accounted for in the conversion process. Instead of using the diluted block model employed for Mineral Resource estimation, which assumes 100% mining via the R&F method, the original undiluted block model for the reef channel is used. To the channel block model, minimum mining widths adjustments based on the mining method per reef domain and grade cut-offs are applied to the reef channel block model in the Measured Resource areas as discussed in Sections 7.6.1 and 7.6.3. Furthermore, an additional 1ft (0.3m) dilution at Stillwater and East Boulder Mines is added to the blocks over which the true thickness is greater than the minimum mining width. The extra dilution is based on historical performances at the mines. In situ regional average grades are applied to the Indicated Mineral Resources areas. There is potential for loss of tonnage and increase in grade resulting from the application of a cut-off grade in the Indicated Mineral Resource areas after definition drilling and modelling of the reef. Accordingly, Stillwater utilises the ratio of material below to material above cut-off per geological domain estimated in closely drilled areas for the estimation of the tonnage and metal ounces available for conversion to Probable Mineral Reserves. As an outcome of this step, stopable blocks are identified in terms of area (size) tonnage and diluted Pd + Pt content and grade in the Measured and Indicated Mineral Resources outlines delineated by the first step.

Finally, mineralisation in the Measured and Indicated Mineral Resource outlines is then converted to Proven and Probable Reserves, respectively, via a process of applying a detailed extraction (stoping) design and scheduling (stope proposal). For the conversion of Measured Mineral Resources to Proven Mineral Reserves, the high abundance of geological information available to accurately constrain thickness, tonnage and grades and the accuracy of technical and cost inputs permits the compilation of estimates to a level of accuracy of within ±10% (Feasibility Study level of accuracy). For the conversion of Indicated Mineral Resources to Probable Mineral Reserves, the absence of detailed geological information limits the knowledge and confidence in the estimates and hence the Indicated classification. The Mineral Reserves in these areas are defined to a lessor level of accuracy of ±20% (Pre-feasibility Study level accuracy).

7.7.2.2 Mineral Resource to Reserve Conversion Process Initially, scheduling includes all primary development (footwall lateral drifts) to access the stope blocks identified through the intense Mineral Resource and Mineral Reserve definition drilling discussed previously. Thereafter, the development design and scheduling is extended to the end of the ten-year period. Beyond the ten-year window, the primary annual development rates required are derived through the utilisation of historical ratios (e.g. ore tons per foot of lateral development for a 300ft or 91m lift). The scheduling of the stoping is dependent on the completion of the footwall access and the necessary diamond drilling to form an outline of the stopable area in terms of grade and tonnage (inclusive of width). In addition, the scheduling will be dependent on the mill feed requirements.

On the completion of the lateral development schedule, the starting dates for the development of the stoping blocks are defined based on when access is attained and the mines’ requirements in terms of RoM ore production. It is also during this process that the true width is corrected for dip and a minimum mining width is applied dependant on mining method and type of equipment to be employed.

For each stope block, a proposal is drawn up, which details the following:

Secondary development (ramp access) required; Location; Block size (height and length);

Geological description (e.g. geological structures, tonnage and grades); Reef width; Applied cut-off grade; Percentage ore recovery; Mineral Reserves; Macro and micro geotechnical considerations; Stope design; Mining method; Extraction sequence; Ventilation design and requirements; Water management; Electrical requirements; Dewatering requirements; Compressed air requirements; Any construction required (e.g. paddocks);

Planned productivity;

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Equipment and personnel equipment requirements;

Fill requirements (type and quantity); and Standards indicating the mining process to be followed in terms of development, support and extraction.

Once the technical inputs have been defined, each stope block is subjected to an economic test. This economic test uses the following technical and financial parameters to determine the economic viability of the planned stoping operation:

Total design tonnage; Recovered tonnage (mill feed); Mineral Reserve grade; Mine Call Factor (MCF); Mill feed (Pd + Pt) grade; Mill feed metal (Pd + Pt) content; Mill recovery; Smelter recovery;

Total recovered metal; Primary development requirements; Secondary development requirements; Construction costs; Direct mining costs; Fill placement costs; Fill production costs; Revenue at spot prices; Crew sizes (for different activities); Mechanised equipment requirements; Stope set up time; and Stope production life span.

From the above process, a net profit and, ultimately, a Net Present Value (NPV) or financial return of the planned stope and payback period are determined. Where required (e.g. if a stope does not meet the required financial returns), the stope is optimised to return the best value.

The process followed to convert the Measured Mineral Resources into Proven Mineral Reserves, based on historical performance and reconciliations, is aligned with industry best practice at an accuracy level of ±10%. A similar process is followed to convert the Indicated Mineral Resources to Probable Mineral Reserves, but the lower level of confidence and geological knowledge for Indicated Mineral Resources place the accuracy employed for Probable Mineral Reserve estimates to approximately within ±20% level of accuracy.

7.7.3 Life of Mine Planning and Budgeting

7.7.3.1 Introduction An economic viability test (ORET test) is completed for the LoM Plans for the operations. Post the ORET evaluation process (Section 7.15.3), Stillwater develops a detailed long-term (25-year) LoM Plans and Budgets to demonstrate the overall economic viability of the mines. The following section presents a high-level outline of that long-range planning process and its outcomes.

7.7.3.2 LoM Planning and Budgeting Cycle Stillwater employs a planning cycle to update the LoM Plan and Budget for each mining operation on an annual basis. Table 37 summarises the planning process utilised to develop the LoM Plans for both Stillwater and East Boulder Mines. The planning cycle is updated from time to time when necessary. Table 37: Stillwater’s planning cycle

Deliverables Completion Date

Update production forecast for current year 1st week of July

Update capital and exploration forecasts for current year 2nd week of July

Update gross mine model with forecasts 2nd week of July

Mid-year update of Mineral Resources and Mineral Reserves 3rd week of July

Update corporate financial model with forecasts 3rd week of July

Update forecasts for first two years of revised LoM Plan 2nd week of August

Mine management reviews and approval of Two-year Plan 3rd week of August

Finalise LoM Plan for remainder of period 1st week of September

Mine management reviews and approval of LoM Plan 2nd week of September

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Deliverables Completion Date

Finalise labour and input prices to LoM Plan 3rd week of September

Mine management reviews and approval of LoM Plan and linked capital 3rd week of September

Finalise LoM model and financial inputs (including mine capital) 4th week of September

Mine management reviews and approval of LoM Financial Model 1st week of October

Finalise all other capital and input to LoM Financial Model 1st week of October

First pass budget (LoM Financial Model) review 2nd week of October

Board meeting to review budget 4th week of October

Second pass to adjust budget according to Board meeting outcomes 2nd Week of November

Finalise second pass budget 1st Week of December

Final review meeting to pass final budget (LoM Financial Model) 2nd Week of December

Planning and Budget cycle complete 2nd Week of December

7.7.3.3 LoM Production Scheduling The LoM production scheduling consists of two primary processes, namely:

Primary access (lateral) development design and scheduling; and Stope proposals (economic assessments) containing designs (access and stopes), schedules and economic

assessments.

The outcome of these processes is a LoM schedule for each mining operation that generates a positive cash flow over the LoM period. The key elements accounted for in the LoM Plan that generates the annualised RoM ore flow are the following:

Milling days; RoM ore production; RoM ore (Pd and Pt) grade; Metal content produced; Reef waste tonnage milled; Sandfill placed;

Mining method splits with tonnages and grade; Primary development required; Secondary development required; Development tonnage broken; Total tonnage broken (ore and waste); Tonnage to be milled (feed).

The output of this process is utilised for a full economic assessment to demonstrate the financial viability of each of the LoM Plans and thus the various mining operations economic contribution.

7.7.3.4 LoM Budgeting The data (tonnage, grade and development) generated by the scheduling process feeds into the General Mine Model to develop a budget in terms of operating costs. The budget model generates the following costs for input into the LoM Financial Valuation Model:

Stope mining;

Development (primary and secondary); Mining support services; Concentrator; Sand plant (fill); Surface maintenance; Departmental costs; Indirect costs; Capitalised development; and Other capital.

Departmental costs include the following: Engineering Geology; Safety; Environmental;

Purchasing; Warehouse;

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Administration;

Human resources; Accounting; Management Information Systems (MIS); Housing.

The outputs from the budget model are summarised and become inputs for the LoM Financial Valuation Model.

7.7.3.5 LoM Financial Valuation Model The LoM Financial Valuation Model brings together both the outputs of the mine scheduling and budget model (costs). The model finally generates a mine cash flow accounting for the following:

Mill feed contained metal; Plant recoveries (Pd and Pt); Tons of concentrate produced; Total metal ounces produced;

Returnable metal ounces (post smelting and refining); Operating costs per stoping method; Capital costs; Metal prices (Pt, Pd, Rh, Au, Cu and Ni); Royalties; Smelter and refinery costs; Insurance; and Offsite General and Administration (G&A) costs.

The LoM Financial Valuation Model generates final cash flows that are used to generate a valuation for each mine. These results are also consolidated to generate a cash flow for the company and ultimately a valuation of the same.

7.8 Stillwater Mine Operations SRC5.4(i); SRC5.4(ii); SRC5.4(iii); SRC5.2(viii);SRC5.2(ix); JSE12.9(h)(vii)

7.8.1 Background The Stillwater Mine complex includes the mining operations and ancillary buildings that contain the concentrator, workshop and warehouse, changing facilities, headframe, hoist house, paste plant, water treatment, storage facilities and offices. All surface infrastructure and tailings management facilities are located within the Stillwater Mine Operating Permit, which covers and area measuring 2 450 acres (991ha).

Stillwater Mine has two principal mining sections, namely: The current section, which has been in operation since 1986 and currently produces 320 000oz per

annum (9 950ktpa) of Pt + Pd in concentrate; and The Blitz section, which is currently under development and expected to start ore production later in

2017.

7.8.2 Mineral Resource Geometry Within the Stillwater Mine, the J-M Reef varies in dip from 40° to 90° to the north, with an average dip of 60°. Reef thickness varies from 3ft (0.91m) to more than 9ft (2.74m).

7.8.3 Key Operational Infrastructure Stillwater Mine accesses the J-M Reef and extracts and processes PGM ores from mine openings located in the Stillwater Valley. In addition, Stillwater Mine owns and maintains ancillary buildings that contain the concentrator, shop and warehouse, changing facilities, headframe, hoist house, paste plant, water treatment, storage facilities and offices.

Mineral Resources developed at Stillwater Mine are controlled by Patented and Unpatented Mining Claims either leased or owned outright by Stillwater. The mine is accessed via a paved road and has adequate water and power from established sources.

The underground mine layout for Stillwater Mine is illustrated in Figure 63. Stillwater Mine has developed a 6-mile (10km) segment of the J-M Reef, between the elevations of 7 600ft (2 317m) and 1 950ft (594m) above sea level. Access to the reef is accomplished by means of a 1 950ft (594m) vertical shaft and a system of horizontal adits and drifts driven parallel to the strike of the J-M Reef at vertical intervals of between 150ft (46m) and 300ft (91m). Seven main adits have been driven from surface portals on the west and east slopes of the Stillwater Valley at various

elevations between 5 000ft (1 524m) and 5 900ft (1 798m) above sea level.

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Five principal levels have been developed below the valley floor by ramping down from the 5 000ft level to

extract ore from the J-M Reef down to the 3 800ft (1 158m) elevation. Four additional major levels below the 5 000ft (1 524m) level are accessed principally from a vertical shaft and shaft ramp system. The mine has developed a decline system from the 3 200ft (975m) elevation to access and develop deeper areas in the central part of the mine below those currently serviced by the existing shaft. The decline system currently accesses the 2 900, 2 600, 2 300 and 2 000 Levels. The mine currently uses its 30ft (9m) laterals and six primary ramps and vertical excavations to provide personnel and equipment access, supply haulage and drainage, intake and exhaust ventilation systems, muck haulage, backfill plant access, powder storage and/or emergency egress. The footwall lateral and primary ramp systems will continue to provide support to production and on-going development activities. In addition, certain mine levels are required as an integral component of the ventilation system and serve as required intake and or exhaust levels, or as parallel splits to maintain electrical ventilation horsepower balance and to meet MSHA Regulations. MSHA Regulations also contain requirements for alternate (secondary) escape-ways from mine workings and these levels meet this need as well. These levels serve as permanent mine service-ways and are used for road and rail transportation, dewatering and backfill pumping facilities. RoM ore from Stillwater Mine is processed by a concentrator plant located adjacent to the mine shaft. The mill has an approximate capacity of 3 000 tons (2 722t) per operating day. Ore processing is via the conventional flotation technique, with sulphide minerals in the ore floated to produce a concentrate. The flotation concentrate, which represents approximately 2% of the original ore weight, is filtered and transported in bins approximately 46 miles (74km) to the metallurgical complex in Columbus. Approximately 53% to 60% of the tailings material from this process is returned to the mine and used for backfill to provide a foundation upon which additional mining activities can occur. The balance is placed in tailings containment areas. No additional steps are necessary to treat any tailings placed back into the mine. Tailings placed into the impoundment areas require no additional treatment and are disposed of pursuant to the Stillwater’s Operating Permits. Mill recovery of Pd + Pt is approximately 92.5%.

7.8.4 Mineral Resource Access The current section of Stillwater Mine was developed by a series of footwall lateral adits driven from the Stillwater River Valley. It was the objective to keep these footwall developments approximately 100ft (30m) from the J-M Reef, so that a fan of diamond drillholes could be drilled across the J-M Reef at 50ft (15m) intervals. The mine has increased the footwall lateral distance from the J-M Reef up to 200ft (61m) in order to drill more diamond drillholes at each drill station located at 50ft (15m) intervals along the drift. The footwall laterals were originally driven on 200ft (61m) vertical intervals, but this spacing was increased to 300ft (91m). Stillwater Mine has been subdivided into three large mining areas, namely the Off-shaft, Upper West and Lower West areas. The mining areas have been subdivided into mining blocks based on mineralisation character as follows: Block 1 and Block 2 in the Upper West area, which is above the 5 000 Level in the Dow Sector; Blocks 3 and 6 in the Off-shaft West area; Blocks 7 and 8 in the Off-shaft East area; and Dow Sector and Blocks 1 and 2 in the Lower West area, which is below the 5 000 Level; Blitz section.

The Blitz section is currently under development to the east of the existing Stillwater section, with level spacing planned at 400ft (122m). A TBM is currently being employed to develop the 5 000E Footwall Drive, which will serve on its completion as the main access to the mine. It is currently being equipped with rails and serves as the main gathering haulage where ore and waste will be transported out of the mine using trains. In July 2017, the 5 000E Footwall Drive was positioned at 17 370ft East. The development of the 5 600E Footwall Drive is currently ongoing and the drive was positioned 600ft (181m) above the 5 000E Footwall Drive, having been advanced to the 15 240ft East position as of July 2017. This development will provide access to the first stoping block. Finally, in the far east of the Blitz section, a decline (Benbow Decline) is being driven from a surface portal to intersect with the 5 600E Level to provide additional access and an intake for ventilation purposes. In July 2017, the decline had been advanced by 2 117ft (645m), and the holing with the 5 600E Level is anticipated for the end of 2019.

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Figure 63: Underground mine layouts for Stillwater and East Boulder Mines

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7.8.5 Mine Historical Production Stillwater Mine was originally planned to produce approximately 500 ton (450t) of RoM ore per day, which was revised upwards to 1 000 ton (907t) and 2 500 ton (2 270t) of RoM ore per day. Steady state production was reached in 2001. However, with the development of the East Boulder Mine and the pressure put on the work force following the recruiting of Stillwater employees by the other mining camps during the worldwide mineral commodity prices boom at the time, production could not be maintained at the steady state level. Therefore, for the years 2002 through 2006, the production level was maintained at approximately 2 200 ton (1 996t) per day. In 2007, the tonnage dropped further to 1 900-ton (1 724t) per day, partly due to labour unrest and a subsequent strike period. The management of Stillwater delivered a Ten-Year LoM Plan in November 2008 at a time of severe economic conditions due to a precipitous fall in Pd and Pt prices in the latter half of the year. To adjust to the severe economic changes, some major organisational changes for the mining operation were made including changing shifts to 11.5 hours on a seven-day per week operation, a significant decrease in manpower from 927 (including contractors) to 873, mothballing or selling 13% of the mobile diesel fleet and eliminating most of the mine’s contractors. From 2012 to 2016, production remained in the range 705 000 ton to 748 000 ton (640kt to 679kt) per annum. The production history is shown in Table 38. It is noteworthy that actual production exceeded budget targets in each year. In 2015, the mine reorganised its priorities and reduced manpower from 942 in the previous year to 784 in 2015. In spite of the reduction in workforce, the mine still exceeded its production target of 695 000 ton (630kt) for the year. Table 38: Production statistics

Year

Actual Production

Tons (000s)

Pd + Pt Pd + Pt Tonnes (000s)

Pd + Pt Pd + Pt

(ounces) (000s) (opt) (kg) (g/t)

2012 709.1 377.4 0.53 643.3 11.7 18.2

2013 800.9 366.1 0.46 726.6 11.4 15.7

2014 748.7 340.8 0.46 679.2 10.6 15.6

2015 748.0 319.8 0.43 678.5 9.9 14.7

2016 715.1 327.0 0.46 648.8 10.2 15.7

Note: All grades are stated as of net of processing recoveries.

The projected average daily production for the LoM Plan in the 2017 Mineral Reserve economic test is 3 414 ton (3 100t) of mill feed per day, totalling 1.2 million ton (1 089kt) per annum at steady state (2022) inclusive of production from the Blitz section. For planning and budgeting purposes, the mine development is divided into two categories: primary development, which consists of footwall lateral drives and ramps, and secondary development, which consists of stope ramps, cross cuts and raises. The previous mine plan had a policy of maintaining a minimum of eighteen months of identified mineralised stoppable area ahead of production. This required that primary development be accelerated in the years 2004 through 2006 to correct a development deficit. Likewise, secondary development was accelerated in the years 2007 through 2008. At that time, the primary development schedule appeared adequate to support the mine plan production goals, assuming that the tonnage of Mineral Reserves developed per metre of footwall lateral drive remained near the current factor of 37. Due to the 2008 to 2009 development curtailment, stope development fell slightly behind. To correct this, the mine added one development crew, which has been adequate to sustain the current level of production.

7.8.6 Stillwater Mine Deep Mining Over the past six years, the main production areas in Stillwater Mine were the Upper West and Off-shaft areas, with production split approximately equally between these two areas. However, in addition to the Blitz expansion programme, the long-term future for the current section of Stillwater Mine is the area below the 3 200 Level. During 2006 and 2007, various trade-off studies were conducted to determine the optimal method of moving ore from the lower portions of the mine, both in the short and long terms. The options considered were: Declines with conveyors; Declines with Kiruna electric 32t trucks (European Supplier);

Extend the existing shaft to the 1 900 Level, with access to footwall laterals below the 3 200 Level; and A rail dump on the 2 000 Level feeding a new crusher station on the 1 900 Level.

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The optimal selection at the time was the Kiruna electric 32t trucks. A significant amount of development and

non-development capital has been completed to date. The mine has three Kiruna trucks in operation. At present, the haulage ramp has been driven down to the 1 900 Level and stopped pending further study work. The ramp serves the lower development and receives ore from the 2 500 Level chutes. Ore collected from the 2 000 Level development is hauled by diesel AD-30 trucks to the 2 600 Level where it is dumped to the 2 500 Level chutes. Kiruna trucks receive the ore and haul it to the 2 900 Level. During 2012, loading chutes were installed on the 2 500 Level and excavations began for the construction of the 1 900 Level pump station. To set up this lower area for future mine production, significant effort has been devoted to building the mine infrastructure on the lower levels. A working ramp has been driven down to the 1 900 Level.

7.8.7 Mining Equipment Criteria

7.8.7.1 Stillwater Mine Overall Stillwater Mine is a highly mechanised operation and employs various pieces of equipment listed in Table 39. The key elements of the current fleet are face drill rigs, bolters, LHDs and dump trucks. These are further

supported by numerous utility and transport units. Accounting for the geographical separation of the stoping and development areas and the daily production called for, it appears that the mine currently has sufficient equipment to meet current production targets. However, as the Blitz section expands, additional units will have to be acquired to meet the planned increase in ore production and associated development. Table 39: Current mechanised mining equipment

Type Units

Bolters 9

Face drill rigs 24

LHDs 62

Trucks 30

Utility units 189

Tractors 13

Locomotives 12

Total 339

Finally, a combination of vertical hoisting (via the shaft) and locomotives (trains) are employed for the transport of ore and waste from the underground workings to the processing facility on surface. Currently, 50% of ore generated underground at the current section of Stillwater Mine is hoisted via the shaft with the remainder being transported via train.

7.8.7.2 Blitz Section Equipment Procurement and Deployment Schedules The Blitz section is currently under development and mining (drill, load and haul) equipment is currently being employed to execute the LoM Plan. The planned ore production from the Blitz section will be supported further by additional mechanised units to be procured over the next four years. Table 40 and Table 41 summarise the key equipment currently (2017) deployed in the Blitz section and key development and production equipment planned for deployment over the period 2018 to 2020. Table 42 summarises the 2017 equipment procurement schedule, which indicates that all the key development and production units required to support the planned

mining operations in 2018 will be on site and commissioned prior to January 2018. The equipment procurement schedule for 2018 is currently under development (detailed budgeting) and will be implemented in 2018 to support the 2019 mechanised equipment requirements. The Mineral Corporation concludes that the planned development and production build-up and the mechanised equipment requirements are supported by a detailed capital expenditure and equipment procurement schedule, which makes a provision of approximately US$41.8 million over the next four years (2018 to 2021).

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Table 40: Blitz section development equipment deployment schedule

Equipment Description Development Units Planned for Deployment

2017 2018 2019 Total for 2017-2019

6-Yard LHD 3 4 4 4

2-Yard LHD 1 1 1 1

4-Yard LHD 1 1 1

2-Boom Jumbo 2 4 4 4

Bolter (Rockbolt Jumbo) 3 5 5 5

AD30 Underground Truck 1 3 5 5

20 ton Trident Haul Truck 2 2 0 0

Rail Muck Car 30 41 41 41

Flatbed Truck 1 1 1 1

Skidsteer 2 2 2 2

Scissorlift 1 1 2 2

Telehandler 1 1 1 1

Locomotives 5 7 7 7

Kubota ATV 6 6 8 8

Table 41: Blitz section production equipment deployment schedule

Equipment Description Production Units Planned for Deployment

2017 2018 2019 2020 Total 2017-2020

2-Yard LHD 1 5 11 11

4-Yard LHD 4 4 4 4

CMAC - DHS 1 1 5 9 9

Stope Block Lift Truck 1 2 2

Single Boom Jumbo 2 4 7 7

Double-boom Jumbo 1 1 1

Rockbolt Jumbo 1 1 1

Muckhaul 20ton Trident 2 2 2 2

Muckhaul AD30 2 2 2

Muckhaul 6-Yard 1 1

Stope ANFO Pots 2 5 5

Underground Heavy Flatbed Truck 1 1 1 1

Skidsteer 2 2 2

Scissorlift - Pipe Truck 1 1 1

Telehandler 1 1 1 1 1

Underground Grader 1 1 1

Powder Fork Truck 1 1 1

Kubota ATV 1 1 7 11 11

Crew Pick-up Truck 1 2 2

Flatbed Underground Truck 1 1 1 1

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Table 42: Blitz section 2017 equipment procurement schedule

Equipment Description Supplier Date Ordered Delivery Date Lead time Days Months

LH410 LHD Sandvik 2017/02/22 2017/10/19 239 8

LH410 LHD Sandvik 2017/02/22 2017/10/20 240 8

DD321 2 Boom Jumbo Sandvik 2017/02/22 2017/08/25 184 6

DD321 2 Boom Jumbo Sandvik 2017/02/22 2017/09/17 207 7

DS311 bolter Sandvik 2017/02/22 2017/12/24 305 10

DS311 bolter Sandvik 2017/02/22 2017/12/10 291 10

AD30 UG truck T&E 2017/05/03 2017/10/30 180 6

AD30 UG truck T&E 2017/05/03 2017/10/30 180 6

LHD R1300GQ T&E 2017/04/21 2017/12/01 224 7

LHD R1300G T&E 2017/02/28 2017/10/30 244 8

T1D single boom Jumbo Atlas Copco 2017/05/02 2017/11/15 197 7

HC110 Drifter for T1D Joy Global 2017/05/22 2017/09/26 127 4

Toyota Tacoma Mantrip Peak Mechanical 2017/05/12 2017/08/10 90 3

Muck Car (15 each 2 flats) Mining Equipment 2017/05/04 2017/10/15 164 5

EOD bucket for LH410 Sandvik 2017/05/02 2017/10/20 171 6

Skidsteer T&E 2017/04/26 2017/12/30 248 8

Fork lift Gehl H&E Equipment 2017/04/26 2017/07/14 79 3

Locomotives Brookville 2017/04/25 2017/12/31 250 8

4-seat Kubota 1140 Billings Kubota 2017/04/26 2017/08/01 97 3

Flatbed utility vehicle Youngs Machinery 2017/02/20 2017/08/15 176 6

7.8.8 LoM Production Schedule The following figures (Figure 64 to Figure 67) illustrate the operation’s LoM RoM production schedule, which includes the current section and the Blitz section. The forecasted production for the current section of Stillwater Mine is generally in line with that achieved historically while, over a period of five years, the production at the Blitz section increases to approximately 553 000 ton (502kt) per annum. Based on the development results to date, mining equipment (drilling, loading and hauling equipment) delivery schedules, available capital funding and the relatively conservative build-up (seven years) for the Blitz section, the planned production increase for Stillwater Mine should be achieved. The LoM for the current section of Stillwater Mine ends in 2041 (Figure 64).

Figure 64: LoM RoM ore production schedule for sections of Stillwater Mine

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Figure 65: Metal (Pt+ Pd) ounces production schedule for sections of Stillwater Mine

Figure 66: LoM Pt + Pd grades for sections of Stillwater Mine

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Figure 67: LoM RoM ore and Pd + Pt ounces production schedule for the mining areas at Stillwater Mine

7.8.9 Mine Logistics A total of seven adits have been driven into the footwall at Stillwater Mine. The main rail haulage adit is the 5 000W Level. Ore is dropped down from the upper levels via a series of raise-bored ore and waste passes to

transfer boxes on 5 000W Level from where the rock is railed to the mine portal by diesel locomotives. The 5 000W rail installation makes use of 90lb (40kg) rail, which is the common surface rail used in the USA. The rail gauge is 36 inches (910mm), which is typical of modern mine installations. The mine makes use of tandem Brookville 20t diesel locomotives to haul the ten to twelve ore cars (10 ton or 9t capacity) per train into the mine, with one locomotive at each end of the train. The waste rock is dumped into a second mine tip, from where the rock is loaded and transported to the tailings dam retaining buttress wall. Ore and waste rock from the levels below the portal adit of the 5 000 Level is hoisted to surface via the vertical shaft, situated in the Stillwater River Valley adjacent to the portal. Ore and waste rock is transferred to the 3 500W Level via a series of raise-bored ore and rock passes to the main transfer boxes on the 3 500W Level. Rock is hauled by tandem 20t diesel locomotives with eight to eleven Granby ore cars per train (nominal 10 ton or 9t capacity per car) and discharged into the mine tip on the 3 500 Level utilising a ‘camel back’ dumping system. Rock reports to the main crusher level where all rock passes over an apron feeder and through a 4ft by 3ft

(1 250mm x 950mm) Metso Nordberg C125 Jaw crusher capable of 850 ton (771t) per hour. Prior to the crusher is a needle grizzly that removes the -6 inch (-150mm) undersize from the crusher path. The crusher section is equipped with a full hydro dust extractor system to ensure dust is separated and settled. Damp dust from the extractor is sluiced to the mud pumping system. Ore and waste rock report to the main belt on the 3 100 Level. Rock material from the passes moves through a hydraulic controlled door onto an apron feeder to feed a 54-inch (1 300mm) belt, which feeds the main surge box prior to loading into measuring flasks at the skip boxes. The conveyor belt is equipped with a belt magnet to remove tramp iron from the broken rock prior to the ore stream entering the mine shaft system. The entire operation is managed and controlled by a single operator per shift, who is stationed adjacent to the belt magnet and has Closed-circuit Television (CCTV) monitoring, which covers all ore transfer points, including the loading flasks and skip loading chutes.

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Over the past three years, a new ramp and related mine infrastructure has been developed down to the

2 000 Level, which will serve production from the 2 900, 2 600, and 2 300 Levels by bringing rock to the loading level of the shaft on 3 200 Level. On the lowest level of the mine (2 000E), ore and waste rock is hauled to the mine tip via tandem 15-ton (14t) diesel locomotives with eight to ten Granby ore cars (10 ton or 9t capacity) per train utilising the same ‘camel back’ dumping system as at the 3 500 Level. The ore from these levels is hauled up the ramp to the 2 600 Level by diesel-powered Caterpillar AD30 haul trucks. From the 2 600 Level, the ore is loaded from the 2 500 Level ore chutes and hauled up the ramp to the 3 500 Level by three electric-trolley 35-ton (32t) payload Kiruna K635ED trucks. The Kiruna trucks are built by GIA industri ab (GIA) in collaboration with ABB (ABB Sweden). The Kiruna trucks operate via an overhead trolley line secured to the decline hangingwall and connected to the truck via a telescopic overhead contactor. The electric truck ramp was planned to be extended incrementally down to the 1 400 Level, but is currently stopped at the 1 900 Level. The vertical 18ft (5.5m) diameter concrete-lined shaft extends from the 5 000ft (1 524m) elevation at the surface to the bottom at 3 000ft (924m) of elevation (approximately 600m deep). This modern shaft, commissioned in 1997, is used for hoisting ore, waste rock, men and materials. The shaft is equipped with a rock hoist and a man/material hoist. Rock is hoisted in two 10t counter-balanced skips by means of a 1 480hp (1 100kW) double-drum direct current (DC) rock winder. Hoisting only on night shift (so as not to interfere with main hoisting activities) provides adequate capacity for the daily target of 2 900t of ore and waste. The MSHA requires that the rock hoisting compartments are separated from the man/material compartment if rock hoisting is to take place at the same time as man hoisting. Stillwater Mine shaft compartments do not have a separating brattice. There is adequate time in the hoisting cycle to increase volumes by either increasing the hours of hoisting by limiting the time for men and material or by installing a shaft brattice between the man/material hoist and the rock hoist compartments. This has been assessed and considered unnecessary by Stillwater at the current planned production profile. The double deck 50-person capacity service cage has a counterbalance. This can also move material loads of 10t either in the conveyance or by slinging large/long equipment underneath the conveyance. The shaft supports the production from the 4 400 Level down to the 3 200 Level. The Blitz Adit (5 000E Level) is being developed by a TBM and is currently at 18 000ft (5 500m) from the portal entrance. Additional breakaways are developed to provide for ore/waste passes from upper levels, traveling ways and ventilation raises. Broken rock from the TBM is railed to the portal via trains, each pulled by tandem Brookville 20t diesel locomotives to haul the ten to twelve ore cars per train into the mine, with one locomotive at each end of the train. This locomotive combination then hauls the loaded ore cars to the mine tip at the portal of the mine discharging the broken rock utilising a fifth wheel camel back. Waste rock is dumped into a second mine tip, from where the rock is loaded and transported to the tailings dam retaining buttress wall. Rock from the 5 200E Level incline and haulage also reports to this rail tramming system.

7.8.10 Mine Services

7.8.10.1 General Stillwater Mine continues to develop its infrastructure in 2017 and beyond to accommodate the increased mining footprint in the new mining areas. The infrastructure currently in place, with the work carried out in 2016 and the planned infrastructure programme, is expected to allow the mine to proceed with its long-range plans to increase production efficiency and continued development of the mine’s Mineral Reserves.

7.8.10.2 Ventilation The current section of Stillwater Mine is accessed from the 5 000W Footwall Adit and the Vertical Shaft, adjacent to the adit on the west of the valley. There are additional service access adits on 5 200W, 5 300W, 5 500W, 5 700W and 5 900W Levels. The Blitz section on the east of the valley is accessed via the 5 000E TBM Adit from which the 5 200E Footwall Drive is developed. The 5 400E adit acts as the current exhaust drive until the Benbow Decline establishes as holing with the TBM Adit in 2019.

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Stillwater Mine has the following ventilation velocity criteria:

Working Faces: 800ft per minute (4m/s); Main Haulage ways: 1 200ft per minute (6m/s); Main ventilation drifts: 1 600ft per minute (8m/s).

Ventilation temperature is targeted to be conducive to optimum machine and personnel productivity. As a result, there are propane bulk air heaters provided at the main intake airways to be operated in winter to limit water freezing, and the maximum temperature for operations underground is targeted to be less than 80°F (27°C). Stillwater Mine draws approximately 1 400 000cft per minute (660m3/s) of ventilation air through the exhaust system via eleven main 400hp (300kW) exhaust fans situated at various ventilation raises and adits, and 30hp to 150hp (22kW-110kW) auxiliary booster fans. Total fan power installed in the primary system is 4 700hp (3 500kW). There are additional development force fans in all the primary development sections.

The mine uses Ventsim® software to model air flows and air pressures. Fan inventory (including fan ratings and performance) are included in the software model to ensure any changes in ventilation management are updated and balanced immediately. The mine has a management system to ensure that any fan forward moves are reported immediately so that the model remains live and representative. The mining sections are equipped with refuge bays close to workings and/or workshops underground. These comply with the common practice of: Having been constructed of materials having at least a one-hour fire resistance rating; Having sufficient size to accommodate the miners’ assembly; Being capable of being sealed to prevent the entry of gases; Having a means of voice communication with the surface (telephone or leaky feeder radio); Being equipped with a means of supply of compressed air and potable water; and Having a door opening outward capable of being sealed air-tight.

The operations also have carbon monoxide (CO) monitors positioned at strategic positions in the mine to detect fires underground so that the necessary mitigation management can be implemented. This system is combined with a “stench” smell release system to warn any employees underground that may not have immediate telephonic or radio communication with the control room or supervisor. This system is also used in the event of forest fires where smoke could be drawn into the mine. It is a requirement for all personnel entering the mine to be trained and to wear a personal containerised self-rescuer to provide for evacuation to the closest refuge bay or to exit the mine in times of emergency. The primary ventilation fans can be operated at either the fan transformer location or remotely in the dispatch office. The mine is separated into five ventilation districts, namely, Off-shaft West, Off-shaft East Upper, Off-shaft East Lower, Lower Far West and Upper West identified in Table 43 within which the intake shafts and exhaust portals are located. Table 43: Ventilation districts and identities of intake fans and exhaust portals

Ventilation District Intake Exhaust

Off-shaft East Lower Shaft 5 400E Portal (Blitz)

Off-shaft East Shaft 5 400E Portal (Blitz)

5 000E Portal (Blitz)

Off-shaft West Shaft 5 150 Portal

5 300W Portal

Lower Far West Shaft 6 600W146 AlimakTM Raise to surface

4 800W Portal 6 600W186 Portal

Upper West

5 000W Portal 6 600W146 AlimakTM Raise to surface

5 500W Portal 6 600W186 Portal

5 900W Portal

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Ventilation flow is supplemented by booster fans ranging from 30hp to 150hp (22kW to 110kW) to create a

mine-wide negative pressure system. All fans are low-pressure vane axial. Stope ventilation is achieved with 30hp to 60hp (22kW to 45kW) axial fans in conjunction with rigid and flexible ducting. Whenever possible, through ventilation is achieved by establishing a raise from the sill level of the stope to the level above. This allows a split of air from the primary circuit to flow through the stopes.

The Blitz section currently has limited ventilation due to the current constrained exhaust system on the 5 400E Adit. The 5 000E TBM, currently at 18 000ft (5 500m) from start is planned to eventually reach 23 000ft (7 000m) from where development will hole into the Benbow Decline in 2019, which is currently being developed from surface. At present, only primary and secondary development is taking place in the Blitz section, but the first production stopes will come on line in late 2017. For the planned ramp up in production, complete through ventilation (at a rate of 550 000cfm (250m3/s)) to the Blitz section extremity is required. In order to accelerate the through ventilation, two steep 11.3ft (3.4m) diameter Alimak raises will be developed to surface prior to the holing of the Benbow Decline. The raises will be equipped with four 400hp (300kW) fans ensuring each Alimak raise is capable of drawing 220 000cfm (100m3/s) until the Benbow Decline holes. This will ensure adequate ventilation for the ramp up in stope production from 2018. In addition, an interim emergency escape way will be installed into one of the current airways linking the 5 000E TBM Drive with the 5 600E Footwall Drive until the Benbow Decline holes into the TBM Footwall Drive.

This ventilation for Stillwater Mine is considered adequate for a mine of this size with the amount of personnel and production equipment in use within the mine. This level of ventilation should also be adequate for the LoM Plan since production remains within a range of between 1 985 ton to 2 865 ton (1 800t and 2 600t) per day. The expansion of the production is planned from the Blitz section where the two new AlimakTM raises and later the Benbow Adit will provide the additional ventilation capacity.

7.8.10.3 Pumping Water from areas above the 5 000 Level at Blitz West and East (Blitz) reports to the West Clarifier on surface. Water from areas below the 5 000 Level reports to the vertical shaft pumping system. The current pumping capacity of Stillwater Mine from the Lower Off-shaft area is approximately 1 500G per minute (95l/s) from the deepest main pump station on the 2 500 Level. This pumping capacity is more than double the expected amount of water mine inflow, which is currently 800 000G per day (3000m3 per day). Gravity drainage from the Upper West area is an additional 150 000G per day (550m3 per day).

The lowest level at Stillwater Mine is the 1 900 Level Decline and the lowest operational level is the 2 000 West Level. Stillwater Mine has a series of “leap frog” interim dams and pumps for the removal of waste and fissure water. Water is pumped from one pump station/sump up to the next in consecutive lifts to bring the water out of the mine. Discharge water in the Lower Off-shaft (the 2 900 Level and below) is ultimately collected at the 2 500 Level Dewatering Station and the 2 000W 1 800 Sump, which water reports to the 1 900 Level Pump Station. Drain water is collected in sumps in the various haulages and pumped to the main pumps station or drain hole on that level to ensure haulages and declines are kept dry.

The 1 900 Level Pump Station consists of two banks of three ASH B5 Pumps driven by 100hp (75kW) motors. Water is pumped from this level to the 2 600 Level Sump and gravity fed for the 2 500 Level Pump Station, which is comprised of two banks of three ASH B5 pumps driven by 120hp (90kW) motors. The 2 500 Level Pump Station pumps the discharge water to the 3 200 Level Shaft Station where it is gravity fed to a series of sumps on the 3 100 Level and then routed to one of the two banks of four ASH B5 pumps driven by 120hp (90kW) motors. The 3 100 Level Station water discharge is conveyed vertically to the 4 400 Level Pump Station. Water from the 4 400 Level Sump is pumped to one of three banks of three ASH B5 pumps, two of which are driven by 100hp (75kW) and one by 130hp (100kW) motors. This water is pumped up to the 5 300 Level Surge Reservoir from where it is gravity fed to the West Clarifier on surface.

Table 44 provides a summary table of the total number of dewatering pumps and power requirements for Stillwater Mine.

Table 44: Total number of dewatering pumps and power required

Level Vertical lift Banks of

pumps Pumps per bank

Total power

(ft) (m) (hp) (kW)

4 400 900 275 3 3 1 065 790

3 100 1 300 400 2 4 1 060 770

2 500 600 180 2 3 620 470

1 900 600 180 2 3 668 500

Total 3 400 1 035 9 29 pumps total 3 413 2 530

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The pumping system handles approximately 650G per minute (3 550m3 per day) of water. In order to improve

the management, maintenance and cost effectiveness of the pumping system, Stillwater has, in terms of the 25-year LoM Plan, approved a new high-pressure pumping system to reduce the number of sumps and pumps in the future. This will also reduce the amount of cascade feed and the effective head pumped. It is proposed to install a single lift dewatering station at the 3 200 Level to pump water from the 3 200 Level to the 5 300 Level Surge Reservoir. This will eliminate the 3 100 Level and 4 400 Level Pump Stations. The proposed single lift pump system will consist of two GEHO ZPM 800 pumps working in parallel to give a maximum discharge of 1 000G per minute (63l/s or 5 400m3 per day), with a third pump being held in reserve as a critical spare to ensure that minimum down time is experienced. The distance between 3 200 Level to 5 300 Level is approximately 2 130ft (650m) and, assuming marginally dirty water (±5% solids by weight), a maximum line pressure is expected to be 1 020psi (70 Bar) in an 8-inch (200mm) Schedule 40 line. This new system will require additional excavations, flood feed pumps and additional surge capacity at the 3 200 Level Pump Station. The expected costs of the system will be approximately $5 million, but will reduce pumping power by approximately 900hp (670kW), combined with the improved maintenance and supervision cover.

7.8.10.4 Power Stillwater Mine receives power from the NWE grid via three 161kV feed sources as follows: 100kV line via the Columbus Auto-substation (located north of Columbus and running west to east); 50kV from Billings via the Bridger Auto-substation; and 50kV from the Mystic Lake Hydroelectric Power Plant.

These lines feed the mine from the Chrome Junction Substation located west of Roscoe. The line from Chrome Junction to Stillwater Mine is a radial feed at 50kV and feeds three small substations belonging to Beartooth Electric. One of these substations feeds the Hertzler TSF. The mine site has a transmission contract with NWE for a firm maximum demand limit of 20MW, but the actual average monthly demand is approximately 23MW. Since NWE does not currently have infrastructure to contractually deliver the higher demand requested by Stillwater Mine, it has allowed Stillwater to use 3MW of non-firm power until a new substation goes online in late 2017. Non-firm power is on an “as-available” basis

and NWE can demand the mine to curtail this power at any time. This network upgrade consists of adding a new Static VAR Compensator (SV) at the new Nye Auto Substation that is being built near the Stillwater Valley Ranch. When this new substation goes online, the non-firm power will no longer be available to the mine and Stillwater will be required to pay the estimated $1.8 million cost for this network upgrade. Most of this cost would be recouped by the mine as a percentage reduction in the monthly transmission bill. The mine site has two main substations, both connected to NWE’s 50kV line, namely the West Substation and East Substation. The West Substation is owned and maintained by NWE and feeds most of the existing mine site including the concentrator. The substation has a single transformer rated at 21/28/35MVA and 50.5kV to 13 090V and includes a secondary ±10% load tap changer. This transformer is operating at close to capacity. NWE has a common spare replacement for this transformer that is stored in Butte. The East Substation is owned and maintained by Stillwater Mine and was installed as part of the Blitz expansion to power the east side of the mine including the TBM. This substation has a single transformer rated at 10/12.5/15MVA and 50.5 kV to 13 800V. There is no spare for this transformer. The actual mine demand loads are as follows: West Substation: 19.5MW at 0.92 Power Factor (PF), current load capacity approximately 109% without

fans, 82% with fans; East Substation: 3.5MW at 0.88 PF, current load capacity approximately 40% without fans and 32% with

fans. The TBM currently accounts for approximately 50% of this load, but will be removed in late 2018; and

Monthly maximum peak for the site: 23MW.

To meet the Blitz production ramp up power requirements, the site electrical capacity will be required to increase proportionately on the East Substation. The current peak demand at the entire site is anticipated to increase to approximately 32MW by 2021 and to remain constant thereafter. This incremental load will be placed on the East Substation while the West Substation will remain on approximately 19.5MW.

It has been reported that NWE is planning network upgrades on both the 50kV and 100kV supply infrastructure. Stillwater Mine has engaged with NWE to understand the upgrades and associated potential

impact/benefits for the mine.

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Power into the mine is reticulated from the West Substation through two switchgears (Incomer Line #1 and

Incomer Line #2) to reticulate the mine. Line #1 feeds six main 13.2kV lines to the following: Main Shaft Feeder A for mining operations; Main Shaft Feeder B for mining operations; Man hoist; Concentrator and ball mill; Semi-autogenous Grinding (SAG) mill; Auxiliary services including workshops and hoist room.

Line #2 feeds six main 13.2kV lines to the following: Rock Hoist; Vertical Mill; West Compressor House; 5 000 West Portal Feeder;

Upper West Feeder; Main Shaft Feeder to Kiruna Ramp and Main Shaft pumps.

Stillwater Mine has a 750kVA emergency generator to power the cage hoist and provide emergency power for the phones and other small critical loads. All underground transformers are dry cooled, eliminating the risk of oil leakage and/or fire. These are skid mounted, installed in concreted cubbies, well demarcated and supplied with lighting. Stillwater Mine has a detailed inventory of all underground switchgear, controller and transformers managed through the JD Edwards Management System. The mine is also equipped with a leaky feeder system for the mobile radios that are used on all mobile equipment throughout the mine. The mine is also equipped with a Gaitronic Paging Phone SystemTM, with stations located strategically throughout the mine.

7.8.10.5 Sandfill Plant/Paste Fill Plant and Reticulation Tailings from the Stillwater Concentrator scavenger circuit are pumped to the sandfill plants, where up to 60% is used in the mine backfill process. The paste fill plant is situated on surface close to the portal. Paste is pumped into the mine via the 5 150W Level and is stored in the 5 150 Level Silos with air agitation. Paste is then pumped to the workings requiring fill. Due to the high pressure required to move the fill, paste fill stopes have been limited to a range close to the facility. Limited paste fill stopes are planned in the life of mine. Stillwater Mine has three sandfill plants, with two (i.e. the 4 900 Level and 5 000 Level Plants) situated close to the portal area. The third sandfill plant on the 5 500 Level West provides sandfill for the Upper West mining area. An additional sandfill plant has been planned on the 6 900 Level. Tailings feed is at approximately 28% at a flow rate of 1 800G per minute (113l/s). Tailings product from the scavenger cells in the Stillwater Concentrator is pumped to the different plants. The supply of tailings to the 5 500 Level Upper West Sandfill Plant is passed through a booster pump in the

5 500 Level Portal. The tailings material is passed through cyclones to remove the fine section (-45µm) and the coarse section is placed in batched storage silos, which are air agitated to prevent settlement. Sandfill is dispatched to the stopes requiring fill mainly by gravity to the Off-shaft mining area and by high pressure Zimpro positive displacement pumps for the workings above the 5 500 Level Sandfill Plant. There is also a booster pump station on the 6 300 Level. The fines portion of the tailings is returned via centrifugal pumps to the tailings storage facility. Tailings supply to the sandfill plants is via an 8-inch (200mm) NB HDPE pipeline. Tailings material on the 5 500 Level is passed through a booster pump and feeds the 5 500 Level Sandfill Plant. Fill ranges are pre-flushed prior to dispatch of fill to the stopes and after fill, and the lines are post-flushed to ensure no settlement in the lines. Prior to fill being placed, backfill bulkheads are constructed in the stope to retain the sandfill and ensure no risk of hydraulic sandfill failure. Stillwater Mine has a detailed procedure for installation of the bulkheads, with the required certified inspections completed by the appropriate technically trained and qualified staff. Up to six decant lines at varying lengths are specified in the wall design. A weep pipe is specified as 6 inches (150mm) Schedule 40 PVC with 0.01-inch (0.25mm) slots with a nylon/neoprene filter sock installed over the weep pipe. The fill operations are controlled by radio communication and the management of the plant is done by both direct operation and CCTV camera control observations.

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7.8.10.6 Equipment Maintenance Stillwater Mine has three workshops on surface, which are the following:

Surface Locomotive Workshop: This has a single bay service and mechanical repairs facility for all rail bound equipment (locomotives and ore cars) operating on the 5 000 Level West. This workshop is primarily for work on wheels and engines;

East Side Workshop: This has multiple bay service and mechanical repairs facilities mainly serving the Blitz development equipment and any maintenance and repairs associated with the TBM; and

Surface Truck Workshop: This has multiple bay service and mechanical repair facilities for surface trucks with full machining, welding and DPM service and testing facilities.

In addition, Stillwater Mine has the following underground workshops:

6 100W Level Workshop: This has multiple bay services and mechanical repairs shop; 5 000W Level Workshop: This is dedicated to the trackless equipment, which is serviced in the mine. It

has a single bay service facility and is available for light mechanical repairs, servicing and electrical repairs on mobile equipment. All the rail equipment on this level is serviced and repaired on surface;

3 500W Level Kiruna Workshop: This is a single bay service and mechanical repair workshop facility, designed specifically for the maintenance of the three Kiruna trucks and for maintenance of the AD30 Cat Trucks;

3 500W Level Locomotive Workshop: The 3 500 Level is primarily an ore and waste rock tramming level. Therefore, the workshop is a two-bay service and repair facility for diesel locomotives and ore cars;

3 800W Level Workshop: This is a two-bay service and light mechanical repairs shop for all production equipment on the level. Much of the equipment is not suitable for extensive travel, such as drill rigs, bolters, CMAC drills, etc., thus they are maintained in the workings (point of use);

3 800E Level Workshop. This is a multiple bay services and mechanical repair shop subject to the same requirements of 3 800W Level Workshop;

2 000W Level Workshop: This is the workshop on the lowest level, which caters for mechanical, electrical and general repair and services in multiple bays.

All the underground workshops are well equipped with good lighting, clean concrete floor areas for maintenance and wash bays to ensure quality inspections, and are stocked with the appropriate tools and

lifting equipment. Some of the workshops also provide for an administrative office underground to ensure that the planned maintenance system is updated timeously.

Stillwater makes use of the JD Edwards Planned Maintenance system. A well-developed maintenance programme is in place that includes daily, weekly and monthly scheduled maintenance. Major rebuilds of equipment take place on site or are sent to offsite original equipment manufacturer (OEM) repair shops. Pre-use checks for all equipment are carried out and logged by the machine operator. Each piece of equipment has a unit number, which is entered into the management system. Equipment performance is logged daily by the operator onto the log sheet, which is uploaded into the system. The maintenance schedule flags equipment for weekly or monthly maintenance. The planned maintenance system records all equipment on the system for availability, utilisation, unit cost, age and planned replacement per the policy for that classification. Job cards are uploaded into the system to ensure each unit has a history of replacements done. The mine personnel report that they have over 500 maintenance items on the system.

Shop Availability MapsTM is the system used by the mine to assist in planning and updating the status of work in the underground workshops. The overall physical map, including all workshops, is updated by the Workshop Foreman daily to ensure that production teams know the status of repairs/maintenance on the equipment.

The Maintenance Department has a target of 80% availability for its major mobile equipment. This percentage is an acceptable standard in industry for underground production and development fleets, although higher availabilities have been achieved at other mines. The unit utilisation is generally lower than industry norms due to the geographical spread of the mining operations. Stillwater Mine has found it more cost effective to provide more equipment, particularly the equipment that is not readily mobile such as bolters and drill rigs to save on transport between underground production workings.

7.8.11 Office Facilities Stillwater Mine has adequate modern, fit for purpose offices for administration, technical and personnel services. The mine also has an integrated training facility and change house in close proximity for use by mine staff, as well as drill core processing and storage facilities. The processing plant has an additional separate small control office facility for operational staff. Likewise, the surface engineering workshops have small operational offices within the workshops. The mine provides adequate secure parking in a gravel parking area

adjacent to the main office entry. The mine complex is fenced, with the complex accessed from a security guard manned main gate.

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7.9 East Boulder Mine Operations SRC5.4(i); SRC5.4(ii); SRC5.4(iii); SRC5.2(viii); SRC5.2(ix); JSE12.9(h)(vii)

7.9.1 Introduction East Boulder Mine complex includes mining operations as well as ancillary buildings that contain the concentrator, shop and warehouse, changing facilities, paste plant, water treatment, storage facilities and offices. The surface facilities are situated on Unpatented Mill Site Claims maintained on Federal Lands administered under the Gallatin National Forest. All surface facilities, including the TSF, are located within a 1 000-acre (405ha) Operating Permit area. East Boulder Mine currently consists of one section with an opportunity to develop the lower section (Lower East Boulder), which is in the planning stage. The current and planned levels of Pd + Pt production is 230 000oz (7 154kg) per annum.

7.9.2 Mineral Resource Geometry The J-M Reef at East Boulder Mine dips 35° to 55° (averaging 50°) to the north. The shallowest dip (35°) is observed in the far west area accessed by the 6 500 Level Footwall Lateral.

7.9.3 Key Operational Infrastructure East Boulder Mine is fully permitted and is operated independent of Stillwater Mine. Mineral Resources for the mine are controlled by Patented and Unpatented Mining Claims owned by Stillwater. The mine is located southeast of Big Timber and is accessed via a public paved road and the gravel surface East Boulder Road, linking the mine and the paved road. Development of the mine commenced in 1997 and consisted of the development of the underground mine and surface support facilities such as the concentrator, workshop and warehouse, changing facilities, storage facilities, office and tailings storage facility. Ore production started on 1 January 2002. The mine layout for East Boulder Mine is illustrated in Figure 63. The J-M Reef at East Boulder Mine is accessed by two tunnel bored access drives, each 3.5 miles (5.6km) long and 15ft (4.6m) diameter, developed from the north perpendicular to the strike of the reef. The access tunnels intersect the reef at an elevation of 6 540ftamsl (1 993mamsl). The reef is also currently accessed from seven levels of footwall lateral drives developed parallel to the reef and vertically by two primary ramps. The predominant mining method is R&F, with sub-level stoping mining methods and limited slusher C&F mining. RoM ore is transported by rail haulage to surface and processed through a concentrator plant, which has a capacity of up to 2 500 ton (2 268t) per day. Ore processing is via the conventional flotation technique, with sulphide minerals in the ore floated to produce a concentrate. The flotation concentrate, which represents 2% of the original ore weight, is filtered and transported in bins approximately 90 miles (144km) to the metallurgical complex in Columbus. Approximately 46% of the tailings material from the concentrator process is returned to the mine and used for backfill to provide a foundation upon which additional mining activities can occur. The balance is placed in tailings containment areas. No additional steps are necessary to treat any tailings placed back into the mine. Tailings placed into the impoundment areas require no additional treatment and are disposed of pursuant to the Stillwater’s Operating Permits. Mill recovery of Pd + Pt is approximately 90.5%.

7.9.4 Mineral Resource Access East Boulder Mine is accessed by two parallel bored tunnels developed from the portal to intersect the J-M Reef. There are footwall haulages developed east and west from this point to open the strike extent of the deposit. The deposit is accessed up-dip by ramps and footwall lateral drifts on 200ft to 300ft (60m to 91m) vertically spaced levels. Mineral Reserves are delineated by diamond drilling from these headings, which are also used for stope access and development. The current mine is approximately 4 miles (6.4km) long and 2 300ft (700m) in vertical extent. The mine plan anticipates the 9 100 Level (2 774mamsl) to be the ultimate highest level in the mine. The main adit haulage level is the 6 500 Level (1 980mamsl). A ramp has been developed to the 8 500 Level. Except for the adit rail haulage, the mine is operated as a trackless mining operation. The stopes are accessed from footwall laterals located approximately 150ft to 200ft (45m to 60m) from the J-M Reef. The 6 500 Level footwall haulage extends for a nominal 21 000ft (6 400m), and the 6 700 Level footwall haulage extends for a nominal 13 000ft (3 960m). The levels are connected by spiral ramps and the reef is accessed by cross cuts. The TBM at the west end of the 6 500 Level was reactivated in 2010 and continued driving farther west. In 2015, the TBM completed the tunnel to the Graham Creek area to connect to the Graham Creek vertical raise.

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7.9.5 Mine Historical Production Table 45 presents the actual production for East Boulder Mine for the Years 2012 through 2016. Planned LoM production to 2041 averages 699 000 ton per annum (634ktpa), at approximately 1 914 ton (1 736t) per day. Based on the historical production to date and the increased levels of development of 25 000ft (7 620m) per year being achieved compared to the historical levels of 22 000ft (6 706m) per year, the forecasted production level of 675 000 ton (612 350t) from 2017 onwards in the East Boulder Mine LoM Plan appears reasonable. Furthermore, additional mining equipment (LHDs and drill rigs) are planned for procurement over the next two years to support the increased levels of stope production planned. Table 45: Production Statistics

Year

East Boulder Mine Actual Production

Ore tons Pd +Pt Pd +Pt Ore tonnes Pd +Pt

(000s) (ounces) (000s)

(opt) (000s) (g/t)

2012 441.1 136.2 0.31 400.2 10.6

2013 472.9 157.8 0.33 429 11.4

2014 515.8 176.9 0.34 467.9 11.8

2015 583.5 201 0.34 529.3 11.8

2016 656 218.4 0.33 595.2 11.4

Note: All grades are net of processing recovery

7.9.6 Mining Equipment Criteria East Boulder Mine is a highly mechanised mine and employs various pieces of equipment listed in Table 46. The mine makes use of 4 cubic yard (3.66m3) and 6 cubic yard (5.49m3) Cat Elphinstone LHDs for infrastructure development and 2-yard (1.83m3) Mining Technology Int (MTI) LHDs for operations on the reef, including development and stope ore removal. These LHDs move the broken rock to a mine tip or tip into a mine haul truck if no mine tip is in the vicinity of the development or the stope. Haul trucks are either 16 ton (15t) Trident Haul trucks or 18 ton (16t) DUX haul trucks. In addition, the mine has various service vehicles, which include John Deere tractors, Tamrok bolters, Kubota utility vehicles, Marcotte or Normet scissor lifts and Cat telehandlers. Other key elements of the current fleet are face drill rigs and bolters supported by numerous utility and transport units. Accounting for the geographical separation of the stoping and development areas and the daily production called for, it appears the mine currently has sufficient equipment to meet current production targets. Locomotives (trains) are employed for the transport of ore and waste from the underground workings to the processing facility on surface. Table 46: Mechanised mining equipment

Type Units

Bolter 5

Face drill rigs 16

LHD 33

Trucks 5

Utility units 77

Tractor 19

Forklifts 10

Skidsteer 5

Locomotives 9

Total 179

7.9.7 LoM Production Schedule The following figures (Figure 68 to Figure 71) illustrate East Boulder Mine’s LoM RoM production schedule.

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Figure 68: LoM RoM ore production schedule for East Boulder Mine

Figure 69: Metal (Pt + Pd) ounces production schedule for East Boulder Mine

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Figure 70: LoM Pt + Pd grades for East Boulder Mine

Figure 71: LoM RoM ore production schedule for mining blocks at East Boulder Mine

7.9.1 Mine Logistics East Boulder Mine is accessed by two parallel tunnels from the surface portal as previously described. The main access level (6 500 Level) is equipped with 90lb (40kg) rail for transport of men, material and rock from the mine. Any levels above and below this access level are operated as trackless mining sections. Broken rock (ore and waste) from the upper levels above the 7 500 Level is transported to internal tips within each of the independent ramp systems. Ore and waste rock from the upper levels is gravitated to the main 6 500 Level rail haulage via vertical ore and waste passes to transfer boxes on the 6 500 Level, from where the rock is railed to the mine portal by diesel locomotives. All rock material on the upper levels passes through a 22-inch x 24-inch (500mm x 550mm) grizzly to ensure adequate operation of the ore control chutes and ore cars. There is no underground crusher at East Boulder Mine. The twin 6 500 Level TBM bored access tunnels are used for all services, including compressed air, water

supply, power, sandfill, and transport of men, materials, equipment, diesel, explosives and rock.

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Most drill rigs are electrically powered.

7.9.2 Mine Services

7.9.2.1 General East Boulder Mine continues to increase its footprint to accommodate the 25-year LoM Plan. Development continues upwards to generate more Mineral Reserves, and this development is supported with the necessary mine services and infrastructure, which includes the following: 8 200 Level sand plant; An optimised ventilation system, which eliminated thirteen control points; Infrastructure for the 7 800 Level ramp system; and Synchronised surface backup generators.

7.9.2.2 Ventilation East Boulder Mine draws 500 000cfpm (236m3/s) of air through the operation, with intake air drawn primarily through the two main TBM adits developed in 2006. The air is exhausted via two vertical raises to the Frog Pond Adit, a raise to Simpsons Creek Adit and the Graham Creek Raise. In July 2017, the mine completed the changeover from forced ventilation to a negative ventilation draw system to eliminate ventilation doors and reduce air leakage. The new system is more power efficient than the previous plan and savings of up to $500 000 per year are expected. In addition, this change over reduced the number of ventilation doors in main traveling drives to four, saving the time lost in traversing the airlocks and eliminating potential collision incidents. The current air flow is more than adequate for the mine. Other than periodic changes to the airflows to accommodate changed development and production areas, no significant changes or upgrades are anticipated in future as the mine is expected to remain in steady state according to the current LoM Plan. East Boulder Mine has similar ventilation velocity criteria to Stillwater Mine, which are as follows: Working faces: 800ft per minute (4m/s);

Main haulage ways: 1 200ft per minute (0.6m/s); and Main ventilation drifts: 1 600ft per minute (0.8m/s).

Ventilation loading is calculated depending on the equipment working in specific areas. In this manner, air is either boosted or regulated into working stopes or development ends and distributed according to the equipment requirements. Typical equipment ventilation demands are as follows: 6-yard LHDs: 11 500cft per minute (5.4m3/s); 40t Haul trucks: 11 600cft per minute (5.5m3/s); and Twin boom jumbos: 8 500cft per minute (4.0m3/s).

East Boulder Mine draws 500 000cft per minute (240m3/s) through the exhaust system via four main 400hp (300kW) Spendrup exhaust fans located at various ventilation raises or adits supported by various 50hp (22kW) auxiliary booster fans. There are additional force fans utilised in primary development sections (no holings). Stope ventilation is achieved with 50hp to 70hp (22kW to 50kW) axial fans in conjunction with rigid and flexible ducting. Whenever possible, through ventilation is achieved by establishing a raise from the sill level of the stope to the level above. This allows a split of air from the primary circuit to flow through the stopes. The mining sections are equipped with refuge bays close to workings and/or workshops underground. These are similar units as utilised at Stillwater Mine. The operation also utilises carbon monoxide (CO) monitors positioned at strategic positions in the mine to detect fires underground as a back-up, while a “stench” smell release system is also available. As per Stillwater Mine, it is a requirement for all personnel entering the mine to be trained and to wear a personal-containerised self-rescuer. The current East Boulder Mine ventilation system, which was modified in July 2017, has a simplified balanced layout, which services four development sections and six stope production sections. Air entering the mine on the 6 500 Level is heated via two propane bulk air heaters in the winter to prevent freezing of pipes and to ensure productive working temperatures. The level of ventilation as discussed is currently adequate for the mine and supports the requirements of the

current LoM Plan.

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7.9.2.3 Pumping East Boulder Mine is primarily developed above the main adit level (TBM tunnels) allowing for water to drain from the mine and, thus, water pumping is not considered a major challenge. Furthermore, water inflow from fissures and underground aquifers is minimal. Ramp development below the 6 500 Level is equipped with normal mobile pumps and cascade sump/pumps to bring the water to the 6 500 Level. Water management focus is primarily to ensure that there is adequate infrastructure to manage service water and waste water from the underground fill. At present, the water flow amounts to approximately 206G per minute (13l/s). The pumping capacity of the mine is approximately 396G per minute (25l/s) from the main pump station on the 6 500 Level.

7.9.2.4 Service Water Service water is supplied from the reverse osmosis water treatment plant, which has a throughput of 150G per minute (9.5l/s). Underground service water is required for drilling, dust suppression, washing of mining equipment at the underground service bays and the flushing of underground waste fill pipe ranges after backfill or paste is placed in the stopes.

Water is pumped into the adit on the 6 500 Level to the 6 450 Level Drill Water Reservoir (DWR6450). Each level above this has a similar DWR with pumping system to ensure water supply to the upper levels. Table 47 summarises the DWR capacities. Service water is gravitated to the workings from the DWR via pressure reducing valves to ensure water pressure is managed to approximately 6 Bar. Table 47: Service water capacity underground East Boulder Mine

Drill Water Reservoir Capacity (G) Capacity (m3)

DWR6450 177 000 670

DWR6700 180 000 680

DWR6900 33 000 125

DWR7200 95 000 360

DWR7500 95 000 360

DWR7900 92 000 350

DWR8200 82 000 310

Total Capacity 754 000 28 55

7.9.2.5 Power Power to East Boulder Mine is fed from the NWE 161kV line via a tap located north of Springdale and then via the Duck Creek Substation. Park Electric, a power co-operative, supplies power to the mine site and owns the distribution facilities. The power feed from Duck Creek to McLeod and from McLeod to the mine is via a 69kV line. East Boulder Mine has two Stillwater-owned main substations situated at the mine. The mill transformer is a 15/20MVA 69 kV to 4160V and the mine operations transformer is a 10/14MVA 69 kV to 13.8 kV. There are no spares for either transformers, but there is a cross feed between the two substations, which is rated for 8MW. Dedicated capacity for East Boulder Mine is 16MW at unity PF from Park Electric. The mine loads are currently as follows: Mine and surface: 7MW at a 0.91 PF (approximately 77% of maximum capacity);

Concentrator: 5.5MW at a 0.93 PF (approximately 40% of maximum capacity); and Monthly Maximum Peak: 12.5MW at a 0.91 PF.

There are two main feeders to the underground switchgear from the surface switchgear. Normal operation is to use one feeder and have the other feeder available as a backup. One feeder is installed in Tunnel #1 and the second feeder installed in Tunnel #2. Current underground load is approximately 5MW at a 0.80 PF. Each of these feeder cables have a loading capacity of approximately 7MW (assuming a 5% maximum voltage drop). East Boulder Mine has two 2MWA Caterpillar 3516B diesel generators installed in 2001 at the portal on surface. These generators are currently permitted only as emergency generators and are only allowed to be operated 500 hours per year. The generators are designed to operate at the same time in parallel and share the load. When running in parallel, the continuous load on these generators is limited to 3.5MW to allow for peak demands of less than 4MW. The mine is also equipped with a leaky feeder system for the mobile radios that are used on all mobile

equipment throughout the mine, and a Gaitronic Paging SystemTM that is strategically placed at fixed underground locations and is in contact with the surface.

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7.9.2.6 Sandfill Plant and Reticulation Tailings from the East Boulder Concentrator scavenger circuit are pumped to the sandfill plant, where up to 60% is used in the mine backfill process, located on the 6 500 Level close to the footwall haulage position and close to the stope horizon. Additional sandfill plants have been installed on the 7 200 Level and, more recently, on 8 200 Level. Tailings feed is at approximately 28% by mass at a flow rate of 1 800G per minute (113l/s). Most of the ore extraction is carried out using the R&F and sub-level stope and fill mining methods. Tailings material is pumped through cyclones to remove the fine section (-45µm) and the coarse section is placed in four batched storage silos, which are air agitated to prevent settlement. Sandfill is dispatched to the stopes requiring fill by Geho positive displacement pumps if above the sandfill plant, but preferably by gravity. The fines portion of the tailings is returned via centrifugal pumps to the TSF at the portal. All decant and flush water reports into the mine waste water system, which reports to the main pump station on the 6 450 Level. East Boulder Mine uses the same procedure for bulk head installation as Stillwater Mine.

7.9.2.7 Equipment Maintenance The East Boulder Mine has two workshops on surface, which are the following: Surface Locomotive Workshop: This has a single bay service and mechanical repairs facility for all rail

bound equipment (locomotives and ore cars), and includes facilities for work on wheels and engines on the locomotives and ore cars; and

Surface Engineering Workshop: This has multiple bay service and mechanical repair facilities for surface trucks with full machining, welding and electrical maintenance facilities.

The mine has the following workshops underground: 6 500 Level Workshop: This has multiple-bay services and carries out repairs for both mechanical and

electrical faults and maintenance. It also provides a service facility for the rail bound equipment and the adjacent sandfill plant. The workshop is equipped with separate wash bay, office area, warehouse and fuel store. Major overhauls are carried out in the surface workshops;

6 900 Level Workshop: This workshop is smaller than the 6 500 Level workshop, but is fit for purpose to

service the requirements of the trackless equipment. It has a large service facility complete with overhead gantry crane and is available for light mechanical repairs, servicing and electrical repairs on mobile equipment;

7 200 Level Workshop adjacent to the Sand Plant: This is a smaller service and mechanical repair shop custom built workshop facility, designed specifically for the servicing of the mobile equipment and minor maintenance;

7 900 Level Mobile Workshop: This is primarily for the mobile equipment in the upper mine. It has an ambulance and medical support centre and adjacent refuge bay. This is expected to be a permanent workshop for the life of the mine.

All the underground workshops are well equipped with good lighting, clean concrete floor areas for maintenance, wash bays to ensure quality inspections, and are stocked with the appropriate tools and lifting equipment. East Boulder Mine also makes use of the JD Edwards Planned Maintenance system.

7.9.3 Offices East Boulder Mine has adequate modern, fit for purpose offices for administration, technical and personnel services. The mine also has a change house in close proximity for the use of mine staff, as well as drill core processing and storage facilities. The processing plant has an addition separate small control office facility for operational staff. Likewise, the surface engineering workshops have small operational offices within the workshops. The mine provides adequate secure parking in a gravel parking area adjacent to the main office entry. The mine complex is fenced, with the complex accessed from a security guard manned main gate.

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7.10 Metallurgical Processing and Recovery SRC5.1(i); SRC5.2(ix); JSE12.9(h)(vii)

7.10.1 Process Samples SRC5.3(i)

7.10.1.1 Background Stillwater and East Boulder Concentrators and the Columbus Metallurgical Complex have all been operating sustainably for several years. This section discusses the sampling, laboratory and metallurgical testing techniques, which are used to manage the processes and account for the metals processed.

7.10.1.2 East Boulder and Stillwater Concentrator Samples Concentrator feed samples are not taken at either concentrator due to the inclusion of flash flotation and gravity recovery processes within the milling circuit. This precludes representative sampling of the concentrator head feed stream and, as a result, concentrator metallurgical recoveries are calculated from feed mass, concentrate mass and grade, and tailings grade. Concentrate and tailings samples are taken at the concentrators using automated linear falling stream sample cutters. The concentrate samples (1kg to 3kg per day) are then produced in duplicate using two stage rotary samplers on the concentrate thickener feed pipeline on an hourly basis, resulting in a 24-hour composite sample, representative of the concentrator final product. It is, however, noted that this sample is not used for accounting purposes, with the concentrate sample from the smelter being used for this purpose. The samples produced are then transported to the assay laboratory. Linear falling stream sample cutters also produce the primary tailings samples, which are reduced using two stage rotary tailings samplers at both plants to also produce duplicate samples from the final float tails stream on an hourly basis. This tailings material sampling process results in a duplicate daily composite of approximately 1kg to 3kg per day. The final tails is then pumped to the sand plant (in the case of East Boulder Concentrator), and the tailings dewatering section (at Stillwater Concentrator). The laboratory process followed for the concentrator samples is similar to that detailed previously for the geological samples (Figure 18). The sampling equipment viewed, and the sampling and sub-sampling regimens in place, would appear to be adequate and suitable for the operations. The concentrate samples are verified via the automated sampling process at the smelter. Sampling equipment, sampling and weighing processes are all given high priority as part of the process operations.

7.10.1.3 Smelter Samples Once the bins containing concentrate arrive at the smelter from the two concentrators, each bin is sampled using a pipe sampler on a grid pattern in the concentrate bin. The bin is then rotated and the process is repeated. The resulting sample is composited per bin and an ultimate sample mass of approximately 5lb to 15lbs (2.3kg to 6.8kg) per bin is then transported to the assay laboratory. This sample becomes the definitive analysis for the concentrate from the concentrators used in the metallurgical accounting process. Converter matte, once granulated, is the smelter final product, which is processed further at the Base Metal Refinery (BMR). The granulated matte is sampled at the smelter by a falling stream sampler at the granulator. A 10lb to 40lb (4.5kg to 18kg) primary sample is taken, which is reduced to approximately 2lb (800g to 900g) via a twelve-point rotary splitter before being manually delivered as duplicate sample to the assay laboratory. This sample becomes the definitive analysis for the convertor matte from the smelter used in the metallurgical accounting process. The laboratory analysis process flow for smelter samples is depicted in Figure 72.

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Figure 72: Laboratory process flow for smelter samples

Other samples produced by the smelter for analysis at the analytical laboratory, which are utilised for internal accounting purposes, are as follows: Furnace slag: spoon samples are taken during the tapping process, from which a daily composite is

prepared and crushed, resulting in a 0.55lb to 0.75lb (250g to 350g) sample delivered to the assay laboratory;

Converter slag: converter slag is grab sampled from each bin produced for recycle, and composited on a

daily and weekly basis and the sample size is reduced by riffling of the composite, resulting in a 0.2lb to 0.6lb sample (100g to 300g) delivered to the assay laboratory;

Furnace matte: furnace matte is grab sampled from each bin produced and composited on a daily and weekly basis and the sample size reduced by riffling of the composite, resulting in a 0.2lb to 0.6lb (100g to 300g) sample delivered to the analytical laboratory;

Gypsum product: gypsum product is pipe sampled from each bin produced resulting in a 4G (15l) bulk sample, which is dried and incrementally split via coning and quartering. The final sample delivered to the laboratory comprises a 0.55lb to 0.75lb (250g to 350g) sample.

The sampling equipment viewed by The Mineral Corporation and the sampling and sub-sampling regimens in place, would appear to be adequate and suitable for the operations.

7.10.1.4 BMR Samples The converter matte bins received from the smelter at the BMR are weighed and the mass becomes the final value used in the metal accounting system. The analysis used in the accounting system originates from the

final smelter sample as discussed previously. BMR products are all sampled within the production process and the products are analysed for quality control purposes as follows: NiSO4 crystals: A primary sample is taken from the bagging process via a rotary splitter resulting in a

2lb to 6lb (1kg to 3kg) sample, which is reduced further using an eight-point sample divider to produce a final sample of 0.5lb (200g) for final analysis;

Copper cathode: This is sampled by drilling of the cathode plate and digestion and ICP-OES analysis of the copper turnings produced. Typically, 0.5lb (200g to 300g) samples are taken per batch/cathode, which are used as the dispatch analysis for the cathode product;

PGM filtercake: This is the final BMR product shipped to Johnson Matthey for further refining. This material is sampled at the final product dryer by a rotary splitter, and is then sub-sampled by an eight-point sample divider within the security area. Duplicate samples of approximately 1oz (31g) are delivered to the assay laboratory. The laboratory process flow also follows that utilised for the smelter samples

depicted in Figure 72.

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This analysis becomes the invoice analysis for the shipment, and is checked by Johnson Matthey Company

(Johnson Matthey) on receipt. There is an umpire process, which is followed for variances greater than that allowed in the contract. The assay laboratory reports quarterly on the correlations achieved between Johnson Matthey, Stillwater and the umpire laboratories (where required) on a per element basis.

The BMR analysis process is depicted in Figure 73.

Figure 73: Base Metal Refinery laboratory processes

The sampling equipment viewed by The Mineral Corporation and the sampling and sub-sampling regimens in

place would appear to be adequate and suitable for the operations.

7.10.2 Metallurgical Amenability SRC5.3(ii)

Stillwater and East Boulder Concentrators and the Columbus Metallurgical Complex have all been operating sustainably for a number of years. As a result, an explanation on metallurgical amenability and mineralogical testwork has no relevance for this CPR. Instead, metallurgical amenability predictions for Stillwater and East Boulder Mine ores going forward (including budget tonnage throughput rates and metallurgical recoveries) are based on historical experience and supported by operational data reviewed (Section 7.10.3).

The Blitz expansion to the Stillwater Mine will be subjected to some metallurgical amenability testing once representative and variability samples of the mineralised material are available for testing. However, some preliminary samples recovered from drill cores have been sent for mineralogical analysis. The results from these samples indicate that the mineralised material at the Blitz section is metallurgically similar to the current Stillwater Off-shaft ore, and is unlikely to behave differently during metallurgical processing and extraction. On this basis, metallurgical amenability predictions for Stillwater Off-shaft ore have been adopted for the Blitz

section in the interim, an approach which is considered reasonable by The Mineral Corporation. However, amenability will be confirmed during the expansion process.

7.10.3 Processing Methods SRC5.3(iii); SRC5.4(ii)

7.10.3.1 Stillwater Concentrator Stillwater Concentrator was commissioned in 1987 as a 500 ton (454t) per operating day crushing, milling and flotation plant, and producing a copper/nickel sulphide concentrate containing PGMs suitable for downstream smelting and refining. The current capacity is indicated as approximately 3 000 tons (2 721t) per operating day following a number of process modifications and expansions. This is equivalent to an estimated 1.02 million tons (924kt) per year at full utilisation.

Based on the information supplied by the concentrator management, the concentrator currently operates on a ten- or eleven-day fortnight basis, with the plant switched off every second weekend; equivalent to

approximately 75% utilisation. This is required to maintain the balance with current mining volumes of 750 000 ton (680kt) per year.

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The plant staffing comprises three crews operating on two 12-hour shifts of one Supervisor, four Operators and

a TSF Operator. Maintenance is currently staffed with ten Mechanical Technicians and three Electrical Technicians who work on a five day per week basis. Major and routine planned maintenance is scheduled for the off weekends, which has resulted in plant mechanical availability of more than 99%. The current staffing levels are adequate for the current levels of operation. However, once tonnage ramp up to approaching nameplate capacity occurs, it will be necessary to increase the number of operating crews to four. Additional maintenance staff will also be required to maintain operational availability at a target 93% once the fortnightly plant stoppage time is no longer available for maintenance. The concentrator currently receives ore and reef waste (low-grade ore) from the Off-shaft and Upper West areas as well as slag and brick recycle materials from the smelter. The two primary ores received at the concentrator both contain up to 20% talc, and have materially different Bond Work Indices (BWIs); Off-shaft material BWI is 18, and Upper West material BWI is 21. As a result, the harder Upper West material requires primary and secondary crushing at the surface plant, reducing it to less than 1.5 inches (38mm). The Off-shaft material is crushed to less than 6 inches (152mm) in a primary jaw crusher underground and delivered to the 3 000-ton (2 721t) ore silo, which feeds the SAG mill via the concentrator feed bin, where it is mixed with the crushed Upper West material. The milling circuit, as currently configured, comprises a SAG-ball mill combination feeding a common discharge sump; the combined mill discharge is in a closed circuit with a cluster of 15 inches (380mm) classifying cyclones. SAG mill scats are returned to the mill discharge sump after crushing in a cone crusher. The SAG mill is driven by an 800hp (597kW) fixed-speed motor and lined with a rubber/steel composite, whilst the ball mill is driven by a 2 500hp (1 864kW) fixed speed drive and is rubber lined. A flash flotation cell is installed in the cyclone underflow stream and recovers the fast-floating sulphide particles as early as possible, minimising the risk of talc flotation and over grinding. This circuit recovers up to 50% of the total recovered PGMs and the flash float concentrate reports to a dedicated cleaner circuit and then to the final concentrate handling circuit. The cyclone overflow product, at an 80% passing size (P80) of 145µm, reports to the rougher conditioning tank ahead of rougher flotation. Rougher and middling concentrates are pumped to the rougher cleaning circuit and join the final concentrate stream. Scavenger concentrate and middling cleaner tails undergo regrinding via three small Stirred Media Detritors (SMD) regrind mills in a closed circuit with cleaner reflotation and a single 10 inch (254mm) cyclone. Concentrates from this circuit also report to the final concentrate stream. Rougher flotation tailings are fed to a tertiary grinding circuit comprising a 1 250hp (932kw) Vertimill, which operates in a closed circuit with a cluster of 15 inch (381mm) cyclones; the cyclone overflow reports directly to middlings flotation. The philosophy has been to float liberated minerals as soon as possible and minimise recycling streams, reducing the impact of talc, which can interfere with the flotation response and adversely affect recovery. The flotation tailings from the scavenger circuit are pumped to the paste plant and sandfill plant for backfill production. It is reported that the majority of the typical final residue grade of 0.04oz/t Pd + Pt (1.45g/t) comprises palladium contained in fine pentlandite grains, together with some unfloated tellurides and native alloy PGMs. The current multiple grind/float operation of the concentrator is designed to minimise overgrinding of the soft minerals (pentlandite and talc). Overgrinding of these minerals adversely affects recovery due to slime losses or coating of valuable mineral grains with talc and other gangue components. Talc also floats readily and can adversely affect recovery by ‘crowding’ of the valuable sulphide minerals in the concentrate. As a result, carboxy methyl-cellulose (CMC), a commercially available chemical is added to the float to suppress the talc. Smelter slag and brick recycle materials are delivered to the primary crushing area and are campaign-treated through the concentrator plant. A typical slag campaign would last 24 hours and would entail process changes such as different reagent dosages, lower throughput and shutting down the flash float circuit. Approximately 75% to 80% recovery of contained Pd + Pt is the sustainable target for these campaigns. The simplified block flow for the Stillwater Concentrator is presented in Figure 74. The concentrator currently processes approximately 800 000 ton (725kt) per year of RoM ore feed and averages approximately 92% total Pd + Pt recovery from this material.

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Figure 74: Block flow diagram of the Stillwater Concentrator

The recent history and budget operational parameters for the concentrator have been reviewed by The Mineral Corporation. The key variables reviewed are presented in Figure 75 and Figure 76. The 2014, 2015 and 2016 data presented reflect the actual annual performance whilst the 2017 to 2028 data represents current budget targets. It can be seen from the plots that the current operational methods and capacities are adequate until the planned expansions occur. Metallurgical efficiencies projected have also been sustainably achieved historically and are thus reasonable budget targets.

Figure 75: Stillwater Concentrator operational data

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Figure 76: Stillwater Concentrator operational data

The increases in the concentrator operational duty planned following the Blitz expansion (AMEC, 2017; Hatch, 2017; Nordmin, 2017) are clearly visible, whilst the other key variable reviewed (concentrator recovery) remains at a level that has been previously achieved. It may be seen in Figure 75 that a slight shortfall (approximately 47 000 tons or 43 000t) is forecast for the Year 2020 based on current ramp up planning. Mine management is aware of this and plans to expedite the current expansion process as far as possible or alternatively stockpile surplus material in 2020 for treatment once full plant capacity is available. The expansion will provide sufficient incremental capacity in 2021 to treat the shortfall. The current capacity constraints being investigated in terms of the Blitz expansion are summarised as follows: Overall plant throughput: An estimated increase from 75% to 93% of annual capacity can be achieved

within an estimated eight-week period by increasing the plant running time via the addition of an additional operating crew. This would result in an annual capacity of approximately 1.02 million ton (0.93Mt) per year. Expansion above this capacity will require additional equipment. The 93% operational availability is a high target as similar plants in the South African context achieve 91.5% to 92% operational availability. However, with the planned ramp up and the capacity upgrades, there should still be sufficient plant capacity to treat the planned tonnages even at slightly reduced availability. Under the previous four-crew operation, a 93% operational availability has been achieved and maintained and, as such, this is deemed to be a minor risk to production;

Crushing: The surface jaw crusher is likely to be undersized for the required duty and may need to be replaced;

Milling: Both the SAG and ball mills are undersized for the planned tonnages once the Blitz section has

achieved full production levels. As such, design changes are currently being investigated and could include changes to the crushing/grinding philosophy, the addition of SAG mill or replacement of the current SAG mill with a larger unit. The space constraints around all of the potential designs need to be considered as part of the scoping and trade-off studies;

Flotation: Some areas of the flotation circuit already have sufficient capacity, such as rougher circuits. However, most of the subsequent stages, in addition to the flash float circuit, will need to be expanded to cater for the increased volumes;

Concentrate handling: All areas of concentrate handling, thickening, filtration, stockholding and transport will need to be addressed as part of the capacity increase; and

Ancillaries: Upgrades to the main electrical substation and tailings pipelines may need to be included in the expansion process and are currently under investigation.

The authorisation for expenditure for the scoping level study of the Stillwater Concentrator expansion was approved in July 2017, and Phase 1 is planned. The scoping level study is based on available technical data and expected growth plan. The Design Engineer will complete the following deliverables:

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Review available technical data, applicable standards, current plant installations, and to-date conceptual

expansion options; Conduct a review of the ten major systems of the Stillwater processing facilities; Conduct parametric surveys to digitise current facility arrangements; Develop at least two conceptual general arrangements that include strategic growth timing; Develop conceptual flow sheets for each General Arrangement (GA) if significantly different; Create draft equipment lists for each alternative; and Develop ±30% capital expenditure and operating cost estimates for each concept.

Phase 1 is due for completion by the end of 2017, with Phase 2 (the detailed design of the agreed option) due to commence in early 2018 and expected to be completed by mid-2018. The expansion will result in a concentrator ultimate capacity of 1.425 million tons per year (1.3Mtpa), sufficient for the expanded production from the current and Blitz sections at Stillwater Mine at full planned production. The three proposals submitted to Stillwater by reputable North American engineering companies have been reviewed by The Mineral Corporation, and found to be compliant to the requirements of Phase 1 of the expansion process. This expansion will be expedited to address the capacity shortfall forecast in 2020 discussed above.

7.10.3.2 Stillwater Tailings Storage Facility The TSF at the Stillwater Mine comprises two slimes impoundments, namely the Nye TSF (no longer in full-time use) and the Hertzler TSF (current primary storage). The Nye TSF was used from the start of the mine until 2002, when the Hertzler TSF was commissioned. The Hertzler TSF is currently permitted to an elevation of 5 036ft (1 535m) including freeboard and supernatant pond, which is the maximum extent of the current Stage 3 embankment raise.

Concentrator tailings after sampling (Section 7.10.1.2) are pumped to a paste plant alongside the Nye tailings impoundment located to the southwest of the Stillwater Concentrator. The paste plant, which is used on a limited basis, operates as a staging point for whole tailings slurry. The tailings may be routed from the paste plant either to the 5 150 Level underground sand plant or to the Hertzler Pump House, from where it can be routed to either of the other sand plants or the Hertzler TSF. Tailings can also be routed to the Nye TSF from the concentrator, the paste plant or the pumphouse if required.

Whole tailings material is classified at the underground sand plants into coarse sand and slimes fractions, the sand remains underground and is pumped into stopes for backfilling purposes, whilst the slimes fraction is pumped back to the pump house. The slime is then pumped via two 8-inch (200mm) pipelines to the Hertzler TSF for deposition.

Deposition on the Hertzler TSF is via periodic rotational discharge of tailings slurry around the perimeter of the facility using a group of spigots. Once a localised tailings beach has formed, deposition is transferred to another group of spigots at a different location.

Water reclamation is achieved via two inclined reclaim pumps located at the south end of the TSF, which return process water to the Stillwater Concentrator. The adjacent Land Application and Disposal (LAD) pond to the west of the Hertzler TSF is used to manage mine water volumes. The TSF is geomembrane lined, and the liner is routinely inspected by the Engineer of Record, where possible.

Basin underdrain and seepage measurement is performed and monitored via vibrating wire piezometers, whilst embankment crest-mounted survey monuments are used to measure slope slippage or movement. Additional inclinometers are installed around the base of the impoundment to monitor deeper ground movement and displacement. The basin underdrain pore pressures are monitored on a weekly basis via the piezometers, and these respond quickly to changes in the basin underdrain pumping rate. This results in changes in the tailings mass consolidation and hence maximises storage availability and assists in long-term closure planning.

The Stillwater Concentrator performs weekly, monthly and quarterly inspections and monitoring per its standard procedures, which are reviewed as part of the annual inspection of the TSF performed by Knight-Piésold of Canada. The inspections and monitoring are required by the 2015 Montana Metal Mine Reclamation Act (MCA). The most recent inspection was performed in September 2016 (Knight-Piésold, 2017a) and raised no material issues.

The Nye TSF, located immediately to the south of the mining and processing complex, is used as emergency tailings storage and for water management purposes, and was decommissioned as the primary storage facility in 2001. Supernatant water is recycled to the concentrator as process water via an inclined retractable pump at the north end of the facility. Survey beacons are in place and are routinely measured for slope stability and slippage. The most recent inspection of the tailings storage facility by Knight-Piésold raised no material findings. Knight-Piésold has been retained to develop a closure and rehabilitation plan for the Nye impoundment.

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As part of the annual inspection of the Hertzler TSF, Knight-Piésold calculates a projected fill rate of the current

and planned TSF capacity as an elevation (amsl) by year. Stage 3 of the Hertzler TSF was completed in 2015 and filling of Stage 3 is planned to commence in late 2017. The embankment crest maximum elevation of Stage 3 has been calculated by Knight-Piésold as 5 036ft (1 526m) amsl. Based on Knight-Piésold’s filling calculations, this limit is scheduled to be reached in August 2031. However, the filling calculations used by Knight-Piésold did not take account of tonnage from the Blitz expansion. If the tonnages are included in the calculation, the Stage 3 limit is indicated to be reached between 2027 and 2028. The Knight-Piésold and recalculated filling profiles for the Hertzler TSF are presented in Figure 77. A maximum filling rate of 1 360mm per year (4.5ft per year) has been estimated based on the total projected tons treated, budget backfill percentages and historical deposited densities. Stage 3 is currently the maximum permitted height of the Hertzler TSF. As a result, operation beyond Stage 3 will require the design and approval of a Stage 4 (additional lift) or the development of a new TSF. Current planning is based on the Stage 4 additional lift option. The Stage 4 lift involves a capital expenditure amount of $22 million for design and construction. The quantum of the capital budget is deemed sufficient for the implementation of the Stage 4 lift. Stillwater has indicated that there are currently no apparent material issues that will prevent the approval of the Stage 4 elevation lift. However, if the approval is declined and a new TSF is required (which would be the worst-case scenario), a timeframe of approximately five to seven years for environmental permitting processes and two years for construction would be required. In addition, a higher capital provision than for the elevation lift option would be required. As such, it is necessary to finalise the planning for the additional capacity within the next six to twelve months (during 2018) to ensure sustained tailings disposal capacity for the Stillwater Concentrator. The TSF facilities are under the operational control of the concentrator management, with 2016 costs of deposition estimated at $2.98/ton milled.

Figure 77: Hertzler TSF calculated elevation profile

7.10.3.3 East Boulder Concentrator The East Boulder Concentrator was commissioned in 2001 as a 2 000-ton (1 814t) per operating day crushing, milling and flotation plant, producing a copper/nickel sulphide concentrate containing PGMs suitable for downstream smelting and refining. Current capacity is indicated as approximately 2 500 tons (2 268t) per operating day following several process modifications and expansions. This is equivalent to an estimated 850 000 tons (771kt) per year at full operational utilisation. The plant was constructed to be expandable to a 4 000-ton (3 629t) per day capacity and, as such, has expansion space available. The concentrator currently operates on a ten- or eleven-day fortnight basis, with the plant switched off every second weekend, equivalent to approximately 75% utilisation. This utilisation level is required to maintain the balance with current mining volumes of 670 000 ton (608kt) per year.

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The plant staffing comprises three crews operating two 12-hour shifts of one Supervisor and four Operators.

Maintenance is currently staffed with six Mechanical Technicians, two Electrical Technicians and two Supervisors, all of whom work on a five-day per week basis. Major and routine planned maintenance is scheduled for the off weekends, which has resulted in plant mechanical availability more than 99%. These staffing levels are adequate for the current levels of operation. A dayshift crew of five Operators provides shift coverage and is responsible for surface operations at the TSF. Unlike Stillwater, the ore feed to the concentrator is consistent in hardness and grade. Hardness, PGM content and talc content are all lower than typical Stillwater Mine composite feed, whilst the base metal content is higher than at Stillwater. The combination of these factors means that planning of the relative levels of concentrate from the two concentrators into the smelter is critical to smelter operations. The underground ore from the mine is transported to the concentrator by rail and is deposited in the rail feed bin, which feeds a jaw crusher. This reduces the size ore to less than 6 inches (152.4mm), where after the ore is conveyed to a stockpile. An underground apron feeder reclaims the ore from the stockpile and delivers it to the milling circuit. The milling circuit, as currently configured, comprises a SAG-Ball mill combination feeding a common discharge sump. The combined mill discharge is in closed circuit with a cluster of 15-inch (380mm) classifying cyclones. SAG mill scats are returned to the SAG mill feed without crushing. The SAG mill is driven by a 2 000hp (1 491kW) variable-speed motor and lined with a rubber/steel composite, whilst the ball mill is driven by a 1 500hp (1 118kW) fixed speed drive and rubber lined. A flash flotation cell is installed in the cyclone underflow stream and recovers the fast-floating sulphide particles as early as possible, minimising the risk of talc flotation and over grinding. This circuit recovers up to 50% of the total recovered Pd + Pt and the flash float concentrate reports to a dedicated cleaner circuit and then to the final concentrate handling circuit. The tailings stream from the flash flotation circuit is returned to the ball mill feed and approximately 15% to 20% of the ball mill discharge stream is fed to a Knelson CD30 gravity concentrator. The gravity concentrate produced amounts to approximately 3 ton to 4 ton (2.7t to 3.6t) per fortnight at a grade of approximately 25oz/ton (856g/t), and is transported in tuff bags directly to the smelter separate from the flotation concentrates. In-house flotation tests on the gravity concentrate revealed less than optimum platinum recoveries, justifying the inclusion of the Knelson concentrator to improve overall Pd + Pt recoveries. The presence of a dense ferro-platinum mineral has been confirmed and makes up a significant component of the gravity concentrate produced. The cyclone overflow product, at a P80 of 105µm, reports to the rougher conditioning tank ahead of rougher flotation. Rougher and middling concentrates are pumped to the rougher cleaning circuit and join the final concentrate stream. Rougher cleaner tailings, scavenger concentrate and middling cleaner tails undergo regrinding via a 125hp (93kW) Vertimill in closed circuit with cleaner and column cell flotation and a bank of three 15 inches (381 mm) Cavex cyclones, which have been recently installed and have reduced circulating load by 10%. Concentrates from this circuit also report to the final concentrate stream. Rougher flotation tailings are fed directly to middlings flotation. The philosophy has been to float liberated minerals as soon as possible and minimise recycling streams. This reduces the impact of talc, which can interfere with the flotation response and adversely affect recovery. The flotation tailings from the scavenger circuit at a typical final residue grade of 0.037opt (1.25g/t) Pd + Pt are pumped to the underground sandfill plant for backfill production. The current multiple grind/float operation of the concentrator is designed to minimise over grinding of the soft minerals (pentlandite and talc), which affects recoveries as already discussed. CMC is added to the float to suppress the talc. In addition, copper sulphate is added to the float seasonally to control biological growth at the TSF. Concentrator staff is in the process of installing a new SMD mill and column flotation cell to treat the first cleaner scavenger concentrate. Testwork indicated a potential additional overall Pd + Pt recovery of 0.25%. This circuit was due for commissioning early in August 2017. The simplified block flow for the East Boulder Concentrator is presented in Figure 78.

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Figure 78: East Boulder Concentrator simplified block flow

The East Boulder Concentrator currently processes approximately 650 000 ton (590kt) per year of RoM ore feed and averages approximately 90.4% total Pd + Pt recovery from this material. The recent history and budget operational parameters for the East Boulder Concentrator have been reviewed by The Mineral Corporation. The key variables reviewed are presented in Figure 79 and Figure 80. The 2014, 2015 and 2016 data presented reflects the actual annual performance whilst the 2017 to 2028 data represents current budget targets. The current operational methods and capacities are adequate. Metallurgical efficiencies projected have also been sustainably obtained historically and are thus reasonable budget targets.

Figure 79: East Boulder Concentrator operational data

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Figure 80: East Boulder Concentrator operational data

Current capacity at the East Concentrator is sufficient for the planned tonnages over the next twelve years. The capacity could also be increased by an estimated 33% via the installation of a fourth operating crew and 24-hour operations. Stillwater is exploring ways to get the tonnage per day limit set in the GNA revised upwards or eliminated.

7.10.3.4 East Boulder Tailings Storage Facility The TSF at the East Boulder Mine comprises two cells of a single slimes impoundment as the current primary

storage. Stage 1, comprising Cell 1, was operated from 2001 to 2007, after which Cell 2 became the primary deposition facility (Stage 2). Stage 3 is an embankment lift of Stages 1 and 2 and has been operated since August 2014. Concentrator tailings after sampling (Section 7.10.1.2) are pumped to the underground sand plant where it is classified into coarse sand and slimes fractions. The sand remains underground and is pumped into stopes for backfilling purposes, whilst the slimes fraction is pumped back to surface. The slime is then pumped via one 10-inch (250mm) pipeline to the TSF for deposition. Deposition on the TSF is via periodic rotational discharge of tailings slurry around the perimeter of the facility using a group of spigots. Once a localised tailings beach has formed, deposition is transferred to another group of spigots at a different location. Water reclamation is achieved via three inclined reclaim pumps and pipelines located on the south-western embankment of the TSF, closest to the concentrator, which discharges into the reclaim water tanks at the

concentrator. All stages of the TSF are geomembrane lined. Basin underdrain and seepage measurement is performed and monitored via vibrating wire piezometers, whilst embankment crest mounted survey monuments are used to measure slope slippage or movement. Additional inclinometers are installed around the base of the impoundment to monitor deeper ground movement and displacement. The basin underdrain pore pressures are monitored on a weekly basis via the piezometers, and these respond quickly to changes in the basin underdrain pumping rate. Water drainage results in changes in the tailings mass consolidation and hence maximises storage availability and assists in long-term closure planning. The East Boulder Concentrator performs weekly, monthly and quarterly inspections and monitoring per its standard procedures which are reviewed as part of the annual inspection of the TSF performed by Knight-Piésold. The most recent inspection was performed in September 2016 and raised no material issues.

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As part of the annual inspection of the East Boulder TSF, Knight-Piésold calculates a projected fill rate of the

current and planned TSF capacity as an elevation (amsl) by year. Stage 3 of the facility is currently being filled, with permitting in place for Stages 4 and 5, both of which entail further embankment lifts of the impoundment. The embankment crest maximum elevation of Stage 5 has been calculated by Knight-Piésold as 6 325ft (1 917m) amsl (Knight-Piésold, 2017b). Based on Knight-Piésold’s filling calculations, this limit is scheduled to be reached in May 2030, with Stage 3 and 4 limits reached in March 2021 and December 2026, respectively. The filling calculations used by Knight-Piésold have been checked using approximate historical rise per ton of material deposited and current East Boulder Mine planned tons treated budget. It appears that the Knight-Piésold projections are not based on current planned tonnage treatment rates as the completions for each stage have been calculated to predate the Knight-Piésold projections by material margins. The recalculated filling profiles for the East Boulder TSF are presented in Figure 81.

Figure 81: East Boulder TSF calculated elevation profile

A maximum filling rate of 3.9ft (1 170mm) per year has been estimated by The Mineral Corporation based on the total projected tons treated, budget backfill percentages and historical deposited densities. Stage 5 is the maximum permitted height of the TSF currently. As a result, operation beyond Stage 5 will require the design and approval of an additional lift (if practical) or the development of a new TSF. The duration of the latter, which would be the worst-case scenario, would be approximately nine to ten years for land purchase and environmental permitting processes and two years for construction. As such, planning for this is required to commence within the next six to twelve months (during 2018) to ensure sustained tailings disposal capacity for the East Boulder Concentrator. The TSF facilities are under the operational control of the concentrator management, with 2016 costs of deposition estimated at $2.96/ton milled.

7.10.3.5 Smelter The Stillwater Columbus Metallurgical Complex was commissioned in 1990. Prior to this date, concentrate from the Stillwater Concentrator was exported to Belgium for toll treatment and refining. Initially, a 30-ton (27t) concentrate per day smelting facility was installed, which was subsequently replaced with a 100-ton (90t) per day unit in 1999. The smelter, as currently configured, comprises a 150-ton (136t) per day primary smelting furnace, with the smaller 100 ton per day unit operating in a slag cleaning duty. Concentrate averaging 11% to 13% moisture is received from the concentrators in 10-ton (9t) bins transported on road trucks (two per truck) from the respective mine sites. The bins are sampled as described previously, where after the concentrate is discharged via an elevator system into a fluidised bed dryer. Natural gas is available at the Columbus Metallurgical Complex site as a piped utility and, as such, is used wherever possible as a heating source. The dryer is thus natural gas fired and reduces the concentrate moisture to below 1%.

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Used automotive catalysts, which average 70oz/ton of (0.2%) Pd + Pt are combined with the new concentrate

feed after the dryer. These materials are sampled and prepared separately. The treatment and processing of recycle materials is addressed in Section 9.1. The current smelting configuration comprises two submerged arc furnaces operating in series. The primary smelting furnace has a 7.5MW power input capacity and a nominal feed capacity of 150-ton (136t) per day. The secondary furnace, which treats the hot slag from the primary furnace also has a 7.5MW power input capacity, but due to furnace geometry is only rated at a 100-ton (91t) per day feed capacity. This furnace also has the capability of operating in a primary duty as a live standby unit for the larger primary furnace as required. The blended concentrate and recycle feedstock, together with a limestone flux, are fed to the primary furnace at a rate of between 5 000lb and 13 500lb (2.3t to 6.1t) per hour. The smelting process produces a copper/nickel matte, which acts as a collector for the PGMs and, being denser, sinks to the lowest levels of the furnace hearth. This matte is periodically (typically four to six times per operating day) tapped into a refractory brick lined ladle, and then poured into a high-pressure 4 000G per minute (900m3 per hour) water granulation facility to produce a granulated furnace matte product containing 200oz per ton to 250oz per ton (6.9kg/t to 8.6kg/t) of Pd + Pt. The supernatant slag layer containing entrained matte and partially reduced PGMs is also periodically tapped into the secondary furnace. A reductant in the form of silicon carbide, carbon or aluminium is added via the charging ports at a rate of 100lb to 200lb (45kg to 90kg) per hour and the smelting process is repeated, recovering up to 70% of the residual Pd + Pt content. The secondary furnace matte follows a similar process to the primary furnace matte, whilst the secondary furnace slag containing 0.15oz per ton to 0.30oz per ton (5g/t to 10g/t) of Pd + Pt is tapped into a sand bed, and allowed to cool before being broken up for transport to the Stillwater Concentrator. At Stillwater Concentrator, it is reprocessed and a further 70% of the Pd + Pt content is recovered. Furnace matte is combined with pebble lime as a flux and charged into the top blown rotary converter vessel, which is effectively a refractory brick lined ladle. The charge is preheated with natural gas burners under the fume hood. Once molten, oxygen is added via a lance into the melt, and additional matte and pebble lime is added to complete the charge. The converting process oxidises some of the remaining iron and sulphur and produces a denser converter matte and a supernatant converter slag. The slag is granulated and dried in the granulation system and is fed back into the furnace feed mix as a revert product. This material averages 20oz per ton to 80oz per ton (686g/t to 2 743g/t) Pd + Pt content. The converter matte is granulated through the same granulation system as the furnace matte and dried in a dedicated fluidised bed dryer to prevent dilution of the final smelter product. This dried converter matte forms the final product from the smelter process, and is delivered to the BMR in Tote bins of approximately 5 000 lbs (2.27t) capacity. The matte typically contains 350opt to 700opt (1.2% to 2.4%) Pd + Pt, and 28% to 30% Cu, 40% to 42% Ni, 20% to 22% S and 2% iron (Fe), the balance comprising cobalt (Co), Au, silver (Ag), Rh, tellurium (Te) and selenium (Se). High-temperature furnace fume and process gases from the electric furnace roof extraction system enter a primary bag house, whilst the lower temperature gas and particulates from the tapping, converting and granulation processes enter a secondary baghouse. The baghouses use high-performance Gore-Tex coated membrane bags to capture the particulates, which are recycled back to the furnace feed hoppers via a pneumatic conveying system. The gases, which comprise mainly sulphur dioxide, are scrubbed via a series of NaOH containing Dynawave scrubbers, which remove more than 99% of the sulphur from the final atmospheric discharge gas. These processes result in a final atmospheric discharge, which is significantly below the complex’s permitted sulphur discharge level, on hourly, daily and annual bases. The scrubber liquor is further modified with the addition of additional NaOH, and then subsequent addition of hydrated lime precipitates a gypsum product (CaSO4.2H2O), which is sold as an agricultural soil modifier and regenerates the NaOH for reuse in the scrubber circuits. The simplified process flow block diagram for the smelter processes is presented in Figure 82.

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Figure 82: A simplified block flow diagram of the smelter

The entire Columbus Metallurgical Complex has a zero-effluent status and, as such, all rainwater, snow melt and spillage are captured and treated through the process. Water management is thus a key focus and could potentially create a risk at increased production rates planned with the treatment of Blitz material. However, the primary consumers of water in the process are the gypsum production, and the water of crystallisation associated with the nickel sulphate product (NiSO4.7H2O). The increased production of these streams should allow for all water captured to be treated and utilised. However, process management will investigate the installation of additional storage facilities to aid management as the expansion project advances. The recent history and budget operational parameters for the smelter plant have been reviewed and the key variables reviewed are presented in Figure 83 and Figure 84. The 2014, 2015 and 2016 data presented reflects

the actual annual performance whilst the 2017 to 2028 data is current budget targets. The current operational methods and capacities are adequate until the planned expansions occur. Metallurgical efficiencies projected have also been sustainably obtained historically and are thus reasonable budget targets.

Figure 83: Smelter operational data

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Figure 84: Smelter operational data

The increases in smelter operational duty planned as part of the Blitz expansion are visible whilst the other key variables reviewed such as smelter first pass recovery and recycle tons treated remain at levels, which have been previously achieved. The current capacity constraints being investigated in terms of the Blitz expansion are summarised as follows:

Feed silo and rotary dryer: At planned expansion tonnages, these are likely to exceed current capacity in

2021, requiring an estimated $4.5 million of capital to address. Sufficient footprint is available for the expansion;

Top blown rotary converters: A third converter is likely to be required in 2019 requiring an estimated $5 million. Sufficient floor space and area is available for this increase;

Primary smelting capacity: The conversion of the old 100-ton (91t) furnace (No. 1) to primary smelting duty in parallel with the 150-ton (136t) unit (No. 2) is likely to be required in 2021. Although limited direct capital will be required for this conversion, a provision of $2 million has been budgeted commencing immediately to address the engineering issues around the smelter upgrade and optimisation;

Gas handling: With the additional primary smelting capacity and a third Top Blown Rotary (TBRC) installed, the gas handling facility should be increased to handle the gas volumes generated. This is likely to be required in 2021. Footprint is available for this expansion and an amount of $5 million has been budgeted; and

Ancillaries: Upgrades to the main electrical substation, the granulation facility and an additional filter press

for gypsum production have all been included in the capital budgeting process, totalling $6 million.

7.10.3.6 Base Metal Refinery The granulated converter matte product is weighed, sampled and analysed on receipt at the BMR facility. This facility was installed in 1996 at a nameplate capacity of 660lbs (300kg) per hour and has a current capacity of approximately 1 100lb (499kg) of granulated matte (499kg/hr) due to some process expansions but primarily a result of process optimisation and improvement. The BMR currently operates on two 12-hour shifts continuously from Monday morning to Thursday afternoon (equivalent to 80 hours per week or a utilisation of 47.6%). The copper electrowinning circuit, which operates continuously, is an exception and represents the current bottleneck in the BMR process.

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The granulated converter matte, once weighed and sampled, is milled in a tower mill to a nominal 85% passing

200-mesh (74µm). The milled matte is then combined with process water and pumped to the nickel atmospheric leach (NAL) circuit. Sulphuric acid, oxygen and steam are added to the five agitated tanks to solubilise iron, nickel and cobalt at atmospheric pressure and a temperature of 200°F (93°C). The leach circuit discharge is pumped to a thickener. The overflow solution from the thickener is pumped directly to the nickel crystallisation circuit. The old iron removal circuit still exists, but is no longer used due to the bureaucratic issues associated with the procurement of ammonia compounds in the USA. The crystallisation circuit operates at 200°F (93°C) and under negative pressure, which causes the solution to super-saturate with nickel, forming crystals of nickel sulphate (NiSO4). Due to the removal of the iron circuit, these crystals contain up to 1% iron. However, this has not adversely affected the product quality, but improved it due to the absence of residual ammonia. The crystals are dried in a fluidised bed dryer and bagged for sale.

The underflow solids slurry from the NAL thickener is pumped to the copper dissolve autoclave. This comprises a horizontal, stainless steel, three-compartment acid autoclave that leaches Cu, Se and Te at 60psig to 75psig (5.2Bar to 6.2Bar) oxygen overpressure and a temperature of 240°F (115°C) for a period of 90 minutes in the presence of sulphuric acid. The autoclave discharge is pumped to a thickener, and the overflow solution reports to the Se and Te removal circuit. This previously used an SO2 injection to precipitate the Se/Te, but the availability of this material in the USA has become progressively more problematic. As such, an alternative mechanism has been developed. The thickener overflow solution is passed through a bed of copper granules, which causes the cementation of Se/Te and the substitution in solution of Cu-sulphate (CuSO4(H2O)x). The remaining Cu-rich solution, which has been supplemented with the Cu from the cementation reaction, is pumped to the Cu electrowinning facility. The Se/Te product is either sold as an animal feedstock or combined with the final filter cake product and sent for further refining to recover Rh. The copper electrowinning facility comprises a multiple-pass electrowinning circuit, where Cu is plated onto stainless steel cathode formers. Fume extraction and floating beads prevent the formation of acid fume from the electrowinning process. All off gases generated by the BMR processes are collected and scrubbed in a water scrubber before venting to atmosphere. The underflow solids slurry from the copper dissolve circuit thickener is pumped to the polishing leach autoclaves. These remove any final soluble contaminants from the final BMR product. Additional sulphuric acid is added, together with oxygen and steam. The leach operates at 100psig (7.9Bar) oxygen overpressure, and a temperature of 300°F (150°C) for a further 90 minutes. The autoclave discharge slurry is pumped to a filter press in a secured area, and the filter cake residue containing 50% to 60% Pd + Pt is dried for final dispatch. The filtration, drying and packaging area is access restricted and separated from the rest of the BMR by a brick wall with an airlock entry system, and is protected internally by motion sensors and alarm systems. The final product (filtercake) is despatched to Johnson Matthey for further separation and refining. The simplified process flow block diagram for the BMR processes is presented in Figure 85. The recent history and budget operational parameters for the BMR have been reviewed by The Mineral Corporation and the key variables reviewed are presented in Figure 86 and Figure 87. The 2014, 2015 and 2016 data presented reflects the actual annual performance whilst the 2017 to 2028 data is current budget targets. It can be seen that the current operational methods and capacities are adequate until the planned expansions occur. Metallurgical efficiencies projected have also been sustainably obtained historically and are thus reasonable budget targets.

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Figure 85: A simplified block flow diagram of the BMR

Figure 86: BMR operational data

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Figure 87: BMR operational data

The increases in BMR operational duty planned as part of the Blitz expansion are clearly visible, whilst the other key variables reviewed such as BMR overall Pd + Pt recovery remain at levels, which have been previously achieved. The 2016 production from the refinery comprised 1 141 087oz (35 492kg) of Pd + Pt, of which 593 573oz (18 462kg) originated from recycle material. The current capacity constraints being investigated in terms of the Blitz expansion are summarised as follows: At a matte capacity of 1 100lb (499kg) per hour, the expected increases in matte volumes resulting from

the Blitz expansion can be accommodated by increasing the BMR operating hours. This will require additional staffing, but no additional capital. The indications are that an increase to a 96-operating hour week in 2019 and a 120-hour week in 2021 will provide sufficient matte capacity for the expansion;

The projected nickel processing capacity will be similarly addressed by increasing the operating hours as discussed above;

The current BMR copper production capacity is constrained at 650 tons (590t) per year and as discussed previously is operating continuously. This capacity constraint is due to the relatively low current efficiencies at which the electrowinning circuit operates due to the nickel content in the feed solution. At the current production levels of approximately 550 tons (498t) per year, capacity is available. The projected Blitz expansion indicates that copper capacity will be exceeded in 2020 and, as such, a capital provision of $5.5 million has been included in the budget for 2018/2019 for expansion, which doubles the copper capacity. Sufficient footprint is available for this expansion.

7.10.3.7 Prill Splits Stillwater measures and reports metal prill splits as a ratio of palladium to platinum in the various intermediate products from the individual operations. The ratios based on data for the 2016 Financial Year and for the 2017 Financial Year to June 2017 have been reviewed by The Mineral Corporation. The Pd and Pt prill split percentages, based on the Pd:Pt ratio in concentrate, are presented in Table 48. Table 48: Summary of 2E prill split data

Mine Pd:Pt Ratio Prill Split

FY2016 FY2017 (to Jun) %Pt %Pd

Stillwater Concentrate 3.11 3.14 24.3% 75.7%

East Boulder Concentrate 3.49 3.51 22.3% 77.7%

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7.10.4 Metallurgical Testwork SRC5.3(iv)

The Stillwater and East Boulder concentrator plants and the Columbus Metallurgical Complex have all been operational for several years, and have been upgraded and modified over the years to take account of new technology and increased capacity. Detailed flow sheets, mass balances and metallurgical accounting schedules are available for all the operations. Metallurgical testwork and recovery factors are not applicable to any of these operations as detailed historical information is available. Process flow diagrams have been presented previously for all processing sections. A simple mass and metal balance, such as would be expected in a greenfield plant design, is not available for the various operations. However, the detailed metallurgical accounting spreadsheet, which is produced monthly and finalised annually, presents all of the mass and metal balance information required for all sections, as would be expected of operational facilities.

7.10.5 Deleterious Elements SRC5.3(v); SRC4.5(ii);SRC4.2(vi);SRC5.6(vii)

As discussed previously, the J-M Reef being exploited and processed at both the Stillwater and East Boulder Mines is well-understood and has been successfully processed for several years. From the start of the mining and processing operations to date, there have been no reports of deleterious elements in the concentrate produced. As such, no allowances or assumptions pertaining to deleterious elements are applied. Neither bulk nor pilot scale testing is necessary as the processing facilities have all been operational for several years.

7.10.6 Processing Technology SRC5.3(vi)

All metallurgical processes in place at Stillwater’s ore processing, smelting and refining facilities are appropriate and well-proven, and have operated successfully for several years.

7.10.7 Processing Logistics SRC5.4(iii)

Concentrate from both the Stillwater and East Boulder Concentrators, averaging 10% moisture, is trucked in 10-ton (9t) custom containers to the smelter. Travel for the concentrate truck from East Boulder Mine to the smelter by road is approximately two to three hours. The time for the concentrate truck from Stillwater Mine to

the smelter is approximately one and half hours. Following tube sampling for moisture and initial assays, the material is introduced into a fluidised bed, natural gas dryer that reduces moisture to less than 1%. The dried concentrate is conveyed to a feed storage bin and sampled in duplicate. The smelter has capacity to store concentrate and to allow a small feed inventory to build up while the plant is down on planned maintenance; typically four to six weeks per annum. At present, the facility can provide storage for only five or six days, but there are plans to increase this capacity. Recycled automotive catalysts and other PGM-bearing materials, averaging 70opt (0.2%) Pd + Pt, constitute a separate source of smelter feed. This is delivered to the smelter by clients in 3ft (1m) cube bags. This material is pulverised, sorted and sampled in the same manner prior to smelting to ensure client custom metal is accounted separately.

All slag from the smelter is sampled to quantify residual precious metals and is returned to the Stillwater Concentrator in the same custom containers for re-milling to ensure residual metals are returned to the value stream. This is also accounted for in terms of the Stillwater Concentrator recovery performance measurement. The smelter produces converter matte containing 350opt to 700opt (1.2% to 2.4%) Pd + Pt, 28% to 30% Cu, 40% to 42% Ni, 20% to 22% S and 2% Fe, with the balance comprising Co, Au, Ag, Rh, Te and Se. It also produces gypsum from the S capture system (approximately 10 000 ton or 9 100t per annum), which is disposed of by selling to regional cement producers (at a discount), selling as an agricultural soil modifier, disposing on the Stillwater Waste Dump or disposing on the Billings Landfill Site. Both of the latter disposals have a cost associated to the disposal, but sale to the cement producers or for agricultural purposes limits the associated costs.

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The BMR produces:

Dried filter cake containing 50% to 60% Pd + Pt is sold in 5G (20l) drums on pallets to traders. This is

dispatched by courier from the facility; and Copper cathodes are sold to traders on a Free on Truck (FOT) basis. This is not London Metal Exchange

(LME) grade copper, but revenue is only marginally less than A-grade copper.

7.10.8 Plant Surface Infrastructure SRC5.4(ii);SRC5.6(viii)

The processing plant infrastructure at Stillwater and East Boulder Mines were built in 1987 and 1999, respectively. Infrastructure at both processing plants has been capitalised well and recapitalised as required to ensure confident performance for the required capacities. The power supplies to the plants are described in Section 7.8.10.4 and 7.9.2.5. As the Stillwater Concentrator plant will be upgraded to accommodate the increased capacity resulting from the Blitz expansion, the power supply has been upgraded accordingly and will be commissioned in time for the expansion requirement. The planned maintenance of the Stillwater and East Boulder Concentrators follows the JD Edwards Maintenances Control system. Both plants are in a good state of repair. The tailings dams for each of the concentrators are at the mature stage. The Stillwater operation has moved the production deposition from the original Nye TSF to the Hertzler TSF. The Hertzler TSF is permitted to Stage 3 to a height of 5 036ft (1 535m), after which additional permitting will be required following a revised design. The current plan is to increase the capacity of the TSF through an elevation lift to accommodate the increased production rate arising following additional material from the Blitz section. Approximately $22 million is planned to be spent over the period from 2028 to 2032. The TSF at East Boulder Mine is located immediately adjacent to the processing plant and is permitted to a height of 6 325ft (1 928m). TSFs at both mines are adequate for current production and the planned Blitz expansion, but will require further design and permitting to satisfy the LoMs of each mining operation. The TSFs are inspected by independent consultants on an annual basis, with Knight-Piésold being the current

specialist consultants. The BMR and smelter are based at Columbus on freehold owned by Stillwater. The building and stack heights are limited due to the proximity of the light aircraft field. The facilities are secured by fencing and access is limited to card holding employees. Power supply to these facilities is from NWE at the standard 100kV at the main switch station and two-step down transformers. Stillwater keeps a spare transformer onsite and, therefore, power supply is reliable. Stillwater has well established automated sampling and sample processing facilities with a robotic operated sample laboratory. Office facilities are adequate for the required staff to operate the BMR and smelter.

7.11 Stillwater Human Resources and Safety SRC5.1(i);SRC5.2(viii); JSE12.9(h)(vii)

7.11.1 Overview The Human Resources Department at Stillwater includes offices at both the Stillwater and East Boulder mine sites and the corporate location in Columbus. The Human Resource Departments at these sites are responsible for all human resources management related aspects for the Stillwater operations. These responsibilities include, inter alia, talent management, succession planning, organisational development, policy creation and maintenance, remuneration benchmarking, insurance and benefits administration and legal compliance. Stillwater maintains compliance with all the various State and Federal laws and regulations applicable to human resources management which govern: Collective Bargaining; Talent Management; Equal Opportunity Employment and Human Rights; Insurance and Health and Welfare Benefits; Retirement Benefits; and Remuneration.

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Stillwater has comprehensive safety and induction training systems to ensure all new and returning staff have

proper training prior to commencement of job responsibilities. Through solid safety leadership, both mines have instituted systems to increase safety awareness in the workplace through active employee engagement. Stillwater is committed to provide a working environment that is conducive to personal health, mental alertness and safety awareness in accordance with the Guide, Educate and Train (GET) Safe Safety and Health Management System, which is a comprehensive framework incorporating standard industry best practice in compliance with legislative requirements. Safety performance reporting is a key requirement by the Mines Safety and Health Administration (MSHA). This reporting is administered by the Safety Department.

7.11.2 Mining Operation Safety Performance Mine safety is continuing to improve for the overall Stillwater operations, as can be seen in the combined incident accident rate per 200 000 hours (Table 49). Stillwater’s data comprises a significant percentage of the USA industry underground metal mines’ data. There were no fatalities reported between 2012 and 2016. East Boulder Mine data shows a gradual drop in total incidence rates between 2012 and 2014, but the number of events has since started to increase to the 2016 Incident Rate (IR) of 2.05. Stillwater Mine data shows a gradual decrease since 2014 to the 2016 IR of 1.81, which is its best annual performance to date. This is a reversal of the trend between 2012 and 2014. Table 49: Safety performance

Mine Accident Incident Rate (All Non-Fatal Days Lost)

2012 2013 2014 2015 2016

Stillwater Mine 2.66 2.71 3.49 2.42 1.81

East Boulder Mine 2.56 1.53 1.00 1.76 2.05

USA Underground Metal Mines 2.52 2.16 1.84 1.69 1.76

Both mines have instituted systems to increase safety awareness in the workplace through active employee engagement by auditing the general safety and housekeeping practices of workers at their work locations. The outcome has created a measurable decrease in the Incidence Rate at both mines. The results of the audits have a financial component that can favourably or unfavourably impact the remuneration of the workers. The potential monetary impact to a worker’s pay cheque has created incentives for the miners to work safely and keep up good housekeeping practices. The mines cite the use of jackleg related injuries as a significant portion of injuries and are investigating various methods to replace jacklegs with other support alternatives in the narrow stopes.

7.11.3 Mines Safety and Health Administration Citations Despite continuing improvement in safety records, the problems of MSHA citations have become more frequent for the USA mining industry as a whole. Several serious coal mine disasters have brought criticism to the mining industry and, more specifically, to the MSHA Inspectors. MSHA, as a result, has greatly accelerated issuing of MSHA citations throughout the country. Since 2012, Stillwater has instituted ongoing safety initiatives with the workers to reduce injury rates and lower MSHA citations as reflected in the statistics in Figure 88 (MSHA, 2017). Figure 88 illustrates how MSHA-assessed penalties have shown a general declining trend from 2011 through 2016, in recognition of the continuous improvement shown in Table 49. Stillwater’s management has communicated its commitment to continue implementing additional systems to reduce accident incident rates further. Stillwater is working hard to continually educate its mine workers at every level of supervision and its union management to meet the challenge of these inspections while adhering to the safety systems and operating safe mines.

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Figure 88: MSHA assessed penalties for Stillwater mining operations (MSHA, 2017)

Since 2011, the mines have continued to initiate safety systems with support from the workers. The result has shown a decrease in MSHA penalties and assessments. The disparity in fines between the mines appears to be influenced by East Boulder Mine being a much younger mine and by Stillwater Mine having a much larger workforce (penalties are proportional to the size of the workforce). Both mines are concentrating on reducing the use of jacklegs and it is expected that new, safer and more ergonomic equipment to replace the jacklegs will be introduced during 2017. Disclosure of specific data regarding health and safety violations, orders and citations, related assessments and legal actions, and mining-related fatalities from 1 January 2016 is required pursuant to Section 1503 of the Dodd-Frank Act.

7.11.4 Diesel Particulate Matter Compliance Over the past twenty years, there has been an increasing concern about the health effects of exposure to exhaust emissions from diesel engines. In 1986, the US National Institute of Occupational Safety and Health (NIOSH) was unable to establish a causal link between exposure to diesel exhaust and cancer, but concluded that such a relationship was plausible. In 1988, NIOSH recommended that diesel exhaust be regarded as a potential occupational carcinogen in conformance with the US Occupational Safety and Health Administration (OSHA) Cancer Policy (29 CFR 1990) (NIOSH, 1988). The policy bulletin advised that minimising exposure should reduce the risk and recommended that employers assess the conditions under which workers may be exposed to diesel exhaust and reduce exposures to the lowest feasible concentrations. MSHA determines a miner’s exposure to Diesel Particulate Matter (DPM) based on the total carbon (TC) content of a single personal sample taken over a miner’s full shift. Exposure can be reduced by improved engine performance, installation of DPM filters, improved underground ventilation and installing driver air-conditioned cabs on underground equipment where appropriate.

The Stillwater Industrial Health Group has led the way in the USA research and development to bring the diesel operations into MSHA DPM compliance. The operations are in compliance with the 160µg of total carbon standard. This does not imply that there may not be an occasional problem in the future with an equipment failure or human error that may result in a violation. Currently, both mines are using bio-fuels with good success and continue to experiment with available mixtures. So far, Stillwater has received no DPM citations since the Dibutyl Phthalate (DPB) Standard was promulgated in 2008. Stillwater’s in-house DPM sampling and testing results far exceed anything that MSHA requires.

7.11.5 Labour Complement Stillwater Human Resources Department provided a breakdown of the current labour complements for the Stillwater and East Boulder operations, as well as the Columbus Metallurgical Complex, Stillwater Trading Inc. (Stillwater Trading) and corporate offices. Stillwater has a total manpower complement of 1 449 and a breakdown of the manpower figures for Stillwater is shown in Table 50.

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Table 50: Stillwater manpower figures

Division Stillwater

Mine

East Boulder

Mine

Columbus Corporate and Metallurgical

Complex

Stillwater Trading

Denver Corporate

Total Stillwater

Corporate Management 1 2 3

Accounting/Finance 1 1 17 19

Administration/Housing 2 1 3

Concentrator/BMR 39 28 35 102

Smelter 79 79

Pd Recycling 15 15

Laboratory 41 41

Engineering/Planning/Survey 22 11 5 38

Environmental/Governmental 4 5 2 11

Geology 27 16 43

Human Resources 4 2 6 12

Information Systems 1 1 2

Maintenance 132 64 2 198

Mine Production 424 242 666

Blitz Project 100 0 2 102

Purchasing 2 4 6

Safety 9 4 4 17

Sand Plant/Paste Lead 18 10 28

Shaft/Hoist/Crusher 16 16

Investor/Public Relations 0

Marketing 2 2

Information Systems 5 5

Surface Crew 16 9 25

Warehouse 7 8 1 16

Total 822 403 219 2 3 1 449

Stillwater Mine (mining and ore processing operations) has a total manpower complement of 822. However, the labour LoM Plan for Stillwater Mine shows an average manpower requirement of 1 120. The primary reason for the increase in manpower is for the development and increased production rates following the ramping up of ore production from the Blitz section. East Boulder Mine (mining and ore processing operations) has a total manpower complement of 403 while the metallurgical complex and corporate office in Columbus are manned by 219 employees. Given the levels of mechanisation at the mines and automation at the plants, The Mineral Corporation considers the staffing levels and competence to be adequate for the operations.

Through discussion with Stillwater personnel and observation, the mining operations appear to be sufficiently resourced in terms of labour and management structures to support current and planned levels of production.

7.11.6 Management Structure The management structure for Stillwater is configured to cater to the leadership and management requirements for the two production units (the Stillwater and East Boulder Mines), Columbus Metallurgical Complex as well as the Columbus Support Groups. Following the Transaction, the management structure for Stillwater has been reconfigured such that the Executive Vice President: US Region leads Stillwater. Direct reports to the Executive Vice President are the Chief Operating Officer, Vice President of Human Resources & Safety and Chief Financial Officer. Reporting to the Chief Operating Officer are Vice Presidents for Montana mining operations (Stillwater and East Boulder Mines), analytical laboratory and refinery and smelter operations. Various Managers and Superintendents report to the Vice Presidents. The Chief Financial Officer and Vice President of Human Resources & Safety oversee Executive Management functions and related support functions including Financial Accounting, Corporate Planning, Marketing, Human Resources, Safety, Public Affairs and Environmental.

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The management structures for the Stillwater mining, ore processing and beneficiation operations reviewed

indicate that all staff members have appropriate qualifications for the positions that they occupy. The Stillwater employees that The Mineral Corporation interacted with during the site visist and the preparation of the Mineral Resource and Mineral Reserve estimates demonstrated competence in their areas of responsibility.

7.11.7 Manpower Remuneration and Retention Stillwater’s remuneration strategy is aimed at maintaining a compensation programme that attracts and retains qualified employees at all levels of responsibility, who perform in a manner that permits Stillwater to achieve its objectives and goals. Remuneration is structured to reflect the relative value of jobs to be externally competitive and internally consistent to provide the flexibility to reward employees based on individual performance and contribution to the achievement of Stillwater’s goals, to foster good employee understanding and comply with all State and Federal laws and regulations. Stillwater has adopted the approach to position overall target pay generally at the 50th percentile of competitive levels, with individual variation that reflects incumbent experience and responsibilities in the role. Annual benchmarking is conducted for all non-executive salaried positions using Mercer and Hay mining company surveys as appropriate. Stillwater’s philosophy and practice on executive remuneration is to benchmark with retained external executive compensation consultants and the annual Equilar executive survey data, to which the tenets are applied on an individual contributor basis. For the manager and above positions, benchmarking includes fixed and variable pay and adjustments are made as appropriate. There is also a short and long-term incentive plan for manager and above positions. Salary equity pay adjustments to non-probationary employees, apart from any merit adjustments, are performed to provide a mechanism for addressing “material” salary inequities arising from external pressure in high demand fields, internal salary compression and/or retention considerations. Stillwater has a target staff attrition rate of 8% per annum and has achieved an attrition rate of 5.6% between 2016 and 2017. The Columbus Metallurgical Complex and the Columbus Corporate office have the highest average attrition (6.4%), followed by East Boulder Mine (5.8%) and Stillwater Mine (5.3%). Despite the global downturn in minerals commodity prices and production curtailments by miners preventing high labour mobility, it appears that Stillwater remuneration and retention policies are working.

7.11.8 Collective Bargaining After a 780-working hour probationary period, hourly employees at Stillwater are represented by the United Steelworkers International Union, Local 11-0001, under collective bargaining agreements (CBA). The Local 11-0001 is split into two units; one that represents the East Boulder Mine and the other that represents the Stillwater Mine and Columbus Metallurgical Complex. Both units are currently operating under four-year collective bargaining agreements; the current Stillwater/Columbus CBA is in place from 2 June 2015 to 1 June 2019 and the East Boulder CBA from 1 January 2016 to 1 January 2020. The relationship between management and the United Steelworkers is generally cooperative, typically with less than 30 grievances filed per year. There have been no work stoppages since 2007.

7.11.9 Employee Housing and Transport Stillwater does not provide housing for employees as there is ample housing available in the surrounding communities. Stillwater is required to provide transportation to Stillwater and East Boulder Mines as part of the environmental focused Good Neighbour Agreement. It is mandatory that employees use company transportation to East Boulder Mine. At Stillwater Mine, employees are provided company-owned transportation, but also may travel to the mine site in personal vehicles under terms specified in the Good Neighbour Agreement. Employees working at the Columbus Metallurgical Complex and corporate offices travel to work in private transportation.

7.12 Environmental Studies SRC5.2(ix);SRC5.5(i); SRC5.5(ii); ESG4.2.2;ESG4.9.1;ESG4.9.2; JSE12.9(h)(vii); JSE12.9(h)(viii);ESG4.4.1

7.12.1 Environmental Modifying Factors SRC5.2(ii);SRC5.5(i); ESG4.4.2; ESG4.9.1;ESG4.9.2

The protection of the groundwater and surface water resources is the primary environmental sensitivity. There has been a non-material environmental non-compliance at the Stillwater facilities pertaining to these resources, and non-compliance is discussed below. The J-M Reef has very low acid-generating potential and low metals solubility, which has minimised potential environmental impacts from the substantial scale of these operations. Restoration of groundwater nitrate impacts from ANFO residuals leaching out of waste rock will continue to be the single largest environmental challenge. Lining and covering of Waste Rock Storage Facilities (WRSFs) and collection of infiltration seepage from WRSFs, in conjunction with the in situ injection of methanol to de-nitrify

impacted groundwater, is anticipated to restore groundwater quality to protective standards and provide a

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reasonable assurance of long-term groundwater and surface water compliance and protection. In addition to

routine internal inspections of its facilities, Stillwater performs third-party audits of its system and facilities for operational integrity, compliance and sound practice. East Boulder Mine also conducts periodic audits under the GNA while both Stillwater and East Boulder Mines perform third-party audits of their respective TSFs. East Boulder Mine’s 2015 GNA audit (ZES, 2015) identified only minor improper handling of some hazardous materials (e.g. aerosol cans, use of lids on containment drums) and inconsistent or incorrect hazard labelling on fuel tanks. There were no material findings regarding compliance with Federal and State Environmental Laws and Regulations, internal environmental management policies and procedures or terms, conditions, and performance objectives of the GNA. Annual inspections of the TSF for each mine are also performed. East Boulder Mine’s TSF 2016 annual inspection report (Knight-Piésold, 2017a) identified no conditions or operating practices that would indicate the potential for an imminent threat to human health or the environment and identified three recommendations for improvement, which have been implemented. Similarly, the Hertzler and Nye Tailings Impoundments 2016 Annual Inspection (Knight-Piésold, 2017b) had no critical findings of non-compliance and few recommendations for completion of construction or instrumentation, all of which have been implemented. There are no material environmental issues identified by The Mineral Corporation that would prevent the achievement of the LoM Plans underpinning the current Mineral Reserve estimates.

7.12.2 Material Environmental Factors SRC5.5(iii)

7.12.2.1 East Boulder Mine Area Groundwater and Surface Water Protection of the East Boulder River is the primary environmental challenge. NO3 impacts to alluvial groundwater adjacent to the East Boulder River and surface water impacts in the river have been identified at East Boulder Mine. These impacts are being addressed as per an Administrative Order on Consent (AOC) as follows: Isolation of NO3-impacted waste rock with high density polyethylene (HDPE) cover/liner placed

over/under waste rock placed as embankment material for the TSF;

Collection of impacted TSF embankment groundwater and surface water; Collection and treatment of impacted waters from mine adit water; In situ bio-reduction of impacted groundwater via methanol injection.

Long-term groundwater and surface water restoration and protection from operational impacts are considered well managed and likely to be achieved.

7.12.2.2 East Boulder Mine TSF The permitted TSF Stage 5 raise allows for current production through mid-2027. A Stage 6 raise conceptual design by Knight-Piésold is in progress, but has not been finalised or submitted to agencies for permitting. The projected operational life of the TSF Stage 6 raise is to approximately 2035 to 2036 although, based on independent calculations by The Mineral Corporation (Section 7.10.3.4), this operational life may be shorter. The Lewis Gulch TSF (Figure 89) is in the conceptual planning phase and would have sufficient capacity for approximately 30 years. The land is controlled by CGNF but within the current Mine Permit (#00149) boundary.

Baseline environmental studies for Lewis Gulch TSF were completed in 2015. Assuming three to four years for TSF Stage 6 permitting and one and half to two years for Stage 6 construction, the TSF Stage 6 raise design should commence by 2021. Based on review of existing documents, this effort is on-track for timely application submittal. There is a potential risk that an increase in mine production will make permitting the TSF Stage 6 raise a critical path permitting issue. A further long-term potential risk to continued production is that land positions for additional expansion areas downstream in East Boulder Creek are not secured and poses a potential future low risk for development past approximately 2060. These risks are relatively low level and can be effectively mitigated through continued good land owner relations and execution of a long-term land acquisition strategy.

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It should be noted that the tailings reclamation cover is not a zero water-balance design. Therefore, long-term

seepage from underdrain is anticipated. The current TSF reclamation water management strategy is for direct underdrain discharge to surface and then to the East Boulder River following closure. Water quality data from the TSF pond indicate metals and nitrate concentrations above MDEQ Circular WQB-7 (now designated DEQ-7) Human Health Standards (HHS) and non-degradation regulatory limit of 7.5mg/l. However, dissolved metals concentrations in water from TSF subdrain are generally below DEQ-7 HHS. This is attributed to chemically reducing conditions within the TSF, lowering metals and nitrate concentrations. There is a potential risk that either the long-term subdrain water quality may not remain as low as currently observed or that changing regulatory requirements may result in underdrain seepage being non-compliant, requiring additional intermediate to long-term treatment or corrective action. The potential risk that significant changes to TSF chemistry and reducing conditions would occur appears to be low, based on observed current TSF geochemical conditions, but may come into question by regulatory agencies in the future. This potential risk may be mitigated by additional mineralogical and geochemical studies and modelling of the TSF evolution to support the conclusion that geochemical conditions will remain as anticipated over the long term.

Figure 89: Conceptual plan for the Lewis Gulch TSF

Given the regulatory trend over the past 20 years of decreasing regulatory compliance concentrations for discharges to the environment, the risk of discharge concentrations becoming non-compliant in the future is real. Although the probabilities of change in standards are uncertain, the consequences of such changes may be significant. Mitigations for lowered metal and nitrogen species standards for TSF underdrain effluent, mine adit effluent or WRSF drainage may include the following: Passing mine effluent discharges through engineered wetlands prior to being received by waters of the

state, which could lower constituent concentrations further by additional chemical and biological reduction; or

Addition of reductants or organic compounds to stimulate biological reduction in TSF or infiltration basins, until such sufficiently reduced conditions are established to maintain acceptable discharge water quality.

7.12.2.3 East Boulder Mine Waste Rock Storage Facility Surface disposal of waste rock is currently placed as embankment material for the WRSF. With completion of the TSF Stage 6 raise, a new WRSF is required (approximately 2027). The Dry Fork WRSF is currently planned for an area on the northeast side of the East Boulder River and would have a storage capacity at current production rates to approximately 2060 (Figure 90). The studies for the Dry Fork WRSF are complete, the conceptual design is complete and 75% of final engineering is complete. Submittal for the Dry Fork WRST is currently planned for mid to late 2018, with the Lewis Gulch TSF following approval of Stage 6 Raise.

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Based on the review of existing documents and assuming five years for permitting, and one year for initial site

preparation, access road construction and clearing, this effort is on-track for timely application approval. A potential risk over the long term (e.g. post-2060) is land position for waste rock disposal. The land directly downstream for Lewis Gulch is privately held and not currently available for future use. Efforts should continue to secure additional lands down stream of Lewis Gulch to mitigate this long-term low risk.

Figure 90: Conceptual plan for the Dry Fork Waste Rock Storage Facility

7.12.2.4 Stillwater Mine and Hertzler Facilities Groundwater and Surface Water Protection of Stillwater River is the primary environmental challenge. NO3 impacts to alluvial groundwater adjacent to the Stillwater River and surface water impacts in the river have been identified at Stillwater Mine. These impacts are being addressed by the same actions as being performed at the East Boulder Mine. However, at Stillwater Mine, these efforts have been undertaken proactively by Stillwater without an AOC. This regulatory path possesses a potential risk (reputational risk) in that, although Stillwater’s efforts are exemplary and may be construed to reflect implicit regulatory approval of the corrective actions, there is lack of formal regulatory administrative record acknowledging the groundwater and surface water impacts, corrective actions, and typical enforcement regulatory mandate (e.g. AOC). Both Stillwater and the MDEQ are open to public criticism for regulatory process failure and preferential treatment. Long-term groundwater and surface water restoration and protection from operational impacts are considered well managed and likely to be achieved.

7.12.2.5 Stillwater Mine TSF and Hertzler TSF The Nye TSF has an old 100-mil Hypalon liner with many known tears. Repairs and patches have been documented by Stillwater over the Nye TSF operational life. It is noted that not all repairs and patches have been water tight, but these appear to have reduced seepage to a point where groundwater quality immediately down gradient of the TSF is compliant with applicable standards.

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The Nye TSF has no underdrain and will maintain a perpetual maximum hydrostatic head on the liner in

perpetuity. A spillway for surface discharge from the reclamation cover runoff and infiltration is proposed as a remedy. For this reason, there is a low likelihood for long-term surface water exceedances from tailings cover spillway/discharges. However, there is a long-term potential risk of increase liner leakage if the liner degrades over time or becomes over-loaded from potential future waste rock deposition on its surface. Limits from additional loading by potential future waste rock placement on the reclaimed TSF should be rigorously assessed prior to implementation to minimise this moderate risk. The Hertzler TSF is lined with a 60mm HDPE on a Geosynthetic Clay Liner (GCL) in Stages 1 and 2, with a 100 mil HDPE liner on a GCL in Stage 3. Stage 3 is the maximum permitted raise for the Hertzler TSF and, at current production rates, has capacity through late 2031. However, as noted in Section 7.10.3.2, additional tailings production associated with development of the Blitz section will shorten the operational life of the Hertzler TSF to between 2027 and 2028. Expansion of the TSF would require a major permit amendment and an EIS by the agencies. Assuming the Blitz expansion comes on line as planned, five years for permitting the new TSF and two years for construction, it is recommended that design and permitting efforts begin promptly. The Herztler Ranch area comprises a large land position and allows for land application disposal (LAD) for water management and treatment as well as for TSF expansion. Northern expansion of the Hertzler TSF would reduce existing LAD areas, but Stillwater owns additional lands that could be used for LAD. This review did not identify any critical land/areas impacts through the 2060-time frame. Expansion of Hertzler TSF to the north would require removal of existing water storage pond and construction of new water storage pond.

7.12.2.6 Stillwater Mine Eastside Waste Rock Storage Facility The existing Eastside WRSF at Stillwater Mine has a projected operational life through 2033 to 2034. The existing waste rock is being covered with a liner composed of 80 mil HDPE, geogrid drainage layer, and a non-woven geotextile to isolate existing waste rock from meteoric rain infiltration solubilising ANFO residuals (e.g. ammonium and nitrate), and to collect infiltrating rainfall from subsequent overlying waste rock disposal stages. Stage I and Stage II WRSF liners are currently being placed. This effort is scheduled to be completed by 2018, which will isolate 60% of existing waste rock from further infiltration/seepage and source of NO3 to groundwater and surface water. The post-2033 WRSF is conceptually planned for west hill slope above Nye TSF and portions of Nye TSF surface, and ultimately portions of Stratton Ranch.

7.12.3 Other Environmental Factors SRC5.5(iii)

Geochemical studies and operational environmental monitoring data demonstrate that the waste rock mined throughout the history of production at Stillwater and East Boulder Mines has negligible potential to generate acid or acid mine drainage. Concurrent leach testing of over 40 parameters including 29 trace metals from tailings and waste rock indicates that dissolved trace metals concentrations will not exceed current groundwater protection standards. Decades of operational environmental monitoring data are consistent with this testing. However, ammonia (NH3), ammonium (NH4

+), and nitrate (NO3-) are soluble residual constituents

from the ANFO (ammonium nitrate/fuel oil) used in mining and have been observed to be present in mine adit waters as well as in leachate from waste rock and tailings. These are the primary groundwater and surface water contaminants at the Stillwater mining operations. The East Boulder River and Stillwater River in the midst of the mines are the principal resources that may be adversely affected by mining operations. Historical and cultural resources are also known to exist within the current and planned mine disturbance areas. The river waters are of very high quality and, although they have measurable loading of nitrate and dissolved solids from mining operations, no evidence was identified that aquatic or terrestrial wildlife populations have been adversely impacted. The East Boulder River and the Stillwater River are both considered "substantial fishery resources” and host brown trout, rainbow trout, brook trout and mountain whitefish (MDEQ and USFS, 1985). Both rivers have good insect and periphyton diversities and densities. The 1985 EIS (MDEQ and USFS, 1985) for Stillwater Mine identified thirteen vegetation types in the study area, along with water and disturbed areas with no vegetation. These vegetation types include stony grassland, Sagebrush and Skunkbush shrubland, drainage bottomland, riparian woodland, ravine aspen-chokecherry, open forest-meadow understory, open forest-rocky understory, Douglas-fir forest, Lodgepole pine forest, subalpine forest and cultivated hayland. Timber resources in the mine areas are described generally as being of low commercial value “…due to poor quality timber and the rugged terrain's limits on harvest operations.” (MDEQ and USFS, 1985).

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Wildlife studies indicate that the mine areas support diverse and abundant wildlife populations including bird,

mammal, reptile, amphibian and aquatic species. The mine areas provide winter ranges for elk, mule deer and bighorn sheep. In addition, the mine area habitats also host moose, black bear, mountain goats and mountain lions. Wildlife habitat types correspond closely to vegetation types previously described. Both the Bald Eagle and the American Peregrine Falcon, which were identified as listed species in the 1985 Stillwater Mine EIS, have been de-listed due to the recovery of their populations.

7.12.4 Environmental Studies SRC5.5(iii); SRC5.5(iv)

Table 51 summarises the major existing environmental studies identified for this assessment. These studies span from 1985 to 2016 and address a wide range of environmental and technical issues. Table 51: Summary of existing environmental studies Site Title Date Author

East Boulder Mine East Boulder 2014 Environmental Audit of Tailings Impoundment Construction and Facility 8/5/2014 Kuipers &Associates, LLC

East Boulder Mine East Boulder Mine GNA Audit Report – Surface Facilities, June 30, 2015 11/30/2015 Zuzulock Environmental Services LLC

East Boulder Mine Tailings Storage Facility - 2015 Annual Review 4/13/2016 Knight-Piésold Consulting

East Boulder Mine 2015 Annual Water Resources Report - SMC East Boulder Mine 3/30/2016 Hydrometrics, Inc.

East Boulder Mine A Class III Cultural Resource Inventory of Stillwater Mining Company's East Boulder Amendment Area, Sweet Grass County, Montana

8/23/2016 GCM Services, Inc.

East Boulder Mine East Boulder Mine - Future Tailings Storage Concepts 12/1/2015 Knight-Piésold Consulting

East Boulder Mine Stillwater Mining Company Dam Safety Reviews 10/5/2015 Norwest Corporation

East Boulder Mine Tailings Storage Facility - 2016 Annual Inspection 1/12/2017 Knight-Piésold Consulting

East Boulder Mine Baseline Environmental Survey at the East Boulder Mine 3/2016 KC Harvey Environmental, LLC

East Boulder Mine Lower Lewis Gulch And Dry Fork Sites Wetland Survey 1/2016 Hydrometrics, Inc.

East Boulder Mine Lewis Gulch and Dry Fork Preliminary Baseline Hydrogeologic Monitoring Report 11/2015 Hydrometrics, Inc.

East Boulder Mine Final Environmental Impact Statement – Revised Water Management Plans and Boe Ranch LAD

5/2012 MDEQ & USFS

Stillwater Mine Annual Water Resources Monitoring Report – 2015 Stillwater Mine 11/14/2016 Hydrometrics, Inc.

Stillwater Mine Final Environmental Statement Stillwater Mine Revised Waste Management Plan and Hertzler Tailings Impoundment

10/1998 MDEQ & USFS

Stillwater Mine Stillwater Mine Hertzler Tailings Impoundment and LAD Audit 9/16/2014 SMC

Stillwater Mine Stillwater Mine GNA Audit Report – Surface Facilities, July 2, 2015 11/30/2015 Zuzulock Environmental Services LLC

Stillwater Mine Stillwater Mine - Future Tailings Storage and LAD Storage Pond Alternatives Assessment 2/14/2015 Knight-Piésold Consulting

Stillwater Mine Hertzler and Nye Tailings Impoundments - 2015 Annual Review 8/18/2016 Knight-Piésold Consulting

Stillwater Mine Stillwater Mining Company Dam Safety Reviews 10/5/2015 Norwest Corporation

Stillwater Mine Hertzler And Nye Tailings Impoundments - 2016 Annual Inspection 1/12/2017 Knight-Piésold Consulting

Stillwater Mine Tailing Impoundment Feasibility Study Report 3/1994 Woodward Clyde Consultants

Stillwater Mine Stillwater Environmental Geochemical Validation 4/2007 SMC

Stillwater Mine Final Environmental Impact Statement Stillwater Project 12/1985 MDEQ & USFS

Stillwater Mine Expanded Checklist Environmental Assessment; Proposed Amendment 12 to Operating Permit No. 00118, Stillwater Mining Company, Montana

7/22/2010 MDEQ

7.12.5 Permits and Permitting Status SRC1.5(v); SRC5.5(ii); SRC5.5(iv); ESG4.3.2

7.12.5.1 Overview Permits, approvals and agreements for operations associated with the Stillwater Mine (including the Hertzler TSF and the Benbow Lease area) and the East Boulder Mine from both State of Montana and Federal agencies are discussed herein. Permits required for current operations at both mines and the smelter are summarised in Appendix 7 through Appendix 9.

Water rights associated with these projects are summarised in Appendix 10. Overall, all necessary permits and approvals are in place, current and adequate for existing operations. Permits and approvals are tracked and renewal dates, schedules, timeframes and requirements for continued compliance are well understood and addressed in a timely manner. Based on this review’s findings, Stillwater has all necessary rights and approvals to operate the mines, smelter and associated ancillary facilities associated with its operations. It is concluded that there are reasonable prospects that the operator’s tenure to operate on these premises is secure for the foreseeable future, unless terminated by regulatory authorities for other reasons. Furthermore, it is this review’s conclusion, based on assessment of the current permits, technical submittals, regulatory requirements and project compliance history that continued acquisition of permit approvals is at low risk for the foreseeable future.

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Mining takes place on Federal Lands managed by the USFS and on private land. Most of the private land is

historical Patented Mining Claims, which are now private. Those private lands that are not currently owned by Stillwater are leased. Federal lands and permission to access the surface for mining purposes is applied for and granted by USFS in conjunction with the NEPA process and technical application to the USFS and MDEQ. Approvals have been granted and are reasonably anticipated to continue to be granted for mining and milling operations for the foreseeable future. The rights to withdraw waters of the State assessed were adequate for current and anticipated future projects.

7.12.5.2 Stillwater Mine, Stratton Ranch and Hertzler Facilities Permits required for current operations at the Stillwater Mine are also summarised in Appendix 7. These permits include the permits from the State of Montana (e.g. Mine Permit, Air Quality Permit, Stormwater Discharge Permits, Exploration Permit and Potable Water Supply Permit) and permits from the Federal Government including the EPA and USFS. Federal Permits from the EPA relate to Class V groundwater injection wells. These Class V injection well permits relate to two different functions. One set of permits addresses the recycling of water back into the mine for re-use (Permit #MT5000-05134), another addresses disposal of septic system waters (Permit #MT5000-06454) while the third set of permits allows the injection of methanol into shallow alluvial groundwater system for in situ biological reduction of nitrates (Permit #MT50000-08681).

Regulatory approvals that will be required for continued operation in the coming years include an amendment to Operating Permit #00118 for expansion of the Hertzler Ranch TSF and modification of the LAD water management System as well as development of a future waste rock management site.

In addition, the Air Permit # 2653-05 will need to be reviewed to see if the change in operating conditions will exceed the existing air emissions assumptions or limits. Application(s) for these actions will trigger the MEPA/NEPA processes and result in the development of an EA or EIS, depending on the actions proposed.

7.12.5.3 East Boulder Mine and Boe Ranch Facilities Permits required for current operations at the East Boulder Mine are summarised in Appendix 8. These include permits from the State of Montana (e.g. Mine Permit, Air Quality Permit, Stormwater Discharge Permits, Exploration Permit and Potable Water Supply Permit) and permits from the Federal government including the EPA and USFS. Federal Permits from the EPA relate to Class V groundwater injection wells. These Class V injection well permits relate to three different functions. One set of permits addresses the recycling of waste

back into the mine for reuse (Permit #MT5000-05150), anther addresses disposal of septic system waters (Permit #MT50000-06439) while the third set of permits addresses injection of methanol into shallow alluvial groundwater system for in situ biological reduction of nitrates (Permit #MT50000-008511).

Approvals that will be required for continued operation in the coming years include an amendment to Operating Permit #00149 for a Stage 6 raise to the existing TSF and/or development of the Lewis Gulch TSF, as well as for the development of the Dry Creek WRSF, which may include a 404 Permit with the ACOE for the waste rock haulage crossing of the East Boulder River.

In addition, Air Permit #2653-05 will need to be reviewed to see if the change in operating conditions will exceed the existing air emissions assumptions or limits. Application(s) for these actions will trigger the MEPA/NEPA processes and result in the development of an EA or EIS, depending on the actions proposed.

7.12.5.4 Smelter Permits required for current operations at the Stillwater Smelter and Columbus Metallurgical Complex are summarised in Appendix 9. The smelter has only a few permits, namely a Montana Air Quality Permit (#2635-17)

from the MDEQ Air Resources Bureau and a MPDES Permit (MTR-000469) with the MDEQ Water Protection Bureau, both of which are current and in good standing.

The Air Quality Permit limits air emissions based on measured opacity, particulate emissions (PM10) from baghouse filters and sulphur dioxide (SO2) emissions based on maximum allowed smelter concentrate throughput (≤37 550 tons per year), precious metals recyclable material throughput (≤11 000 tons per year), gypsum production (≤25 000 tons per rolling 12-month period), smelter slag production (≤60 000 tons per rolling 12-month period), the amount of waste ore for lining the slag pits (≤40 000 tons per rolling 12-month period) and emergency back-up generator run time (≤500 hours per rolling 12-month period).

Emissions testing requirements of the Air Permit include the following:

Particulate and opacity performance source tests every two years on the smelting circuit main stack and the concentrate drying circuit main stack;

Particulate and opacity performance source tests every five years on the process baghouse for the nickel sulphate crystal dryer; and

SO2 performance source testing on the smelting circuit stack every five years.

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In addition, Continuous Emissions Monitoring System (CEMS) to monitor stack volumetric flow rate and record

SO2 emissions is performed as required. Reporting of testing and monitoring results as well as material inventories is provided annually. The MPDES Permit for stormwater contains non-numeric technology-based effluent limits and numeric water quality-based effluent limits. Non-numeric technology-based effluent limits include best management practices for managing materials to minimise contact with site waters, control site materials from egress, maintenance and erosion control practices. Numeric water quality-based effluent limits are established as well as benchmark and outfall monitoring requirements. However, the smelter operates in a zero-discharge mode with all stormwater contained on-site with no routine discharges. Approvals that may be required for the expanded operation in the coming years include an amendment to Air Quality Permit #2635-17 to increase the throughput and possibly the emission limits on stack emissions.

7.12.5.5 Critical Issues A proposed rule by the EPA under Section 108(b) for the Comprehensive Environmental Responsibility, Compensation, and Liability Act (CERCLA) is pending final promulgation for facilities in the hardrock mining industry. It was published in the Federal Register on 11 January 2017. The comment period ended on 11 July 2017. This proposed rule would establish financial responsibility requirements for owners and operators of hardrock mining facilities to demonstrate financial responsibility independently of existing surety amounts. This regulatory effort is designed to prevent the burden of potential mine clean up, where operators fail to meet their obligations or where reclamation commitments are insufficient for long-term environmental protection, from falling to other parties, including the American taxpayer. By adjusting the amount of financial responsibility to account for environmentally safer practices, the EPA expects this proposed rule would provide an incentive for implementation of sound practices at hardrock mining facilities, and thereby decrease the need for future CERCLA actions. These new requirements will require hardrock mine operators to: Calculate a level of financial responsibility for their facility using a formula provided in the rule (and

provide supporting documentation for the calculation);

Obtain a financial responsibility instrument or qualify to self-assure for the amount of the financial responsibility if that option is adopted in the final rule;

Demonstrate to EPA that they have obtained such evidence of financial responsibility; and Update and maintain financial responsibility until EPA releases the owner or operator from the

CERCLA Section 108(b) Regulations. These requirements will run parallel to and independently from State sureties, though some credit for existing surety instruments and good mining practices may reduce the EPA Section 108(b) amounts required. The financial responsibility amounts will be calculated differently than the surety amounts already established with the States and other Federal Agencies (e.g. USFS) and may result in increased surety instrument amounts. This new requirement may require significant additional financial resources set aside as surety. The full impact of this pending new requirement cannot be assessed currently, but promulgation of the new rule should be tracked and contingency environmental reserve amounts considered in a timely manner. Stillwater is fully aware of this rule and its cost implications.

7.12.6 Environmental Compliance Management ESG4.3.1;ESG4.7.1;ESG4.7.2;ESG4.3.2;ESG4.3.3

Environmental compliance is managed by the Stillwater Environmental Department, with appropriately experienced responsible Environmental Managers at each of Stillwater Mine, East Boulder Mine and Columbus Metallurgical Complex all reporting to the overall head of environmental. All Managers have more than ten years site-specific experience in environmental management at the Stillwater mining operations and facilities and were observed to be highly knowledgeable and competent. Communications and planning between Environmental Managers was found to be robust and the working culture conducive to efficient, effective and timely discharge of environmental management responsibilities.

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Environmental monitoring, data analysis and reporting were reviewed and those materials reviewed were found

to be thorough and complete. The Environmental Department relies on third-party contractors for analytical data QA/QC review, verification and validation, although Stillwater maintains a robust Environmental Data Management System database, which allows for effective data, storage, review and analysis. Specific QA/QC field and laboratory analytical performance metrics were not identified in this review (e.g. in a specific Quality Assurance Plan), but review of the analytical and QA/QC data included in annual report appendices indicated that reasonable performance metrics were being applied for data validation.

7.13 Market Review of Palladium and Platinum SRC5.1(i);SRC5.6(i); SRC5.6(ii); SV1.18; JSE12.9(h)(vii)

7.13.1 Introduction PGMs (also referred to as Platinum Group Elements or PGEs) comprise platinum, palladium, rhodium, ruthenium, iridium and osmium. The Bushveld Complex in South Africa contains approximately 80% of the known global PGM mineralisation and produces approximately 80% of the world's annual PGM supply from the UG2 Reef and Merensky Reef. The J-M Reef mined at the Stillwater and East Boulder Mines is the sole source of primary palladium and platinum production in the USA, accounting for approximately 5% of the world annual primary PGM supply. PGM mineralisation in the J-M Reef is dominated by palladium and platinum and negligible concentrations of the other PGMs. Given that palladium and platinum account for almost 100% of the revenue generated at the Stillwater and East Boulder Mines, this review focuses on these metals. The following commentary on the palladium and platinum demand and supply dynamics is based on The Mineral Corporation’s analysis of information within the public domain (eg. Anglo American Platinum Limited, 2017; Heraeus, 2017a&b; Johnson Matthey, 2017; World Platinum Investment Council, 2017a&b). The sources used in this review are listed in Section 12. Global primary palladium and platinum production trends for 2015 and 2016 are illustrated in Figure 91.

Figure 91: Primary global Palladium and Platinum production 2015-2016

Global primary production of palladium in 2016 amounted to approximately 6.8 million ounces and primary platinum production in this period totalled approximately 6.1 million ounces as illustrated in Figure 92 and Figure 93.

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Figure 92: Primary global Palladium production 2016 (after Johnson Matthey, 2017, The Mineral Corporation

Research, 2017)

Figure 93: Primary global Platinum production 2016 (after Johnson Matthey, 2017, The Mineral Corporation

Research, 2017)

Over the last three decades, the global automotive sector has emerged as the principle consumer of PGMs used as auto-catalysts in catalytic converters to treat automobile exhaust emissions. In addition, the intrinsic properties of PGMs (such as resistance to chemical corrosion, stable thermal and electrical properties) permit a diverse range of industrial, electronic and chemical applications. In recent years, Exchange Traded Funds (ETFs) for certain PGMs and investment positions in certain PGM physical metal stocks have become an important market demand factor. Platinum's wear and tarnish resistance characteristics are well suited for jewellery applications which have become a key, but volatile primary demand driver in the last decade. In contrast, palladium demand for jewellery has been lacklustre, but offset by sustained palladium demand growth for auto-catalyst, electronic and industrial applications.

2.77

2.57

0.890.39

0.136.76

-

1

2

3

4

5

6

7

Russia South Africa North America Zimbabwe Others Global Total

Palladium oz

Mill

ion

s

4.39

0.72

0.49

0.34 0.166.10

-

1

2

3

4

5

6

7

South Africa Russia Zimbabwe North America Other Global Total

Platinum oz

Mill

ion

s

163


In recent months, the outlook for the future of the internal combustion engine, and diesel-motive vehicles in

Europe in particular, has been much discussed. The diesel-motive vehicle share of the light duty vehicle market in France, Germany, Spain and the United Kingdom (UK) has fallen below 50%, as perhaps one of the consequences of the emissions scandal of 2015. In addition, certain cities have suggested that some or all diesel vehicle access may be limited or prohibited in future. The degree to which these politically-motivated initiatives can be practically or commercially implemented remains to be seen, given the relative efficiency of diesel engine technology and diesel-motive economics in both light and heavy-duty applications. The PGM demand effects of these possible European changes are difficult to assess, but are likely to be offset to some degree as other jurisdictions with no practical alternative to diesel-motive vehicles migrate to stricter emissions standards. Similarly, while many vehicle manufacturers offer hybrid electric-internal combustion drive trains on certain models or have stated intentions to offer only hybrid models, these vehicles require similar catalyst PGM loadings to conventional internal combustion engines and will sustain PGM demand. Elsewhere, including China, PGM fuel cell electric vehicles offer zero-emission alternative to the conventional internal combustion engine vehicle. Battery technology and improved recharging infrastructure availability in certain urban markets has seen battery electric passenger vehicle sales start to expand in these permissive circumstances. Such vehicles contain no PGM, but it is considered unlikely that all jurisdictions will see internal combustion engine-free passenger, light duty and heavy-duty vehicle power trains in the next three decades.

7.13.2 Palladium

7.13.2.1 Demand The main uses for palladium are in auto-catalyst, chemical, electronic, dental applications and jewellery. Auto-catalyst applications are the primary palladium demand driver. The recovery of the global automotive industry and substitution of palladium for platinum have contributed to sustained growth in palladium demand over the last five years. During 2016, global light vehicle sales expanded to a record 93.2 million units with China and the USA being the main drivers of this demand growth. This has contributed to gross annual palladium demand approaching 10 million ounces in 2016, which is substantially higher than the 6.7 million palladium ounces mined annually. Over the next several years, it is anticipated that China will consolidate its position as the world’s largest car market, driven by domestic economic stimulus efforts and will support sustained auto-catalytic palladium demand as China 6 Emission Standards are phased in by 2020. The improved economy in the USA and the shift away from diesel to gasoline engines in Europe are also likely to support sales growth in these regional automotive industries. These underpin the global growth in light duty vehicle sales in which increased platinum (and palladium) catalyst loadings will be required to meet the Euro 6d and Tier 3/LEV III standards in these jurisdictions. Palladium demand in applications beyond the automotive sector amounts to approximately 2 million ounces per annum spread over the chemical, electronics and dental sectors. Growth in chemical and industrial application-driven palladium use is likely to be sustained while palladium demand for multi-layer ceramic capacitor fabrication in the electronics sector is undiminished. By contrast, palladium dental and jewellery off-take is expected to continue its established reducing demand trajectory as consumers seek cheaper or cosmetically preferred materials. The palladium market deficit in 2016 would have been larger were it not for the liquidation of approximately 650 000 ounces of ETF positions as illustrated in Figure 94. ETF interest for palladium is anticipated to be firm with continued investor interest, buoyant palladium prices and an apparent decoupling of palladium pricing from gold price performance and currency effects. In contrast, physical metal investment is expected to remain inconsequential reflecting continued low retail investor interest in palladium ingots. The palladium market is anticipated to remain in substantial deficit for the fourth consecutive year, with continued draw down of above-ground stocks, as emission legislation continues to tighten and platinum substitution and growth in the automotive sectors in China and the USA seems likely to be sustained. In 2017, palladium consumption may reach a record high of 10.5 million ounces suggesting a palladium market deficit of as much as 1 million ounces.

164


Figure 94: Palladium ETF and price trends (after Johnson Matthey, 2017, The Mineral Corporation Research,

2017)

7.13.2.2 Supply Palladium is mined extensively in Russia, South Africa and North America with production for 2016 amounting to 39%, 35% and 17% of the global total of 6.7 million ounces produced from these respective jurisdictions. Norilsk Nickel, the world’s largest nickel producer, has weathered a sustained secular low in nickel prices by

increasing PGM production in 2016, including 2.77 million ounces of palladium from stockpiled concentrates and from inventory. In addition, Norilsk Nickel also purchased some 300 000 ounces of palladium from the market, half of which was purchased on behalf of the Global Palladium Fund, created by Norilsk Nickel to ostensibly reduce palladium market volatility by acquiring stocks of metal held by the Russian Central Bank, hedge funds and others. Palladium mined in South Africa in 2016 declined by 4% to 2.57 million ounces, primarily due to reduced refined output at Anglo American Platinum Limited, where higher palladium production in the prior year reflected in-process inventory release. Acute policy uncertainty, volatile PGM pricing and domestic currency strength have contributed to primary South African producer capital investments being at their lowest levels in the last decade and the outlook for sustained South African palladium production at this level appears unlikely. Palladium mined in North America in 2016 increased 2% on the prior year to 894 000 ounces, with increased production from the Stillwater’s mining operations offset by lower production at the North American Palladium operation in Canada.

Secondary palladium supply in 2016 totalled some 2.49 million ounces. Auto-catalytic palladium recovery was subdued and this is interpreted to reflect an on-going consequence of the global collapse in scrap steel pricing through 2014 and 2015, with scrap yards tending to pay ‘bottom dollar’ for end-of-life vehicles. This resulted in such vehicles being exported to developing markets rather than being scrapped, and reduced the quantity of catalytic converters being removed and recycled. Scrap steel prices improved into 2017 and account for the modest improvement in catalyst scrap volume throughput, with palladium-rich catalyst scrap increasing in the Americas and Europe as greater numbers of vehicles are entering the global scrap collection circuit. The Chinese auto-catalyst recycling dynamics in 2016 showed increasing volumes, but with lower than anticipated PGM recoveries. This is interpreted to be a result of the gradual increase in the number of end-of-life vehicles containing low PGM content catalyst being scrapped. In addition, prior forecasts of Chinese auto-catalytic scrap PGM contents are now thought to have been optimistic because of repair-shop scrap catalyst from higher PGM loaded ‘young’ vehicles biasing assays in the recycling chain before significant volumes of older, lower PGM content catalysts from scrapped end-of-life vehicles began to enter the recycling circuit.

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European & US ETFs koz (LHS) South African ETFs koz (LHS)

Palladium Price $/oz (LHS) Palladium Price R/kg (RHS)

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While China is a small contributor to the global auto-catalyst recycling industry, it is the source of the majority

of palladium jewellery recycling as the remnant vestige of the country’s palladium jewellery fad of 2004 to 2009. As Chinese retail interest in palladium jewellery has evaporated, palladium jewellery recycling and fabrication in China has become a closed loop. Old jewellery is exchanged for new items reworked from scrap, with little demand for primary metal for new fabrication. The palladium demand and supply balance for the last three and five years is tabulated and graphically summarised in Figure 95.

Figure 95: Palladium demand and supply balance (after Johnson Matthey, 2017)

7.13.2.3 Palladium Market and Pricing Outlook Further primary palladium supply disruptions are considered unlikely and sustained demand for palladium is anticipated over the medium to long term, with the key uncertainty being the quantity of above-ground stock and palladium investment holding redemptions that may erode the market deficit. Given the market dynamics in platinum, some substitution for palladium is a likely response to short-term palladium price increases. Over

the longer term, palladium pricing is anticipated to sustain parity with platinum as market balances in both metals are likely to be achieved over the next decade. Figure 96 illustrates the palladium price performance since 2004, expressed as nominal $/oz and Rand/kg.

Figure 96: Palladium price trend 2004 to 2017 (The Mineral Corporation Research, 2017)

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The third quarter of 2017 has seen reports of sustained steady demand for palladium from both the industrial

sector and from investors. In the automotive sector, car sales in China increased by 5.5% in July 2017 to 1.7 million units and 0.6% more vehicles were sold in the first seven months of 2017 than in the same period of 2016. Table 52 and Figure 97 juxtapose the palladium price history discussed above with the following forward-looking points of reference: A three year (12-quarter) trailing average palladium price as at July 30 2017 (US$/oz), as applied by SGL

and Stillwater in the definition of Mineral Reserves; A six-month trailing average palladium price as at 30 July 2017 (US$/oz); and An independent consensus forecast of palladium prices in US$/oz for 2018-2021 and from 2022 onwards

(long-term or LT), reflecting the compiled views of 21 separate sources as at 31 August 2017. Table 52: Palladium price forecast reference points

Reference Point PGM Unit FY2018 FY2019 FY2020 FY2021 LT

Three-year Trailing Average Pd $/oz 704 704 704 704 704

Six-month Trailing Average Pd $/oz 810 810 810 810 810

Consensus Pd $/oz 836 880 895 952 795

Figure 97: Palladium price forecast reference points

Recent palladium price performance and the six-month trailing average price are congruent with the independent consensus price forecast for the 2018 to 2021 period, and the consensus forecast for the long term beyond 2021. In the context of mineral economics applied to the definition of Mineral Resources and Mineral Reserves, The Mineral Corporation would consider the three-year trailing average to be a reasonable and transparent basis for such Mineral Resource and Mineral Reserve definition. In terms of a buoyant commodity price, this would be a conservative basis for Mineral Resource and Mineral Reserve estimation. The completed market review and the credible forecast supply deficit in palladium set the context for mineral economic assumptions to be considered for Mineral Asset valuation. On this basis, The Mineral Corporation considers it reasonable to apply the median consensus forecast of $888/oz for the period 2018 to 2021 and, thereafter, apply a ‘flat-line’ long-term palladium price forecast of $850/oz (in 31 July 2017 terms).

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7.13.3 Platinum

7.13.3.1 Demand Total platinum demand in 2016 amounted to 8.2 million ounces as weakness in platinum jewellery markets in Asia offset demand gains in auto-catalyst, industrial and investment sectors elsewhere. While the platinum market is anticipated to be in surplus in 2017 for the first time in six years, the 2015 emission scandal and more recent discussions about the future of the internal combustion engine have had little effect on the demand for platinum for automotive applications. This is because of the continued recoveries in global car sales, coupled with the generally higher platinum loadings required to comply with of stricter emissions controls in several jurisdictions. In 2016, the use of platinum in auto-catalyst applications rose 2% on the prior year to 3.32 million ounces reaching an eight-year high for this application segment. Europe accounts for over half of all platinum auto-catalyst usage because of its large light duty diesel market for which Euro 6b Standards are now mandatory. European light-duty diesel production achieved a nine-year sales volume record of 9.76 million vehicles in 2016, albeit with some loss of market share to petrol engine

vehicles. This increased European demand for platinum auto-catalyst applications was partially offset by reduced heavy duty truck sales in the USA and subdued diesel vehicle sales in India’s cities because of regulatory changes and a narrowing price differential between gasoline and diesel fuel. In other sectors of the North American automotive market, strong light duty vehicle sales have seen platinum auto-catalyst demand increase as the diesel-motive option is finding increasing favour in the sports utility vehicle and light truck segments. Global demand for platinum in auto-catalysts is expected to shrink by some 5% in 2017 to 3.16 million ounces, with most of this decline being ascribed to the changing dynamics in the European light duty diesel sector as new Euro 6 Regulations mandate Real Driving Emission testing for the first time, and lower platinum-loaded selective catalytic reduction catalyst systems are required to meet tightened NOx restrictions. In the three years prior to 2015, Chinese demand for platinum jewellery maintained levels of between 1.8 million and 2.1 million ounces per year, underpinning the platinum market deficits in that period. In 2016, there was a considerable reduction in demand for platinum jewellery from Chinese wholesalers, fabricators and consumers. Platinum jewellery demand has also been weak in other jurisdictions through a combination of declining marriage rates in Japan, off-shoring by jewellery fabricators, demonetisation-driven jewellery store footfall reductions in India and global jewellery fashion trends moving from white metals towards yellow and rose gold items. It is anticipated that platinum jewellery demand will continue to fall as retailers continue to turn towards gold, higher design finishing and fabrication levels, and per-piece rather by weight platinum jewellery pricing. Industrial demand for platinum peaked in 2016 on strong demand from global glass and chemical sectors and policy driven industrialisation initiatives in China aimed at developing national self-sufficiency in key chemical feedstocks, which require platinum catalysts. Petroleum refinery consumption of platinum for refinery catalysis was supported by stable low oil prices and improved margins at the older European and North American refineries, which have seen capital investment rather than closure. Chinese petro-catalyst demand reduced, reflecting the continued overcapacity of that country’s domestic petroleum refineries. Sales of platinum into the electrical sector for use in hard disk drives remains robust as burgeoning global data storage capacity demands require increased disks per drive unit. Industrial demand for platinum is anticipated to remain strong in 2017 at 1.88 million ounces, with much of this increase from large stationery fuel cell applications. Smaller stationery fuel cell plants for domestic and telecoms applications are also expected to show further growth. By the end of 2016, Japan had more than 200 000 residential systems deployed and several European initiatives are seeking to emulate this degree of market penetration. While platinum demand for passenger fuel cell electric vehicles remains a small market niche with challenging refuelling infrastructure costs, several European public transport fuel cell electric vehicle initiatives, supported by collaboration between fuel suppliers, vehicle manufacturers and governments, show some promise. Investment purchases of platinum in ETFs and physical metal have been robust over 2015 and 2016, with new demand outweighing liquidation in most quarters. The Japanese physical metal investment market has been particularly active through 2016, accounting for 1.1 million ounces of sales. This is because of low and falling Yen-denominated platinum prices, a widening of the platinum price discount to gold and increased interest in platinum metal among younger investors.

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Following a phase of rapid ETF liquidation in 2015, global holdings in platinum ETFs settled on 2.5 million

ounces, with on-going South African platinum ETF liquidation balanced by a return to positive ETF investment in the USA and Europe as illustrated in Figure 98.

Figure 98: Platinum ETF and price trends (After Johnson Matthey, 2017, The Mineral Corporation Research,

2017

7.13.3.2 Supply Platinum is mined extensively in South Africa as well as Russia, Zimbabwe and North America, with 2016 production from these jurisdictions being 70%, 13%, 8% and 8% of the total 6.1 million ounces mined, respectively. Within these jurisdictions, mines operated by Anglo American Platinum Limited, Impala Platinum Limited, Lonmin plc, Northam Platinum Limited, Norilsk Nickel, Zimplats and SGL are the main producers. Excluding stock movements, 2016 mined platinum production in South Africa fell marginally to 4.39 million ounces as the large mining complexes near Rustenburg experienced shaft closures, difficult ground conditions, safety stoppages and some accidental infrastructure damage. These events were partially offset by improved production performance at most other South African operations including Bafokeng Rasimone, Kroondal, Two Rivers, Booysendal North and Mogalakwena Mine. While Russian PGM production had been anticipated to decline to below 650 000 ounces in 2016, some 723 000 ounces are recorded as primary production. This came largely from Norilsk Nickel, which supported platinum sales by refining stockpiles and materials recovered during the decommissioning of its metallurgical

plants at Norilsk, and from its inventory metal sales. Mined platinum from Zimbabwe rose 22% during 2016 to reach an all-time high of 489 000 ounces in 2016, sustaining an unparalleled track record of incremental annual production growth over the last two decades. Platinum production in North America rose by 7% to 338 000 ounces reflecting higher sales by Stillwater and increased by-product platinum from Canada’s nickel mines.

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Platinum Price $/oz (LHS) Platinum Price R/kg (RHS)

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Secondary platinum supply increased substantially during 2016 primarily on a wave of platinum jewellery

recycling in China where disappointing retail sales and subdued consumer interest prompted destocking of the jewellery distribution chain. In contrast, global platinum recovered from auto-catalyst scrap remained subdued at 1.15 million ounces, as vehicle scrapping volumes were influenced by the scrap steel price regime discussed in Section 7.13.3.1. Europe has eclipsed North America as the principle source of platinum from auto-catalyst scrap as diesel-motive vehicles dominate this jurisdiction, in contrast with the palladium-rich auto-catalyst scrap prevalent in petrol-motive markets elsewhere. The increasing availability of platinum-loaded diesel catalyst scrap in Europe is likely to consolidate this circumstance, while platinum from North American auto-catalyst recycling will continue to decline, reflecting the path of progressive reduction in platinum loading of auto-catalysts in the USA since the mid-1990s. Figure 99 tabulates and graphically summarises the platinum market demand and supply balance for the last three and five years.

Figure 99: Platinum demand and supply balance (after Johnson Matthey, 2017)

7.13.3.3 Platinum Market Outlook It is anticipated that, while auto-catalyst and industrial demand for platinum will be sustained over the medium to long term (linked to the fortunes of the global automotive and industrial sectors), investment demand will remain unpredictable. Platinum stocks from surpluses remain substantial and pricing is likely to reflect this for a sustained period. To sustain current levels of established primary mined platinum production in South Africa, producers will have to navigate hostile government policy and the challenges of operating mature mines in an environment with little to incentivise new capital investment for replacement or new production capacity. Figure 100 illustrates the platinum price performance since 2004, expressed as nominal $/oz and Rand/kg.

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Figure 100: Platinum price trend 2004 to 2017 (The Mineral Corporation Research, 2017)

Global sales of light vehicles in the first half of 2017 have attained a record level of 46.8 million units, with particularly strong sales in Europe, Japan and South America. The third quarter of 2017 has seen a platinum price recovery as geopolitical tension in the Korean Peninsula has increased, prompting platinum metal investment purchases in preference to gold. However, at current platinum price levels, as much as 1 million

ounces of South African platinum production is no longer profitable and production cuts in the absence of further deprecation of the South African Rand appears inevitable. These platinum market dynamics set the context for a series of platinum price forecast reference points that are quite different from the palladium price outlook discussed previously. Platinum price history (in the context of historical trailing averages and an independent consensus outlook) is contained in Table 53 and Figure 101. These are based on the following: Three-year (12-quarter) trailing average platinum price as at July 30 2017 ($/oz), as applied by SGL and

Stillwater in the definition of Mineral Reserves; Six-month trailing average platinum price as at 30 July 2017 ($/oz); and An independent consensus forecast of platinum prices in $/oz for 2018-2021 and from 2022 onwards

(long term), procured by SGL from 21 separate sources as at 31 August 2017. Table 53: Platinum price forecast reference points

Reference Point PGM Unit FY2018 FY2019 FY2020 FY2021 LT

Three-year Trailing Average Pt $/oz $1 047 $1 047 $1 047 $1 047 $1 047

Six-month Trailing Average Pt $/oz $952 $952 $952 $952 $952

Consensus Pt $/oz $1 054 $1 100 $1 167 $1 323 $1 302

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2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

Rand/kg$/oz

Platinum $/oz (LHS) Platinum R/kg (RHS)

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Figure 101: Platinum price forecast reference points In sympathy with the 2017 forecast market surplus illustrated in Figure 99, the six-month historical average price lies below the three-year trailing average. Given sustained continuation of the recent platinum price recovery, supported by the supply-side constraints in South Africa and/or improved investment and jewellery interest, the consensus forecasts for the 2019 to 2021 period appear reasonable to optimistic. The long-term consensus forecast from 2021 onwards is considered somewhat optimistic from The Mineral Corporation’s perspective, given the anticipated growth in recycled platinum loaded diesel-motive catalyst scrap. In the context of mineral economics applied to the definition of Mineral Resources and Mineral Reserves, The Mineral Corporation would consider the three-year trailing average to be a transparent and reasonable basis for such Mineral Resource and Mineral Reserve definition, with the caution that, if applied without context in a commodity in secular decline, trailing averages may offer an optimistic perspective. The circumstances in the platinum market set out in this CPR offer the context for the mineral economic assumptions to be considered for Mineral Asset valuation. The Mineral Corporation considers it reasonable to apply the median consensus forecast of $1 133/oz for the period 2018 to 2021 and, thereafter, a ‘flat-line’ long-term platinum price forecast of $1 150/oz (in July 2017 terms).

7.14 Capital and Operating Costs SRC5.6(viii); SRC5.6(ix)

7.14.1 Capital Costs

7.14.1.1 Background This section discusses the planned capital expenditure for Stillwater and East Boulder Mine Complexes as well as the Columbus Metallurgical Complex.

7.14.1.2 Stillwater Mine and Concentrator The capital costs for Stillwater Mine and Concentrator are separated into Category 1 and Category 2. Category 1 is essential for sustaining production in the production plan and Category 2 capital relates to improved productivity, reduced unit costs, environmental management and social/administration issues. In addition, Stillwater Mine includes the Blitz section, which is in the development phase. Accordingly, capital costs are thus captured separately for the current section and the Blitz section for the next four years on at a decreasing rate. Thereafter, the Blitz section costs are captured as part of the Stillwater Mine operations.

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Stillwater Mine capital profile is detailed by month for two years and, thereafter, the costs are annualised.

Long-term capital related to a specific project and/or scheduled equipment replacement or per the capital production plan is forecasted in detail. For the other general issues, long-term capital expenditure is forecast is based on historical actuals. Development capital amounts to an approximate average of $63 million per year for the first seven years. Items that are capitalised under development are: Direct labour and materials for primary development (footwall lateral, primary ramp, diamond drilling,

raise boring, etc.); and Allocations of support services – i.e. load and haul, maintenance, mine services, surface facilities and site

G&A. Typically, direct cost of primary development is 40% to 45% of the total capital development cost. The balance is allocations for the support services. Mining equipment replacement is carried out based on a schedule. Typically, the trackless equipment has a minor rebuild after 8 000 hours of operation, a second major rebuild at 8 000 hours and is replaced at approximately 8 000 hours later. Drill rigs are replaced on a time bound cycle. Jacklegs (pneumatic percussion hand held drills) are used on a rental basis. Figure 102 indicates the capital expenditure profile for Stillwater Mine including the Blitz section and Concentrator to 2030.

Figure 102: Stillwater Mine (including Blitz) and Concentrator capital schedule

Stillwater forecasts to spend approximately $4 million on 2-yard LHD replacements at the current section of Stillwater Mine over the next five years. Table 54 summarises the capital allowance per mechanised equipment type over the next four year period (2018 to 2021) for the Blitz section. The mine will spend approximately $400 000 per year on underground Kubota RTV units for Stillwater Mine, including the Blitz section. Three Normet utility trucks and five bolters will be bought and approximately $150 000 per year is scheduled for rail car maintenance.

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Table 54: Blitz section 2018-2021 capital provision summary for mechanised units

Equipment Description $ million

LHDs 15.30

Jumbo Drill Rigs 11.30

Rock Bolters 5.50

Underground Trucks 2.40

Ancillary Underground units 7.00

Core Drill Rig 0.25

Total 41.75

Between 2017 and 2021, additional rail infrastructure, including tips and grizzlies on the upper levels and LKAB chutes, will be installed on the 3 500 West Level of Stillwater Mine. A similar upgrade will happen with additional infrastructure on the 2 000 East Rail System. A total of $24 million is planned on the Blitz section ore passes, tips, grizzlies and chute in the next ten years.

In line with the expanded production infrastructure footprint, additional workshops and workshop upgrades are also planned. Mill expansion capital of $58 million is included in the capital plan (2018 to 2021) to meet the increase in production. Environmental capital expenditure related to water management is catered for at $150 000 per annum, and an amount of $22 million has been allowed for the Hertzler Stage 4 TSF elevation lift between 2028 and 2032. A total of $9 million is planned to be spent on WRSF strategic land acquisition and $7 million is to be spent on the LAD Pond relocation. The total capital expenditure plan for Stillwater Mine including the Blitz section is $177 million in 2018, which decreases to $89 million in 2021, when Blitz expansion development is completed, and thereafter decreases steadily to annual capital expenditures ranging from $96 million in 2022 to $40 million in 2030.

7.14.1.3 East Boulder Mine and Concentrator The capital costs for East Boulder Mine and Concentrator are also separated into Category 1 and Category 2. East Boulder Mine capital profile is detailed by month for two years and, thereafter, the costs are annualised. Long-term capital related to a specific project and/or scheduled equipment replacement or per the capital production plan is forecast in detail. For the other general issues, long-term capital expenditure is forecast on historical actuals. Development capital development amounts to approximately $13 million to $18 million per year. Items that are capitalised under development are similar to those described for Stillwater Mine. Mining equipment replacement is carried out based on a schedule. Typically, the trackless equipment has a minor rebuild after 8 000 hours of operation, a second major rebuild at 8 000 hours and is replaced approximately 8 000 hours later. Drill rigs are replaced on a time bound cycle. Jacklegs are used on a rental basis. Figure 103 indicates the capital expenditure of East Boulder Mine and Concentrator to 2030.

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Figure 103: East Boulder Mine and Concentrator capital schedule

The mine has forecasted a capital expenditure of $220 000 per year on underground RTV units as these do not receive major overhauls, but are replaced. There are several 2-yard LHDs, trucks and twin boom jumbos that

have cycled replacement in 2021 to 2026. A total of $200 000 per year is scheduled for rail car refurbishment/replacement and $180 000 per year for surface light vehicle replacement. Environmental capital expenditure is directly related to key projects scheduled, including TSF4 construction ($340 000 per year), Boe Ranch pipeline and the LAD in 2019 and 2020, TSF5 slope reclamation, TSF6 infrastructure move and TSF5 lining installation. In 2030 and 2031, there is $14 million planned in each year for the TSF6 infrastructure relocation for the new extension.

7.14.1.4 Columbus Metallurgical Complex Stillwater has updated the capital forecast for operations to account for the increased loading from the incremental Blitz production. Although the overall BMR facility has ample capacity for the increased production, which can be accommodated by improved utilisations, bottleneck studies have identified the need for increased copper electrowinning. This has been accounted for in the capital schedule. A further $2 million has been provided for further improvements of the process, with $100 000 per annum provided for as sustaining capital expenditure. Table 55 summarises the BMR capital schedule. Table 55: BMR capital expenditure schedule for the 2018 to 2026 period

Capital Cost Item 2018 2019 2020 2021 2022 2023 2024 2025 2026

BMR Throughput Optimisation $250 000

BMR Throughput Improvement

$1 000 000 $1 000 000

EW Circuit expansion cost $500 000 $5 000 000

Auto Titrator $100 000

$100 000

$100 000

Replacement Vehicle

$40 000

$40 000

Forklift $50 000

Replace EW Cathodes/Anodes

$500 000

Security Area Drying Oven $80 000

$80 000

$80 000

Sustaining Capital $100 000 $100 000 $100 000 $100 000 $100 000 $100 000 $100 000 $100 000 $100 000

Total $1 080 000 $6 100 000 $1 640 000 $180 000 $200 000 $140 000 $100 000 $180 000 $200 000

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Although the smelter and laboratory are of a high standard and fit for purpose, Stillwater has provided a sum of

$4 million to automate the section that deals with geology samples at the laboratory and approximately $500 000 per annum for sustaining capital and other minor projects at the smelter. The Mineral Corporation considers the processing and metallurgical laboratory well capitalised and unlikely to present a constraint to the production plan as presented in the 25-year LoM Plan.

7.14.2 Mining Operating Costs The mining operating costs utilised in the ORET and LoM valuation models are based on recent historical (last 12 months) cash costs (mining) being achieved at each of the mines (Stillwater and East Boulder Mines). These consist of the following key costing elements: Stope mining costs dependant on mining method employed; Primary development costs depending on type; Secondary development costs depending on type; Underground operational support services depending on activity;

Surface facilities including concentrator; and Site specific general and administration costs.

The mining operating costs for the mines are illustrated in Table 56. This indicates that, apart from accounting for annual escalation, the costs at East Boulder Mine are in line with the mines’ current performance. For Stillwater Mine (both the current and Blitz sections), the costs differ from the historical average as the volumes of production (ore tonnage) increase and, thus, the mine’s fixed costs are split over more ore tonnage and thus ounces (Pd and Pt ounces). Table 56: Mining costs for Stillwater and East Boulder Mines

Actual Actual Actual Forecast Budget Budget Budget Budget Budget

2014 2015 2016 2017 2018 2019 2020 2021 2022

Stillwater Mine production (ton)

748 680 747 965 715 147 785 806 796 101 926 325 995 227 1 175 972 1 246 274

Direct Cash Cost ($/Pd+Pt oz) 446 409 370 386 394 359 327 321 321

East Boulder Mine production

(ton) 515 753 583 452 656 044 659 687 662 752 667 590 705 013 703 087 703 087

Direct Cash Cost ($/Pd+Pt oz) 458 431 376 366 381 387 398 400 397

Other costs accounted for in the LoM valuation model are: Royalties; Smelting; Refining; Central support services (Columbus); Shipping; Insurance; Laboratory operations; Insurance; Taxes;

Exploration; and Company General and Administration (G&A).

The above approach adopted for the development of operating costs aligns with general industry practice.

7.14.3 Plant and Ore Processing Cost

7.14.3.1 Background The costs of processing of the ores for the two mines are included in the gross mining costs for each operation, and are part of the Surface Facilities Cost Centre. This cost centre comprises the following elements for Stillwater Surface Facilities Cost (with maintenance of each area included in the cost): Paste plant costs; Sand plant costs; Shaft/hoisting and surface crusher area costs; and

Hertzler TSF costs.

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This cost centre comprises the following elements for East Boulder Mine Surface Facilities Cost (with

maintenance of each area included in the cost): Concentrator costs; Sand plant costs; and Tailings impoundment costs.

The costs for the Columbus Metallurgical Complex (comprising smelter, BMR and laboratory costs) are distributed between the two mining operations as shared services overhead.

7.14.3.2 Stillwater, East Boulder and Columbus Metallurgical Complex Processing Costs The surface facility and Columbus Metallurgical Complex operating cost history and budget for Stillwater Mine is presented in Table 57 and indicates that both surface facility and Columbus Metallurgical Complex costs, which have been historically achieved, are budgeted at similar levels going forward. However, overhead dilution reduces the unit costs budgeted as the ore tons and ounces increase from the Blitz expansion progress.

The surface facility and Columbus Metallurgical Complex cost history and budget for East Boulder Mine is presented in Table 58. Table 58 indicates that both surface facility and Columbus Metallurgical Complex costs, which have been historically achieved, are budgeted at similar levels going forward. Table 57: Stillwater Mine Surface Costs

Parameter Actual Actual Actual

Actual to June

Budget Budget Budget Budget Budget

2014 2015 2016 2017 2018 2019 2020 2021 2022

Milled tons 833 600 820 264 773 005 714 802 796 101 926 325 995 227 1 175 972 1 246 274

Pd + Pt (oz) 363 004 337 570 326 975 339 511 360 398 435 541 500 183 608 868 632 659

Total Cost Surface Facilities ($) 25 774 483 24 488 669 20 272 943 21 056 925 23 240 955 25 275

000 27 931 000 32 227 000 33 754 000

Cost ($/t milled) 30.92 29.85 26.23 29.46 29.19 27.29 28.06 27.40 27.08

Cost ($/Pd+Pt oz) 71.00 72.54 62.00 62.02 64.49 58.03 55.84 52.93 53.35

Columbus Metallurgical Complex Costs ($)

19 671 000 18 052 000 17 792 000 17 994 000 19 183 000 23 348

000 25 546 000 31 332 000 32 841 000

Cost ($/t milled) 23.60 22.01 23.02 25.17 24.10 25.21 25.67 26.64 26.35

Cost ($/Pd+Pt oz) 54.19 53.48 54.41 53.00 53.23 53.61 51.07 51.46 51.91

Table 58: East Boulder Mine Surface Costs

Parameter Actual Actual Actual

Actual to June

Budget Budget Budget Budget Budget

2014 2015 2016 2017 2018 2019 2020 2021 2022

Milled tons 515 912 583 452 656 044 638 666 662 752 667 590 705 013 703 087 703 087

Pd + Pt (oz) 182 926 201 942 218 354 216 752 225 776 226 769 225 364 224 748 225 327

Total Cost Surface Facilities ($) 11 712 359 13 552 380 13 015 090 13 414 325 13 749 137 13 612 116 13 685 047 13 680 868 13 680 868

Cost ($/t) 22.7 23.23 19.84 21. 20.75 20.39 19.41 19.46 19.46

Cost ($/Pd+Pt oz) 64.03 67.11 59.61 61.89 60.9 60.03 60.72 60.87 60.72

Columbus Metallurgical Complex Costs ($)

13 639 000 14 145 000 14 629 000 15 808 000 15 759 000 16 471 000 17 210 000 17 726 000 17 639 000

Cost ($/t) 26.44 24.24 22.3 24.75 23.78 24.67 24.41 25.21 25.09

Cost ($/Pd+Pt oz) 74.56 70.04 67. 72.93 69.8 72.64 76.37 78.87 78.28

7.14.4 Environmental and Social SRC5.6(ix); ESG4.8.1;ESG4.8.2;ESG4.8.3;ESG4.3.6

7.14.4.1 Current Environmental Operating Costs and Liabilities Environmental operating costs include labour, materials and supplies, maintenance and utilities, outside service costs related to operations of the Environmental Department, support for environmental compliance monitoring, maintenance of environmental monitoring and corrective action systems (e.g. wells, air monitoring equipment, water treatment plant operations and methanol injection for groundwater corrective action). Environmental liabilities include the ongoing mitigation of groundwater impacts, although upgrades to operational facilities (e.g. lining of WRSF, which is carried in the Mine’s capital budget), are not included in the Environmental Department budgets. Sections 7.14.4.2 to 7.14.4.4 discuss the current environmental operating and liability costs as assessed through the review of the Environmental Department actual and budgeted costs over the past several years through to the current fiscal year. Table 59 summarises the total Stillwater’s Environmental Department budgets and actual costs from 2015 through to June of 2017.

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Based on this assessment of the Environmental Department’s budget and actual cost data, discussions with Site

Environmental Department Personnel and understanding of the current and projected Environmental Department activities, upcoming permitting efforts and other responsibilities, it is concluded that the current environmental operating costs and liabilities are reasonably managed and funded, and existing and planned near-term budgets appear adequate to meet foreseeable obligations. Table 59: Stillwater environmental management costs

Cost Element 2015 2016 2017

Budgeted ($) Actual ($) Budgeted ($) Actual ($) Budgeted ($) Actual to June ($)

Labour Expenses 1 257 091 1 478 440 1 261 557 1 411 032 1 571 419 711 235

Material & Supplies 564 410 487 132 573 356 393 860 612 471 257 709

Maintenance Expenses - - - - - -

Utilities 413 400 345 650 347 905 288 351 359 100 186 993

Services 2 586 016 2 048 984 3 171 227 2 684 026 2 624 289 1 168 836

Other Costs 169 966 151 594 153 392 77 303 200 895 262 661

Total 4 990 883 4 511 800 5 507 437 4 854 572 5 368 175 2 587 435

7.14.4.2 Stillwater Mine Current Environmental Operating Costs The Environmental Department operating budgets for the Stillwater Mine facilities and actual costs for 2015, 2016 and the first half of 2017 were reviewed as well as the budgets for 2015, 2016 and 2017. Labour costs, including fringe and medical, accounted for approximately 25% of the annual budgets and services while other costs (e.g. consultants and other contracted services related to environmental reporting and compliance) account for approximately 40% to 60% of the annual budget). Table 59 summarises the Environmental Department’s budgets and actual costs for Stillwater Mine. Table 60: Stillwater Mine and Hertzler TSF environmental management costs


Budgeted ($) Actual ($) Budget ($) Actual ($) Budget ($) Actual to June ($)

Labour Expenses 512 285 541 497 505 895 483 062 577 241 243 647



Utilities 399 000 332 485 333 505 280 623 344 700 185 409

Services 1 057 884 789 282 1 404 283 1 066 839 937 089 346 485

Other Costs 31 650 27 631 21 092 19 058 28 000 10 218

Total 2 348 069 2 010 812 2 620 591 2 092 026 2 282 926 939 424

7.14.4.3 East Boulder Mine Environmental Operating Costs The Environmental Department operating budgets for the East Boulder Mine facilities and actual costs for 2014, 2015, 2016 and the first half of 2017 were reviewed as well as the budgets for 2015, 2016 and 2017 (Table 61). Table 61: East Boulder Mine environmental management costs


Budget ($) Actual ($) Budget ($) Actual ($) Budget ($) Actual to June ($)

Labour Expenses 194 134 391 201 194 134 395 723 425 635 188 614

Material & Supplies 19 380 3 682 9 760 194 8 360 2 399

Maintenance Expenses

Utilities

Services 730 432 616 420 861 444 535 972 902 400 345 187

Other Costs 110 296 107 707 113 500 41 658 148 140 241 526

Total 1 054 242 1 119 010 1 178 838 973 547 1 484 535 777 727

Actual labour costs, including fringe and medical, accounted for roughly 29% to 32% of the annual budget expenditures, excluding 401K contributions (tax-qualified, defined-contribution pension account). Actual labour expenditures were higher than budgeted for the periods reviewed due primarily to below budget labour costs at the East Boulder Mine. Consultants and other contracted services related to environmental reporting, expansion design and compliance account for approximately 50% to 65% of the annual budget. Sufficient budget has been allowed for TSF and WRSF expansion ($200 000 to $240 000 per year). Environmental Department actual costs decreased between years 2015 and 2016 due to lower contracted services costs. Costs for 2017 are

budgeted significantly higher due to increased labour and contracted services.

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7.14.4.4 Columbus Metallurgical Complex Environmental Operating Costs The Environmental Department operating budgets for the smelter facilities and actual costs for 2015, 2016 and the first half of 2017 were reviewed as well as the budgets for all of 2015, 2016 and 2017. The Environmental Department operating budgets for the Columbus Metallurgical Complex facilities and actual costs for 2015, 2016 and the first half of 2017 were reviewed as well as the budgets for all of 2015, 2016, and 2017. Table 62 summarises the Environmental Department budgets and actual costs.

Actual labour costs, including fringe and medical and excluding 401K contributions, accounted for roughly 29% to 40% of the annual expenditures, and actual labour expenditures were generally lower than budgeted for the periods reviewed (Table 62). Consultants and other contracted services account for approximately 50% to 60% of the annual budget. Total Environmental costs for these facilities have fluctuated annually due to contracted service costs. The 2017 total cost is budgeted to slightly decrease due to lower contracted services costs.

Table 62: Columbus Metallurgical Complex environmental management costs


Budget ($) Actual ($) Budget ($) Actual ($) Budget ($) Actual to June ($)

Labour Expenses 550 672 545 742 561 528 532 247 568 543 278 974



Utilities 14 400 13 165 14 400 7 728 14 400 1 584

Services 797 700 643 282 905 500 1 081 215 784 800 477 164

Other Costs 28 020 16 256 18 800 16 587 24 755 10 917

Total 1 588 572 1 381 978 1 708 008 1 788 999 1 600 713 870 284

7.14.4.5 Overview of Reclamation Costs and Liabilities Reclamation liabilities and costs relate to reclaiming all mine portals, ventillation shafts, surface mining and milling support facilities and infrastructure, and associated waste treatment, management and disposal facilities in accordance with the plans as addressed in the PoO for the Operating Permits (#00149 and #00118), water management plans and USFS RoDs (MDEQ and USFS, 2012a and 2012b). Reclamation surety amounts are reviewed and updated annually and completely revised with updated unit rates and volumes every five years.

Reclamation surety bond amounts were developed by the MDEQ using methods provided in the MDEQ Bonding Procedures Manual (MDEQ, 2001) and signed-off by Stillwater. Reclamation surety bonds run to the benefit of the State of Montana, which issues the Operating Permits, and not to the Federal Government.

Table 63 summarises reclamation costs for both Stillwater and East Boulder Mines and ancillary facilities. Direct reclamation costs are grouped by general area:

Tailings impoundments; waste rock storage facilities; Facilities, portals, roads, diversions, etc.; Interim care and maintenance; Closure water treatment; and Long-term care and maintenance.

Indirect reclamation costs are based on a fixed percentage of direct costs (excluding long-term care and maintenance) as identified in Table 63. Reclamation costs have been developed for five-year periods with an assumed annual inflation rate of 2%.

Bond renewals or updates are performed every five years, forward looking and attempt to identify and include activities/expansions that are expected to occur over the next five years. Only unplanned disturbances over the five-year bond period are unsecured and are typically minor (a few thousand dollars). The major long-term unsecured reclamation obligations are discussed below.

A moderate potential risk over the long-term for both mines is the assumed time for water treatment following closure. An additional period of only 18 months for water treatment following dewatering of tailings (except the Nye TSF) and collection of waste rock drainage is budgeted. This assumes that all water seeping through the WRSF covers and collected from TSF underdrains will be compliant and suitable for surface discharge in a relatively short time after covers are placed. Though current TSF underdrain water quality is consistent with this assumption, operation of the water treatment facilities may be required for longer if WRSF seepage does not “rinse out” ANFO residuals to below release standards in this time period. Thus, the impact and likelihood of this risk may be better bounded through assessment of the WRSF water balance prior to and after cover placement, quantitative modelling of the time for individual pore volumes of infiltrating waters to pass through the waste rock and column and/or batch tests to assess the number of pore volumes necessary to rinse the waste rock of leachable nitrogen species.

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Mitigations to this risk may include the following:

Enhancing the WRSF design to reduce infiltration; Active and dedicated rinsing of the WRSF to flush the nitrogen while the mines are active; Passing WRSF effluent discharges through engineered wetlands prior to being received by waters of the

State, which could lower constituent concentrations further by additional chemical and biological reduction, or

Addition of reductants or organic compounds to stimulate biological reduction in WRSF or infiltration basins, until such sufficiently reduced conditions are established to maintain acceptable discharge water quality.

Table 63: Stillwater and East Boulder Mines reclamation costs

Cost Item Factor East Boulder Mine Period: 2014-2018

Stillwater Mine Period: 2016-2020

Subtotal

Direct Cost

Tailings impoundments

$3 129 481 $3 479 687 $6 609 168

Facilities, portals, roads, diversions, other

$3 500 238 $4 722 911 $8 223 149

Waste rock storage facilities

NA $ 439 625 $439 625

Interim care and maintenance during closure $3 319 189 $ 4 103 363 $7 422 552

Closure water treatment

$1 361 813 $ 1 056 165 $2 417 977

Subtotal of direct costs

$11 310 720 $ 13 801 751 $25 112 471

Inflation cost adjustment @ 2% per year for 5 years 10.40% $1 176 315 $ 1 435 382 $2 611 697

Inflation adjusted subtotal of direct costs

$12 487 035 $ 15 237 133 $27 724 168

Indirect costs

Mobilisation and demobilisation1 4% $499 481 $ 609 485 $1 108 967

Engineering & redesign 4% $499 481 $ 609 485 $1 108 967

Contingency

Bid 10% $1 248 704 $ 1 523 713 $2 772 417

Scope 7% $874 092 $ 1 066 599 $1 940 692

Other fees

Trustee fees2 0% $ - $ - $ -

Legal fees2 6% $500 000 $ 500 000 $1 000 000

Agency project management3 3% $399 585 $ 242 119 $641 704

Subtotal of indirect costs 0% $ 4 021 344 $4 551 402 $ 8 572 746

Long-term site care and maintenance $967 850 $ 1 395 108 $2 362 958

Total reclamation liability

$ 17 476 229 $ 21 183 643 $ 38 659 873

1. Includes 1.5% for performance bond + 1.5% for payment bond + 1% mob /demob

2. MDEQ requirement (legal fees capped at $500k)

3. USFS personnel costs for contract oversight

7.14.4.6 East Boulder Mine Reclamation Costs and Liabilities Table 63 also summarises the 2014 to 2018 East Boulder Mine reclamation surety costs. The proposed closure and post closure water management plans for adit water, tailings impoundments and stormwater is for discharge water into the East Boulder River once adit and tailings waters have met Montana State water quality standards or have met applicable Montana Pollution Discharge Elimination System (MPDES) Permit limits. Stillwater will continue operating the East Boulder Mine water treatment facilities during mine closure until water quality standards are met. Reclamation direct costs have been developed for the five-year period 2014 to 2018. Cost categories are segregated into five tasks as follows: Task 1: Tailings impoundments; Task 2: Facilities, portals, roads, diversions, other; Task 3: Interim care and maintenance; Task 4: Closure water treatment; and Task 5: Long-term care and maintenance, with indirect costs for mobilisation, engineering, contingency,

legal, trust and agency management fees as percentages of direct costs.

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Under Task 1, reclamation costs address placement of geotextiles, subsoil, soil and rock cap placement and

associated regrading earthwork TSF Stages 1 and 2. No costs are evident for reclamation of TSF Stages 3 or 4 raises, which will likely be included in the 2019 update by the MDEQ. Therefore, this cost may be underfunded by between $100 000 and $5 000 000. This potential underfunding is not considered to be a material issue as the current rehabilitation cost quantum determined by the MDEQ for the 2014 to 2018 period is still valid. The reclamation costs will only be adjusted upward in the budgets after the surety revision by the MDEQ in 2019 determines the top up amount required. Under Task 2, three portals (No. 1, No. 2 and Frog Pond adit) and four vent raise closures (two at Brownlee Creek and one each at Simpson Creek and Graham Creek) are anticipated for a cost of approximately $498 300. Mine surface facilities to be reclaimed include, inter alia, the concentrator and annexes, office buildings, various water treatment buildings, towers and storage buildings. These buildings and facilities have been adequately inventoried. Task 2 reclamation includes hazardous materials and petroleum disposal, diversion channel and monitoring well abandonment, fence removal, tailings pipeline demolition and disposal as well as regrading and revegetation of disturbed mine surface areas. Task 3 addresses interim care and maintenance for an unplanned shut down and 12 months of agency site management and operations of treatment systems. Subsequent reclamation under agency control is assumed to take three years and the costs cover taxes and fees normally due. Task 4 addresses closure water treatment. It assumed that a treatment rate of 500G per minute (32l/s) for tailings dewatering and 250G per minute (16/s) from adit water will be treated and discharged for 18 months, and LAD systems will also continue to be operated for this period as well as the biological treatment system for denitrification of waters. Water treatment is assumed to be limited by the denitrification capacity (500G per minute). This task includes demolition and disposal of the treatment systems once all water treatment has been completed. This task also includes reclamation of the Boe Ranch LAD area and grouting of the pipeline. Task 5 addresses funding of long-term care and maintenance obligations. This task assumes annual monitoring begins immediately following cessation of mining and that adit and tailings supernatant water treatment occurs in Years 1 and 2, site reclamation occurs in Years 2 and 3, long-term site monitoring and maintenance begins in Year 4 and post-closure annual monitoring and maintenance occurs through Years 4 through 8. No ongoing site monitoring or maintenance is assumed to be required after Year 8. Monitoring frequencies are identified and are deemed reasonable. It should be noted that surety for reclamation of the potential TSF Stage 6 raise, the Lewis Gulch TSF and the Dry Creek WRSF will add to surety amounts until the East Boulder Mine TSF is reclaimed and the incremental surety bond amount released. No estimates for those future reclamation liabilities have yet been made. Based on this review’s assessment of the reclamation bond calculation worksheets provided by the Stillwater Environmental Department, discussions with Site Environmental Department Personnel, the approved Reclamation Plans and understanding of the annual regulatory review of surety bases, it is concluded that the current reclamation costs and liabilities are reasonably managed and funded, existing sureties appear adequate to meet foreseeable commitments for East Boulder Mine.

7.14.4.7 Stillwater Mine and Hertzler Facilities Reclamation Costs and Liabilities Table 63 summarises the Stillwater Mine 2016-2020 reclamation surety costs. The proposed closure and post closure water management plans for adit water, tailings impoundments and storm water are for discharge water into the Stillwater River once adit and tailings waters have met Montana State water quality standards or complied with applicable Montana Pollution Discharge Elimination System (MPDES) Permit limits. Stillwater will continue operating East Boulder Mine water treatment facilities during mine closure until water quality standards are achieved. Reclamation direct costs have been developed by the MDEQ for the five-year period (2014 to 2018). Cost categories are segregated into seven tasks as follows: Task 1: Stillwater Mine Nye Tailings Impoundment; Task 2: Hertzler Tailings Impoundment; Task 3: East Side WRSF; Task 4: Facilities, portals, roads, diversions, etc.; Task 5: Interim care and maintenance; Task 6: Closure water treatment; and Task 7: Long-term care and maintenance, with indirect costs for mobilisation, engineering, contingency,

legal, trust and agency management fees as percentages of direct costs.

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Under Tasks 1 and 2, reclamation costs address placement of geotextiles, subsoil, soil and rock cap placement

and associated regrading earthwork. For the existing Nye TSF, the reclamation plan calls for no dewatering of the tailings, but the removal of “free” water at the surface or surface regrading and the placement of a geotextile for sub-grade stabilisation, 32-inch (81cm) thick cover consisting of 24 inches (61cm) of waste or borrow materials and 8 inches (20cm) of soil or borrow as growth media for revegetation. For the existing Hertzler TSF, final reclamation of the impoundment’s surface would not occur until Stillwater stops tailings production and the impoundments are dewatered. The reclamation plan calls for dewatering the tailings surface regrading to afford surface drainage via an outlet channel, placement of a geotextile for sub-grade stabilisation, embankment ripping and regrading and cover material placement. The planned cover consists of 3ft (91cm) of fill of the removed embankment material and 1ft (30cm) of soil or borrows as growth media for revegetation. It should be recognised that reclamation surety costs for expansion of the Hertzler TSF will add to existing surety until the existing TSF is reclaimed and the incremental surety bond amount released. No estimates for those future reclamation liabilities have yet been made. These estimates will be made in conjunction with the TSF expansion design, which should be prepared in the next two years. The Hertzler TSF expansion is required to be complete by 2027 to 2028, near the time when the five-year bond revision is required (2028). Task 3 reclamation of the East Side WRSF involves surface ripping, surface grading and cover placement. The current basis assumes approximately 68 acres (25ha) requiring approximately 109 500 cubic yards (83 768m3) of cover material or 1ft of cover. Under Task 4, three east side portals closures (5 000E, 5 400E, and 5 400E), two east side ventillation raise closures (5 800E and 5 400E), six west side portal closures (5 150W, 5 300W, 5 500W, 5 700W, 5 900W and 6 500W) and one ventillation raise closure (6 600W) are anticipated. Mine surface facilities to be reclaimed have been inventoried and include, inter alia, the main office building, mill, storage buildings and shops, shaft building and hoist house, various water treatment buildings and towers. Task 4 reclamation also includes underground decommissioning, hazardous materials disposal, diversion channel and monitoring well abandonment, fence removal, tailings pipeline demolition and disposal as well as regrading and revegetation of disturbed mine surface areas. Task 5 addresses interim care and maintenance for an unplanned shut down in the same manner as used for East Boulder Mine, discussed previously. Task 6 addresses closure water treatment. It assumed that a treatment rate of 750G per minute (47l/s) for tailings dewatering and 250G per minute (16l/s) from adit water will be treated and discharged for 18 months, and LAD systems (as well as the biological treatment system for denitrification of water), will also continue to be operated for this period. Water treatment is assumed to be limited by the denitrification capacity (1 300G per minute). This task includes demolition and disposal of the treatment systems once all water treatment has been completed. This task also includes grouting of the tailings and LAD pipelines. Furthermore, this task does not include reclamation or decommissioning costs for any of the Benbow area disturbances or treatment plant operation or decommissioning, which are carried on the mine’s Exploration Permit and are in the order of $2 100 000. Once the Benbow Decline holes into the 5 600 Level Adit (the main access), the Benbow area will become part of Stillwater Mine for the purposes of rehabilitation closure costing. Accordingly, the closure costs for the Benbow area, which are currently carried on the mine’s Exploration Permit, will be transferred to the mine and included in the Stillwater Mine surety bond. The Exploration Permit rehabilitation bond will drop while the Stillwater Mine rehabilitation bond will increase accordingly in 2019. However, it is anticipated that the closure costs for Stillwater Mine are likely to be adjusted upwards for the 2021 surety revision due to the planned expansions at the mine. Furthermore, the current reclamation cost estimate for Task 6 does not contain explicit funding for the treatment of seepage from the East Side WRSF for any period after closure. However, costs for closure and post-closure water treatment are included for the combined flow (assuming a maximum flow of 1 300G per minute (1 300l/s) based on treatment plant de-nitrification capacity) from adit waters and supernatant water. Post-closure water treatment is currently planned for 18 months after closure is complete. This review could not determine if the combined post-closure adit water flows, tailings supernatant flows from dewatering and WRSF seepage water flows would be less than the assumed 1 300G per minute (1 300l/s).

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Task 7 addresses funding of long-term care and maintenance obligations. This task makes similar assumptions

discussed for East Boulder Mine. Monitoring frequencies are identified and are deemed reasonable. Based on this review’s assessment of the reclamation bond calculation worksheets provided by Stillwater’s Environmental Department, discussions with site Environmental personnel, the approved Reclamation Plans and understanding of the annual regulatory review of surety bases, it is concluded that the current reclamation costs and liabilities are reasonably managed and funded and existing sureties appear adequate to meet foreseeable commitments for Stillwater Mine. Currently, no material additional surety amounts are required. The reclamation costs will only be adjusted upward in the budgets after the surety revision by the MDEQ in 2021 determines the top up amount required.

7.15 Economic Criteria and Analysis SRC5.6(iii); SRC5.6(iv); SRC5.6(v);

7.15.1 Background The capital and operating costs employed for the economic analysis underpinning the current Mineral Reserve estimates are discussed in Section 7.14. No exchange rates have been used for the economic analysis as all prices and costs are reported in the US currency. The Pd + Pd cut-off grades used for Stillwater Mine are 0.20opt (6.86g/t) for the Farwest and 0.30opt (10.29g/t) for the remainder of the mine whereas the Pd + Pd cut-off grade for East Boulder Mine is 0.20opt (6.86g/t).

7.15.2 Taxation SRC5.6(vii) Stillwater’s non-income taxes (primarily property taxes), royalty payments and insurance costs are contractual or governmental obligations outside of the control of Stillwater’s mining operations. SGL has advised that an aggregate tax rate of 25.9% is used for mineral asset valuation. It is to be noted that Mineral Reserves are tested for economic viability on a pre-tax basis.

7.15.3 Mineral Reserve Economic Viability Testing SRC5.8(i); SRC5.8(ii); SRC5.8(iii); SRC5.8(iv)

Stillwater prepares a detailed Ore Reserve Economic Test (ORET) model to determine that the LoM Plan and, hence, the estimated and reported Proven and Probable Mineral Reserves can be profitably extracted over the life of the mines. For the ORET model, each mine develops a first pass mine plan that includes all operating and capital expenses, manpower requirements, equipment replacement and purchase, and primary and secondary development including ventilation and haulages that are needed to extract the estimated Mineral Reserves. This information forms the basis for the ORET cash flow financial analysis, which evaluates the amount and timing of all costs including mine closure costs. This analysis uses 12-quarter (three-year) trailing average prices for the expected production of Pd, Pt and by-product metals. The analysis is done on an undiscounted basis. At the end of July 2017, the estimated life of the Stillwater Mine based on the current 25-year LoM Plan and estimated Proven and Probable Mineral Reserves continues until 2039. For East Boulder Mine, the life of the mine (based on the current LoM Plan and estimated Proven and Probable Mineral Reserves) continues until 2059. The ORET model underpinning the July 2017 Mineral Reserve estimates projects positive undiscounted net LoM pre-tax cash flows for Stillwater and East Boulder Mines, which indicate that the LoM Plans are economically viable under the set of economic parameters utilised. Should the prices of Pd and Pt fall significantly (as happened in 2008 and 2009), the operational plans for each mine will be re-evaluated and appropriate changes will be made considering the then-applicable economic conditions. It should be noted that the ORET model is not the same as Stillwater’s long-range LoM cash flow model, which is based on the 25-year LoM Plan. The 25-year LoM Plan contemplates driving footwall laterals declines and other infrastructure into areas currently classified as Inferred Mineral Resources. Both Stillwater and East Boulder Mines have expanded this way over the years. The ORET model, however, provides a useful check on the economic viability of Mineral Reserve estimates reported.

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8 MINERAL RESERVE ESTIMATES

8.1 Estimation and Modelling Techniques SRC6.1(i); SRC6.1(ii); SRC6.1(iii);SRC6.3(iv)

8.1.1 Mineral Resource Estimate Stillwater has adopted the Mineral Resource reporting terminology and guidelines provided by the SAMREC Code. Mineral Resources have been classified into Inferred, Indicated and Measured categories depending on increasing level of geoscientific knowledge and confidence. Although Stillwater did not report Mineral Resources in its public disclosures of the operations at Stillwater and East Boulder Mines under the SEC Guide 7 reporting regime, it always had geological models of the J-M Reef, which were constructed from extensive drillhole data and which were utilised for the estimation of Reserves. The modelling and estimation techniques employed for current Mineral Resources which have been converted to Mineral Reserves are discussed in Section 6. The estimates are reproduced in Table 65.

8.1.2 Historical Tonnage and Metal Content Reconciliation The conversion of Mineral Resources to Mineral Reserves at Stillwater and East Boulder Mines has followed a methodology that was developed in 1990 and adjusted as required over the years as more geological and mining information became available. Mining experience and reconciliation between Mineral Reserve estimates and actual production figures have demonstrated robustness of the methodology in making estimates of tonnages and ounces that have been reported as Mineral Reserves over the years. The following key parameters, assumptions and Modifying Factors are utilised on an annual basis to develop the mine designs and LoM production schedules: Reef width; Applied cut-off grade; Percentage ore recovered; Geotechnical considerations; Mining method; Minimum mining widths dependant on mining method employed;

Dilution (planned and unplanned overbreak); Extraction rate; Ore loss; MCF; Extraction sequence; Planned productivity; Equipment and personnel equipment requirements; and Fill requirements (type and quantity).

Prior to their application, these are adjusted as required based on the previous five years of the mine’s actual rolling average production outputs (ton and grades) and productivities. Since 2004, reconciliation between the reported Reserves and the actual production in terms of tons and ounces has been carried out on an annual basis to validate the Modifying Factors and assumptions used to generate the LoM plans and thus the Reserves. The results of that annual reconciliation are presented in Table 64.

When there was significant variance that could not be explained through a change in the estimation approach, the Modifying Factors and parameters were adjusted to correct the LoM in the following year. As indicated in Table 64, the factors for Stillwater Mine were corrected at the end of 2004 due to the 16% variance in tonnage and 18% variance in grade. Overall, the variance between estimates and actual tonnage and grades at both mines are within ±10% level, which is a level of accuracy that is aligned with industry best practice for a LoM/Feasibility Study.

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Table 64: Reserves reconciliation

Stillwater Mine

Year Starting Reserve

Tons

Production Tons

Reserve Ton

Addition

Ending Reserve

Tons

Mine-Wide Tonnage

Reconciliation

Starting Reserve

Ounces

Production Ounces

Reserve Ounce

Addition

Ending Reserve

Ounces

Mine-Wide Ounce

Reconciliation

Comments

2004 2 052 112 -728 217 1 016 485 1 971 248 84.2% 1 386 567 -430 259 611 586 1 278 775 81.6% Adjustment to estimation factors and mine planning criteria

2005 1 971 248 -709 661 1 120 436 2 457 616 103.2% 1 278 775 -403 450 745 393 1 663 577 102.6%

2006 2 457 616 -739 377 1 023 974 2 775 189 101.2% 1 663 577 -440 863 679 111 1 818 261 95.6%

2007 2 775 189 -639 659 509 526 2 783 572 105.2% 1 818 261 -386 362 371 036 1 795 640 99.6%

2008 2 783 572 -690 065 675 909 2 910 404 105.1% 1 795 640 -375 188 462 503 1 898 338 100.8%

2009 2 910 404 -726 949 396 581 2 606 133 101.0% 1 898 338 -422 112 260 978 1 712 210 98.6%

2010 2 606 133 -708 172 492 258 2 558 604 107.0% 1 712 210 -375 627 309 615 1 648 021 100.1%

2011 2 558 604 -736 432 600 078 2 782 206 114.9% 1 648 021 -411 436 367 209 1 710 745 106.7% Adjusted cut-off from 0.30 to 0.20 oz/ton in Far West Blocks

2012 2 782 206 -672 605 725 356 3 333 247 117.6% 1 710 745 -405 988 457 483 1 951 790 110.8% Significant amount of stope redesign in Far West Blocks

2013 3 333 247 -765 144 471 414 3 246 524 106.8% 1 951 790 -390 415 324 584 1 855 541 98.4%

2014 3 246 524 -703 054 710 240 3 351 214 103.0% 1 855 541 -361 841 500 111 1 984 260 99.5%

2015 3 351 214 -675 838 562 667 3 247 553 100.3% 1 984 260 -333 511 318 812 1 932 607 98.1%

2016 3 247 553 -683 173 526 210 3 201 916 103.6% 1 932 607 -346 204 303 519 1 898 924 100.5%

Past 5 Years

2 995 887

106.7%

1 904 509

101.9%

East Boulder Mine

Year

Starting

Reserve Tons

Production

Tons

Reserve

Ton Addition

Ending

Reserve Tons

Mine-Wide

Tonnage Reconciliation

Starting

Reserve Ounces

Production

Ounces

Reserve

Ounce Addition

Ending

Reserve Ounces

Mine-Wide

Ounce Reconciliation

Comments

2004 660 346 -485 390 1 048 649 1 225 490 100.2% 284 792 -187 995 483 460 558 293 96.2%

2005 1 225 490 -501 651 1 053 136 1 665 428 93.7% 558 293 -198 032 509 743 787 591 90.5%

2006 1 665 428 -540 910 921 726 2 011 084 98.3% 787 591 -212 959 381 709 902 249 94.3% Adjusted cut-off from 0.20 to 0.30 oz/ton

2007 2 011 084 -530 053 759 210 2 016 758 90.0% 902 249 -200 845 346 859 920 931 87.9%

2008 2 016 758 -372 714 539 659 2 066 117 94.6% 920 931 -155 707 243 483 934 764 92.7% Adjusted cut-off from 0.30 to 0.20 oz/ton

2009 2 066 117 -358 310 37 464 2 036 003 116.7% 934 764 -144 510 16 650 866 809 107.4%

2010 2 036 003 -383 931 342 546 2 058 607 103.2% 866 809 -147 969 153 087 848 110 97.3%

2011 2 058 607 -394 784 397 732 2 228 090 108.1% 848 110 -145 427 160 873 907 053 105.0%

2012 2 228 090 -418 804 888 581 2 690 510 99.7% 907 053 -150 903 396 916 1 125 607 97.6%

2013 2 690 510 -437 389 565 586 2 852 134 101.2% 1 125 607 -175 150 219 385 1 181 434 101.0%

2014 2 852 134 -478 297 387 566 2 814 726 101.9% 1 181 434 -195 700 152 306 1 156 202 101.6%

2015 2 814 726 -537 400 480 181 2 632 018 95.4% 1 156 202 -217 175 169 137 1 055 752 95.3%

2016 2 632 018 -589 882 668 229 2 775 762 102.4% 1 055 752 -233 696 254 207 1 093 411 101.6%

Past 5 Years

2 990 143

100.2%

1 191 951

99.3%

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8.2 Mineral Reserve Classification Criteria SRC6.2(i)

Measured Resources and Indicated Resources are converted to Proved and Probable Reserves as required by the SAMREC Code. Consideration of the geological knowledge and confidence level in the geological model is the first step in the Mineral Reserve classification scheme employed. Measured Mineral Resources which are defined on the basis of drilling on 50ft (15m) centres are converted into Proven Reserves, utilising Modifying Factors based on historical performance and reconciliations. The use of Modifying Factors and costs based on historical performance and reconciliation is aligned with industry best practice and ensures that the estimates are reported within an accuracy level of ±10% (LoM/ Feasibility Study level of accuracy). No Measured Mineral Resources have been converted to Probable Reserves. The Indicated Mineral Resources are converted to Probable Reserves using the same Modifying Factors, but at a lesser level of detail than Proved Reserves. The lower confidence levels in the geological model reflected in the Mineral Resource classification and the lesser detail leads to the conversion outcome being of a lower degree of accuracy than Proved Reserves. Probable Mineral Reserves are based on an accuracy level of approximately ±20% (typical Pre-Feasibility Study level of accuracy). The actual conversion process followed includes the following key components: Development design and scheduling: For each of the mining operations, the development design and

scheduling covers a ten-year period and is scheduled on an annual basis utilising various types of software including AutoCADTM and VulcanTM. Beyond the ten-year window, the primary annual development rates required are derived through the utilisation of historical ratios (e.g. ore ton per foot of lateral development). The scheduling of the stoping is dependent on the completion of the footwall access and the necessary diamond drilling to form an outline of the stopable area in terms of grade and tonnage (inclusive of width).

Stope Proposal and evaluation: On the completion of the footwall lateral development schedule, the starting dates for the development of the stoping blocks are defined, based on when access is attained and the mines requirements in terms of ore production. It is also during this process that the minimum mining width is applied to the true width of the reef, dependant on the applicable mining method and

type of equipment per sub-area. A cut-off grade is applied to the diluted block model to delineate areas of the Mineral Resources that can be scheduled. Additional dilution due to overbreak is also applied. Ore recovery and loss factors are also applied to the stoping blocks. All these Modifying Factors are based on the operations’ historical performance as discussed previously. For each stope block, a proposal is drawn up detailing all the technical inputs such as face timing, mining method, daily production, grade, geotechnical considerations, equipment requirements, ventilation requirements, extraction sequence, etc. Once the technical inputs have been defined for each stope block, they are then subjected to an economic test.

This stope mining economic test uses both the technical and financial inputs to determine the economic viability of the planned stoping operation. Amongst others, these inputs include the following: Recovered ton (mill feed); Ore grade; Mill feed grade; Mill recovery;

Smelter recovery; Total recovered PGMs; Direct mining costs; Revenue at spot prices; and Stope production life span.

From the above process, a net profit/loss is defined and, ultimately, the undiscounted NPV/financial return and pay back for the planned stope are calculated. Once this process is completed, the stope NPV is assessed and, where required, this is optimised to return the best value. Only Stope Proposals that generate a positive NPV are included in the LoM Plan and converted to Mineral Reserves. The tonnage and grades of these stopes are tallied for Probable and Proved Mineral Reserve areas. Another economic test is performed for the LoM Plan through the ORET model as already discussed.

186


Mineral Reserve classification maps for Stillwater and East Boulder Mines are shown in Figure 104 and

Figure 105, respectively. All of the Mineral Reserves reported are derived from the Stillwater (inclusive of the Blitz section) and East Boulder underground mining operations. Operations at Stillwater Mine commenced in 1986 and East Boulder Mine commenced ore production in 2002. In the ORET model, Stillwater Mine currently has a LoM of 25 years while East Boulder Mine has a LoM of 43 years.

187


Figure 104: Mineral Reserve classification for Stillwater Mine

188


Figure 105: Mineral Reserve classification for East Boulder Mine

189


8.3 Mineral Resource and Mineral Reserve Statement SRC5.6(v);SRC6.3(i); SRC6.3(ii); SRC6.3(iii); SRC6.3(v); SRC6.3(vi);SV1.9; JSE12.9(h)(ix)

The Mineral Resource estimates used to derive the Mineral Reserves and the Mineral Reserve estimates as at 31 July 2017 are provided in Table 65. The Mineral Resource estimates are reported inclusive of Mineral Reserves and on the assumption of 100% mining via the R&F underground mining method which is the predominant method used at Stillwater and East Boulder Mines. However, Mineral Resource to Mineral Reserve conversion (and thus the Mineral Reserve estimates in Table 65) considers other underground mining methods employed at these mines. The Mineral Reserve estimates have been compiled Brent LaMoure, assisted by Jim Dahy and Jennifer Evans all of whom are Stillwater employees. The estimation has been supervised and validated by Jonathan Buckley who is a Senior Mining Engineer at The Mineral Corporation. Only the Measured and Indicated portions of the Mineral Resources within the LoM Plan have been included in the Mineral Reserve. No Inferred Mineral Resources have been included in Mineral Reserve estimates. Table 65: Mineral Resource and Mineral Reserve Statement as at 31 July 2017

Imperial

Mineral Resources Mineral Reserves

Category Mine Million Ton Pd + Pt

(Moz) Grade (opt) Category Million Ton

Pd + Pt

(Moz) Grade (opt)

Measured


Proved

3.2 1.9 0.6

East Boulder 4.0 1.8 0.44 2.9 1.1 0.38


Indicated


Probable

16.7 9.8 0.59

East Boulder 32.4 14.7 0.45 23.9 9.4 0.39


Inferred


East Boulder 48.1 21.9 0.46



Metric

Category Mine Tonnage

(Mt)

Pd + Pt

(Moz)

Pd + Pt

Grade (g/t) Category Tonne (Mt)

Pd + Pt

(Moz)

Pd + Pt Grade

(g/t)

Measured


Proved

2.9 1.9 20.56

East Boulder 3.6 1.8 15.22 2.6 1.1 13.17


Indicated

Stillwater 20.2 12.1 18.71

Probable

15.1 9.8 20.11

East Boulder 29.4 14.7 15.55 21.7 9.4 13.46


Inferred

Stillwater 48.9 27.5 17.48

East Boulder 43.6 21.9 15.65



While the Stillwater and East Boulder Mines have surface stockpiles of tailings material and low-grade rock material, the Mineral Resource and Mineral Reserve estimates Table 65 exclude PGM material contained in the stockpiles. All Measured Mineral Resources within the LoM have been converted to Proven Mineral Reserves while all Indicated Mineral Resources have been converted to Probable Mineral Reserves. No Measured Mineral Resources are converted to Probable Reserves. The reference point for tonnage and grade estimates for the Mineral Reserve statement is the delivery of mined ore to the RoM processing plant stockpiles at both mines (Stillwater and East Boulder Mines). Therefore, the tonnage and grade estimates are reported for the RoM ore delivered to the concentrator plants. Only Measured and Indicated Resources have been converted to Mineral Reserves and their economic viability included in the LoM mining operations has been tested in the Mineral Reserve economic test model (ORET). The ORET model underpinning the July 2017 Mineral Reserve estimates projects positive undiscounted net LoM pre-tax cash flows for both Stillwater and East Boulder Mines, which indicates that the LoM Plans are economically viable under the set of economic parameters utilised.

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8.3.1 Reconciliation with Previous Estimates SRC6.3(iv)

Table 66 presents Reserve estimates for Stillwater and East Boulder Mines which were reported under the SEC Guide 7 reporting regime. Compared to the July 2017 estimates in Table 65, a 2% decrease in East Boulder tonnage and Pd + Pt ounces is noted, which is mainly attributable to mining depletion. A 10% increase in tonnage and 12% increase in Pd + Pt ounces for Stillwater Mine are noted and attributable to increasing contribution from the Blitz section. Table 66: December 2016 Reserve Statement for Stillwater and East Boulder Mines

Imperial Metric

Mine Category Million Ton Pd + Pt (Moz) Pd + Pt Grade (opt)

Tonnage (Mt) Pd + Pt (Moz) Pd + Pt Grade (g/t)

Stillwater

Proven 3.2 1.9 0.59 2.9 1.9 20.33

Probable 15.1 8.6 0.57 13.7 8.6 19.43


East Boulder

Proven 2.8 1.1 0.39 2.5 1.1 13.51

Probable 24.6 9.6 0.39 22.3 9.6 13.45



The Mineral Corporation has also interrogated the ratios of Proven to Probable Reserves reported by Stillwater since 2015, which average 22% for Stillwater Mine and 11% for East Boulder Mine (Figure 106). There is consistency in Stillwater’s ability to upgrade Probable Mineral Reserves reported for the mines, which may suggest that there are no material tonnage and grade risks in the Probable Mineral Reserves reported. The gradual increase in the Stillwater Mine Mineral Reserves due to additional contribution from the Blitz section is noted. Significant portions of Inferred Mineral Resources, which have been excluded from the Ten-year LoM Plan underpinning the current Mineral Reserves, are indicated in Figure 106.

8.4 Audits and Reviews SRC7.1(i); SRC7.1(ii)

The mining and ore processing operations at Stillwater and East Boulder Mines (as well as the smelting laboratory analysis and base metal refining operations) have been subject to yearly external audits since 1990

until December 2016. Behre and Dolbear has completed most of the audits pertaining to the geological data gathering, processing and storage, geological modelling, mine planning and Mineral Reserve estimation and reporting. All these audits were based on the SEC 7 Guidelines reflecting Stillwater’s reporting regime at the time. The latest audit by Behre and Dolbear was completed in February 2017 for the December 2016 public reporting. Behre Dolbear is a mineral industry advisory firm providing specialist services technical and strategic studies for mining companies’ financial institutions governments and international agencies. For the audit, Behre and Dolbear employed a team of appropriately experienced personnel. The audit concluded the manner employed by Stillwater to obtain relevant data to estimate its Mineral Reserves and the estimation methodology used are proper and conducted in an exemplary fashion. The audit identified risks which are typical for mining operations located in matured mining areas globally and in the areas of metal pricing, costing, manpower requirements, regulatory changes, unknown geological conditions, estimation and inherent sample variability. Stillwater provided sufficient mitigation for these risks over time and the declaration of Mineral Reserves at the time was acceptable.

For the purposes of this CPR, The Mineral Corporation has completed a comprehensive technical review of the geological data gathering, processing and storage, geological modelling, mine planning and Mineral Resource and Mineral Reserve estimation and reporting for Stillwater mining and ore processing operations as well as the smelting laboratory analysis and base metal refining operations. A team of appropriately experienced personnel indicated in Table 2 completed the technical review. With the current public reporting being under the SAMREC Code reporting regime, The Mineral Corporation provided guidance to Stillwater for the reporting requirements under this regime. The Mineral Corporation has confirmed the risks identified by Behre and Dolbear in February 2017 and agrees with materiality of the risks as interpreted by Behre and Dolbear. The Mineral Resource estimates for Stillwater and East Boulder Mine are supported by extensive geological data which has been validated and processed using methods and approaches that are consistent with industry best practice. Similarly, the Mineral Reserve estimates are supported by detailed LoM Plans which are based on reasonable and realistic technical and economic parameters and Modifying Factors with the methods employed for the planning and economic evaluation of the plans consistent with industry best practice. The reporting of the Mineral Resources and Mineral Reserves for Stillwater and East Boulder Mines has followed the guidelines

of the SAMREC Code.

191


Figure 106: Comparison of the historical Mineral Reserve estimates for Stillwater and East Boulder Mines

192


9 OTHER RELEVANT DATA AND INFORMATION

SRC8.1(i)

9.1 Catalytic Converter Business

9.1.1.1 Background As part of its smelting and refining process, Stillwater operates a recycling facility for spent automotive catalytic converters at its Columbus Metallurgical Complex. The recycled catalytic converters are added to the concentrate from the mines in the electric arc furnace and the contained PGMs are recovered using the copper and nickel in the mine concentrate as collectors. The format of the catalytic converters varies with the origin of the supply. The European market is being typified by more diesel vehicles which use a SiC substrate and tend to be higher in carbon content whilst the North American market tends to supply an exclusively palladium containing recycle material. Carbon and SiC are problematic to the smelting process dependant on the levels contained, and thus are measured and managed accordingly. The recycle business is operated on both toll and outright purchase bases dependant on prevailing market conditions. However, under these scenarios, accurate sampling and analysis is critical to the business.

9.1.1.2 Recycle Samples Each individual bag of catalyst is received with an indicative analysis of PGM content and carbon content. Once selected for processing, the bag is delivered into the process via a Tema Dual DiscTM sampler to a three-point sample divider, which ultimately produces a duplicate 64oz (2kg) sample per bag after pulverising. These samples are delivered manually to the dedicated recycle laboratory facility. This is discrete from the main assay laboratory to prevent any potential cross-contamination due to the high grade of the recycle materials. The analytical process for the recycle materials is depicted in Figure 107 from which it may be seen that the carbon analysis is performed via the Leco Analysers ahead of any other analysis to ensure that the process critical carbon levels are in line with the levels reported by the customer. This carbon analysis is used to inform the blending and processing of recycle materials to ensure excess carbon is not added into the smelting process. The laboratory processing for the recycle samples is fully automated with the samples being captured into LIMS via a barcode, which is linked to the original bulk bag of recycle material. The received samples are pulverised, and split. The split sample is used to make XRF pellets, which are produced via a robotic sample preparation facility. The duplicate pellets are then automatically fed into the scanning XRF instrument. This automated analytical facility has been fully operational since 2012 and has reduced the turn-around time for analysis of spent catalyst shipments for customers from up to 30 days to less than seven days, giving a significant competitive advantage in obtaining catalyst shipments from suppliers in terms of both cash flow and inventory/pipeline costs.

9.1.1.3 Recycle Processing The recycle materials are delivered in bulk bags with a mass and chemical analysis per bag from the supplier. The official mass and analysis measurements are performed by Stillwater. The bags are stored until the furnace feed recipe allows for processing (based on the contained carbon) and then delivered into the process via the sampling plant. This has a nominal capacity of approximately 30 tons (27t) per day. However, the operational budget calls for approximately 24 tons (22t) per day or recycle feed to the smelting plant. The bags are weighed and the contents introduced into the sampling plant which comprises several stages of magnetic and tramp removal, a rotary impact breaker to reduce the agglomerate size, followed by the Tema Dual DiscTM sampler. This produces a bulk sample equivalent to approximately 1.6% of the bulk mass which is then further reduced via a three-point rotary splitter to produce the final samples for the laboratory analysis. All sections of the sampling process operate under negative pressure via a bag filter to ensure no losses of material. The bag filter then deposits all collected dust into the Tema sampler feed hopper ahead of sampling to ensure batch integrity is maintained. The sampled and crushed recycle materials are introduced into the smelting process via a dedicated hopper in the batching plant and are then blended into the primary furnace feed via the computer control system. The copper and nickel in the matte from the mine concentrates act as a collector for the Pd and Pt present in the smelter feed stream originating from both mine concentrates and recycle materials. As such, it is critical that the recycle materials are balanced with the mine concentrates to ensure sufficient collection capacity for the total PGM loading delivered.

193


Figure 107: Recycle Laboratory Processes

The quantity of recycled catalytic converters received typically fluctuates with the prices of PGMs and the specific market conditions where the recycle materials originate. In 2016, the smelter and refinery processed 8 999 tons (8 164t) of recycled catalysts containing 623 007oz (19 378kg) of Pd + Pt, which compares with the 2015 totals of 7 638 tons (6 929kg) of recycled catalyst containing 515 173oz (16 024kg) Pd + Pt.

9.1.1.4 Recycling Operations The catalyst recycling business forms an integral part of the Columbus Metallurgical Complex processing feedstock, but is not relevant to the economic evaluation of the LoM Plans and the declaration of Mineral Reserves for Stillwater and East Boulder Mines. Pd and Pt reported in the converter matte and filtercake are derived from recycle and mining operations. The Pd and Pt prill splits for the matte and filtercake are presented in Table 67. Table 67: Summary of 2E prill split data

Material Pd/Pt Ratio Prill Split %

FY2016 FY2017 (to Jun) %Pt %Pd

Columbus Matte 2.11 2.36 32.2% 67.8%

Columbus Filter Cake 2.11 2.38 32.1% 67.9%

194


9.2 Planned Exploration and Expenditure JSE12.9(e)(iii)

Exploration work is planned in the brownfield areas (West Fork-Iron Creek areas) situated to the west of Stillwater Mine. A surface drilling programme involving 19 900ft (6 066m) and anticipated to cost approximately $2.85 million is planned. However, the exploration budget is as yet approved. Between 1973 and 1993, surface exploration work was completed in the area to locate and follow the J-M Reef along strike to provide discoveries and support patent applications for the mining claims. However, there is a lack of deep sub-surface geological information for this area. This exploration programme is aimed at gathering geological and geotechnical information on the J-M Reef at depth in the area of the West Fork. This information will guide future studies and additional technical work to evaluate the J-M Reef between Stillwater and East Boulder Mines. The programme is expected to commence subject to budget approval by Stillwater management and approval Drilling and Water Permits by the State of Montana and USFS.

9.3 Risk Assessments SRC5.7(i); ESG4.9.1;ESG4.9.2; JSE12.9(h)(x)

The Mineral Corporation has completed a semi-quantitative risk analysis of the Stillwater operations discussed in this CPR. For this, The Mineral Corporation has utilised the SAMREC Code’s guideline in assessing the materiality of a risk identified, whereby an issue should be considered material if it results in an economic outcome different from that currently envisaged by 10% or more. The risk should have a high chance (likelihood) of occurrence. If an issue does not satisfy both criteria, it has been identified as a low to medium risk or minor issue. It is noted that Stillwater has a risk management process in place that identifies risks, assesses the materiality of the risks and provides mitigation measures where possible. From the current assessment, potential material issues have been identified relating to material price decreases and the proposed rule by the EPA under Section 108(b) for the CERCLA, which will establish financial responsibility requirements for owners and operators of hardrock mining facilities. The impact of a material price change is assessed through a price sensitivity analysis, with a material drop in the combined Pd + Pt price from the current, necessitating a revision of the LoM Plans for the operations. Stillwater will be in a position to quantify the additional cost and materiality to the NPV due to the implementation of the rule by the EPA only when the rule has been promulgated. Except for these two risks, the remainder of the risks identified are considered to be minor operational issues that can be dealt with by the mitigation measures adopted by Stillwater. These minor issues should not be ignored as they can potentially become material issues in the long term. The Mineral Corporation is satisfied that Stillwater is fully aware of the risks identified by The Mineral Corporation and has mitigation measures in place or is actively pursuing strategies to minimise the impact of the risks on the mining and processing operations in Montana. The following commentary details the risks identified by The Mineral Corporation as well as mitigation measures in place or proposed for Stillwater’s consideration to minimise the impact of the risks: Inaccurate tonnage estimates: Tonnages estimates for the Mineral Resources and Mineral Reserves for

Stillwater and East Boulder Mines are based on an average specific gravity estimate of 0.086 ton/ft3, which was determined in 2000. Tonnage reconciliation completed by Stillwater indicates that the estimated tonnages have been understated by approximately 6% at Stillwater Mine since 2012. The estimated and actual tonnage figures for East Boulder Mine for this period are aligned. Furthermore, recent specific gravity data accumulated by Stillwater since July 2017 suggests that the specific gravity used for tonnage estimation for both mines is understated by approximately 4%. The reconciliation data and the recent specific gravity data indicate that the use of an average specific gravity is not a material issue. The conservative stance by Stillwater to use the historical specific gravity estimate provides sufficient mitigation for the risk of inaccurate tonnage estimates. The approach by Stillwater to collect specific gravity data on a routine basis is a positive step that will permit the modelling of specific density used for tonnage estimation.

Unknown geological conditions: The geological character of the J-M Reef has been established by

systematic surface and underground drilling. Reconciliation between estimated tonnage and grades completed by Stillwater since 2004 indicates alignment between estimated and actual tonnage and grades. It is noted that the current drillhole spacing for Measured Mineral Resource areas provides sufficient information for the interpretation of major geological structures affecting Measured and Indicated Mineral Resource areas. It is unlikely that there are major unknown geological structures that could have a material impact on the LoM Plans for Stillwater and East Boulder Mines. However, geological interruptions due to small scale structures may be encountered in these areas. Small scale faults and dykes lead to additional dilution of ore during mining operations. The additional dilution, which is based on historical experience, has been accounted for during Mineral Resource to Mineral Reserve conversion.

195


Lower than expected Indicated and Inferred Mineral Resource grades and tonnages: Geostatistical

evidence and historical experience have provided useful information to understand the macro-continuity of the J-M Reef as well as to understand local variability of the reef. Local variability is expressed in the geological domains or sub-areas delineated at both Stillwater and East Boulder Mines, which are taken into account during the estimation of tonnage and grades at these mines. Local variability is more pronounced at Stillwater Mine where significant amounts of metal are periodically found in ballrooms. The spacing and size of ballrooms cannot be predicted. The estimation methodology for Indicated and Inferred Mineral Resource grades and tonnages assumes continuity of J-M Reef facies, grade and tonnages from the extensively drilled areas into sparsely drilled areas. This leaves a low to medium risk of lower than expected grades and tonnages in the Indicated and Inferred Mineral Resource areas. The use of regional means provides sufficient mitigation against this risk. It is noted that ore production takes place in Measured Mineral Resource areas, where tonnage and grade estimates are informed by Mineral Resource and Mineral Reserve definition drilling data. This data provides sufficient geological information for refining the stope designs. Reconciliation of the estimated tonnage and grades versus actual production tonnage and grade indicates that the estimation methodology used produces acceptable results.

Geotechnical risks: Stillwater and East Boulder Mines have accumulated an extensive geotechnical

database and developed ground classification and support measures that are suited to the rockmass conditions. These measures have eliminated major falls of ground at Stillwater and East Boulder Mines. However, as with all mining operations, there is always a degree of residual low risk relating to excavation failures. It is noted that the systems and support standards in place at mines are sufficient to minimise the potential impact of geotechnical risk.

Geohydrological risks: Mining operations at Stillwater and East Boulder Mines have not experienced

material interruptions due to groundwater problems, with both mines being relatively dry in the upper sections. However, a significant amount of groundwater has been encountered at the Blitz section of Stillwater Mine during the development of the TBM and Benbow Adits. This groundwater poses a medium risk in terms of excavation stability and the management and disposal of the water generated. Stillwater is taking a two-pronged approach to mitigate this risk. Firstly, when groundwater is encountered during an advance, the development end is halted and a cement grouting programme takes place. Secondly, Stillwater has commissioned Itasca to continue with the geohydrological study and monitoring at the Blitz section and to expand the geohydrology study to the remainder of Stillwater Mine and to East Boulder Mine. This is a proactive stance adopted to gain a better understanding of the source of the groundwater and its potential impact on future mining operations.

Failure to achieve the LoM Plan: Mineral Reserve estimates and the underlying LoM plans are inherently

forward-looking statements subject to error or change due to changes or optimism in the underlying technical and economic parameters utilised. Although experience in mining at the Stillwater and East Boulder Mines has provided improved understanding of the mineralisation, improved modelling ability and Modifying Factors, estimation errors cannot be eliminated. The major expected sources of error in the Mineral Reserve estimates, in order of importance, include metal prices, estimated mining and production costs, manpower requirements, regulatory changes, unknown geological conditions, estimation methodologies and inherent sample variability. The timing and effect of such changes cannot be predicted. These factors are continually being reviewed to determine whether any adjustments are needed and are partially mitigated through the use of a significant amount of historical data in the LoM

forecasting of key elements of the operations, namely RoM ore production levels, RoM grades and operating costs. In addition, the mines have systems and personnel in place that monitor the mining operations on a daily basis (working face for working face) to ensure stope faces are kept on-reef and thus the grades are realised as per the plan (Stope Proposal). Reviewing the annual reconciliation data presented demonstrates the levels of accuracy being attained in the said forecasting. In addition, Mineral Reserves are subjected to an economic test (ORET) to demonstrate their economic viability prior to being reported.

Mining and production cost escalation: In the past, mining and production costs have typically increased

over time, with the increases linked to producer inflation. Restructuring at both Stillwater and East Boulder Mines during 2015 resulted in a significant mining cost reduction. These costs are also impacted by the mining methods employed and the quantities of ore and waste produced each year from each mine. Improvements in mining efficiency continued in 2017 that allow for improved profitability of Stillwater’s operations. Furthermore, additional initiatives adopted for rapid containing cost escalation include the increased use of mechanised mining methods, thereby improving productivities and reducing operating costs, increasing mining volumes through the development of the Blitz section at Stillwater and

optimising the mining fleets (reducing active units) to reduce maintenance costs.

196


Power losses: The loss of power at the mining operations during the winter months (snow and high

winds) represents the single notable risk relating to mining infrastructure. The power losses are infrequent and are mitigated by the use of backup generators. The generators have sufficient capacity to power surface and underground fans so that, if required, personnel can be safely withdrawn from the underground mining operations.

Inadequate TSF capacity at Stillwater and East Boulder Mines: TSFs at Stillwater and East Boulder Mines

have adequate capacity for the short and medium term (ten-year range) storage of tailings from the mines. However, the ore production increase at Stillwater Mine following the development of the Blitz section will result in an increased filling rate for the Hertzler TSF and additional capacity required three to four years earlier than currently anticipated. Similarly, additional capacity at the East Boulder TSF will be required two years earlier than anticipated. Permitting for TSF capacity upgrades or the construction of new TSFs may require periods of five to seven years. Stillwater is aware of these long-term tailings storage capacity shortfalls and has already embarked on the necessary technical studies required in support of permit applications. It is unlikely that the operations will run out of TSF capacity before Stillwater receives approvals for the construction of new TSFs or upgrading of the existing TSFs.

Inadequate concentrator capacity: Production capacity at Stillwater Mine is set to double in the long term

when production from the Blitz section reaches steady state. Plans are in place for concentrator capacity upgrades to achieve sufficient capacity in 2021 but a minor concentrator capacity shortfall of 47 000 tons is anticipated in 2020. Stillwater plans to expedite the upgrades, stockpile the excess tonnage or reduce the slag tonnage to account for this potential capacity shortfall.

Poor amenability of Blitz ore: Predictions of metallurgical amenability for ore from the Blitz section of

Stillwater Mine are based on preliminary testwork and the assumption that the ore will have similar metallurgical characteristics to the ore at the Off-shaft area of Stillwater. Based on the available information, it is unlikely that ore from the Blitz section will materially differ with that from the Off-shaft area. Furthermore, the ore from the Blitz section will be subjected to amenability testing once representative samples are available – i.e. late 2017 to early 2018.

Environmental non-compliance: The Stillwater and East Boulder Rivers are the principal resources that

may be adversely affected by mining operations at Stillwater and East Boulder Mines. Waste rock mined at Stillwater and East Boulder Mines has negligible potential to generate acid or acid mine drainage. Results of routine water quality assessments completed by Stillwater indicate that the river waters are of very high quality, but have measurable loading of nitrate and dissolved solids emanating from the mining operations. There is, however, no evidence that aquatic or terrestrial wildlife populations have been adversely impacted by the nitrate and dissolved solids. All the TSFs at the mines are lined and have subdrains for the reclamation of excess water, except the Nye TSF, which will maintain a maximum hydrostatic head on the liner in perpetuity. There is the potential that changing regulatory requirements may result in underdrain seepage being non-compliant, necessitating additional intermediate to long-term treatment or corrective action for the TSFs that have underdrains. Mitigation measures currently under consideration by Stillwater for lowered metals and nitrogen species standards for effluent from TSF underdrains, mine adits and WRSF include passing the discharge through engineered wetlands (which can lower constituent concentrations further by additional chemical and biological reduction) and the addition of reductants or organic compounds to stimulate biological reduction in TSF or infiltration basins until such sufficiently reduced conditions are established to maintain acceptable discharge water quality.

Safety: There is a significant focus on safety aimed at protecting personnel and assets (e.g. excavations

and equipment) at the Stillwater operations in Montana. Failure to do so will result in increased MSHA penalties and reputational risk. Stillwater has comprehensive safety and induction training systems to ensure all new and returning staff have proper training prior to commencement of job responsibilities. Stillwater’s efforts since 2011 focused on improving safety at all of its operations via the “GET Safe” Safety and Health Management System are noted. Based on the current performance since 2011, which is reflected by the reduction in safety related penalties and citations by the MSHA, it appears that the additional focus is generating the desired results.

197


Staff turnover and inability to attract required skills: Stillwater’s long-range mine plans depend on its

ability to attract, develop and retain the staff required to achieve the planned mine development and mining production rates. Stillwater has a target staff attrition rate of 8% per annum and has achieved an attrition rate of 5.6% between 2016 and 2017. This can be attributed to the global downturn in mineral commodity prices and production curtailments by miners preventing high labour mobility, as well as Stillwater’s favourable remuneration and retention policies. There is potential that this situation may not be sustainable over the long term as an upturn in mineral commodity prices may trigger production expansions and demand for skilled underground mine labour, resulting in a higher in-country and global labour mobility. However, Stillwater has taken a proactive stance in terms of employment contracts, reflecting industry aligned conditions of employment and remuneration levels.

Lower than forecast metal prices: The prices for palladium and platinum fluctuate depending on global

supply and demand, which makes pricing forecasting an onerous task. Demand for palladium and platinum primarily depend on their use in auto-catalytic converters for both gasoline and diesel engines. Stillwater has traditionally relied on the 12-quarter trailing averaging technique for forecasting of prices utilised for economic viability testing of its Mineral Reserves. A material decrease in prices for both palladium and platinum may necessitate a change in the mine plans. The estimated revenue per combined ounce of palladium and platinum over the LoM Plans varies depending on which parts of each of the mines are being exploited. This offers the mines the flexibility to delay the mining of sub-economic areas during times of price downturns.

Regulatory changes: Stillwater is currently in compliance with all regulatory requirements for its mining

and ore processing and beneficiation facilities in Montana. The legal framework for mining in the USA appears to be straightforward and stringently monitored. However, there is no assurance that the regulatory framework will not change in both the Montana State and USA. The proposed rule by the EPA under Section 108(b) for the CERCLA, which is awaiting final promulgation, is an example of such a regulatory change. It will establish financial responsibility requirements for owners and operators of hardrock mining facilities to demonstrate financial responsibility independent of existing surety amounts. The financial responsibility amounts may result in increased surety instrument requirements. Obtaining permits and approvals needed to build and operate a mine takes an average of seven years and is costly. Added to this is social licensing in which non-governmental organisations and citizens are participating actively in the scoping and review of mining permits. Stillwater’s Good Neighbour Agreement provides a means for Stillwater and all interested parties to discuss issues as they arise and reach mutually acceptable resolutions.

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10 MINERAL ASSET VALUATION

10.1 Introduction and Scope SV1.0; to SV1.10 inclusive; SV1.13; SV1:18;SRC5.8(i-iv);JSE12.9(a); JSE12.9(d); JSE12.9(f); JSE12.9(h)(i-xi inclusive)

On 9 December 2016, SGL announced through the JSE SENS that it had entered into a definitive agreement to acquire all of the outstanding common stock of Stillwater for $2.2 billion in aggregate. SGL announced the conclusion of the acquisition on 4 May 2017 through the JSE SENS. Stillwater included the Montana Assets (the subject of this CPR), Marathon Project in Canada and Altar Project in Argentina at the time of the acquisition. The Montana Assets of Stillwater, which are the subject of the CPR, comprised East Boulder Mine and Stillwater Mine including its expansion into the Blitz section, integrated concentrators, smelter, recycling plant and the BMR. The scope of work for this valuation comprises an independent valuation of the Mineral Resources and Mineral Reserves of Stillwater and East Boulder Mines (the Mineral Assets), informed by the content of the CPR on the Montana PGM Mineral Assets of SGL. The valuation is presented on a 100% ownership basis. The 31 July 2017 Mineral Resource and Mineral Reserve Statement for these assets is presented in this CPR (Section 8.3, Table 65). Additional information and illustrations regarding the Mineral Resources and Mineral Reserves estimation and Modifying Factors are presented in Sections 4 to 8 of this report. The Competent Valuator (CV) has personally inspected the Mineral Assets, critically considered the findings and recommendations of The Mineral Corporation’s Review (“Review” as defined by the SAMREC Code) of the Mineral Resource and Mineral Reserve estimation methodologies that underpin the Mineral Assets, and has interviewed the key Competent Persons for Mineral Resources and Mineral Reserves employed by SGL at the operations. The CV is satisfied that the Mineral Resource and Mineral Reserve estimates may be relied upon as the basis for a Mineral Asset valuation, and that the facts presented in this report are correct to the best of the CV’s knowledge. On this basis, it is concluded that the analyses and conclusions presented herein are limited only to the reported forecasts and conditions. The CV has no present or prospective interest in the Mineral Assets, and the results of this report have no bearing or consequence on the professional fees earned in this work. Furthermore, the CV has no bias with respect to the Mineral Assets that are the subject of this report, or to SGL, the commissioning entity for this assignment. The CV’s credentials and experience and signature to this report are included in Appendix 1. The valuation results have been informed by the comprehensive market review of palladium and platinum presented in Section 7.13 of this report. The Mineral Resource and Mineral Reserve estimates are reported as at 31 July 2017. The valuation results are presented at an effective date of 31 July 2017 and have been prepared in compliance with the SAMVAL Code.

10.2 Previous Mineral Asset Valuations SV1.11

The Mineral Corporation is not aware of any previous Mineral Asset valuations for these Mineral Assets.

10.3 Cost Approach Valuation Result SV1.12; SV1.14

The Mineral Assets have not been valued using the Cost Approach as this method is not considered to be appropriate for these established mining operations, embedded in an integrated mine to market business. Stillwater and East Boulder Mines are mature PGM operations, having been in operation since 1986 and 2002, respectively.

10.4 Income Approach Valuation Results SV1.14; JSE12.9(h)(xii)

10.4.1 Background The Montana Mineral Assets have been valued through the construction of a Discounted Cash Flow (DCF) model based on the planned mine production data, with due regard to appropriate financial model inputs and reasonable assumptions informed by The Mineral Corporation’s review as set out in this CPR. In the preparation of the DCF model, the following aspects discussed in Sections 10.4.2 to 10.4.4 have been considered.

10.4.2 Revenue and Cost Inputs SV1.18

10.4.2.1 Revenue Inputs Guided by the market review and metal price commentary contained in Section 7.13, the following key metal price and fiscal assumptions have been applied (Table 68).

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Table 68: Metal price and inflation forecast Element Units 2018 2019 2020 2021 Long Term

Platinum price (real) $/oz 1 133 1 133 1 133 1 133 1 150

Palladium price (real) $/oz 888 888 888 888 850

US inflation % 1.5% 1.5% 1.5% 1.5% 1.5%

10.4.2.2 Capital and Operating Cost Inputs SV1.9; SV1.10

The capital and operating cost inputs used in the construction of the DCF model have been reviewed in Section 7.14 of this CPR. These are summarised on a $/milled ton basis for East Boulder (Table 69) and Stillwater Mines (Table 70). Table 69: East Boulder Mine cost profile

East Boulder Mine Unit

2017 (Aug-Dec) 2018 2019 2020 2021 2022 2023 2024 2025 LT Av.

Cash Cost $/ton milled $145.81 $155.45 $158.50 $154.16 $156.30 $155.75 $156.59 $156.83 $155.47 $151

Capital Cost $/ton milled $34.67 $40.73 $38.71 $28.76 $26.82 $26.80 $27.58 $29.30 $27.38 $31

Total Cost $/ton milled $180.49 $196.19 $197.20 $182.91 $183.12 $182.55 $184.17 $186.13 $182.85 $183

Table 70: Stillwater Mine cost profile

Stillwater Mine Unit 2017 (Aug-Dec) 2018 2019 2020 2021 2022 2023 2024 2025 LT Av.

Cash Cost $/ton milled $187.21 $208.24 $200.26 $197.39 $200.74 $197.18 $199.14 $196.00 $210.18 $185

Capital Cost $/ton milled $195.68 $222.76 $175.56 $154.20 $75.53 $76.95 $58.47 $61.65 $46.25 $60

Total Cost $/ton milled $382.89 $431.00 $375.81 $351.60 $276.28 $274.13 $257.60 $257.65 $256.43 $245

10.4.3 Taxation SV1.12; SV1.16

A company tax rate of 25.9% has been applied to the DCF model. This rate is made up of the cash tax rates for the State of Montana and Federal taxes. Taxation has been computed on revenue less operating costs and depreciation, depletions and amortisations of capital expenditure. Guided by SGL management, the combined Montana Assets incur a modest tax benefit that cannot be apportioned to the mines individually, which has arisen from a prior year Net Operating Loss (NOL). This has been taken into account in the valuation results of the combined Mineral Assets. Taxation is calculated on nominal cash flows and discounted back to money of the day (being at 31 July 2017) to accurately depict the effect of inflation on depreciation, depletion and amortisation claims. The nominal taxation cash flow is converted to real cash flows and incorporated into the DCF model, which is presented in real terms as 31 July 2017.

10.4.4 Working Capital SV1.12

Working capital requirements have been estimated based on historical working capital levels. The working capital requirements are computed on nominal cash flows and the nominal changes in working capital are converted to real cash flows and incorporated in the real terms DCF model.

10.4.5 Abridged Cash Flow Models SV1.14; SV1.16

The abridged cash flow models for East Boulder and Stillwater Mines incorporating the foregoing inputs and assumptions have been prepared as follows: East Boulder Mine: a cash flow for East Boulder Mine based on the 2017 East Boulder 25-year LoM Plan;

Stillwater Mine Scenario A: a cash flow for the Stillwater Mine, including the Blitz section, as per the 2017

Stillwater Mine 25-year LoM Plan; The cash flow models for East Boulder Mine and Stillwater Mine Scenario A are set out in Table 71 and Table 72, respectively. The 25-year LoM Plan for Stillwater Mine includes a proportion of Inferred Mineral Resources to the east of the currently defined Measured and Indicated Resources in the Blitz section. These Inferred Mineral Resources are included in the LoM production schedule over the 15-year period after 2026. Post 2026, these Inferred Mineral Resources contribute approximately 30% of the total planned tonnage to mill in the 25-year LoM Plan for Stillwater Mine. There is a reasonable expectation that the Inferred Mineral Resources in this area will be upgraded to Indicated and Measured Resources as the basis for additional Mineral Reserves as progressive underground development permits additional Mineral Resource and Mineral Reserve definition drilling. However, the SAMREC Code and the SAMVAL Code require that the possible impact of the complete exclusion of such

200


Inferred Mineral Resources on cash flows be demonstrated. For this purpose, a cash flow model for Stillwater Mine,

which constrains the contribution from the Blitz section to the Mineral Reserve envelope within the 10-year mining plan (i.e. up to 2026), has been prepared. The abridged cash flow model for this scenario (termed Scenario B) is presented in Table 73, and has been prepared as follows: Stillwater Mine Scenario B: a cash flow for the Stillwater Mine as per the 25-year LoM Plan, but

constraining mining in the Blitz section to ten years. From 2027 until the end of the LoM, the model considers production from only the current section of Stillwater Mine.

In addition, a third cash flow scenario (Scenario C) for Stillwater Mine, which considers the 25-year LoM for the current section of Stillwater Mine, while permitting an 18-year LoM contribution to the overall Stillwater LoM Plan from the Blitz section, has been prepared. This scenario recognises the reasonable but yet to be realised expectation that a proportion of the Inferred Mineral Resources in the Blitz East area will be upgraded to Indicated and Measured Resources as the basis for additional Mineral Reserves as progressive underground development permits additional underground Mineral Resource and Mineral Reserve definition drilling. The abridged cash flow model for Scenario C is contained in Table 74, and has been prepared as follows:

Stillwater Mine Scenario C: a cash flow for Stillwater Mine as per the 25-year LoM Plan, constraining

mining in the Blitz Section to 18 years. From 2035 until the end of the LoM, the model considers production from only the current section of Stillwater Mine.

201


Table 71: Abridged cash flow for 25-year LoM Plan for East Boulder Mine

East Boulder Mine Abridged Cash Flow Model to 2041, 25-year LoM (Real)

Component Units Total Average 2017 (Aug-Dec) 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027-2041

Production

Milled Ton Sh. Ton 17,092,723 683,709 282,918 662,752 667,590 705,013 703,087 703,087 703,087 705,013 703,087 703,087 10,554,004

Contained Pt oz oz 1,320,202 52,808 23,213 54,377 54,616 54,278 54,130 54,275 54,130 54,278 54,130 54,275 808,498

Contained Pd oz oz 4,754,179 190,167 83,592 195,818 196,679 195,461 194,927 195,451 194,927 195,461 194,927 195,451 2,911,483

Saleable PGM

Platinum oz 1,203,862 48,154 21,167 49,586 49,804 49,495 49,360 49,493 49,360 49,495 49,360 49,493 737,251

Palladium oz 4,204,762 168,190 73,931 173,189 173,950 172,873 172,400 172,864 172,400 172,873 172,400 172,864 2,575,017

Revenue

PGM $m $4 983.6 $ 199.3 $ 89.6 $ 209.9 $ 210.8 $ 209.5 $ 209.0 $ 203.9 $ 203.3 $ 203.9 $ 203.3 $ 203.9 $3 036.6

Total Revenue $m $4 983.6 $ 199.3 $ 89.6 $ 209.9 $ 210.8 $ 209.5 $ 209.0 $ 203.9 $ 203.3 $ 203.9 $ 203.3 $ 203.9 $3 036.6

Cash Costs

Mine Site Costs $m $2 255.9 $ 90.2 $ 38.4 $ 94.0 $ 92.6 $ 93.0 $ 92.9 $ 92.8 $ 92.5 $ 92.6 $ 92.6 $ 92.5 $1 382.0

SG+A Costs $m $ 238.8 $ 9.6 $ 4.1 $ 10.8 $ 9.9 $ 9.8 $ 9.8 $ 9.8 $ 9.8 $ 9.8 $ 9.8 $ 9.8 $ 145.3

Less Cap Dev $m -$ 319.6 -$ 12.8 -$ 7.6 -$ 18.7 -$ 14.8 -$ 13.2 -$ 12.8 -$ 13.2 -$ 12.2 -$ 11.9 -$ 13.1 -$ 11.9 -$ 190.3

Met Complex Costs $m $ 391.5 $ 15.7 $ 6.0 $ 15.8 $ 16.5 $ 17.2 $ 17.7 $ 17.6 $ 17.6 $ 17.7 $ 17.6 $ 17.6 $ 230.2

Columbus Support $m $ 35.8 $ 1.4 $ 0.6 $ 1.6 $ 1.5 $ 1.4 $ 1.3 $ 1.3 $ 1.3 $ 1.3 $ 1.3 $ 1.3 $ 23.0

Less By Product Credits $m -$ 318.5 -$ 12.7 -$ 5.6 -$ 14.0 -$ 13.8 -$ 13.8 -$ 13.7 -$ 13.8 -$ 13.8 -$ 13.8 -$ 13.8 -$ 13.8 -$ 188.8

Less Recyc. Credits $m -$ 138.8 -$ 5.6 -$ 2.0 -$ 5.5 -$ 5.0 -$ 4.6 -$ 4.0 -$ 3.9 -$ 3.9 -$ 3.9 -$ 3.9 -$ 3.9 -$ 98.4

Royalties $m $ 226.8 $ 9.1 $ 3.6 $ 9.4 $ 9.3 $ 9.2 $ 9.2 $ 9.3 $ 9.3 $ 9.3 $ 9.3 $ 9.3 $ 139.5

Taxes, MMLT, Gross P& prop tax $m $ 190.5 $ 7.6 $ 3.1 $ 7.9 $ 7.8 $ 7.7 $ 7.6 $ 7.7 $ 7.7 $ 7.7 $ 7.7 $ 7.7 $ 118.0

Insurance $m $ 46.6 $ 1.9 $ 0.7 $ 1.8 $ 1.9 $ 1.8 $ 1.8 $ 1.8 $ 1.8 $ 1.8 $ 1.8 $ 1.8 $ 29.8

Total Cash Cost $m $2 609.0 $ 104.4 $ 41.3 $ 103.0 $ 105.8 $ 108.7 $ 109.9 $ 109.5 $ 110.1 $ 110.6 $ 109.3 $ 110.4 $1 590.4

Capital Costs

Capital Development $m $ 319.6 $ 12.8 $ 7.6 $ 18.7 $ 14.8 $ 13.2 $ 12.8 $ 13.2 $ 12.2 $ 11.9 $ 13.1 $ 11.9 $ 190.3

Non-dev Capital $m $ 214.8 $ 8.6 $ 2.2 $ 8.3 $ 11.1 $ 7.1 $ 6.1 $ 5.7 $ 7.2 $ 8.8 $ 6.1 $ 11.9 $ 140.4

Mine $ 1.6 $ 5.8 $ 5.1 $ 1.4 $ 1.7 $ 2.6 $ 2.6 $ 6.1 $ 2.7 $ 2.7

Project $ 0.6 $ 0.3 $ 5.6 $ 4.3 $ 1.1 $ 1.8 $ 0.3 $ 1.4 $ 1.1 $ 7.9

Other $ 2.1 $ 0.4 $ 1.3 $ 3.3 $ 1.3 $ 4.3 $ 1.3 $ 2.3 $ 1.3

Total Cost $m $3 143.4 $ 125.7 $ 51.1 $ 130.0 $ 131.7 $ 129.0 $ 128.7 $ 128.3 $ 129.5 $ 131.2 $ 128.6 $ 134.2 $1 921.1

Operating cash flow before tax and working capital $m $1 840.3 $ 73.6 $ 38.5 $ 79.9 $ 79.2 $ 80.6 $ 80.2 $ 75.5 $ 73.8 $ 72.6 $ 74.7 $ 69.7 $1 115.5

Taxation $m $ 454.0 $ 18.2 $ 10.1 $ 21.5 $ 20.7 $ 19.3 $ 18.9 $ 17.6 $ 17.5 $ 17.4 $ 17.8 $ 17.6 $ 275.6

Working capital changes $m $ 5.7 $ 0.2 $ 0.0 $ 1.1 $ 0.7 $ 0.7 $ 0.5 $ 0.2 $ 0.4 $ 0.3 $ 0.1 $ 0.4 $ 1.4

Free cash flow after taxation $m $1 380.6 $ 55.2 $ 28.4 $ 57.3 $ 57.8 $ 60.6 $ 60.9 $ 57.8 $ 55.9 $ 54.9 $ 56.9 $ 51.6 $ 838.5

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Table 72: Scenario A Abridged cash flow for 25-year LoM Plan for Stillwater Mine

Stillwater Mine Abridged Cash Flow Model to 2041, 25-year LoM (Real)


Production

Milled Ton Sh. Ton 29,848,012 1,193,920 352,755 796,101 926,325 995,227 1,175,972 1,246,274 1,246,274 1,249,689 1,246,274 1,246,274 19,366,847

Contained Pt oz oz 3,582,013 143,281 38,327 87,238 105,578 120,966 147,033 152,912 152,817 153,236 152,817 152,817 2,318,271


Saleable PGM

Platinum oz 3,293,894 131,756 35,286 80,315 97,199 111,625 135,880 141,206 141,119 141,506 141,119 141,119 2,127,519

Palladium oz 11,271,483 450,859 122,697 274,785 332,551 381,908 464,892 483,113 482,815 484,138 482,815 482,815 7,278,952

Revenue

PGM $m $13 420.3 $ 536.8 $ 148.9 $ 334.9 $ 405.3 $ 465.5 $ 566.6 $ 573.0 $ 572.7 $ 574.2 $ 572.7 $ 572.7 $8 633.8

Total Revenue $m $13 420.3 $ 536.8 $ 148.9 $ 334.9 $ 405.3 $ 465.5 $ 566.6 $ 573.0 $ 572.7 $ 574.2 $ 572.7 $ 572.7 $8 633.8

Cash Costs

Mine Site Costs $m $5 690.9 $ 227.6 $ 64.8 $ 184.6 $ 208.9 $ 210.9 $ 234.0 $ 246.1 $ 243.5 $ 243.6 $ 240.1 $ 224.7 $3 589.8

SG+A Costs $m $ 495.8 $ 19.8 $ 6.2 $ 18.0 $ 18.8 $ 20.1 $ 20.3 $ 20.8 $ 20.8 $ 20.8 $ 20.8 $ 20.7 $ 308.7

Less Cap Dev $m -$1 457.4 -$ 58.3 -$ 14.5 -$ 60.6 -$ 71.2 -$ 67.4 -$ 58.9 -$ 63.5 -$ 58.5 -$ 61.9 -$ 41.3 -$ 30.0 -$ 929.6





Royalties $m $ 492.6 $ 19.7 $ 4.8 $ 11.3 $ 14.1 $ 16.3 $ 19.9 $ 20.9 $ 21.0 $ 21.1 $ 21.0 $ 21.0 $ 321.2


Insurance $m $ 83.1 $ 3.3 $ 1.2 $ 3.1 $ 3.3 $ 3.4 $ 3.4 $ 3.4 $ 3.4 $ 3.4 $ 3.4 $ 3.4 $ 51.6

Total Cash Cost $m $5 668.9 $ 226.8 $ 66.0 $ 165.8 $ 185.5 $ 196.5 $ 236.1 $ 245.7 $ 248.2 $ 244.9 $ 261.9 $ 257.8 $3 560.4

Capital Costs

Capital Development $m $1 457.4 $ 58.3 $ 14.5 $ 60.6 $ 71.2 $ 67.4 $ 58.9 $ 63.5 $ 58.5 $ 61.9 $ 41.3 $ 30.0 $ 929.6

Non-dev Capital $m $ 736.8 $ 29.5 $ 54.5 $ 116.7 $ 91.4 $ 86.1 $ 30.0 $ 32.2 $ 14.4 $ 15.1 $ 16.3 $ 21.8 $ 258.1

Environmental $m $ 0.3 $ 2.5 $ 0.6 $ 0.3 $ 0.3 $ 0.3 $ 0.3 $ 0.3 $ 0.3 $ 9.3

Mine and Surface Equipment $m $ 1.8 $ 14.8 $ 12.6 $ 7.7 $ 9.4 $ 18.1 $ 7.7 $ 7.9 $ 11.0 $ 7.8

Project $m $ 0.6 $ 7.3 $ 10.1 $ 13.7 $ 9.7 $ 12.8 $ 5.0 $ 5.8 $ 3.7 $ 3.3

Infrastructure $m $ 1.0 $ 1.8 $ 0.8 $ 0.8 $ 0.9 $ 0.8 $ 0.7 $ 0.8 $ 0.7 $ 0.8

Other $m $ 0.1 $ 0.4 $ 0.9 $ 0.6 $ 0.2 $ 0.2 $ 0.7 $ 0.3 $ 0.7 $ 0.5

Blitz Growth $m $ 8.3 $ 46.4 $ 39.5 $ 63.1 $ 9.4

Blitz Project $m $ 42.4 $ 43.5 $ 26.9

Total Cost $m $7 863.1 $ 314.5 $ 135.1 $ 343.1 $ 348.1 $ 349.9 $ 324.9 $ 341.6 $ 321.0 $ 322.0 $ 319.6 $ 309.5 $4 748.2

Operating cash flow before tax and working capital $m $5 557.2 $ 222.3 $ 13.8 -$ 8.2 $ 57.2 $ 115.6 $ 241.7 $ 231.4 $ 251.6 $ 252.3 $ 253.1 $ 263.1 $3 885.6

Taxation $m $1 500.0 $ 60.0 $ 15.3 $ 28.5 $ 38.6 $ 47.6 $ 60.5 $ 58.1 $ 58.7 $ 61.4 $ 59.8 $ 61.7 $1 009.7

Working capital changes $m $ 28.2 $ 1.1 $ 0.0 $ 2.1 $ 3.6 $ 2.3 $ 6.9 $ 2.1 $ 1.0 $ 0.1 $ 3.3 $ 0.0 $ 6.8

Free cash flow after taxation $m $4 029.0 $ 161.2 -$ 1.5 -$ 38.8 $ 14.9 $ 65.6 $ 174.3 $ 171.2 $ 191.9 $ 190.8 $ 190.0 $ 201.4 $2 869.1

203


Table 73: Scenario B: Abridged cash flow for Stillwater Mine with Blitz section constrained to a 10-year LoM Plan

Stillwater Mine Abridged Cash Flow Model to 2041, Current Blitz Reserve Depleting in 2026 (Real)


Production

Milled Ton Sh. Ton 20,743,143 829,726 352,755 796,101 926,325 995,227 1,175,972 1,246,274 1,246,274 1,249,689 1,246,274 1,246,274 10,261,978



Saleable PGM

Platinum oz 2,209,081 88,363 35,286 80,315 97,199 111,625 135,880 141,206 141,119 141,506 141,119 141,119 1,042,706

Palladium oz 7,559,977 302,399 122,697 274,785 332,551 381,908 464,892 483,113 482,815 484,138 482,815 482,815 3,567,446

Revenue

PGM $m $9 018.0 $ 360.7 $ 148.9 $ 334.9 $ 405.3 $ 465.5 $ 566.6 $ 573.0 $ 572.7 $ 574.2 $ 572.7 $ 572.7 $4 231.4

Total Revenue $m $9 018.0 $ 360.7 $ 148.9 $ 334.9 $ 405.3 $ 465.5 $ 566.6 $ 573.0 $ 572.7 $ 574.2 $ 572.7 $ 572.7 $4 231.4

Cash Costs

Mine Site Costs $m $4 071.1 $ 162.8 $ 64.8 $ 184.6 $ 208.9 $ 210.9 $ 234.0 $ 246.1 $ 243.5 $ 243.6 $ 240.1 $ 224.7 $1 970.0

SG+A Costs $m $ 411.5 $ 16.5 $ 6.2 $ 18.0 $ 18.8 $ 20.1 $ 20.3 $ 20.8 $ 20.8 $ 20.8 $ 20.8 $ 20.7 $ 224.4

Less Cap Dev $m -$ 711.3 -$ 28.5 -$ 14.5 -$ 60.6 -$ 71.2 -$ 67.4 -$ 58.9 -$ 63.5 -$ 58.5 -$ 61.9 -$ 41.3 -$ 30.0 -$ 183.5





Royalties $m $ 325.1 $ 13.0 $ 4.8 $ 11.3 $ 14.1 $ 16.3 $ 19.9 $ 20.9 $ 21.0 $ 21.1 $ 21.0 $ 21.0 $ 153.8


Insurance $m $ 77.0 $ 3.1 $ 1.2 $ 3.1 $ 3.3 $ 3.4 $ 3.4 $ 3.4 $ 3.4 $ 3.4 $ 3.4 $ 3.4 $ 45.5

Total Cash Cost $m $4 414.7 $ 176.6 $ 66.0 $ 165.8 $ 185.5 $ 196.5 $ 236.1 $ 245.7 $ 248.2 $ 244.9 $ 261.9 $ 257.8 $2 306.3

Capital Costs $m

Capital Development $m $ 711.3 $ 28.5 $ 14.5 $ 60.6 $ 71.2 $ 67.4 $ 58.9 $ 63.5 $ 58.5 $ 61.9 $ 41.3 $ 30.0 $ 183.5

Non-dev Capital $m $ 627.0 $ 25.1 $ 54.5 $ 116.7 $ 91.4 $ 86.1 $ 30.0 $ 32.4 $ 14.4 $ 15.1 $ 16.3 $ 21.8 $ 148.3

Environmental $m $ 0.3 $ 2.5 $ 0.6 $ 0.3 $ 0.3 $ 0.3 $ 0.3 $ 0.3 $ 0.3 $ 9.3


Project $m $ 0.6 $ 7.3 $ 10.1 $ 13.7 $ 9.7 $ 12.8 $ 5.0 $ 5.8 $ 3.7 $ 3.3


Other $m $ 0.1 $ 0.4 $ 0.9 $ 0.6 $ 0.2 $ 0.2 $ 0.7 $ 0.3 $ 0.7 $ 0.5

Blitz Growth $m $ 8.3 $ 46.4 $ 39.5 $ 63.1 $ 9.4 $ 0.0 $ 0.0 $ 0.0 $ 0.0 $ 0.0

Blitz Project $m $ 42.4 $ 43.5 $ 26.9 $ 0.0 $ 0.0 $ 0.0 $ 0.0 $ 0.0 $ 0.0 $ 0.0

Total Cost $m $5 753.0 $ 230.1 $ 135.1 $ 343.1 $ 348.1 $ 349.9 $ 324.9 $ 341.6 $ 321.0 $ 322.0 $ 319.6 $ 309.5 $2 638.1


Taxation $m $ 814.6 $ 32.6 $ 15.3 $ 28.5 $ 38.6 $ 47.6 $ 60.5 $ 58.1 $ 58.7 $ 61.4 $ 59.8 $ 61.7 $ 324.2

Working capital changes $m -$ 14.4 -$ 0.6 $ 0.0 $ 2.1 $ 3.6 $ 2.3 $ 6.9 $ 2.1 $ 1.0 $ 0.1 $ 3.3 $ 0.0 -$ 35.8


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Table 74: Abridged Cash Flow for Stillwater Mine with 18 years of Blitz Section contribution

Stillwater Mine, Abridged Cash Flow Model, Preferred Valuation Result


Production

Milled Ton Sh. Ton 25,116,954 1,004,678 352,755 796,101 926,325 995,227 1,175,972 1,246,274 1,246,274 1,249,689 1,246,274 1,246,274 14,635,789



Saleable PGM

Platinum oz 2,737,286 109,491 35,286 80,315 97,199 111,625 135,880 141,206 141,119 141,506 141,119 141,119 1,570,911

Palladium oz 9,367,141 374,686 122,697 274,785 332,551 381,908 464,892 483,113 482,815 484,138 482,815 482,815 5,374,610

Revenue

PGM $m $11 161.5 $ 446.5 $ 148.9 $ 334.9 $ 405.3 $ 465.5 $ 566.6 $ 573.0 $ 572.7 $ 574.2 $ 572.7 $ 572.7 $6 375.0

Total Revenue $m $11 161.5 $ 446.5 $ 148.9 $ 334.9 $ 405.3 $ 465.5 $ 566.6 $ 573.0 $ 572.7 $ 574.2 $ 572.7 $ 572.7 $6 375.0

Cash Costs

Mine Site Costs $m $4 843.3 $ 193.7 $ 64.8 $ 184.6 $ 208.9 $ 210.9 $ 234.0 $ 246.1 $ 243.5 $ 243.6 $ 240.1 $ 224.7 $2 742.2

SG+A Costs $m $ 445.8 $ 17.8 $ 6.2 $ 18.0 $ 18.8 $ 20.1 $ 20.3 $ 20.8 $ 20.8 $ 20.8 $ 20.8 $ 20.7 $ 258.7

Less Cap Dev $m -$1 096.1 -$ 43.8 -$ 14.5 -$ 60.6 -$ 71.2 -$ 67.4 -$ 58.9 -$ 63.5 -$ 58.5 -$ 61.9 -$ 41.3 -$ 30.0 -$ 568.4





Royalties $m $ 405.3 $ 16.2 $ 4.8 $ 11.3 $ 14.1 $ 16.3 $ 19.9 $ 20.9 $ 21.0 $ 21.1 $ 21.0 $ 21.0 $ 233.9


Insurance $m $ 78.4 $ 3.1 $ 1.2 $ 3.1 $ 3.3 $ 3.4 $ 3.4 $ 3.4 $ 3.4 $ 3.4 $ 3.4 $ 3.4 $ 47.0

Total Cash Cost $m $4 977.6 $ 199.1 $ 66.0 $ 165.8 $ 185.5 $ 196.5 $ 236.1 $ 245.7 $ 248.2 $ 244.9 $ 261.9 $ 257.8 $2 869.2

Capital Costs $m

Capital Development $m $1 096.1 $ 43.8 $ 14.5 $ 60.6 $ 71.2 $ 67.4 $ 58.9 $ 63.5 $ 58.5 $ 61.9 $ 41.3 $ 30.0 $ 568.4

Non-dev Capital $m $ 683.5 $ 27.3 $ 54.5 $ 116.7 $ 91.4 $ 86.1 $ 30.0 $ 32.2 $ 14.4 $ 15.1 $ 16.3 $ 21.8 $ 204.9

Environmental $m $ 0.3 $ 2.5 $ 0.6 $ 0.3 $ 0.3 $ 0.3 $ 0.3 $ 0.3 $ 0.3 $ 9.3


Project $m $ 0.6 $ 7.3 $ 10.1 $ 13.7 $ 9.7 $ 12.8 $ 5.0 $ 5.8 $ 3.7 $ 3.3


Other $m $ 0.1 $ 0.4 $ 0.9 $ 0.6 $ 0.2 $ 0.2 $ 0.7 $ 0.3 $ 0.7 $ 0.5

Blitz Growth $m $ 8.3 $ 46.4 $ 39.5 $ 63.1 $ 9.4

Blitz Project $m $ 42.4 $ 43.5 $ 26.9

Total Cost $m $6 757.4 $ 270.3 $ 135.1 $ 343.1 $ 348.1 $ 349.9 $ 324.9 $ 341.6 $ 321.0 $ 322.0 $ 319.6 $ 309.5 $3 642.5


Taxation $m $1 163.0 $ 46.5 $ 15.3 $ 28.5 $ 38.6 $ 47.6 $ 60.5 $ 58.1 $ 58.7 $ 61.4 $ 59.8 $ 61.7 $ 672.7

Working capital changes $m -$ 13.0 -$ 0.5 $ 0.0 $ 2.1 $ 3.6 $ 2.3 $ 6.9 $ 2.1 $ 1.0 $ 0.1 $ 3.3 $ 0.0 -$ 34.4


205


10.4.6 Income Approach Valuation Results and Sensitivity Analysis SV1.14; SV1.16; JSE12.9(h)(xii)

10.4.6.1 Results The cash flow models discussed in Section 10.4.5 form the basis for the Income Approach valuation of the Montana PGM Mineral Assets. The 31 July 2017 results of the Income Approach valuations carried out by The Mineral Corporation are contained in Table 75, and comprise the following: East Boulder Mine: the NPV for the cash flows based on the 25-year LoM Plan for East Boulder Mine; Stillwater Mine Scenario A: the NPV for the cash flows based on the 25-year LoM Plan for Stillwater Mine,

including the Blitz section; Stillwater Mine Scenario B: the NPV for the Stillwater Mine cash flows based on the 25-year LoM for the

current section of Stillwater Mine and contribution from the Blitz section constrained to a 10-year LoM as discussed in Section 10.4.5;

Stillwater Mine Scenario C: the NPV for the Stillwater Mine cash flows based on the 25-year LoM for the current section of Stillwater Mine and contribution from the Blitz section constrained to a 18-year LoM as

discussed in Section 10.4.5; and The combined Montana PGM Mineral Assets (East Boulder Mine and Stillwater Mine, with Stillwater Mine

results determined for the three scenarios discussed, and with the indivisible tax benefit discussed in Section 10.4.3 applied).

The Mineral Corporation has applied a range of real discount rates to the post-tax, pre-interest and pre-financing free cash flows for Stillwater and East Boulder Mines to derive the NPV results contained in Table 75, which serve to illustrate the discount rate sensitivity of the Income Approach results for the Mineral Assets. The Mineral Corporation has been advised by the management of SGL that the group’s weighted average cost of capital (WACC) as at 31 July 2017 is 5%. SGL also provided the base data utilised for the calculation of the WACC as well as the WACC calculation methodology. The Mineral Corporation has reviewed the base data and SGL’s WACC calculation methodology and concludes that the base data is reasonable and the WACC of 5% is appropriate for the valuation of the Montana PGM Mineral Assets. Accordingly, The Mineral Corporation would consider the NPV5% results to be preferred Income Approach results for the Mineral Assets, in the context of the discount rate range contained in Table 75. Table 75: Income Approach results

The results for the combined Montana PGM Mineral Assets include the modest additional tax benefit that cannot be directly apportioned to the individual mines, which amounts to $19.8 million at a real 2.5% discount rate and $17.5 million at a 10% real discount rate. The preferred Income Approach result for Stillwater Mine is Scenario C, which considers the 25-year LoM for the current section of Stillwater Mine, while permitting an 18-year LoM contribution to the overall Stillwater LoM Plan from the Blitz section. The basis for constraining mining in the Blitz section to 18 years is that the 25-year LoM Plan for Stillwater Mine, which envisages unconstrained mining from the Blitz section until 2041 (i.e. Scenario A), includes a proportion of Inferred Mineral Resource in the Blitz East area. The selection of the 18-year LoM contribution from the Blitz Section recognises the reasonable but yet to be realised expectation that a portion of the Inferred Mineral Resources in the Blitz East area will be upgraded to Indicated and Measured Resources as the basis for additional Mineral Reserves as progressive underground development permits additional underground Mineral Resource and Mineral Reserve definition drilling.

2.5% 5.0% 7.5% 10.0%

East Boulder Mine, 25 year plan NPV $ million $1 038.9 $ 810.7 $ 653.4 $ 541.7

Scenario A: Stillwater Mine, Blitz per 25 year plan NPV $ million $2 884.9 $2 127.7 $1 612.0 $1 251.0

Scenario B: Stillwater Mine, Blitz constrained to 10 yr plan NPV $ million $1 858.1 $1 439.1 $1 140.8 $ 922.5

Scenario C: Stillwater Mine per 25 year plan, with 18 years of Blitz Section NPV $ million $2 424.5 $1 850.1 $1 442.1 $1 145.7

* Combined Montana Assets, Blitz per 25 year plan NPV $ million $3 943.6 $2 957.3 $2 283.6 $1 810.2

* Combined Montana Assets, Blitz constrained to 10 year plan NPV $ million $2 916.8 $2 268.7 $1 812.4 $1 481.7

* Combined Montana Assets, per 25 year plans, with 18 years of Blitz Section NPV $ million $3 483.2 $2 679.6 $2 113.7 $1 704.9

* Combined Montana Assets results include NOL tax benefit

Mineral Asset UnitsR eal D isco unt R ate

206


10.4.6.2 Sensitivity Analysis SV1.14; JSE12.9(h)(xii)

For East Boulder and Stillwater Mines, a sensitivity analysis of the NPV5% results for variation in revenue, capital and operating costs in the range ±10% is illustrated in Figure 108, Figure 109, Figure 110 and Figure 111, respectively. In each case, the NPV is most sensitive to revenue and less sensitive to operating cost and capital cost variation.

Figure 108: East Boulder Mine sensitivity analysis

Figure 109: Stillwater Mine Scenario A, including Blitz as per the 25-year LoM Plan, sensitivity analysis

0

200

400

600

800

1 000

1 200

-10% -5% 0% 5% 10%

NPV$m5% discount rate

% Variation

Revenue

Operating Cost

Capital Cost

0

500

1 000

1 500

2 000

2 500

3 000

-10% -5% 0% 5% 10%


% Variation

Revenue

Operating Cost

Capital Cost

207


Figure 110: Stillwater Mine Scenario B, with Blitz mining constrained to 10 years, sensitivity analysis

Figure 111: Stillwater Mine Scenario C, with Blitz mining constrained to 18 years, sensitivity analysis

For the combined Montana PGM Mineral Assets and with reference to the palladium and platinum prices used in the Income Approach (Table 68) and reproduced in Table 76, the two-variable sensitivity analysis of the NPV5% to changes in both palladium and platinum prices has been completed. The results are illustrated in Table 77. Table 76: Metal price forecast

Element Units 2018 2019 2020 2021 Long Term

Platinum price (real) $/oz 1 133 1 133 1 133 1 133 1 150

Palladium price (real) $/oz 888 888 888 888 850

0

200

400

600

800

1 000

1 200

1 400

1 600

1 800

2 000

-10% -5% 0% 5% 10%


% Variation

Revenue

Operating Cost

Capital Cost

0

500

1 000

1 500

2 000

2 500

-10% -5% 0% 5% 10%


% Variation

Revenue

Operating Cost

Capital Cost

208


Table 77: Combined Mineral Asset NPV5% sensitivity to palladium and platinum price variation

10.5 The Market Approach SV1.12

10.5.1 Methodology SV1.12; SV1.14;SRC4.5(ix)

The Market Approach methodology relies on the principle of “willing buyer-willing seller at arms-length” and is premised on the analysis of recent transactions of similar Mineral Assets for which a monetary value per unit of Mineral Resource or Mineral Reserve may be derived. The Mineral Corporation notes a paucity of comparable operating Mineral Asset transactions for assets of similar stature in the last five years and, as a result, has undertaken an analysis of market trading multiples for several listed PGM producers in relation to the PGM content of their Mineral Resource and Mineral Reserve Statements as set out below (Table 78). The PGMs commonly included in Mineral Resource and Mineral Reserve Statements are Pt, Pd, Rh and Au. It is a common approach in the PGM sector to report the combined content of the four PGMs (4PGM). Table 78: PGM producing companies, and their contained Mineral Resources and inclusive Mineral Reserves

The individual Pt, Pd, Rh and Au grades for the 4PGM attributable ounces for the comparable PGM companies are contained in Table 79: Table 79: Listed PGM producing companies, and their contained Pt, Pd, Rh and Au grades for Mineral

Resources and inclusive of Mineral Reserves

This analysis has considered the current enterprise value (EV) for five PGM producers listed on the JSE, where EV is defined as the sum of a company’s market capitalisation and debt, minority interests and preference shares, less total

free cash and cash equivalents. In each instance, this EV determination was based on the particular company’s published interim or final financial statements during the period 1 January 2017 to 31 July 2017, and the corresponding Mineral Resource and Mineral Reserve Statements tabulated above, published at or near the date of financial statement publication. A South African Rand:US$ exchange rate of R13.25:$1.00 was applied to establish the EVs in $ terms, based on the six-month trailing average exchange rate over the period in which these companies have reported their financial results.

To permit a meaningful Market Approach comparison of South African PGM producers mining the Bushveld Complex-hosted 4PGM (Pt, Pd, Rh, Au) with the 2PGM (Pd and Pt) J-M Reef hosted in the Stillwater Complex, a common denominator is required as the basis for the comparison. Determining an equivalent metal content for a single PGM offers such a common denominator. The Mineral Resources and Mineral Reserves and the 4PGM grade proportions (the prill split) were used to determine an implied EV per equivalent platinum ounce, with the equivalent grade calculation considering the following factors as required by the SAMREC Code:

The individual grades for Pt, Pd, Rh and Au included in the metal equivalent calculation (Table 79); Commodity prices adjusted for smelter/refinery terms for all metals (Table 80);

Metallurgical recoveries for each of the metals considered (Table 81).

-10% -5% 0% 5% 10%

-10% $2 006 $2 137 $2 270 $2 406 $2 545

-5% $2 346 $2 477 $2 610 $2 746 $2 885

0% $2 693 $2 824 $2 957 $3 093 $3 232

5% $3 047 $3 178 $3 311 $3 447 $3 586

10% $3 408 $3 539 $3 672 $3 808 $3 946

Variation in Platinum Price

Variation in

Palladium Price

Montana NPV5% $millions

Measured

Mineral Resource

Indicated

Mineral Resource

Mineral Reserves

Anglo Platinum Limited 227.7 254.0 157.2

Impala Platinum Limited 95.9 104.2 37.1

Lonmin plc 7.3 81.4 31.0

Northam Platinum Limited 26.1 41.3 24.5Royal Bafokeng Platinum Limited 23.2 15.3 12.7

*Northam Platinum Limited's 4PGM Moz Reserve figure is used in the illustrative equivalent grade calculation below

Listed Mining Company Attributable 4PGM Moz

Inferred

Mineral Resource219.1

141.1

60.4

133.0

8.2

Pt Pd Rh Au 4PGM Pt Pd Rh Au 4PGM Pt Pd Rh Au 4PGM Pt Pd Rh Au 4PGM

Anglo Platinum Limited 1.82 1.70 0.19 0.17 3.89 1.45 1.72 0.11 0.19 3.48 1.45 1.72 0.11 0.19 3.47 1.25 1.49 0.10 0.17 3.00

Impala Platinum Limited 2.91 2.07 0.30 0.31 5.58 2.11 1.50 0.21 0.22 4.05 1.85 1.31 0.19 0.19 3.54 1.92 1.36 0.19 0.20 3.68

Lonmin plc 2.88 1.36 0.40 0.13 4.77 2.79 1.32 0.39 0.13 4.62 2.94 1.39 0.41 0.13 4.88 2.45 1.16 0.34 0.11 4.07

Northam Platinum Limited 2.13 1.13 0.28 0.10 3.63 2.42 1.29 0.32 0.11 4.13 2.82 1.50 0.37 0.13 4.82 2.01 1.07 0.26 0.09 3.43Royal Bafokeng Platinum Limited 3.84 1.76 0.51 0.14 6.24 3.54 1.62 0.47 0.12 5.75 3.88 1.78 0.51 0.14 6.31 2.81 1.29 0.37 0.10 4.58

*Northam Platinum Limited's 4PGM Reserve grades (the prill proportions), are used in the illustrative equivalent grade calculation below

Listed Mining Company Measured Mineral Resource g/t Mineral Reserves g/tIndicated Mineral Resource g/t Inferred Mineral Resource g/t

209


Table 80: Six month trailing average metal prices

Table 81: Metallurgical recovery factors

The worked example of an equivalent grade calculation below uses Northam Platinum Limited’s (Northam’s) figures highlighted in Table 78 and Table 79 to illustrate the equivalent platinum content calculation methodology at the applied metal prices and recovery factors contained in Table 80 and Table 81. It is to be noted that Northam has been used as a worked example only to demonstrate the general method of calculation of an equivalent grade and has been randomly selected from the list of PGM mining companies indicated in Table 78. Northam's equivalent grade calculation results have not been used as a proxy for the Montana Mineral Assets. 1. Northam’s 4PGM Mineral Reserve contains 24.5 million oz 4PGM [a] in the proportions:

Pt prill proportion of 59% = (2.01/3.43 x 100%) Pd prill proportion of 31% = (1.07/3.43 x 100%)

Rh prill proportion of 8% = (0.26/3.43 x 100%) Au prill proportion of 2% = (0.09/3.43 x 100%)

2. At the metal prices and metal recovery factors listed above, the proportional revenue contributions per

metal are as follows: [b] Pt: $12 445 million = (24.5 million oz [a] x 59% x $952 x 91.1%)

[c] Pd: $5 551 million = (24.5 million oz [a] x 31% x $810 x 89.2%) [d] Rh: $1 576 million = (24.5 million oz [a] x 8% x $954 x 88.2%) [e] Au: $707 million = (24.5 million oz [a] x 2% x $1 245 x 88.2%)

= Total revenue contribution: $20 240 million [f] = [b] $12 445 million + [c] $5 551 million + [d] $1 576 million + [e] $707 million)

3. Platinum equivalent ounce content [g] is calculated as follows:

[g] = (Total revenue contribution [f] / Pt price $/oz)) x (1/Pt recovery)

[g] = ($20 240 million/$952 per oz) x (1/91%) = 23.3 million oz equivalent platinum

4. In terms of this worked example, Northam’s 24.5 million ounces of 4PGM Mineral Reserve would be

equivalent to 23.3 million equivalent Pt ounces (ePt oz) at the metal prices and metal recoveries quoted in Table 80 and Table 81.

This equivalent grade calculation methodology, using the prices and parameters in Table 80 and Table 81, may similarly be applied to the Montana Mineral Assets as indicated in Table 82. As indicated in Table 65, Mineral Resources and Mineral Reserves for the Montana PGM Mineral Assets are quoted for Pd + Pt (2PGM). Table 82: Montana Mineral Assets expressed in terms of ePt content

Montana Mineral Assets

Mineral Resource or Mineral Reserve Category

ePt Moz

East Boulder Mine Stillwater Mine Montana Mineral Assets

Proved and Probable Mineral Reserves 9.11 10.20 19.31

Measured, Indicated and Inferred Mineral Resources (inclusive of

Mineral Reserves 33.41 36.85 70.26

The results of the EV analysis for the comparable South African PGM producers in terms of ePt are shown in Table 83. Table 83: EV $ per ePt ounce in the total Mineral Resource and in the Mineral Reserve

Item Platinum Palladium Rhodium Gold Rand:US$

Six Month Trailing Average $952 $810 $954 $1,245 R 13.25

Item Platinum Palladium Rhodium Gold

Metallurgical Recoveries 91.1% 89.2% 88.2% 88.2%

Tot.

Mineral Resource

Mineral Reserves EV /

Mineral Resource oz

EV /

Mineral Reserve oz

Anglo Platinum Limited $7 183.4 656.9 31% 147.3 $10.94 $48.76

Impala Platinum Limited $3 027.8 324.5 41% 35.3 $9.33 $85.80

Lonmin Plc $ 638.2 142.8 41% 29.7 $4.47 $21.52

Northam Platinum Limited $2 076.0 190.8 66% 23.3 $10.88 $88.99Royal Bafokeng Platinum Limited $ 795.7 44.6 17% 12.1 $17.82 $65.65

Mean$/ ePt.oz $10.69 $62.15

US$/attributable ePt ozListed

Mining Company

EV

(US$m) Inferred.%

of Mineral Resource

Attributable ePt Moz

210


Table 83 illustrates the proportion of Mineral Resources in the Inferred Mineral Resource category as a

percentage of the total Mineral Resource quoted for the PGM companies considered. For these entities, this proportion ranges from 17% to 66% of the total Mineral Resource. It is considered reasonable to expect that a proportion of the Inferred Mineral Resources will be elevated to Indicated and Measured Mineral Resource categories in due course. The Mineral Corporation favours discounting the Inferred Mineral Resource’s contribution to the valuation by applying a discounting factor (to the Inferred Mineral Resource), while retaining the as-reported Indicated and Measured Mineral Resources. The Mineral Corporation considers that a 50% discount applied to the Inferred Mineral Resources, as set out in Table 84, is reasonable. The Mineral Corporation has selected this discounting factor based on its PGM experience and consideration of the following factors: In terms of the SAMREC Code, only Measured and Indicated Mineral Resources can be converted to

Mineral Reserves; Measured Mineral Resources can be converted to Proved and Probable Mineral Reserves while Indicated Mineral Resources can be converted to Probable Mineral Reserves. In The Mineral Corporation’s experience, market-based valuations, therefore, tend to consider Proved and Probable Mineral Reserves (and consequently the linked Measured and Indicated Mineral Resources) with

equal prominence, reflecting the market expectation that Mineral Reserves will generally be mined and turned to account in a time frame considered reasonable by the market.

Equitably addressing Inferred Mineral Resources, particularly in the relatively concentrated global PGM sector, must consider the following: o Considerable Inferred Mineral Resources may be held in a company’s Mineral Asset inventory having

been acquired, accumulated or retained for long-term strategic motives rather than operational reasons; and

o Inferred Mineral Resources may be many decades away from contributing to mining realisation, and only after successful future upgrading of a proportion of the current Inferred Mineral Resource to a higher confidence Mineral Resource category at that point in time.

Guidance from published research on valuation (Young, 2006). Table 84: EV $ per ePt ounce for Mineral Reserves and for Mineral Resources including only 50% of Inferred

Mineral Resource

The EV $/ePt ounce results contained in Table 83 and Table 84 are graphically illustrated in Figure 112.

Tot.

Mineral Resource

Mineral ReservesEV/ Factored

Mineral Resource oz

EV /

Mineral Reserve oz

Anglo Platinum Limited $7 183.4 656.9 147.3 $12.96 $48.76

Impala Platinum Limited $3 027.8 324.5 35.3 $11.76 $85.80

Lonmin Plc $ 638.2 142.8 29.7 $5.60 $21.52

Northam Platinum Limited $2 076.0 190.8 23.3 $16.29 $88.99

Royal Bafokeng Platinum Limited $ 795.7 44.6 12.1 $19.53 $65.65

Mean $/ ePt.oz $13.23 $62.15

US$/attributable ePt oz

554.2

257.4

Listed

Mining Company

EV

(US$m)

A ttributable eP t M o z

Meas.&Ind.& 50%

of

Inferred Mineral

113.9

127.5

40.7

211


Figure 112: EV ($ millions) plotted against ePt oz

Scrutiny of Figure 112 and the compelling R2 results for zero y-intercept trend lines of the data suggests that a relationship exists between the EV of a company and the ePt content of its Mineral Resource and/or Mineral Reserve. Figure 112 also offers a perspective on the relative significance of discounting Inferred Mineral Resources by 50% (the red data points and trend line) as compared to Mineral Resources with no Inferred Mineral-category discount applied (green data points and trend line) for the comparable companies considered.

Given the limited number of companies that can be considered in this analysis, The Mineral Corporation has explored this relationship through establishing 90% confidence limits on the mean of the data (Table 83 and Table 84) as contained in Table 85. Table 85: Mean EV/ePt ounce and the 90% confidence limits about the mean for each category of Mineral

Resources and Mineral Reserves

In the context of the five companies considered in Table 83 and Table 84, it may be interpreted that the average EV$/ePt ounce result lies within the upper and lower 90% confidence limit range defined for each of the ePt Mineral Resource or Mineral Reserve metal content categories considered.

10.5.2 Market Approach Valuation Results SV1.14

10.5.2.1 East Boulder Mine SV1.14; JSE12.9(h)(xii)

East Boulder Mine has been valued using the Market Approach, considering the mine’s Mineral Resource and Mineral Reserve figures contained in Table 65 in Section 8.3 of this CPR, converted to ePt ounces using the equivalent grade methodology set out above (Table 82). The Market Approach Results for East Boulder Mine are contained in Table 86.

Anglo Platinum Limited

Impala Platinum Limited

Lonmin Plc

Northam Platinum Limited

Royal Bafokeng Platinum Limited



Lonmin Plc



R² = 0.89R² = 0.96

R² = 0.96

$100

$1,000

$10,000

10 100 1000

EV US$ millions

All Mineral Reserve / Meas., Ind. & Factored Inferred Mineral Resource / Meas., Ind. & all Inferred Mineral Resource ePt Moz

All Mineral Reserve Meas.& Ind. & 50% Factored Inferred Mineral Resource Total Mineral Resource

EV /

M ineral R eso urce o z.

EV/

F acto red M ineral

R eso urce.o z

EV /

M ineral R eserve o z

90% Confidence Limit - Upper $15.25 $18.22 $88.78

M ean of the Data $10.69 $13.23 $62.15

90% Confidence Limit - Lower $6.13 $8.24 $35.51

$ / eP t o z

M ean o f the D ata

R esult

212


Table 86: East Boulder Mine Market Approach results on an ePt ounce basis

The value result range for East Boulder Mine derived from the Market Approach is illustrated in Figure 113.

Figure 113: East Boulder Mine Market Approach results

10.5.2.2 Stillwater Mine (including the Blitz Section) SV1.14; JSE12.9(h)(xii)

Stillwater Mine has been valued using the Market Approach, considering the mine’s Mineral Resource and Mineral Reserve figures contained in Table 65 in Section 8.3 of this CPR, converted to ePt ounces using the equivalent grade methodology set out above. The Market Approach Results for Stillwater Mine are contained in Table 87. Table 87: Stillwater Mine Market Approach results on an ePt ounce basis

This value result range derived from the Market Approach for Stillwater Mine is illustrated in Figure 114.

East Boulder Mine

Category Lower Mean Upper Lower Mean Upper

Proved and Probable Mineral Reserve 9.11 $35.51 $62.15 $88.78 $ 323.4 $ 566.0 $ 808.7

Measured, Indicated and Inferred Mineral Resource 33.41 $6.13 $10.69 $15.25 $ 204.7 $ 357.1 $ 509.6

Meas., Ind., 50% Inf. Mineral Resources 23.87 $8.24 $13.23 $18.22 $ 196.8 $ 315.8 $ 434.9

Unit Value ($/ePtoz) Market Value Result $millionePt Moz

$323.4 $566.0 $808.7

$204.7 $357.1 $509.6

$196.8 $315.8 $434.9

0.50

1.50

2.50

3.50

$0 $100 $200 $300 $400 $500 $600 $700 $800 $900US$ millions

Total Mineral Reserve

Total Mineral Resource

Meas., Ind. &50% Inf. Mineral Resource

Stillwater Mine, including Blitz


Proved and Probable Mineral Reserve 10.20 $35.51 $62.15 $88.78 $ 362.3 $ 634.1 $ 905.8

Measured, Indicated and Inferred Mineral Resource 36.85 $6.13 $10.69 $15.25 $ 225.7 $ 393.8 $ 561.9


ePt Moz Unit Value ($/ePtoz) Market Value Result $million

213


Figure 114: Stillwater Mine Market Approach results

10.5.2.3 The Combined Mineral Assets SV1.14; JSE12.9(h)(xii)

Table 88 and Figure 115 below consolidate these Market Approach Results for the combined Mineral Resources and Mineral Reserves for the Stillwater and East Boulder Mines (the Montana PGM Mineral Assets), considered on an ePt ounce basis. Table 88: Montana Mineral Assets Market Approach results, on an ePt ounce basis

Figure 115: Montana PGM Mineral Assets, Market Approach results, on an ePt ounce basis

$362.3 $634.1 $905.8

$225.7 $393.8 $561.9

$205.2 $329.4 $453.5

0.50

1.50

2.50

3.50

$0 $200 $400 $600 $800 $1,000US$ millions




$685.7 $1 200.1 $1 714.5

$430.5 $751.0 $1 071.5

$402.0 $645.2 $888.4

0.50

1.50

2.50

3.50

$0 $500 $1,000 $1,500 $2,000US$ millions




Montana Mineral Assets


Proved and Probable Mineral Reserve 19.31 $35.51 $62.15 $88.78 $ 685.7 $1 200.1 $1 714.5

Measured, Indicated and Inferred Mineral Resource 70.26 $6.13 $10.69 $15.25 $ 430.5 $ 751.0 $1 071.5



214


It is helpful to place these findings in the context of Figure 112, replicated below, including the results for the

Montana Mineral Assets (Figure 116).

Figure 116: Montana PGM Mineral Assets, Market Approach results, on an ePt ounce basis

The Market Approach results warrant further consideration of the following context: In general, the South African domiciled PGM industry faces considerable domestic challenges as has been

discussed in the market review section of this CPR. Consequently, the market capitalisations and resulting

EVs of these companies will reflect these circumstances to varying degrees and may contribute to subdued EV/ounce results for the period considered. This would suggest that the Market Approach results applied to the Montana Mineral Assets may be conservative.

On an ePt basis, the average ePt grade of the South African PGM companies considered in this analysis is

approximately 4.4g/tonne ePt (0.13oz/ton ePt), which is approximately one third of the ePt grade of the Montana Mineral Assets (14.7 g/tonne ePt (0.43oz/ton ePt).

Based on these two factors, The Mineral Corporation would conclude that the Market Approach results are conservative and would, in the absence of an alternative valuation method, favour the upper range Market Approach results for each mine and for the combined Montana PGM Mineral Assets as consolidated in Table 89. Table 89: Consolidated Market Approach results

10.6 Additional Considerations

10.6.1 Valuation of Inferred Mineral Resources Beyond the current 25-year LoM Plan for East Boulder The 25-year LoM plan for East Boulder Mine is based on Proved and Probable Mineral Reserves derived from Measured and Indicated Resources and has been addressed in the Income Approach results for East Boulder Mine. It is reasonable to expect that a proportion of the Inferred Mineral Resources will be upgraded to Indicated and Measured Resources in the latter years of the 25-year LoM Plan as progressive underground development permits additional definition drilling and the basis for continued mining beyond 2041. In the context of the Income Approach results for East Boulder Mine only, The Mineral Corporation considers it reasonable to apply the Market Approach to these Inferred Mineral Resources as set out below.



Lonmin Plc





Lonmin Plc



R² = 0.8877

R² = 0.9642

R² = 0.9621

$100

$1,000

$10,000

10 100 1000

EV US$ millions

Measured, Indicated and all Inferred Mineral Resource / Meas., Ind. & Factored Inferred Mineral Resource/ All Mineral ReserveePt Moz

All Mineral Reserve Meas.& Ind. & 50% Factored Inferred Mineral Resource Total Mineral Resource

Lower Mean Upper Lower Mean Upper

East Boulder Mine, Proved and Probable Mineral Reserve 9.11 $35.51 $62.15 $88.78 $ 323.4 $ 566.0 $ 808.7

Stillwater Mine, including Blitz, Proved and Probable Mineral Reserve 10.20 $35.51 $62.15 $88.78 $ 362.3 $ 634.1 $ 905.8

Montana Mineral Assets, Proved and Probable Mineral Reserve 19.31 $35.51 $62.15 $88.78 $ 685.7 $1 200.1 $1 714.5

ePt Moz Unit Value ($/ePtoz)Consolidated Market Approach Results

Market Value Result $million

215


The Inferred Mineral Resource beyond the 25-year LoM Plan footprint for East Boulder Mine is contained in

Table 90. The Mineral Corporation has applied the equivalent grade calculation procedure and parameters set out in Section 10.5.1 to derive ePt ounces for this Inferred Mineral Resource. Table 90: East Boulder Mine, Inferred Mineral Resources beyond the 25-year LoM Plan footprint

The Market Approach results applied to 50% of the East Boulder Mine’s Inferred Mineral Resource on an ePt basis are contained in Table 91. Table 91: Market Approach Results applied to East Boulder Mine's Inferred Mineral Resource

The Mineral Corporation’s preferred Market Approach value is the upper value result of $174 million. The Mineral Corporation would consider it appropriate to treat this preferred valuation result as a potential singular cash flow occurring in 2042 (the year immediately after the current 25-year LoM Plan for East Boulder Mine), which may be discounted back to 31 July 2017 terms at the preferred 5% real discount rate. On this basis, the NPV5% result for the Market Approach for the Inferred Mineral Resources at East Boulder Mine is $51.5 million, and it is considered reasonable to add this $51.5 million to the Income Approach NPV5% for East Boulder Mine to account for Inferred Mineral Resources outside the current 25-year LoM Plan.

10.7 Valuation Summary and Conclusions SV1.13; SV1.15; JSE12.9(h)(xii)

In conclusion, the Montana PGM Mineral Assets comprise Mineral Resources and Mineral Reserves that are included in the 25-year LoM Plans for East Boulder and Stillwater Mines as well as the Inferred Mineral Resources outside of the 25-year LoM Plan footprints. The Mineral Assets have been valued as of 31 July 2017 using the Income and Market Approaches, in accordance with SAMVAL Code requirements. The Mineral Corporation is of the view that the Income Approach results offer a reasonable and fair valuation result, which accurately represents the technical aspects and economic parameters of the Mineral Assets where LoM plans are available. The Market Approach results have been adopted for the valuation of the Inferred Mineral Resources outside of the 25-year LoM Plan footprints only. The consolidated 31 July 2017 results of the Income Approach and Market Approach valuations carried out by The Mineral Corporation are contained in Table 92 and Table 93, respectively. Table 92: Consolidated Income Approach results and identified preferred values

For the Income Approach, the preferred results comprise the following: East Boulder Mine: the NPV5% for the East Boulder Mine based on its 25-year LoM Plan; Stillwater Mine Scenario C: the NPV for the Stillwater Mine cash flows based on the 25-year LoM for the

current section of Stillwater Mine and contribution from the Blitz section constrained to a 18-year LoM as discussed in Section 10.4.5;

The combined Montana PGM Mineral Assets: the NPV5% for the East Boulder Mine and Stillwater Mine, with contribution from the Blitz section constrained to an 18-year LoM as discussed in Section 10.4.5, and the indivisible tax benefit discussed in Section 10.4.6.1 applied.

The Income Approach result for East Boulder Mine is the NPV5% of $810.7 million, to which the Market Approach valuation result of $51.5 million for Inferred Mineral Resources beyond the 25-year LoM Plan is added to define a preferred valuation result for East Boulder Mine of $862.2 million. The preferred valuation for Stillwater Mine is the Income Approach valuation result of the NPV5% of $1 850.1 million. The rationale for the preferred cash flow and value for Stillwater Mine is already discussed in Section 10.4.5 and Section 10.4.6.1.

East Boulder Mine Ton million oz/ton Pt Prill Pd Prill Pt Moz Pd Moz ePt Moz

Inferred Mineral Resource 48.06 0.36 22% 78% 3.71 13.37 19.08

East Boulder Mine


50% Inf. Mineral Resource 9.54 $8.24 $13.23 $18.22 $78.6 $126.2 $173.8


2.5% 5.0% 7.5% 10.0%

East Boulder Mine, 25 year plan NPV $ million $1 038.9 $ 810.7 $ 653.4 $ 541.7 $ 862.2 *

Stillwater Mine per 25 year plan, with 18 years of Blitz section NPV $ million $2 424.5 $1 850.1 $1 442.1 $ 925.5 $1 850.1

Combined Montana Assets NPV $ million $3 483.2 $2 679.6 $2 113.7 $1 145.7 $2 731.2 **


** Combined Montana Assets also include NOL tax benefit (at NPV5%, this is $18.9 million)

Preferred Result at

5% discount rateMineral Asset Units

R eal D isco unt R ate

216


The final preferred Income Approach results on a per mine and consolidated basis, which are set out in the

right-hand-most columns of Table 92, include the Market Approach-derived valuation results for the Inferred Mineral Resources beyond the respective LoMs as detailed in Section 10.6 and the combined Montana Assets tax benefit (as described in Section 10.4.6.1). As required by the SAMVAL Code, an alternative valuation method based on the Market Approach has been employed in respect of the Proved and Probable Mineral Reserves as set out in Table 93. For the reasons discussed in Section 10.5.2.3, the Market Approach results for the Mineral Assets are considered to be conservative and the Income Approach is, therefore, selected as the basis for this Mineral Asset Valuation. Table 93: Consolidated Market Approach Results

It is concluded that the value of the Montana PGM Mineral Assets as at 31 July 2017 is $2 731 million as summarised in Table 94 and Figure 117. Table 94: Valuation summary (31 July 2017)

Figure 117: Valuation summary

10.8 Historic Verifications, Audits and Reviews SV1.17; SRC7.1(i);SRC7.1(ii)

The Mineral Corporation is not aware of, nor has conducted, any historic verifications, audits or reviews of the Montana Mineral Assets in a Mineral Asset valuation context. However, The Mineral Corporation has undertaken a detailed review of the Project’s Mineral Resource and Mineral Reserve estimates, which support this valuation result, as documented in this CPR.

Lower Mean Upper Lower Mean Upper

East Boulder Mine, Proved and Probable Mineral Reserve 9.11 $35.51 $62.15 $88.78 $ 323.4 $ 566.0 $ 808.7

Stillwater Mine, including Blitz, Proved and Probable Mineral Reserve 10.20 $35.51 $62.15 $88.78 $ 362.3 $ 634.1 $ 905.8

Montana Mineral Assets, Proved and Probable Mineral Reserve 19.31 $35.51 $62.15 $88.78 $ 685.7 $1 200.1 $1 714.5

Market Value Result $millionePt Moz Unit Value ($/ePtoz)Consolidated Market Approach Results

C o st A ppro ach M arket A ppro ach Inco me A ppro ach

East Boulder Mine, 25 year plan $ million NA $ 808.7 $ 810.7 $ 862.2 *

Stillwater Mine per 25 year plan, with 18 years of Blitz section $ million NA $ 905.8 $1 850.1 $1 850.1

Combined Montana Assets $ million NA $1 714.5 $2 679.6 $2 731.2 **


** Combined Montana Assets also include NOL tax benefit of $18.9 million

Preferred Result

$ MillionMineral Asset Units

$ millio ns

$685.7 $1 200.1 $1 714.5

$3 943.6$2 957.3$2 283.6

$2 916.8$2 268.7$1 812.4

$3 483.2$2 679.6$2 113.7

0.00

1.00

2.00

3.00

4.00

$ 0 $ 500 $1 000 $1 500 $2 000 $2 500 $3 000 $3 500 $4 000 $4 500

US$ millions

Market Method Results

based on EV and ePt

Income Method ResultsReal NPV at 7.5%, 5.0%, 2.5% discount rate

Montana Mineral Assets, Mineral Reserves

Montana Mineral Assets DCF for 25-year LoM Plan

Montana Mineral AssetsDCF for Blitz 10-year LoM and 25-year LoM Plans for East Boulder and Stillwater Mines

Preferred value: $2 731 million

Montana Mineral Assets DCF for 25-year LoM Plan and 18 year LoM for Blitz Section

217


10.9 Risk Assessment SRC4.3(viii); SRC5.7(i); JSE12.9(h)(x)

The key risks identified and mitigation measures proposed for the Montana Mineral Assets are summarised in Section 9.3, elsewhere in this CPR. The CV is satisfied that Stillwater is fully aware of the risks and has mitigation measures in place or is actively pursuing strategies to minimise the impact of the risks on the mining and processing operations in Montana.

11 INTERPRETATION, CONCLUSIONS AND RECOMMENDATIONS

The Montana Assets discussed in this CPR are mature mining, ore processing and beneficiation operations located in a politically and economically stable geographic jurisdiction. The regulatory framework for mining in this jurisdiction is straightforward, but obtaining the permits and approvals needed to build a mine takes an average of seven years and is costly. Furthermore, public approval of regulatory decision making has become an important aspect of mining permitting, as non-governmental organisations and citizens have become increasingly vocal and engaged in the scoping and review of mining permits. Stillwater and East Boulder Mines exploit the J-M Reef, which is a world class magmatic reef type PGM deposit in the geologically favourable Stillwater Complex. Stillwater’s title covers the entirety of the known outcrop of the J-M Reef along the Beartooth Mountains in Montana. A significant portion of the J-M Reef lies outside the current Stillwater and East Boulder Mine boundaries. The presence of the reef in these areas has been confirmed from historical exploration. Overall, the character of the J-M Reef is well-understood from extensive exploration and mining and ore processing of at Stillwater and East Boulder Mines and Concentrators. Mineral Resource estimates reported for Stillwater and East Boulder Mines are supported by an extensive drillhole database, which has been validated and stored securely on Stillwater’s IT central server. Owing to the rugged terrain characterising the Beartooth Mountain area and the steep dips of the J-M Reef, most of the drilling is completed from underground footwall lateral drifts. Drillhole spacing is tailored to sufficiently reveal micro-variability in the J-M Reef in areas earmarked for mining in the short and medium terms, with sparse drilling data sufficient to model the macro-continuity of the reef. The approaches employed for the drillhole data collection, validation, processing and interpretation are in line with industry best practice. The use of an average specific gravity value for tonnage estimation is identified as an area of improvement. A programme of routine specific gravity determinations initiated at the mines is a positive step that should provide the data required for improving the tonnage estimates, which appear to have been understated over the years. Stillwater has the requisite mining, environmental and social permits for the mining, ore processing and beneficiation facilities in Montana. The Stillwater and East Boulder Mines and brownfield areas where the J-M Reef outcrop has been mapped are covered by secure mining title (Mining Claims), which is held or leased by Stillwater in perpetuity. Stillwater also holds Tunnel and Mill Site Claims, which provide servitude required to access the reef or to establish surface infrastructure. Mineral Reserves reported for Stillwater and East Boulder Mines are supported by detailed LoM Plans. The LoM Plans are based on the conversion of Mineral Resource using Modifying Factors that are based on historical experience. The R&F method is the dominant mining method and is well understood and suited to the character and attitude of the J-M Reef. Mine design incorporates rockmass characteristics, which are understood from an extensive geotechnical database. Ground support procedures employed at the mines have eliminated occurrences of major fall of ground. The commissioning of geohydrological studies covering Stillwater and East Boulder Mines is a positive step, which will provide the data required geohydrological modelling and for assessing the impacts of groundwater on ground conditions at the mines. Only Measured and Indicated Mineral Resources are scheduled in the LoM Plans underpinning the Mineral Reserve estimates for Stillwater and East Boulder Mines. However, Inferred Mineral Resources are included in long-term strategic plans as is the case at Stillwater Mine where the long-term plan schedules Inferred Mineral Resources from the Blitz section. Development of the Blitz section commenced in 2011 with the excavation of access adits and has been ongoing until to date. The LoM Plans for Stillwater and East Boulder Mines have been subjected to economic viability testing as required by the SAMREC Code. Most of the key infrastructure for mining is already in installed at the Stillwater and East Boulder Mines. Additional infrastructure has been necessitated by the introduction of the Blitz section at Stillwater Mine. Ore processing at the Stillwater and East Boulder Concentrators are based on proven technology and process routes, with metallurgical recoveries and production profiles employed in the LoM Plans informed by historical experience. A plant capacity upgrade is planned at Stillwater Concentrator to accommodate increased RoM production resulting from the development of the Blitz section and expected to start producing RoM ore in late 2017. From the review of the development results to date, delivery schedules for drilling, loading and hauling equipment, available capital funding and the seven-year production build-up for the Blitz section,

218


The Mineral Corporation concluded that the planned production increase for Stillwater Mine should be achieved.

Tailings storage facilities are adequate for the current needs and plans are in place to upgrade the TSF capacities for the long-term disposal of the tailings. It is recommended that the requisite studies for these upgrades commence immediately given potential long lead times for approval of environmental permits in Montana. The smelter and BMR utilise proven technology and process routes for the processing of concentrate and matte respectively. These facilities and require modest capacity upgrades and debottlenecking to cater for increased production anticipated when the Blitz section starts producing at the steady state. Appropriate capital expenditure been budgeted to cater for the various capacity upgrades while operating costs based on history experience have been utilised in the budgets. The market fundamentals for Pd and Pt are forecast to remain in place in the foreseeable future and the price assumptions utilised for economic viability testing of the LoM Plans are reasonable. All the operations are manned by appropriately qualified staff. Stillwater has maintained a low staff turnover, which may indicate the efficacy of its employee value proposition. However, the low staff turnover may also reflect the impact of the depressed mineral commodity prices, which has resulted in production cuts and low staff mobility globally. There are no apparent issues that prevent the declaration of Mineral Resources and Mineral Reserves for Stillwater and East Boulder Mines. Apart from the potential material drop in metal prices and potential financial burden brought about by the implementation of environmental rule proposed which will establish financial responsibility requirements for owners and operators of hardrock mining facilities, no other potentially material issues have been identified by The Mineral Corporation. Most of the issues identified are minor issues, which should not be ignored as they may become material issues in the long term. The minor issues identified, which are discussed in Section 9.3, include the following: Regulatory changes; Lower than forecast metal prices; Staff turnover and inability to attract required skills; Safety; Environmental non-compliance; Poor amenability of Blitz ore; Inadequate concentrator capacity; Inadequate TSF capacity at Stillwater and East Boulder Mines; Power losses; Mining and production cost escalation; Failure to achieve the LoM Plan; Geotechnical and geohydrological risks; Lower than expected grades and tonnages; and Unknown geological conditions.

The Mineral Corporation is satisfied that Stillwater is fully aware of the risks and has mitigation measures in place or is actively pursuing strategies to minimise the impact of the risks on the mining and processing operations in Montana. The Montana PGM Mineral Assets comprise Mineral Resources and Mineral Reserves that are included in LoM Plans for the Stillwater and East Boulder Mines as well as Inferred Mineral Resources outside of the 25-year LoM Plan footprints. The Mineral Assets have been valued using the Income and Market Approaches, in accordance with SAMVAL Code requirements. The Mineral Corporation is of the view that the Income Approach results offer a reasonable and fair valuation result which accurately represents the technical aspects and economic parameters of the Mineral Assets. The Market Approach results have been adopted for the Inferred Mineral Resources outside of the 25-year LoM Plan footprints. It is concluded that the value of the combined Montana PGM Mineral Assets as at 31 July 2017 is $2 731 million.

219


12 REFERENCES

AMEC, 2017. AMEC 17-231 Proposal for Stillwater Concentrator Expansion, 26 June 2017 Anglo American Platinum Limited, 2017. Interim Results Report, August 2017 http://www.angloamericanplatinum.com/~/media/Files/A/Anglo-American-Platinum/interim-reports/2017-interim-results.pdf Blakely, R.J., and Zientek, M.L., 1985. Magnetic anomalies over a mafic intrusion: The Stillwater Complex. The Stillwater Complex, Montana Bureau of Mines and Geology, Special Publication 92, 2002 reprint. Czamanske, G.K., and Zientek, M.L. eds. Behre Dolbear, 2017. Technical Report for the Mining Operations at Stillwater Mining Company – Stillwater Mine and East Boulder Mine as of 31 December 2016 Freeze, R.A., and Cherry, J.A., 1979. Groundwater: Englewood Cliffs, N.J., Prentice-Hall, 604 p. Hatch, 2017. Amended Proposal for Stillwater Concentrator Expansion, June 30, 2017 Heraeus Precious Metals: Precious Metals Update, August 2017 https://www.heraeus.com/media/media/hpm/doc_hpm/precious_metal_update/en_6/Heraeus_Precious_Metals_Update_2017.08.07.pdf Heraeus Precious Metals: Precious Metals Forecast 2017 https://www.heraeus.com/media/media/hpm/doc_hpm/precious_metal_update/en_6/Heraeus-Precious-Metals-Forecast-2017.pdf Johnson Matthey: PGM Market Report, May 2017 http://www.platinum.matthey.com/documents/new-item/pgm%20market%20reports/pgm_market_report_may_2017.pdf Kleinkopf, D.M., 1985. Regional gravity and magnetic anomalies of the Stillwater Complex area. The Stillwater Complex, Montana Bureau of Mines and Geology, Special Publication 92, 2002 reprint. Czamanske, G.K., and Zientek, M.L. eds. Knight-Piésold Consulting., 2017a. Hertzler and Nye Tailings Impoundments - 2016 Annual Inspection. January 12, 2017 Knight-Piésold Consulting., 2017b. East Bolder Tailings Storage Facility - 2016 Annual Inspection. January 12, 2017 McCallum, I.S., 2002. The Stillwater Complex: A review of the geology. In: Boudreau, A.E., (ed.). Stillwater Complex, Geology and Guide. Billings, 21-25 July 2002, 9th International Platinum Symposium, A1-25. https://www.mbmg.mtech.edu/gmr/gmr.asp MDEQ., 2001. Montana Department of Environmental Quality Bonding Procedure Manual. 2001 MDEQ and USFS, 1985. Montana Department of Environmental Quality and U.S Forest Service. Final Environmental Impact Statement, Stillwater Project. December, 1985 MDEQ and USFS., 2012a. Final Environmental Impact Statement, Stillwater Mining Company's Water Management Plans and Boe Ranch LAD, May 2012 MDEQ and USFS., 2012b. Record of Decision for Stillwater Mining Company's Water Management Plans and Boe Ranch LAD July, 2012 MSHA., 2017. http://www.msha.gov/drs/drshome.htm Montana Spatial Data Infrastructure: http://geoinfo.msl.mt.gov/msdi.aspx Nordmin P17100-01 SWM Concentrator, 9 June 2017 OECD., 2017. https://data.oecd.org

http://www.msha.gov/drs/drshome.htm

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Page, N.J., and Zientek, M.L., 1985. Geologic and structural setting of the Stillwater Complex. The Stillwater

Complex, Montana Bureau of Mines and Geology, Special Publication 92, 2002 reprint. Czamanske, G.K., and Zientek, M.L. eds. Record of Decision for Stillwater Mining Company's Revised Water Management Plans and Boe Ranch LAD, Stillwater and Sweet Grass Counties, Montana, July 2012 Rendu, J-M., 2002. Review of Proven and Probable Mineral Reserve Estimation and Classification Methods for Stillwater Mining Company, April 2002 Stillwater Mining Company., 2013. Stillwater Mining Company. Technical Memorandum: East Waste Dump Planning And Scheduling. From Hank Hedrich to Cole Deringer. August 13, 2013 Stillwater Mining Company, Northern Plains Resource Council, Cottonwood Resource Council, Stillwater Protective Association, 2014. Good Neighbor Agreement. Amended December 8, 2014 Starbureau., 2017. https://www.statbureau.org/ Suburban Stats., 2017a. https://suburbanstats.org/population/montana/how-many-people-live-in-big-timber. Suburban Stats., 2017b. https://suburbanstats.org/population/montana/how-many-people-live-in-absarokee. World Platinum Investment Council, 2017a. Platinum Perspectives July 2017 https://www.platinuminvestment.com/files/546194/WPIC_Platinum_Perspectives_July_2017.pdf World Platinum Investment Council, 2017b. Platinum Perspectives June, 2017 https://www.platinuminvestment.com/files/864734/WPIC_Platinum_Perspectives_June_2017.pdf Young, D.R., 2006. Valuation of a mineral resource that has a compound metal content distribution: an example based on the Merensky Reef at Wesizwe Platinum Limited’s Pilanesberg project. International Platinum Conference ‘Platinum Surges Ahead’, The Southern African Institute of Mining and Metallurgy, 2006 Zientek, M.L., Czamanske, G.K., and Irvine, N.T., 1985. Stratigraphy and nomenclature for the Stillwater Complex. The Stillwater Complex, Montana Bureau of Mines and Geology, Special Publication 92, 2002 reprint. Czamanske, G.K., and Zientek, M.L. eds.

https://www.statbureau.org/

https://suburbanstats.org/population/montana/how-many-people-live-in-big-timber

https://suburbanstats.org/population/montana/how-many-people-live-in-absarokee

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13 SIGNATURE PAGE

Name Signature Date

Coniace Madamombe MBA MSc Geology BSc Geology Hon BSc Geology Pr Sci Nat Lead Competent Person – Mineral Resources

22 September 2017

Jonathan Buckley MSc Petroleum Engineering B.Eng (Hons) Mining Engineering Pr Eng Lead Competent Person – Mineral Reserves

22 September 2017

John Murphy MBA BSc Hons Engineering Geology BSc Geology & Applied Geology Pr Sci Nat Competent Valuator

22 September 2017

Jennifer Evans BSc Geology AIPG – Certified Professional Geologist Competent Person Mineral Resource Estimation

22 September 2017

James Dahy MSc Geology B.A. Geology AIPG – Certified Professional Geologist Competent Person Mineral Resource Estimation

22 September 2017

Michael Koski B.A. Geology AIPG – Certified Professional Geologist Competent Person Mineral Resource Estimation

22 September 2017

Brent LaMoure B.S. Mining Engineering with Honors MMSA – Qualified Professional Member Competent Person Mineral Reserve Estimation

22 September 2017

222


Appendix 1: Competent Person’s and Competent Valuator’s Certificates and Qualifications SRC9.1(iii)

LEAD COMPETENT PERSON FOR MINERAL RESOURCES Name: Coniace Madamombe Position: Director Name of Firm: Mineral Corporation Consultancy (Pty) Limited Profession: Geologist Years with Firm/Entity: 10 Nationality: Zimbabwean

Education: University of Stellenbosch Business School MBA 2016 Rhodes University South Africa MSc Geology 2006 University of Zimbabwe Harare BSc (Hons) Geology 2002 University of Zimbabwe Harare BSc Geology 1999

Membership of Professional Societies: Member of the Geological Society of South Africa South African Council for National Scientific Professions (Pr Sci Nat Number 400093/08)

Key Qualifications: Coniace has 14 years experience in base metals (copper lead zinc) precious metals (gold and platinum group metals) and bulk commodities (chromium, iron ore, manganese and bauxite) exploration and Mineral Resource estimation. He is proficient in country reviews, commodity selection, target generation, exploration project management, geological modelling, Mineral Resource evaluation; techno-economic studies, due diligences, technical reviews and desktop reviews. He has participated in several multi-disciplinary due diligence scoping and feasibility studies and independent technical reviews. In the last five years Coniace has participated in several Mineral Resource audits; due diligence studies and technical reviews of PGM exploration projects, mines and processing facilities in South Africa, Zimbabwe and United States of America for major and minor companies. Employment Record:

Dates Company Position Job Description

2007-Present Mineral Corporation Consultancy (Pty) Ltd

Director Senior Technical and Corporate Advisory: Project leadership and senior technical advisory; Exploration strategic planning and project management; Exploration budget compilation; Exploration area/target selection for various commodities (gold, iron ore, chromium, copper,

manganese, lead zinc platinum-group metals, bauxite and coal; Due diligence and verification of historical exploration work; Scoping studies; Feasibility studies; Fatal flaw analyses;

Designing and auditing work protocols for exploration and evaluation; Mineral Resource audits; Acting as project owner’s representative; Country risk profiling.

Exploration and Mineral Resource Evaluation: Target identification and appraisal; Mineral Resource estimation (PGM, base metals, manganese, bauxite, uranium); Exploration strategic

planning and management; Compilation of Technical and Competent Person’s Reports that comply with requirements of various legal instruments such as the JORC and SAMREC Codes; Ensuring compliance with the requirements of various legal instruments in all exploration and

evaluation work; Designing exploration programmes and appropriate techniques: geophysics geochemical surveys and drilling.

2004-2006 Zimplats Holdings (Pvt) Ltd

Mine/Project Geologist

Resource Evaluation: 3-D orebody modelling using Vulcan modelling software tonnage-grade estimation; Assist with

Mineral Resource evaluation and reporting according to the JORC Code; Resource/Revenue modelling.

Database Management: DataShed Database administration and maintenance; Assay and geological data manipulation in Datashed; Data validation data import and export from

DataShed database; Quality Assurance Quality Control of assay data using Maxwell's QAQC Reporter.

Mine Geology: Platinum grade control (Open pit and Underground) in the Main Sulphide Zone of the Great Dyke; Underground and open pit mapping planning and supervising reverse

circulation and diamond drilling.

Rock Mechanics: Monitor adherence to set support standards; Quality control and monitoring of support systems and strategies; Risk assessment of underground and open pit mining operations; Geo-technical logging of underground excavations and rock mass classification of

ground districts using a customised Q-system.

Safety and Environment: Championing safety campaigns through routine audits and behaviour based safety initiatives; Championing ISO14001 Environmental campaigns initiatives.

Exploration and expansion projects: Exploration Project management; Provide geological input and support for feasibility studies.

2003-2004 Zimplats Holdings (Pvt) Ltd

Exploration Geologist

Surface geological mapping; Supervision of the geological technician and field crews; Coordinating diamond drilling; Drillhole planning and stacking holes in the field; Controlling

hole depths core quality and transportation; Geological and geotechnical logging of drill holes.

223


MINERAL RESOURCES LEAD COMPETENT PERSON’S CERTIFICATE – CONIACE MADAMOMBE As a contributing author to the report titled Competent Persons Report on the Montana Platinum Group Metal Mineral Assets of Sibanye Gold Limited I hereby state:- 1. My name is Coniace Madamombe and I am a Director of Mineral Corporation Consultancy (Pty) Limited (trading as The Mineral

Corporation) located at Block B, Homestead Office Park, 65 Homestead Avenue, Bryanston, Johannesburg, South Africa.

2. I am registered as a Professional Natural Scientist (Geological Science) with the South African Council for Natural Scientific Professions (SACNASP) registration No. 400093/08. I am a Member of the Geological Society of South Africa (GSSA).

3. I am a graduate of the University of Zimbabwe Harare with a BSc (Honours) Degree in Geology (2002); and an MSc Geology Degree

from Rhodes University South Africa (2006); and an MBA (2016) from the University of Stellenbosch Business School and confirm that I have practiced my profession continuously since 2003.

4. I have been actively involved in the mining industry since 2003. I am a skilled Economic Geologist and corporate advisor with

14 years experience in platinum group metals, manganese, bauxite, chrome and base metals exploration, Mineral Resource evaluation and mining. I have worked in a number of African countries and have managed multi-million-dollar programmes from conceptually-driven project generation through to drill-out evaluation. I have worked in Mineral Resource estimation projects covering a range of commodities including platinum group metals, manganese, bauxite, chromium and base metals.

5. I am a Competent Person as defined in the SAMREC Code.

6. I have supervised the Mineral Resource estimates contained in this CPR, co-authored all the sections of the CPR, compiled and

managed the complete CPR documentation.

7. I have conducted site visits to Stillwater (including Blitz) and East Boulder Mines.

8. I am responsible for the transparent and material reporting of the Mineral Resource section of this report.

9. I am not aware of any material fact or material change with respect to the subject matter of the Report which is not reflected in the Report, the omission of which would make the Report misleading.

10. I am independent of Sibanye Gold Limited.

11. As of the date of this certificate to the best of my knowledge information and belief this report contains sufficient technical

information that is required to be disclosed to ensure that this report is not misleading.

12. I have read the SAMREC Code (2016) and the SAMVAL Code (2016) and the Report has been prepared in accordance with the guidelines of the SAMREC Code and the SAMVAL Code.

13. I do not have nor do I expect to receive a direct or indirect interest in any of Sibanye Gold Limited’s assets contained in the Report

or in Sibanye Gold Limited. My compensation or contractual relationship with the Sibanye Gold Limited is not contingent on any aspect of the CPR.

14. At the effective date of the Report to the best of my knowledge information and belief the report contains all scientific and technical

information that is required to be disclosed to make the report not misleading.

15. I hereby provide written approval for my contribution to this report to be issued into a Public Report in the form content and context in which it appears herein.

Dated at Johannesburg on 22 September 2017.

_________________________________ Coniace Madamombe (Pr Sci Nat) Director Mineral Corporation Consultancy (Pty) Limited (trading as The Mineral Corporation)

224


LEAD COMPETENT PERSON FOR MINERAL RESERVES Name: Jonathan Anthony Buckley Position: Principal Mining Engineer Name of Firm: Mineral Corporation Consultancy (Pty) Limited Profession: Mining Engineer Years with Firm/Entity: 14 Nationality: British Education: Camborne School of Mines Camborne England B.Eng (Hons) Mining Engineering 1986 University of Strathclyde Glasgow Scotland MSc Petroleum Engineering 1987 Membership in Professional Societies: Fellow of The Southern African Institute of Mining and Metallurgy Member of the Engineering Council of South Africa (Pr Eng) No. 20090049 Key Qualifications: Jonathan has 30 years of experience in the mining industry at both operational and consulting levels which has included experience of both surface and underground mining operations. He has operated in and consulted to a number of mineral and mining projects spanning a wide commodity spectrum (rare earth elements, industrial minerals, base and precious metals, chromium, manganese and coal). He is proficient in mining engineering (planning, scheduling, design ,equipment costing and manpower), Mineral Reserve estimation, Mineral Reserve auditing, business analysis and techno-economic evaluation of mining projects and has participated in a number of multi-disciplinary due diligence scoping pre-feasibility and feasibility studies and independent technical reviews. Employment Record:


2003-Present Mineral Corporation Consultancy (Pty) Ltd

(trading as The Mineral Corporation)

Principal Mining Engineer

Senior Technical and Corporate Advisory: Technical research projects, Served on management committees, Acted as owners

representative on 9 pre-feasibility/feasibility studies, Currently owners representative on two projects in execution phase, Consulted and advised

operations due diligences techno-economic design, mine design pre-feasibility and feasibility studies on open pit and underground operations using every conceivable method of extraction for 17 different commodities throughout Africa South Africa

and Eastern Europe.

2002-2003 Selwyn Mines Ltd

Australia

Mining Manager

underground and open pit Copper

and Gold Mine

Primary function was the safe and productive management of the Selwyn Mine

operations which employed some 85 miners with a monthly ore target of 140 000t. Mining methods employed included sub-level caving and sub-level open stoping

which were highly mechanised employing typical long hole drilling and blasting techniques in addition to modern loading and hauling methods. These resources were shared between all four mines and hence planning in terms

of logistical needs was critical. In addition to being the relieving senior site executive he also had the following additional management duties for the

operations including; ventilation mine survey mine planning mine maintenance production engineering capital projects and feasibility studies examining the potential re-opening of an additional mine.

2000-2002 Northam Platinum Ltd South Africa

Assistant Mine Manager Deep

Level Platinum Mine

Primary function was the safe and productive management of the UG2 operations which employed some 1 050 workers with a monthly PGM target of 300 broken

kilograms. Responsible for all mine services which included the following: safety ventilation rock engineering survey and geology planning backfill technical services

contracts management capital projects responsibility for exploring and carrying out feasibility studies on mine expansion projects.

1999-2000 Great Noligwa Mine South Africa

Section Manager Deep Level Gold

Mine

The mining method employed was that of narrow stoping that lead to the extraction of a tabular gold-bearing ore body. Primary function was to ensure the safe and

productive management of stoping operations which employed some 1 300 workers with a monthly target of 1.1Mt in addition to some 700m of ore body development. To ensure the effective extraction of the assigned ore body the following key result

areas were employed and measured against on a regular basis: Safety performance short term control and planning of production operations business driven production

and planning processing constraint management long term planning (five year window) asset resourcing and utilisation manpower development technology implementation dynamic budgeting and cost control.

1995-1999 Moab Khotsong Mine South Africa

Section Manager Ultra Deep Level

Gold Mine

The mine consisted of: (i) a 9.6m diameter main shaft from a depth of 2 384m; (ii) a rock ventilation (RV) sub-shaft of 8.5m in diameter from 2 220-3 200m below

surface; (iii) a tertiary shaft; and (iv) 3.5km long twin decline system. Primary function was the management of capital projects with a total annual value

of ZAR2 billion which included the planning and co-ordinating of the following type of work: sinking and equipping an 8.5m sub-shaft to a depth of 3 200m completion of main shaft equipping development and support of large excavations ore pass

support and lining decline development shaft deepening management and co-ordination of various technology projects for the purpose of identifying appropriate

technology for application to the Ultra Deep Level mining operation (such as manufacture and application of SFR Wetcrete technology emulsion explosives impact ripper and rock splitter asset tracking and in-mine communication) Health

and Safety Manager (to develop and implement risk management programme).

225


MINERAL RESERVES LEAD COMPETENT PERSON’S CERTIFICATE – JONATHAN ANTHONY BUCKLEY As a contributing author to the report Competent Persons Report on the Montana Platinum Group Metal Mineral Assets of Sibanye Gold Limited I hereby state:- 1. My name is Jonathan Anthony Buckley and I am a Principal Mining Engineer of Mineral Corporation Consultancy (Pty) Ltd (trading as

The Mineral Corporation) located at Block B, Homestead Office Park, 65 Homestead Avenue, Bryanston, Johannesburg, South Africa. 2. I am registered as a Member of the Engineering Council of South Africa (Pr Eng No. 20090049) and am a Fellow of the Southern

African Institute of Mining and Metallurgy.

3. I am a graduate of the Camborne School of Mines Camborne England with a BSc Degree in Mining Engineering (1986) and University of Strathclyde Glasgow Scotland with an MSc Degree in Petroleum Engineering (1987) and confirm that I have practiced my profession continuously since 1988.

4. I have been actively involved in the mining industry since 1988. I have worked in mining production due diligence and Mineral

Reserve estimation projects covering a range of commodities including iron ore platinum chrome diamonds gold coal base metals and manganese. I have written and contributed to numerous compliant documents applicable to the Australian South African and Canadian stock exchanges.


6. I have co-authored the Technical Studies section of the Report.

7. I have conducted site visits to Stillwater (including Blitz) and East Boulder Mines

8. I have reviewed the Report and approved the references to my work in the form and context in which it appears in the Report.

9. I am not aware of any material fact or material change with respect to the subject matter of the Report which is not reflected in the

Report the omission of which would make the Report misleading.


11. As of the date of this certificate to the best of my knowledge information and belief this report contains sufficient technical information that is required to be disclosed to ensure that this report is not misleading.

12. I have read the SAMREC Code (2016) and the SAMVAL Code (2016) and the Report has been prepared in accordance with the

guidelines of the SAMREC Code and the SAMVAL Code.

13. I do not have nor do I expect to receive a direct or indirect interest in any of Sibanye Gold Limited’s assets contained in the Report or in Sibanye Gold Limited. My compensation or contractual relationship with the Sibanye Gold Limited is not contingent on any aspect of the CPR.





_________________________________ Jonathan Anthony Buckley (Pr Eng) Principal Mining Engineer Mineral Corporation Consultancy (Pty) Limited (trading as The Mineral Corporation)

226


COMPETENT VALUATOR Name: John Edward Murphy Position: Managing Director Name of Firm: Mineral Corporation Consultancy (Pty) Limited Profession: Geologist Years with Firm/Entity: 13 Nationality: South African Education: University of Natal Durban BSc Geology & Applied Geology 1989; BSc Hons Engineering Geology 1990 University of Pretoria Gordon Institute of Business Science MBA 2004 (Dissertation: An Analysis of Growth Strategies in South Africa’s Mining Industry) Membership of Professional Societies: Fellow of the Geological Society of South Africa The South African Council for Natural Scientific Professions (Pr Sci Nat Reg Number 400004/94) Key Qualifications: John Murphy is a skilled Economic Geologist and corporate advisor with 25 years experience in base, precious metal and energy minerals exploration and mining. He has worked in a number of countries and has managed and executed programmes from conceptually driven project generation through to drill-out evaluation, feasibility design, execution and review, mining geology, project and operation due diligence. John is proficient in the financial evaluation of base metal, precious metal and energy minerals from early stage exploration through to feasibility and operation and has led and participated in a number of multi-disciplinary due diligence studies, and evaluation exercises. Employment Record:


2006-Present Mineral Corporation

Consultancy (Pty) Ltd Director and Owner; Managing Director from

1 September 2014

Provides a lead senior advisory role focussing on the corporate strategic and

evaluation aspects of mineral projects from base and precious metals to energy minerals across the project development-stage spectrum for a diverse range of

South African and International minerals industry clients, including southern African PGE.

2004-2006 Mineral Corporation Consultancy (Pty) Ltd

Consulting Geoscientist

Provided senior technical advisory role focussing on the economic geology of base metals, precious metals and energy minerals across sub-Saharan Africa. Mineral economic, due diligence and evaluation contributions in a range of commodities and

jurisdictions, including southern African PGE.

2001-2004 African Rainbow

Minerals Ltd

Project Manager

Exploration and Business

Development

ARM down-scaled its early stage exploration and generative programmes and

focussed on only those projects and acquisition initiatives with the potential to provide short- to medium-term returns. Geologic, mineral economic, due diligence

and evaluation contributions to these corporate level initiatives.

1998-2001 Anglovaal Mining Ltd Geological Project

Manager Project Generation

Target generation studies and due diligence for base and precious metals

exploration and operations in southern and East Africa; In country project manager for a base metal exploration programme in East Africa.

1996-1998 Avmin Ltd Senior Exploration Geologist Project Generation

Target generation and due diligence for base and precious metals in Southern and East Africa.

1992-1996 Anglovaal Namibia (Pty) Ltd

Senior Exploration Geologist

Target generation and due diligence exercises for base metals and gold in Namibia. Geological contributions to a regional exploration in the Pan African Damara Orogen

of Namibia.

1991-1992 Lavino (Pty) Ltd (an

Anglovaal Group Company)

Exploration/Mine

Geologist

Mine Geologist responsible for on-mine surface exploration programme and routine

underground mine geological services.

1991 Anglovaal Exploration - Barberton

Exploration Geologist

Geological contributions to the Ni-Cu-Co-PGM exploration of the Uitkomst Intrusion.

227


COMPETENT VALUATOR’S CERTIFICATE – JOHN EDWARD MURPHY As a contributing author to the report Competent Persons Report on the assets of Sibanye Gold Limited I hereby state:- 1. My name is John Edward Murphy and I am the Managing Director of Mineral Corporation Consultancy (Pty) Limited (trading as The

Mineral Corporation) located at Block B, Homestead Office Park, 65 Homestead Avenue, Bryanston, Johannesburg, South Africa.

2. I am registered as a Professional Natural Scientist (Geological Science) with the South African Council for Natural Scientific Professions (SACNASP) registration No. 400004/94. I am a Fellow of the Geological Society of South Africa (GSSA).

3. I am a graduate of the University of Natal Durban South Africa with a BSc Degree in Geology and Applied Geology (1989) and a

BSc Honours Engineering Geology (1990) and the University of Pretoria South Africa with a MBA (2004) and confirm that I have practiced my profession continuously since 1991.

4. I have been actively involved in the mining industry since 1991. I am a skilled Economic Geologist and corporate advisor with

25 years’ experience in base and precious metal exploration and mining, in which my experience has included geological, mineral economic, due diligence and financial evaluation of a broad spectrum of base and precious metals including magmatic PGM and base metal mineralisation.

5. I am a Competent Valuator as defined in the SAMVAL Code.

6. I have co-authored the Mineral Asset Valuation and Market Studies sections of the Report and compiled and managed the complete

Competent Persons Report documentation.

7. I have conducted site visits to Stillwater (including Blitz) and East Boulder Mines.

8. I have reviewed the Report and approved the references to my work in the form and context in which it appears in the Report.

9. I am not aware of any material fact or material change with respect to the subject matter of the Report which is not reflected in the Report the omission of which would make the Report misleading.




12. I have read the SAMREC Code (2016) and the SAMVAL Code (2016) and the Report has been prepared in accordance with the guidelines of the SAMREC Code and the SAMVAL Code.

13. I do not have nor do I expect to receive a direct or indirect interest in any of Sibanye Gold Limited’s assets contained in the Report

or in Sibanye Gold Limited. My compensation or contractual relationship with the Sibanye Gold Limited is not contingent on any aspect of the CPR.





_________________________________ John Edward Murphy (Pr Sci Nat) Managing Director Mineral Corporation Consultancy (Pty) Limited (trading as The Mineral Corporation)

228


MINERAL RESOURCES COMPETENT PERSON Name: Michael Koski Position: Chief Geologist Name of Firm: Stillwater Mining Company Profession: Geologist Years with Firm/Entity: 22 Nationality: American

Education: University of Montana, Missoula Montana, United States of America, BA Geology, 1983

Membership of Professional Societies: AIPG – CPG # 11321 1990/1996 Vivienne Snowden/Isobel Clark-Classical and Geostatistics courses 2006 Maptek Vulcan software mine design/Model

Key Qualifications: Michael has been with Stillwater Mining Company for the past 22 years and currently holds the position of Chief Geologist. Employment Record:


1995-Present Stillwater Mining

Company

Chief Geologist Chief Geologist presently working with upper level managers and technical staff to

affectively develop the Stillwater complex, delineate reserve and apply geologic control support both in design and at the face. Supervise up to 29 multi-tiered

geologic staff. Implement safety initiatives so “everyone goes home safe every day”. Senior Development Geologist: 2002-2011 I safely lead a Development geology

team to interpret regional and local geology, Design and implement definition and probe drilling programs designed using Vulcan 3D modelling. Interpret geology and

apply geotechnical information to schedule and development of the mine. Sample ore zones for use in reserve modelling. Provide QAQC sample control, provided

recommendations on future development targets based on geologic trends in the ore body and deposit as a whole. Senior Production Geologist: 1996 to 2002 I managed a team of up to 18 grade

control to effectively delineate ore safely at the face and work with operations to optimise ore recovery and minimise dilution. Conduct departmental safety meetings

on a frequent basis.

1983-1995 Manville Corp

Mine Geologist

Sublevel Engineer Underground mapping, drilling and sampling preproduction feasibility to production

grade control at the face. Calculate proven reserves, sublevel stope design and longhole drilling logistics and ore definition.

1979-1983 Manville Corp – Exploration Geologist

Geological Field Assistant

Geologic Field Assistant - Support Helicopter exploration – Diamond drill, field mapping, and survey support - Underground mapping and sampling Frog Pond adit.

229


MINERAL RESOURCES COMPETENT PERSON’S CERTIFICATE – MICHAEL KOSKI As a contributing Competent Person responsible for the estimation and reporting of Mineral Resources for Stillwater and East Boulder Mines documented in the report titled Competent Persons Report on the Montana Platinum Group Metal Mineral Assets of Sibanye Gold Limited I hereby state:- 1. My name is Michael Koski and I am a Chief Geologist at Mining Company located at 536 East Pike Avenue, Columbus, MT59019,

Montana, United States of America.

2. I am registered as a Certified Professional Geologist with the American Institute of Professional Geologists registration No. CPG – 11321.

3. I am a graduate of the University of Montana with a BA Degree in Geology (1983) and confirm that I have practiced my profession

continuously since 1983.

4. I have been actively involved in the mining industry since 1983. I am a Chief Geologist presently working with upper level managers and technical staff to affectively develop the Stillwater Complex, and delineate Mineral Resources and Mineral Reserves and apply geological control support both in design and at the face. I have been responsible for leading the development geology team to interpret regional and local geology; design and implement definition and probe drilling programmes using Vulcan 3D modelling software. I interpret geology and apply geotechnical information to schedule and development of the mine. I am also skilled in Mineral Resource modelling, QAQC analysis and mine geology functions.


6. I have participated in the Mineral Resource and Mineral Reserve estimation for Stillwater and East Boulder Mines reported in this

report.

7. I am an employee of Stillwater and conduct visits to Stillwater (including Blitz) and East Boulder Mines from time to time.

8. I am responsible for the transparent and material reporting of the Mineral Resource estimates in this report.


10. I am a fulltime employee of Sibanye Gold Limited.



12. I have read the SAMREC Code and the Report has been prepared in accordance with the guidelines of the SAMREC Code.

13. Other than normal remuneration, I do not have nor do I expect to receive a direct or indirect interest in any of Sibanye Gold Limited’s assets contained in the Report or in Sibanye Gold Limited. My compensation or employment relationship with the Sibanye Gold Limited is not contingent on any aspect of the CPR.




Dated at Columbus on 21 September 2017.

230


MINERAL RESOURCES COMPETENT PERSON Name: James P. Dahy Position: Senior Geologist – Mineral Resources and Mineral Reserves Name of Firm: Stillwater Mining Company Profession: Geologist Years with Firm/Entity: 21 Nationality: American Education: University of Montana, Missoula Montana, United States of America, BA Geology, 1984 Montana Tech, Butte, Montana, United States of America, MSc Geology, 1989 Membership of Professional Societies: Certified Professional Geologist since 2006, with the American Institute of Professional Geologist Montana Tech Alumni Appreciation Award 2004 Key Qualifications: James has been with Stillwater Mining Company for the past 21 years and currently holds the position of Senior Mine Geologist. Employment Record:


1996-Present Stillwater Mining Company

Senior Mine Geologist

I am responsible for estimating and tracking the Mineral Resources and Mineral Reserves at the Stillwater Mine and reconciling and reporting monthly production statistics. My job includes the review of relevant geological data, the creation of the

block models and the estimation of the final Mineral Resources and Mineral Reserves. I organise the Resource and Reserve schedule and workload, train Geologists on the

methods and protocols, insure the accuracy of the data and the calculations, and report the proven reserve information to the management. In 2002, I collaborated with others to convert the SMC ore reserve program from the Techbase software to

the Vulcan software. I was part of the “Big Krig 2002”, a project that redefined how SMC calculated the probable reserve. During my tenure at Stillwater, I have been

involved in all the facets of the ore reserve process: drilling, logging, sampling, data collection, assaying, geologic interpretation and reporting final results to the

management. In the last 10 years, I have completed numerous statistical studies related to drill core sampling, channel sample correlation, sample spacing, grade-ton curves, grade estimation precision, mining dilution, mining bests practices scenarios,

reserve simulation and reserve reconciliation. From January 1998 to January 2000, I was also supervising 12 Geologists in the Grade control department. My duties

included training, mentoring, scheduling, and evaluating personnel. I was tasked to write and present reports, maintain the quality control program and communicate with other departments on matters related to engineering, ground support, drilling and

scheduling.

1998-1996 Stillwater Mining

Company (Chevron Owned)

Mine Geologist I worked underground at the Stillwater palladium-platinum mine. My most important

duty was geologic grade control of the J-M Reef. The process involves identifying the zone of interest, deciding if the rock at the face is ore or waste rock, recording

geologic data for entry on plan maps, and collecting channel samples. I also designed underground drilling programs, logged diamond drill core, interpreted geologic and assay data, mapped underground heading, and drafted geologic plans and sections.

My daily activities included communicating geologic, economic, and geotechnical information to the engineering and mine departments and making recommendations

on mining methods, ground-support, planning and feasibility. I reported monthly production statistics and used a personal computer in my everyday work. I also presented lectures and tours to visitors

1986-1987 Montana College of Mineral Science and

Technology

Teaching Assistant and Campus

Radiation Safety Officer

I worked underground at the Stillwater palladium-platinum mine. My most important duty was geologic grade control of the J-M Reef. The process involves identifying the

zone of interest, deciding if the rock at the face is ore or waste rock, recording geologic data for entry on plan maps, and collecting channel samples. I also designed

underground drilling programs, logged diamond drill core, interpreted geologic and assay data, mapped underground heading, and drafted geologic plans and sections.

My daily activities included communicating geologic, economic, and geotechnical information to the engineering and mine departments and making recommendations on mining methods, ground-support, planning and feasibility. I reported monthly

production statistics and used a personal computer in my everyday work. I also presented lectures and tours to visitors.

1984-1986 Montana College of Mineral Science and

Technology

Research Specialist Operated and maintained a fast-neutron accelerator for the purpose of analysing coal and mineral samples. Wrote and edited reports and research proposals and

manuscripts. As radiation safety officer, maintained the radiation safety program in accordance with NRC regulations. Assisted in a major research project involving platinum ore microprobe analysis. My duties included specimen collection and

preparation, microscopic mineral identification, drafting, computer input, and general geologic support.

231


MINERAL RESOURCES COMPETENT PERSON’S CERTIFICATE – JIM P. DAHY As a contributing Competent Person responsible for the estimation and reporting of Mineral Resources for Stillwater Mine documented in the report titled Competent Persons Report on the Montana Platinum Group Metal Mineral Assets of Sibanye Gold Limited I hereby state:- 1. My name is Jim P. Dahy and I am a Senior Geologist at Mining Company located at 536 East Pike Avenue, Columbus, MT59019,



3. I am a graduate of the University of Montana with a BSc Degree in Geology (1984) and MSc Geology (1989), and confirm that I

have practiced my profession continuously since 1984.

4. I have been actively involved in the mining industry since 1984. I am a Senior Geologist responsible for estimating and tracking the Mineral Resources and Mineral Reserves at the Stillwater Mine and reconciling and reporting monthly production statistics. My job includes the review of relevant geological data, the creation of the block models and the estimation of the final Mineral Resources and Mineral Reserves. I organise the Mineral Resource and Mineral Reserve schedule and workload, train Geologists on the methods and protocols, ensure the accuracy of the data and the calculations, and report the proven reserve information to the management.



report.













232


MINERAL RESERVES COMPETENT PERSON Name: Brent D. LaMoure Position: Director of Planning Name of Firm: Stillwater Mining Company Profession: Mining Engineer Years with Firm/Entity: 22 Nationality: American Education: Montana College of Mineral Science and Technology, United States of America, BSc Mining Engineering with Honors; May 1988 Membership in Professional Societies: Qualified Professional (QP) Member – Mining and Ore Reserves Mining and Metallurgical Society of America Member #: 01363QP Key Qualifications: Brent has been with Stillwater Mining Company for the past 22 years and currently holds the position of Director of Planning and Projects. Employment Record:



Director of Planning and Projects

Director of Planning and Projects, Columbus, MT Responsible for Montana based projects, mine/business planning and ore reserve reporting. Accountable to Vice-President of Mining Operations.

Manager Corporate Planning, Columbus, MT Responsible for company-wide mine/business planning and Ore Reserve reporting.

Accountable to Vice-President of Corporate Planning.

Chief Engineer, Stillwater Mine, Nye Mt,

Responsible for managing 28-person team of engineers and surveyors. Accountable to Mine Manager for safety, technical and operations performance of the Stillwater

Mine.

General Mine Foreman, Stillwater Mine Responsible for overseeing nine supervisors and two mine clerks. Accountable to

mine manager for safety and production performance of 140-person underground division.

Mine Superintendent, East Boulder Mine Responsible for mine design and development of operating systems for new

underground mine. Accountable to mine manager for safety and production performance of 60-person underground tunnel boring crew when other superintendent was off site.

Mine Superintendent, Stillwater Mine Responsible for overseeing eight supervisors and one mine clerk.

Accountable to operations vice president for safety and production performance of 160-person underground division.

Mine Supervisor, Stillwater Mine Responsible for overseeing 18-person underground crew, whose duties included

drill/ blast mining, underground rubber tire and rail haulage and underground supply delivery. Accountable to mine superintendent for safety and production performance of 18-person hourly team.

Mine Planning and Ventilation Engineer, Stillwater Mine Responsible for underground production forecasting and yearly budgeting.

Underground production stoping and development design. Mine ventilation surveys and ventilation planning. Accountable to senior engineer for personal safety and

engineering project completion.

1989-1995 Homestake Mining Co.,

Homestake Mine, Lead, South Dakota (Underground and

Surface Gold Mine)

Mine Planning

Engineer

I was responsible for underground production forecasting and yearly budgeting.

Underground production stoping and development design; Rock mechanics design and installation review; Underground water grouting program startup and execution. Relief supervision when supervisors were off site; Accountable to chief

engineer for personal safety and engineering project completion.

1988-1989 Homestake Mining Co.,

Homestake Mine, Lead, South Dakota

Underground Miner Operation of Jackleg and Jumbo drills, Load Haul Dump units, Haul trucks,

Locomotives, Explosive handling and underground Surveying. Training on Diamond drills, Raisebore drills, Assay Lab, Surface ball mill, Jaw crushers, Down the hole and

Top hammer longhole drills. Training in Open pit gold mine on operation of Dozers, surface Loader, surface Blasthole drill, loading Explosives in production benches and surface Surveying

1986-1988 Cominco American, Warm Springs

Operation Underground Phosphate Mine)

Junior Engineer Full time during the summer. Part time during the school year. Calculating bonus incentive contracts. Surface and underground surveying.

Designing rock size classifier installation. Radon gas surveys.

233


MINERAL RESERVES COMPETENT PERSON’S CERTIFICATE – BRENT D. LAMOURE As a contributing Competent Person responsible for the estimation and reporting of Mineral Reserves for Stillwater and East Boulder Mines documented in the report titled Competent Persons Report on the Montana Platinum Group Metal Mineral Assets of Sibanye Gold Limited I hereby state:- 1. My name is Brent D. LaMoure and I am a Senior Mining Engineer and Director of Planning at Mining Company located at 536 East

Pike Avenue, Columbus, MT59019, Montana, United States of America.

2. I am registered as a Qualified Professional (Mining and Ore Reserves) with the Mining and Metallurgical Society of America registration No. 01363QP.

3. I am a graduate of the Montana College of Mineral Science and Technology with a BSc Degree in Mining Engineering (1988) and

confirm that I have practiced my profession continuously since 1988.

4. I have been actively involved in the mining industry since 1988. I am the Director of Planning responsible for projects, mine/business planning and Mineral Reserve estimation and reporting. I have skills in the management of mining engineering and survey teams, production and safety, mine planning, design, ventilation, rock engineering.



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234


MINERAL RESOURCES COMPETENT PERSON Name: Jennifer Evans Position: Senor Geologist Name of Firm: Stillwater Mining Company Profession: Geologist Years with Firm/Entity: 12 Nationality: American Education: Montana State University, Montana, United States of American, BSc Geology, 2003 Membership in Professional Societies: Member of American Institute of Professional Geologists (CPG#11669) Key Qualifications: Jennifer has been with Stillwater Mining Company for the past 12 years and currently holds the position of Senior Geologist. Employment Record:



Senior Geologist I am responsible for block modelling and estimation and reporting of Mineral Resources and Mineral Reserves. I am also a diamond drill program planner overseeing core logging. I have extensive skills in the use of Vulcan modelling

software as well as in database management.

2003-2005 Montana Fish, Wildlife

& Parks

Administrative

Assistant

Fast‐paced position central to all departments with a wide variety of duties including

editing Environmental Assessments, mailing surveys, license sales, as well as field work netting fish and teaching gold panning.

235


MINERAL RESOURCES COMPETENT PERSON’S CERTIFICATE – JENNIFER EVANS As a contributing Competent Person responsible for the estimation and reporting of Mineral Resources for East Mine documented in the report titled Competent Persons Report on the Montana Platinum Group Metal Mineral Assets of Sibanye Gold Limited I hereby state:- 1. My name is Jennifer Evans and I am a Senior Geologist at Mining Company located at 536 East Pike Avenue, Columbus, MT59019,



3. I am a graduate of the University of Montana with a BSc Degree in Geology (2003) and confirm that I have practiced my profession

continuously since 2005.

4. I have been actively involved in the mining industry since 2005. I am a Geologist responsible for block modelling and estimation and reporting of Mineral Resources and Mineral Reserves at East Boulder Mine. I am also a diamond drill program planner overseeing core logging. I have extensive skills in the use of Vulcan modelling software as well as in database management.



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236


Appendix 2: Qualifications of Technical Experts

METALLURGY – TECHNICAL EXPERT

Name: Russell Alexander Heins Position: Director and Principal Metallurgical Engineer Name of Firm: Mineral Corporation Consultancy (Pty) Limited Profession: Metallurgist Years with Firm/Entity: 3 Nationality: British

Education: University of Birmingham, United Kingdom, BSc (Hons) Minerals Engineering, 1986

Membership in Professional Societies: Registered Chartered Engineer Corporate Member Institute of Materials, Minerals & Mining (UK) Fellow Southern African Institute of Mining & Metallurgy

Key Qualifications: Russell has 30 years of metallurgical experience over a wide range of commodities including precious and base metals, rare earth metals and industrial minerals. He has been responsible for all aspects of the refinery operations, including strategic planning, labour, safety, process development, product quality, production and engineering. He has participated in a number of multi-disciplinary due diligence, scoping and feasibility studies, and independent reviews. During his tenure as Operations Director for a tantalite refining company, he acquired experience in the mining and processing of tantalite ore through to tantalum pentoxide and hydroxide via hydrometallurgical and chemical processing. In addition, he has managed plant design, installation and commissioning projects for a tantalite recovery operation in Northern Mozambique. He has been associated with consulting studies at all levels on commodities which include; gold, tin, REEs, graphite, nickel, tantalum, niobium, manganese, iron, copper, PGMs and chrome.

Employment Record: Dates Company Position Job Description

2014-

Present

Mineral Corporation

Consultancy (Pty) Ltd (trading as The Mineral Corporation)

Director Senior Technical Advisory

Project leadership and senior technical advisory: Technical studies relating to professional discipline and experience including: Metallurgical studies strategic planning and project management; Project budget

compilation; Technical project evaluation, laboratory and metallurgical variability testwork planning and implementation; Metallurgical audits and operational reviews;

Due diligence and verification of historical metallurgical and process work; Scoping studies; Feasibility studies; Fatal flaw analyses; Designing and auditing work protocols for metallurgical evaluation; Desktop studies; Acting as project owner’s representative;

Country risk profiling.

2011-2014 Benu Consulting Independent

Metallurgical Consultant

Providing consulting services to the minerals industry globally, with clients ranging from

minerals advisory companies to mining companies and strategic intelligence companies. Exposures included Stock Exchange compliant PEA/Scoping Level Studies, due diligence

and fatal flaw investigations, in a variety of commodities and in many jurisdictions.

2007-2011 Tantalite Resources

Refinery

Operations

Director

Start-up junior mining company, mining and processing tantalite ore through to

tantalum pentoxide and hydroxide and niobium hydroxide via hydrometallurgical and chemical processing. Responsible for all aspects of the refinery operations, including strategic planning, labour, safety, process development, product quality, production and

engineering. Refinery operation was picked up from a 2-3 tpm ‘entrepreneurial’ operation to a 25tpm, AIM compliant professional organisation, via the installation of

various management systems, statutory compliance and debottlenecking of the process. Project management of the ‘K-Salt’ expansion project.

2002-2007 Gekko Systems S.A. Manager Operations and Sales

Small business management, responsible for all aspects of the running of the South African branch office for an Australian minerals processing equipment manufacturer. Key portfolios include capital equipment sales, in addition to financial and general

management of the company, marketing, advertising, corporate sponsorships, human resources, strategic planning and corporate governance. Within 18 months, company

was turned around from group liability to a going concern, with more than 50% of group capital sales in 2004FY originating from SA office. A drive to improve after sales service was initiated and paid itself back in terms of consulting service and spares sales.

1995-2002 Assmang Manganese, Cato Ridge

Technical Manager Responsible for the management of the Raw Materials procurement, Finished Product scheduling and despatch, customer liaison, ISO 9002 Quality Assurance, sales and

marketing liaison, laboratory, production planning and modelling and technical metallurgy functions. In addition, the overall responsibility for company health, safety

and environmental management was later included to maintain and improve NOSA standards. Managerial responsibility for approximately 100 employees.

1994-1995 Winkelhaak Gold Mine Production Superintendent -

Milling

Responsible for managing the production section of a large gold plant, including Run of Mine ore receipt, conveying, milling and classification.

1993 Gencor Metallurgical

Services

Gengold Manager Responsible for the management and development of the technical metallurgical service

function provided to the Group gold and uranium mines

1991-1993 Richards Bay Minerals Development

Metallurgy Department

Senior Metallurgist (Development)

Process development research and project work on the RBIT ilmenite smelting and slag

and pig iron processing sections of the RBM operations.

1986-1991 Gencor Metallurgical

Services (West)

Plant Metallurgist Metallurgical process project work, graduate development training including acting in

various line positions at Group gold, and uranium metallurgical plants.

237


MINING INFRASTRUCTURE, BULK SERVICES SUPPLIES AND LOGISTICS – TECHNICAL EXPERT Name: Edward William Legg Position: Senior Associate Mining Engineer Name of Firm: Mineral Corporation Consultancy (Pty) Limited Profession: Mining Engineer Years with Firm/Entity: 3 Nationality: South African and British Education: BSc Engineering (Mining) University of the Witwatersrand (1980) Mine Managers Certificate of Competency (1983) Professional Engineer (ECSA) (1987) Masters Degree in Business Administration - Heriot Watt University (Edinburgh) (1995) Membership of Professional Societies: Member of the Association of Mine Managers of South Africa Fellow - SA Institute of Mining and Metallurgy Member of the Engineering Council of South Africa (Pr Eng) No. 880117 Key Qualifications: Edward has 34 years of operational, technical and executive experience across the southern African mining industry. Since 2014, he has provided specialist mining and business consulting services including contributions to detailed due diligence studies and he has a broad knowledge of the base metals, coal and precious metals mining business. Employment Record:


2014 Mineral Corporation Consultancy (Pty) Ltd

Consulting Associate Mining

Engineer

Consulting Mining Engineer offering technical assistance on various projects for The Mineral Corporation including the CPR for Stillwater Mining.

2014-Present Edward Legg

Consulting Services

Principal

Consulting Engineer

Specialist mining and business consulting services to operational, financial and

support companies in the Southern African mining community. •Executive operational experience dealing with international directors in jurisdictions

of RSA, Zambia, DRC, Barbados, Switzerland. •Extensive experience in Project and Full Mine Feasibility Studies. •Comprehensive experience and capacity to manage greenfield and brownfield mine

development. •Detailed knowledge and capacity for management of contractors, both for mine

construction and mine development. •Extensive experience in negotiating copper offtake agreements for both cathode and concentrate.

•Experience in high level negotiations with senior government officials in Namibia, Zambia and DRC for mining and exploration rights.

•Capacity and knowledge to implement management systems for a mine in ramp up production phase.

2009-2014 Teal Minerals (Barbados) Corporation Valearm Joint Venture

Senior General Manager

Responsible to the Executive Chairman of the Board for the management, governance, technical and operational performance of operations in Southern Africa.

2005-2008 Metorex Limited Director Appointments included the O’Okiep Copper Mine (MD), Vergenoeg Fluorspar mine and the Alfluorco Fluoro Chemical Project (MD), Sable Zinc Refinery in Zambia

(MD), Chibuluma Mines Plc in Zambia (MD) and Ruashi Mining Sprl (Ops Director).

2003-2004 Metorex Limited Director Appointed as the Managing Director of the subsidiary companies to oversee the

business development of the units, including expansions, acquisitions, marketing, and governance.

2002-2003 Anglo American Platinum Corporation

General Manager Strategic Planning

Responsible for strategic Life of Mine business, planning of the individual mining units and new Capital Projects, and consolidation of this into a Strategic Business

Plan, for presentation to the EXCO.

2000-2002 Anglogold Limited Head of Operations

South African Region

Responsible to the Executive Director South Africa, for the operational performance

of the Free State and West Wits mines and operations. This included initially 4 mines in the Free State and 5 mines in the West Wits and 2 shaft sinking projects at Joel and Mponeng Mines, and the completion of the access development of the

Deepened Elandsrand Shaft.

1995-1999 Metorex (Pty) Ltd Senior Manager

Operations

Responsible to the Chief Executive Officer and Board for overall management of

appointed mines. The portfolio included coal, base metals and industrial minerals although feasibility studies were also carried out on other diverse target

acquisitions, including stone quarries and gold and copper operations.

1981-1995 Anglovaal Group Technical Services

Manager, Manager Mining

Held various positions at all of the Anglovaal Group Mines, from Learner Official to

General Manager at Lorraine Gold Mines in 1995. It included all the technical aspects of operating a mining business, from survey, strategic planning, refrigeration and ventilation, grade control and ore reserve valuation, industrial

engineering, medical facilities, strata control strategy and environmental control and policy.

238


MINERAL TITLE AND SOCIAL – TECHNICAL EXPERT Name: Lynne Ann Soulsby Position: Social Scientist and Mineral Title Specialist Name of Firm: Mineral Corporation Consultancy (Pty) Limited Profession: Social Scientist Years with Firm/Entity: 11 Nationality: South African Education: University of the Witwatersrand, Johannesburg, BA Hons (Sociology), 2004 Key Qualifications: Lynne has been involved in the successful conversion and application of over 30 mining rights and numerous prospecting rights, mostly for PGMs, gold, coal and iron. This includes mineral title and compliance management, submissions of various reports for prospecting and mining title and title due diligence reviews on a variety of projects. Lynne has also been involved in the compilation of many Competent Persons Reports with regards to the Mineral Title and Social Matters. As part of this she has gained experience in strategy formulation, socio-sustainability, corporate social investment, community development and stakeholder engagement, and has been responsible for developing and implementing social and labour plans for clients that directly impacted workers, their families and affected communities. Through her involvement in the development of Social and Labour Plans she has gained experience in local economic development, human resources development, employment equity and social implications in mine closure planning. In her time at The Mineral Corporation she has also developed skills and experience to undertake comprehensive surface right investigations for companies which include the capture, collation and transformation of fragmented hard copy sources, into an integrated digital database and auditing of freehold ownership circumstances of projects and identifying potential threats to this ownership. Employment Record:



Consultancy (Pty) Ltd

Mineral Title

Specialist

All aspects of Mineral Title, including but not limited to application compilation,

Mineral Title portfolio management, Social and Labour Plan compilation and compliance audits.

Comprehensive surface right investigations for companies which include the

capture, collation and transformation of fragmented hard copy sources, into an integrated digital database and auditing of freehold ownership circumstances of projects and identifying potential threats to this ownership.

Assisting with the compilation of Competent Persons Reports with regards to Mineral Title and Social aspects.

Mineral Title, Surface and Social Due Diligences.

239


GEOTECHNICAL AND ROCK ENGINEERING – TECHNICAL EXPERT Name: Thagarajh Rangasamy Position: Associate Consulting Rock Engineer Name of Firm: Mineral Corporation Consultancy (Pty) Limited Profession: Rock Engineer Years with Firm/Entity: 4 Nationality: South African Education: MSc (Mining Engineering), University of the Witwatersrand, 2004 GDE (Mining), University of the Witwatersrand, 1999 Advanced Rock Engineering Certificate, (UNISA), 1999 COM Cert Rock Eng (TSA), 1995 Elementary Cert Rock Eng (COM), 1994 BSc (Applied Geology), University of Natal, 1991 Membership in Professional Societies: The South African Institute of Mining and Metallurgy The South African National Institute of Rock Engineering Key Qualifications: Thagarajh (Trevor) has 20 years of professional experience in various rock engineering and geotechnical related projects. He practiced as a rock engineering specialist for various Mining (AngloGold, JCI) as well as Consulting Companies (Itasca Africa, Groundwork) and served as a researcher on several projects for the CSIR. His specialist skills include consulting to the mining industry in the rock engineering, geotechnical and geological disciplines; non-linear plasticity based numerical codes such as 3DEC, UDEC and FLAC; FLAC/SLOPE Version 4 – continuum assessment of FOS using strength reduction techniques for rotational failure; UDEC Version 4 – discontinuum assessment of jointed slopes susceptible to wedge, planar and stepped-path failures; Kinematic assessments using stereographic projections; Limit-equilibrium analysis using wedge failure spread sheets; Empirical assessments using RMR classifications. He has more than a working knowledge of first-pass elasticity based codes such as Minsim_W and Besol_MS; solving mine design and rock engineering problems using experience, numerical models and mathematical equations; Research on a needs-driven basis aspects of rock engineering, mine design and geology. He is currently actively involved in Rock Engineering, Geological and Geotechnical Engineering Consulting, spanning a wide commodity spectrum (gold, platinum, coal, base metals, and diamonds). Employment Record:


2013-2017 Mineral Corporation

Consultancy (Pty) Ltd (trading as The Mineral Corporation)

Consulting Rock Engineer Consulting Rock Engineer assisting The Mineral Corporation on various

projects for The Mineral Corporation including the CPR for Stillwater Mining.

2003-Present Middindi Consulting (Pty) Ltd

Owner and Director Trevor Rangasamy and Johan Hanekom started Middindi Consulting in 2003. Both serve as Directors, Owners and Senior Principle Rock

Engineers. Actively involved in Rock Engineering, Geological and Geotechnical Engineering Consulting for a wide range of clients ranging

from gold, platinum, coal, base metals, and diamonds, civil and environmental.

1999-2001 CSIR Researcher Trevor was doing Rock Engineering research for deep and ultra-deep mines. The Council for Scientific and Industrial Research (CSIR) is one of the leading scientific and technology research, development and

implementation organisations in Africa.

1998-2000 JCI Mining (Pty) Ltd Group Rock Engineering

Manager

Coordinate activities and roles and responsibilities of Rock Engineering,

Seismology, grout plant and secondary support staff.

1997-1998 JCI Mining (Pty) Ltd Chief Rock Engineer Legal appointment for the SV1 and South Deep shafts.

1995-1997 AngloGold Ashanti Senior Rock Engineer Legal appointment for Savuka shaft, WDL.

1994-1995 AngloGold Ashanti Strata Control Officer Underground data gathering.

240


ENVIRONMENTAL AND PERMITTING – TECHNICAL EXPERT Name: Leonard M. (Toby) Wright III Position: President/Principal Engineer Name of Firm: Wright Environmental Services Inc. Profession: Geotechnical Engineer/Hydrogeologist Years with Firm/Entity: 1 Nationality: United States of America

Education: University of Arizona, BSc. Geosciences, 1985 Colorado State University, MSc. Civil Engineering/Geotechnical, Minor Hydrology, 1999

Membership in Professional Societies: Registered Professional Geologist: Wyoming (#PG-3241)

Key Qualifications: Toby has 30 years of experience in geologic, hydrologic and geotechnical characterisation studies with 25 years’ experience specifically related the mining industry as both a mining operator and a consultant. Though he has been engaged in operations across several commodities (base and precious metals, industrial minerals, uranium), his expertise relates primarily to permitting, licensing and regulatory compliance for metals mining and milling operations. He is proficient in hydrogeologic and geotechnical characterization of environmental conditions, design and management of mine and mill waste management systems, mine environmental systems management and regulatory compliance. He has participated in several NI-43-101 compliant pre-feasibility studies, multi-disciplinary pre-acquisition due diligence reviews and independent technical reviews, as well as legal compliance audits for operating facilities. Toby also has considerable experience managing and supporting mine and mill remedial actions under CERCLA assisting Site owners with State and EPA regulatory strategy and relations.

Prior to forming his own firm, Toby served as the Environmental Manager for the Conventional Mining Group of Uranium One Americas from March of 2007 through March of 2010. In this role, he was responsible for all permitting, environmental compliance and H&S activities for Uranium One’s conventional mining and mill operations in the United States. In addition to his responsibilities for staff management, environmental monitoring and regulatory compliance he also assisted company environmental and regulatory due diligence reviews of potential acquisitions. Employment Record:



Consultancy (Pty) Ltd (trading as The Mineral

Corporation

Consulting

Geotechnical Engineer/Hydrogeolo

gist

Consulting services for The Mineral Corporation as Geotechnical

Engineer/Hydrogeologist for the CPR for Stillwater Mining.

2015-Current Anfield Resources Inc.

(TSX VENTURE: ARY) (OTCQB: ANLDF) (FRANKFURT: 0AD)

Managing Director Mr. Wright is the Managing Director of Anfield Resources Corporation, an

energy metals exploration, development and near-term production company with assets focused on uranium projects in North America.

2010-Current Wright Environmental Services Inc.

President Principal Engineer/Hydrogeologist Mr. Wright provides regulatory support to a number of major and junior mining

operators, covering technical areas such as mine and mill State permitting, Federal licensing, design of environmental monitoring systems, mine and mill

reclamation strategies, remedial action design and environmental characterization as well as regulatory compliance strategies. He also has

performed support as a Qualified Person for several NI-43-101 pre-feasibility reports regarding environmental issues.

2007-2010 Uranium One Inc. Env. Manager, USA Environmental Manager for USA Conventional Mining and Milling Assets. Managed milling and conventional mine asset environmental portfolio across several States, directed and managed permitting, licensing, and regulatory

compliance of mine and mill projects with State and Federal agencies. Participated in asset pre-acquisition due diligence reviews of mining and milling

assets, managed mill standby operations staff.

2001-2007 Tetra Tech, Inc. Senior Engineer Project Manager, Hydrogeology Technical Section Lead: Managed and

supported many environmental projects for major international mineral and energy resource development companies (ExxonMobil, Freeport McMoRan, Newmont Gold Company), including new mine permitting, mine reclamation,

both domestically and abroad. Served as the US Department of Energy’s Technical Assistance Contract Project Manager for the Moab UMTRA Project

(Federal reclamation of abandoned uranium mill), which managed a US$20MM annual budget, a technical staff of over 40 personnel, and a diverse array of programs including operation and maintenance of inactive uranium mill sites,

site hydrologic and radiological characterization studies, the site health and safety programs, groundwater remedial actions, site environmental monitoring

and development of a major Environmental Impact Statement.

1992-2001 Shepherd Miller Inc. Engineer Project Scientist/Engineer: Supported mine reclamation design as well as

hydrogeologic and geotechnical Site condition characterizations for numerous major natural resource development companies in the USA and abroad. Mr. Wright served as the acting Environmental Manager for the Newmont Mining

Company Batu Hijau Mine in Sumbawa Indonesia for approximately one year during the ANDAL permitting and mine development phase of the project.

241


Appendix 3: Glossary of Terms Glossary Explanation

Adit An essentially horizontal mine working extending from the surface underground. Tunnels have surface openings on both

sides of a hill while adits have only one.

Anorthosite An igneous rock composed almost entirely of anorthite plagioclase.

Archaean The oldest geological period on earth, >2 500 million years in age.

Assay An analysis of minerals and mine products to determine the concentrations of their individual components.

Assaying The processes used to accurately determine the quantity of metal, in this instance Pd and Pt that is present in a sample. X-ray methods and fire assays with an Inductively Coupled Plasma determination are the principal analytical methods for

platinum group metals.

Audit

A systematic and detailed examination of the Mineral Resource and Mineral Reserve, processes of estimation (including

geological, geotechnical and other models), assumptions and conclusions undertaken in order to validate the appropriateness of the various components which contribute to the estimates of the Mineral Resource and Mineral Reserve.

An Audit includes a detailed examination of the base data and validation of the Mineral Resources and Mineral Reserves estimates. When compliance to the SAMREC Code is declared and signed off, the audit must have been conducted by a Competent Person.

Azimuth A directional measurement from the true north – typically true north measured as a 0° azimuth. Moving clockwise on a 360o circle, east has azimuth 90°, south 180° and west 270°

Ball Mill A type of grinding machine that uses ball-shaped grinding media to reduce the size of the rocks being ground.

Base Metals Refinery An industrial plant that uses mechanical and chemical means to purify a substance such as base metals.

Block Model Three dimensional representation of ta deposit consisting of small mineable blocks, which is produced using specialised

modelling software such as Vulcan.

Braggite Braggite is a sulphide mineral of platinum, palladium and nickel with chemical formula: (Pt, Pd, Ni)S

Bronzitite A rock composed primarily of the pyroxene mineral bronzite.

Chalcopyrite A copper iron sulphide mineral that crystallises in the tetragonal system.

Competent Person A person who is registered with SACNASP, ECSA or SAGC, or is a Member or Fellow of the SAIMM, the GSSA, IMSSA or a Recognised Professional Organisation (RPO). The person must have a minimum of five years relevant experience in the

style of mineralisation or type of deposit under consideration and in the activity which that person is undertaking.

Competent Person’s Report

A report on the technical aspects of a project or mine prepared by a Competent Person (CP). The contents are determined

by nature/status of the project/mine being reported and may include a techno-economic model as appropriate for the level of study.

Competent Valuator

A person who is registered with ECSA, SACNASP, or SAGC, or is a Member or Fellow of the SAIMM, the GSSA, SAICA, or a Recognised Professional Organization (RPO) or other organizations recognised by the SSC on behalf of the JSE Limited. A Competent Valuator is a person who possesses the necessary qualifications, ability, and relevant experience in valuing

mineral assets.

Concentrator A plant where ore is separated into values (concentrates) and rejects (tails).

Cooperite A grey mineral consisting of platinum sulphide (pts), generally in combinations with sulfides of other elements such as palladium and nickel (pds and nis)

Cumulate/Cumulous An igneous texture formed by the accumulation of crystals that settled out from magma by the action of gravity

Decline An underground development work driven either from the surface or from a starting point underground that is driven at a declining angle to provide access to deeper parts of a mine.

Dibutyl Phthalate A commonly used plasticiser

Dilution Low or zero grade (waste) material that is mined during the course of mining operations and thereby forms part of the

Mineral Reserve

Dip The angle measured from the horizontal that a layered or tabular geologic feature declines into the ground. Dips are given

in degrees, for example 63°, and a direction, for example northeast.

Dyke A wall-like body of igneous rock that is intruded (usually vertically or near-vertically) into the surrounding rock in such a

way that it cuts across the stratification (layering) of this rock.

Effective Date The date of the most recent scientific or technical information included in the technical report.

Environmental Assessments An environmental analysis prepared pursuant to the National Environmental Policy Act to determine whether a federal action would significantly affect the environment and thus require a more detailed Environmental Impact Statement (EIS)

Environmental Impact Statement

A document required by the National Environmental Policy Act (NEPA) for certain actions "significantly affecting the quality of the human environment

Euhedral Crystals are those that are well-formed, with sharp, easily recognised faces.

Facies

A rock unit defined by its composition, its shape and internal geometry. Generally, a sub-unit of a more extensive rock unit

which exhibits variations in features such as composition, texture and other characteristics, compared to other facies within the overall rock unit.

Fault A fractured surface in the earth's crust along which rocks have been displaced relative to each other.

Felsic Igneous rocks that are rich in silica and usually are lighter coloured.

Flotation A method of mineral processing that causes some minerals to attach to air bubbles that rise to the surface while other minerals sink to the bottom of the flotation cell; thus, separating different minerals from each other.

Footwall The block of rock which lies on the underside of an inclined fault or of a vein of mineral.

Gabbronorite A mafic composed of the calcium-rich plagioclase and hypersthene, olivine can be present in small quantities

Gaitronic Paging Sytsem Advanced paging and intercom system

Gangue Minerals that have no value

Hangingwall The overlying side of an ore body, fault or mine working

Harzburgite A basic igneous rock, comprising mostly pyroxene, with a low concentration of calcic plagioclase. Accessory minerals such as chromite may be present.

Historical Estimate

An estimate of the quantity, grade, or metal or mineral content of a deposit that an issuer has not verified as a current

Mineral Resource or Mineral Reserve. The estimate predates the issuing of the code and/or was prepared before the issuer acquiring, or entering into agreement to acquire, an interest in the property that contains the deposit.

Igneous One of the three main groups of rock types (igneous, metamorphic, and sedimentary), to describe those rocks that have

crystallised from a magma.

In Situ In its natural or original position or place

Jackleg Percussive tool that is powered by compressed air; it is used to bore holes into hard rock.

242


Glossary Explanation

Kotulskite A hexagonal-dihexagonal dipyramidal mineral containing bismuth palladium and tellurium.

Kriging A geostatistical method used to interpolate the value at a random point (e.g., an assay value) at an unobserved location

from observations of its value at nearby locations.

Layered Igneous Complex An intrusive ultramafic to mafic igneous body intruded deep in the earth that cools very slowly into distinct layers with

differing mineralogy. The layering is very similar to the layering in sedimentary rocks.

Lenticular Lens-shape

Life Of Mine Duration of time that it will take to extract accessible material.

Life Of Mine Plan A design and financial/economic study of an existing operation in which appropriate assessment have been made of existing geological, mining, social, governmental, engineering, operational, and all other Modifying Factors, which are

considered in sufficient detail to demonstrate that continued extraction is reasonably justified.

Lopolith A type of igneous intrusive body that is more or less saucer shaped (concave up), often composed of ultramafic and mafic rocks and many square miles (square kilometres) in area.

Mafic Igneous rocks composed primarily of minerals rich in iron and magnesium and have a low silica content

Material Issue A risk or circumstances over which the associated factor, constituent or information were omitted or misstated, could influence the economic decisions of users. As a rule of thumb, this would normally be equal to or exceed 10%.

Mesozoic From 252.17 million to 66 million years ago

Mine Design A framework of mining components and processes taking into account such aspects as mining methods used, access to the ore body, personnel and material handling, ventilation, water, power, and other technical requirements, such that mine

planning can be undertaken.

Mineralisation

A concentration (or occurrence) of material of possible economic interest, in or on the earth’s crust, for which quantity and quality cannot be estimated with sufficient confidence to be defined as a Mineral Resource. Mineralisation is not classified

as a Mineral Resource or Mineral Reserve and can only be reported under Exploration Results. The data and information relating to it must be sufficient to allow a considered and balanced judgement of its significance.

Modifying Factors

Appropriate assessment, which can include a feasibility study, that has been carried out, including the consideration of

realistically assumed mining, geotechnical, quality, processing, economic, marketing, legal, environmental, social and governmental factors

Norite A coarse-grained, basic igneous rock consisting of essential plagioclase feldspar, orthopyroxene (hypersthene or bronzite), and clinopyroxene (augite)

Oikocrysts Igneous rocks where large component crystals contain smaller crystals of other minerals within them.

Olivine A mineral group, (Mg, Fe) 2Sio4, that is olive green, green, brown, or black in colour and found in ultramafic to mafic

igneous rocks.

Ore QMS Database System An in-house developed Software System For Storage Managing Sampling, Assay, And Other Data.

Paleozoic From 541 million to 252.17 million years ago

Pentlandite A nickel-sulphide mineral ((Fe, Ni)9S8) that contains much of the palladium in the J-M Reef.

Peridotite A dense, coarse-grained igneous rock consisting mostly of the minerals olivine and pyroxene

Podiform Having the form of a pod

Pothole A bowl-shaped depression in a rock surface.

Pyrite An iron sulphide with the chemical formula FeS2

Pyrhotite An iron sulphide mineral with the formula Fe(1-x)S (x = 0 to 0.2)

Reef A term for a narrow tabular metalliferous mineral deposit

Royalty A payment made by a producer of minerals, oil, or natural gas to the owner of the site or of the mineral rights over it.

Returnable ounces That portion of metal (Pd and Pt) contained in ore that can be extracted by ore processing.

Review

A systematic and detailed inspection or examination of any element of the Mineral Resource and/or Mineral Reserve estimation process undertaken in order to validate adherence to standards and procedures, identify material errors and/or

omissions or improvements. A review might include a detailed examination of the base data. When compliance to the SAMREC Code is declared, the review must have been conducted by a Competent Person.

Run of Mine The raw mined material

SAMREC Code South African Code for the Reporting of Exploration Results, Mineral Resources and Mineral Reserves

SAMVAL Code The South African Code for the Reporting of Mineral Asset Valuation

Smelter A mineral processing plant that removes sulphur from sulphide minerals

Stoping The excavation of underground openings (stopes) by a variety of mining methods.

Strike The horizontal direction along a sloping stratum which is at right angles to the dip.

Subhedral Having a partial or incomplete crystal face or form

Surface Portal A hillside tunnel entrance

Tailings The finely ground waste rock produced by a mine’s processing plant that crushes and grinds the ore fed to the plant.

Thrust A reverse fault of low angle, with older strata displaced horizontally over newer.

Troctolite An igneous rock composed of anorthite and olivine.

Ultramafic Igneous rocks that are composed of minerals rich in iron and magnesium with a very low silica content, often largely composed of a single mineral such as olivine.

243


Appendix 4: List of Abbreviations and Symbols Abbreviations Description

ANFO Ammonium Nitrate Fuel Oil

°C Degrees Celsius

°F Degrees Fahrenheit

3D Three Dimensional

3D Three Dimensional

4PGM Sum of Pt, Pd, Rh and Au

AC Alternating Current

ACOE Army Corps of Engineers

AMSL Above Mean Sea Level

AN-I Anorthosite Zone I

AN-I and AN-II Anorthosite Zones I and II

AN-II Anorthosite Zone II

AOC Administrative Order on Consent

ARM Administrative Rules of Montana

ATF Bureau of Alcohol Tobacco and Firearms

ATF United States Bureau of Alcohol, Tobacco and Firearms

BA Bachelor of Arts

BLITZ_W Blitz-West

BLM Bureau of Land Management

BSc Bachelor of Science

BWI Bond Works Index

C&F Cost and Freight

CatEx Categorical Exclusions

CAA Clean Air Act

CBA Collective Bargaining Agreement

CCTV Closed Circuit Television

CERCLA Environmental Response, Compensation and Liability Act

cfpm Cubic Feet per Minute

CFR Code of Federal Regulations

CFR United States Code of Federal Regulations

CGNF Custer Gallatin National Forest

CO Carbon Monoxide

Conventional C&F Conventional Overhand C&F

CP Competent Person

CPR Competent Person’s Report

CV Competent Valuator

CVR Competent Valuator’s Report

CWA Clean Water Act

dBA Decibel

DC Direct Current

DCF Discounted Cash Flow

DDH Diamond Drill Hole

DEQ Department of Environmental Quality

DNRC Department of Natural Resources and Conservation

DOWL Dow-Lower

DOWU Dow-Upper

DPB Dibutyl Phthalate

DPM Diesel Particulate Matter

EA Environmental Assessment

EIA Environmental Impact Assessment

EIS Environmental Impact Statement

EMP Environmental Management Programme

EMPR Environmental Management Programme Report

EPA Environmental Protection Agency

ESA Endangered Species Act

ESA 1973 Endangered Species Act

ETF Exchange Traded Funds

EV Enterprise Value

FA Fire Assay

FCC Federal Communications Commission

FCC United States Army Corps of Engineers, United States Federal Communications Commission

FCC United States Federal Communications Commission

FGSSA Fellow of The Geological Society of South Africa

FHFC First Half Final Certificates

FLPMA Federal Land Policy and Management Act of 1976

FM Frequency Modulation

FoNSI Finding of No Significant Impact

FOT Free on Truck

FSAIMM Fellow of The South African Institute of Mining and Metallurgy

G&A General and Administration

244


Abbreviations Description

GCL Geosynthetic Clay Liner

GIS Geographical Information Systems

GNA Good Neighbour Agreement

GN-I Gabbronorite-I

GN-II Gabbronorite-II

GN-III Gabbronorite-III

GPS Global Positioning System

GSSA Geological Society of South Africa

ha Hectares

HAP Hazardous Air Pollutant

HDPE High Density Polyethylene

hp Horse Power

HW LpoC Spotted Anorthosite

ICP-OES Inductively Coupled Plasma Optical Emission Spectrometry

IDW Inverse Distance Weighting

Inc Incorporated

Ir Iridium

ISRM International Society for Rock Mechanics

IT Information Technology

J-M Johns-Manville

JORC Joint Ore Reserves Committee

JSE or JSE Limited Johannesburg Stock Exchange

JSE12 Johannesburg Stock Exchange 12 Month

kph Kilometres Per Hour

kt Kilotonne

kton Kiloton

kV Kilovolt

l/s Litres Per Second

LAD Land Application Disposal

LDL Lower Detection Limits

LHD Load-Haul-Dump

LIMS Laboratory Information System

LoM Life of Mine

m Meters

m/s Meters per second

M3/s Meters cubed per second

mamsl Meters above mean sea level

MBA Master of Business Administration

mbs Meters Below Surface

MCA Montana Code Annotated

MDEQ Montana Department of Environmental Quality

MDEQ Montana Department of Environmental Quality

MEPA Montana Environmental Policy Act

MF Standard naming convention

mGal Milligal

MIS Management Information Systems

MMRA Montana Metal Mine Reclamation Act

MPa Megapascal

MPDES Montana Pollutant Discharge Elimination System

MSc Master of Science Degree

MSHA Mine Safety and Health Administration

MT Montana

MTI Mining Technology International

MW Molecular Weight

NAAQS National Ambient Air Quality Standards

NAD27 North American Datum of 1927

NAD83 North American Datum of 1983

NEPA National Environmental Policy Act

NFS National Forest Service

NGI Norwegian Geotechnical Institute

NGO Non-Governmental Organisation

N-I Norite I

N-II Norite-II

NIOSH National Institute for Occupational Safety and Health

NPV Net Present Value

NRC Nuclear Regulatory Commission

NRC United States Nuclear Regulatory Commission

nT Nanotesla

NYSE New York Stock Exchange

OB-I Olivine-Bearing-I

245



OB-II Olivine-Bearing-II

OB-III Olivine-Bearing-III

OB-IV Olivine-Bearing-IV

OB-V Olivine-Bearing-V

oC Buckshot

OEM Original Equipment Manufacturer

oik Mottled Anorthosite

opt Ounces per Ton

Ore QMS Ore Quality Management Systems

ORET Ore Reserve Economic Test

OSE Off Shaft East

OSE-E Off Shaft East-East

OSE-W Off Shaft East-West

OSHA Occupational Safety and Health Administration

OSW-L Off Shaft West Lower

OSW-N Off Shaft West North

OSW-U Off Shaft West Upper

oz/t Ounce Per Ton

pC Hangingwall Anorthosite

PbFA Lead Fire Assay

PF Power Factor

PGE Platinum Group Elements

PGM Platinum Group Metal

poC Pegmatoidal Rocks

PoO Plan of Operations

Power Mount Power Mount, Inc.

ppb Parts Per Billion

Pr Eng Professional Engineer

Pr Sc Nat Professional Natural Scientist

psi Pounds per Square Inch

psi Pounds per Square Inch Gauge

Pt Platinum

Pty Proprietary

QA Quality Assurance

QA.QC Quality Assurance and Quality Control

QC Quality Control

QMS Quality Management System

R&F R&F

R2 Regression Coefficients

ROD Record of Decision

RoM Run of Mine

RQD Rock Quality Designation

RQI Rock Quality Index

SACNASP South African Council for Natural Scientific Professions

SAG Semi-Autogenous Grinding

SAIMM Southern African Institute of Mining and Metallurgy

SAMREC Code The South African Code for Reporting of Exploration Results, Mineral Resources and Mineral Reserves.

SAMREC Code South African Code for the Reporting of Exploration Results, Mineral Resources and Mineral Reserves

SAMVAL Code The South African Code for the Reporting of Mineral Asset Valuation.

SAMVAL Code South African Code for the Reporting of Mineral Asset Valuation

SANAS South African National Accreditation System

SEC United States Securities and Exchange Commission

SEC Guide 7 Securities and Exchange Commission Industry Guide 7

SGL Sibanye Gold Limited

SLD Sub-Level Development

SLE Sub-Level Extraction

SLO Social License to Operate

SMC Stillwater Mining Company

SO2 Sulphur Dioxide

SRC SAMREC Code Reference

SRF State Revolving Fund (United States Environmental Protection Agency)

Ss specific storage

SENS Stock Exchange News Service

stph Short ton per hour

SVC SAMVAL Code Reference

TBM Tunnel Boring Machine

TBRC Top Blown Rotary Converter

TC Total Carbon

TMC The Mineral Corporation

TSF Tailings Storage Facility

246



UCS uniaxial compressive strengths

UMS Ultramafic Series

US$ United States Dollars

USA United States of America

USFS United States Forest Service

USGS United States Geological Survey

UWE Upper West East

WACC Weighted Average Cost of Capital

WMP Water Mine Programme

WQA Water Quality Act

WRSF Waste Rock Storage Facility

WTP Water Treatment Plant

XRF X-Ray Fluorescence

247


Appendix 5: List of Chemical Symbols

Chemical Symbol Element

Au Gold

Co Cobalt

Cr Chromium

Cu Copper

Fe Iron

Ir Iridium

Mg Magnesium

Mn Manganese

Na Sodium

Ni Nickel

Os Osmium

Pb Lead

Pd Palladium

Pt Platinum

Rh Rhodium

Ru Ruthenium

S Sulphur

Se Selenium

Si Silicon

SiC Silicon Carbide

Te Tellurium

Ti Titanium

248


Appendix 6: List of Units

Unit Quantity

cm Centimetre

g Gram

Ga Billion years before present

g/t Gram per tonne

hp Horse Power

G Gallon

F Fahrenheit

ft Foot

km Kilometre

kV kiloVolt

l Litre

m Metre

M Million

mamsl Metres above mean sea level

mbc Metres below collar

mm Millimetre

Moz Million ounces

Mt Million tonne

oz Ounce

opt Ounce per ton

psi pounds per square inch

psi pounds per square inch, gauge

°C Degrees Centigrade

‘ Minutes

% Percentage

º Degrees

kt Kilotonne or thousand tonne

ktpm Kilotonne per month

Mt Million tonne

a Annum

µm Micron

249


Appendix 7: Stillwater Mine Current Permit Summary and Status

Operating Permit Status Permit Number Regulatory Agency Permit Type Discharge Type Date Issued Renewal Date Description Comments

Plan of Operations (POO) Active 00118

USFS Custer Gallatin National Forest/

MTDEQ Hard Rock Mining Program

Plan of Operations Feb-90 NA Plan of

Operations

Original (EIS) Record of Decision Active 00118

USFS Custer Gallatin

National Forest/ MTDEQ Hard Rock Mining Program

Mine Permit Jan-86 NA Mine Permit

Operating Permit Active 00118


National Forest/ MTDEQ Hard Rock

Mining Program

Mine Operating Permit

Jan-86 NA

Operating

Permit #00118 - Approved by

ROD in

December 1985

No expiration date; Change

in operating plan triggers

need for amendment.

Amendment No. 9 Active 00118



Operating Permit

Amendment Mar-96 NA

East-West

mining areas connected with haulage way

(mining under Stillwater

River)




Operating Permit Amendment

Nov-98 NA

Hertzler expansion

approved and production cap

eliminated




Operating Permit Amendment

Jul-10 NA Addition of

Hertzler LAD Pivot #7

Minor Revisions Status Permit Number Regulatory Agency Permit Type Discharge Type Date Issued Renewal Date Description Comments

Operating Permit Minor Revision 89-001 Active 00118

USFS Custer Gallatin National Forest/ MTDEQ

Hard Rock Mining Program

Operating Permit

Minor Revision Dec-89 NA

Waste rock haulage railroad

spur at 5150W Adit



National Forest/ MTDEQ Hard Rock Mining

Program

Operating Permit Minor Revision

Jul-90 NA

5200E Ventilation

Adit with auxiliary facilities




Program


Sep-90 NA Sediment basin construction (no new permit area)



Hard Rock Mining

Program


Oct-91 NA

Compressor pipeline crossing at Stillwater River

Bridge



Hard Rock Mining

Program


Mar-92 NA 5000E loci haul

rail track

extension

250





Hard Rock Mining

Program


Sep-93 NA

Compliance

timeframe extension for Amendment 8

stipulations



Hard Rock Mining

Program


Oct-93 NA 6500W secondary

escapeway installation



Hard Rock Mining

Program


Mar-94 NA

Expansion of OP boundary to

include Stillwater

Valley Ranch




Operating Permit

Minor Revision May-94 NA

Construction of west-side

production shaft (location change)




Operating Permit

Minor Revision Jul-94 NA

Tree planting to

visually screen mine site facilities




Program


Nov-94 NA

Boulder storage

area permitting in north area of

permit boundary




Program


Mar-95 NA Road relocation on

Nye TSF embankment



Hard Rock Mining

Program


1995 NA

Relocate west-side low grade ore

stockpile to east-

side



Hard Rock Mining

Program


Feb-96 NA

Waste rock processing to

augment coarse

tailings backfill




Operating Permit


Smelter waste disposal (gypsum

and slag) in Nye TSF




Operating Permit

Minor Revision Jan-97 NA

Plan of Ops revision to

construct Outfall

001 (not constructed)




Operating Permit

Minor Revision Aug-97 NA

Modify Nye TSF liner to lower final

elevation (5111 to 5108)




Operating Permit

Minor Revision 1998 NA

Mine plan revision to extend 4400W

level under the river

251





Hard Rock Mining

Program


Aug-99 NA

Staged

development plan for East-Side Waste Rock

Storage Area



Hard Rock Mining

Program


Mar-00 NA BTS expansion

from 4 to 6 denitrification cells



Hard Rock Mining

Program


May-00 NA

Hertzler pipeline route change

(avoid culturally

sensitive area)




Operating Permit


Dow Meadow Vent Raise (6500W)

final location




Operating Permit

Minor Revision Sep-01 NA

Comprehensive mine site

development plan

(east and west side additions)




Operating Permit


East-side

compressor building addition




Operating Permit


Warehouse addition (north-

side of 5150W Paste Plant)




Program


Mar-02 NA Two paste backfill

lines to 4400W




Program


Mar-02 NA East-side parking area for additional

vehicles



Hard Rock Mining

Program


Apr-03 NA Hertzler TSF Stage 2 final design and

LAD storage pond




Operating Permit

Minor Revision Apr-04 NA

Modifications to Hertzler Ranch

TSF and LAD Pond liner




Operating Permit


Temporary

reduction in Nye TSF freeboard




Operating Permit

Minor Revision Jan-07 NA

Construction of West Fork

Stillwater River breakout

252





Hard Rock Mining

Program


May-06 NA

Concentrator storage buidling

(east-side of

concentrator)




Operating Permit

Minor Revision Apr-09 NA

Adjustment to flow monitoring

requirement in Stillwater River




Operating Permit

Minor Revision Mar-08 NA

Relocation of laydown to north-

side of delivery road




Operating Permit


Tailings water treatment (150

gpm) and land application




Program


Feb-10 NA

Increase final

elevation of ESWRSF from

5050 ft to 5150 ft




Program


Mar-10 NA

Hertzler in-situ

methanol treatment

injection wells



Hard Rock Mining

Program


Oct-10 NA Two 5400E vent raises near the

5400E Portal




Operating Permit

Minor Revision Jun-11 NA

Raise bore hole from 4400 level to

5000W Portal for road road




Operating Permit

Minor Revision Nov-11 NA

Final design surface facilities

for Blitz Project




Operating Permit


Hertzler TSF Stage

3 construction plan modifications




Program


Sep-15 NA

Concrete

containment pad for biodiesel fule

tote storage




Program


Jan-16 NA

Closure/Post-

Closure monitoring

locations (sites)



Hard Rock Mining

Program


Jun-16 NA ESWRSF lining

system and water

transfer system




Operating Permit


Installation of inclinometers at

the Nye and Hertzler TSFs

253





Hard Rock Mining

Program


Aug-16 NA Concrete sidewalk to new Blitz trailer

Other Permits Status Permit Number Regulatory Agency Permit Type Discharge Type Date Issued Renewal Date Description Comments

Authorization to Discharge Under MPDES Active MT-0024716 MTDEQ Water Protection

Bureau Treated Mine Water

Discharge Groundwater or Surface Water

Dec-15 Nov-20 Authorization to

discharge treated mine water

Air Quality Permit - Preconstruction Permit Active 2459-17 MTDEQ Air Resources

Bureau Air Quality Permit Air Jul-14 NA

Authorization to discharge air

emissions

Air Quality Permit - Title V Operating Permit Active OP2459-07 MTDEQ Air Resources

Bureau Air Quality Operating

Permit Air Jan-15 Mar-18

Authorization to discharge air emissions for

facilities emitting >100 tpy

Storm Water MPDES Permit Active MTR-000511 MTDEQ Water Protection

Bureau Storm Water

Discharge Permit Storm Water from

site Apr-13 Jan-18

Multi-Sector General Permit for

Storm Water

Discharges

AQ Burn Permit TW40 Not Active TW40 MTDEQ Hard Rock Mining

Program Air Air

404 Permit - Hertzler Pipeline Active NA Army Corp of Engineers Excavation

Potable Water System Authorization - Beartooth Ranch Active PWSID MT0003972 MTDEQ Public Water &

Subdivision Bureau Potable Water Mine

Site 1998 NA

Potable Water System Authorization - Stillwater Mine Active PWSID MT0003587 MTDEQ Public Water &

Subdivision Bureau Potable Water Mine

Site 1986

Potable Water System Authorization - Stratton Ranch Not Active/Not

Maintained PWSID MT0003588

MTDEQ Public Water & Subdivision Bureau

Potable Water Mine Site

Septic System - Original system did not require permit Active NA MTDEQ Water Protection

Bureau Septic Drainfield Groundwater 1986

Septic System - Onsite Wastewater Treatment System Active 06-05 Stillwater County Groundwater Jan-06

Septic System Modification Authorization Active EQ-06-1122 (see

MR05-001)

MTDEQ Water Protection Bureau and Environmental

Management Bureau

Septic Treatment System with land

application Groundwater Oct-05

254



Septic System Modification Authorization - drainfield exp. Active ES94/B66 MTDEQ Water Protection

Bureau Septic Drainfield

Septic System - SVR Sewage Treatment System Permit Active 260 MTDEQ Water Protection

Bureau

Hazardous Waste Authorization/Classification Active MTD981552292 MTDEQ Waste and Underground Tank

Management Bureau

Hazardous Waste Permit

Jan-00 NA

Conditionally Exempt Small Generator /

Upgrade to Small Quantity if generation

exceeds 100kg/month

UIC Class V Injection - Authorization by Rule Active #MT5000-05134 USEPA Region 8

Groundwater Program

Underground Mine

Water Groundwater Nov-01 NA

Mine recycle

water


Groundwater Program Large Capacity Septic

System Groundwater Mar-05 NA

(Septic System) Change in

operating methods and

conditions triggers

EPA review and approval


Groundwater Program Hertzler Methanol

Injection Well Groundwater Dec-09 NA

Methanol injection well at Hertzler

UIC Class V Injection - Authorization by Rule -

Amendment Active #MT50000-08681

USEPA Region 8

Groundwater Program

Mine Site Methanol

Injection Wells Groundwater Jul-12 NA

Methanol injection wells

downgradient of ESWRSF (five)


Amendment Active #MT50000-08681

USEPA Region 8

Groundwater Program

Mine Site Methanol

Injection Well Groundwater Oct-14 NA

Methanol injection wells

downgradient of

ESWRSF (one additional well)

Statewide Exploration Permit Active 00046 MTDEQ Hard Rock and

Placer Exploration/USFS

Mine Exploration

Permit May-16 May-17

Submit annual progress report

and fees annually

in May (Sam Corson)

Temporary Grazing or Livestock Use Permit Active NA USFS Custer Gallatin

National Forest

Livestock Use and

Grazing Aug-16 Oct-16

Ekwortzel/Kirch

Agreement

Encroachment Permit Active 2006-23 Stillwater County Right of Way

Encroachment Permit Active 2007-48 Stillwater County Right of Way

USFS Special Use Permit - Stratton Ranch Road Active BEA407301 USFS Custer Gallatin

National Forest Special Use Permit Jan-16 Dec-16

Road Use Agreement

255



USFS Special Use Permit - Delger Road Active BEA388 USFS Custer Gallatin

National Forest Special Use Permit Jan-16 Dec-16

Road Use Agreement

Licenses Status Permit Number Regulatory Agency Permit Type Discharge Type Date Issued Renewal Date Description Comments

Nuclear Regulatory Commission - Materials License Active 25-26871-01 Nuclear Regulatory

Commission Nuclear Density Gage

Permit Sep-14 Nov-23

Bureau of Alcohol Tobacco and Firearm - Explosives Active 9-MT-095-33-7B-

90263

Bureau of Alcohol Tobacco

and Firearms

Explosives Use and

Storage Permit Feb-17

Radio Frequency Licenses Active 8610054645 &

8802398055

Federal Communications

Commission FCC

Stratton Man Camp License Active T-6732

Agreements Status Permit Number Regulatory Agency Permit Type Discharge Type Date Issued Renewal Date Description Comments

Road Use/Maintenance Agreement (FAS419 & FR846) Active NA USFS Custer Gallatin

National Forest Agreement Mar-94 NA

USFS Road

Maintenance Agreement

FAS419 and FR846

USFS Land Use Agreement Active AG-0355-B-15-5501 USFS Custer Gallatin

National Forest Agreement Apr-15

Helibase Pad usage

GNA 2009 Amendment Active Agreement Jan-09 NA Good Neighbor

Agreement

256


Appendix 8: East Boulder Mine Current Permit Summary and Status


Plan of Operations (POO) Active 00149


MTDEQ Hard Rock

Mining Program

Plan of Operations Feb-90 NA Plan of Operations

Original (EIS) Record of Decision

Active 00149


MTDEQ Hard Rock

Mining Program

Mine Permit Dec-92 NA Mine Permit

Operating Permit Active 00149



Mine Operating

Permit Mar-93 NA

Operating Permit #00149 - Approved by

ROD in 1993 following EIS

No expiration date; Change in operating

plan triggers need for amendment.

Minor Revisions Status Permit Number Regulatory Agency Permit Type Discharge Type Date Issued Renewal Date Description Comments

Operating Permit Minor

Revision 99-001 Active 00149



Operating Permit

Minor Revision 1999 NA Air Monitoring Site

PM-10 1A Site -

Increased Permit Area by 1.23 acres;

Increased area Permitted for

Disturbance by 1.23

acres

Operating Permit Minor Revision 00-001

Active 00149


MTDEQ Hard Rock

Mining Program


2000 NA Boe Ranch Pipeline

Construction of portion of Boe Ranch

pipeline from minesite to Yates

property; no new permit area; no new

permitted disturbance





Operating Permit

Minor Revision 2000 NA Tailings Pipeline

No new permit area; Increase area Permitted for

Disturbance by 0.94 acres.





Operating Permit


6350 Explosives Bench

laydown

No new permit area; Increase area Permitted for

Disturbance by 3.50 acres.





Operating Permit


Surface Crushing

Facility

No new permit area; no new permitted

disturbance.





Operating Permit

Minor Revision 2001 NA Slag Processing

Processing od

Columbus Smelter Slag


Active 00149




2001 Withdrawn

Withdrawn - Removal

of Production ore production cap

257




Active 00149


MTDEQ Hard Rock

Mining Program


2004 NA Laydown Area 6 & Expansion of Soil

Storage

Redefines 'miscellaneous

disturbance' by adding laydown and

expanding soil

storage footprint; no new permit area; no

new permitted

disturbance


Active 00149


MTDEQ Hard Rock

Mining Program


2004 NA LAD Area 6

Addition to Water

Management Plan; replaces LAD Area 5; no new permit area;

no new permitted disturbance


Active 00149


MTDEQ Hard Rock

Mining Program


2004 TSF - Detailed Design of On-going expansion

Stage 2 use of TBM Cuttings


Active 00149


MTDEQ Hard Rock

Mining Program


2005 NA Warehouse

New warehouse building in Area 8; no new permit area; no

new permitted disturbance





Operating Permit


Water treatment

improvements

Conversion of WTP cell #3 to

Anox/Kaldness MBBR

system; no new permit area; no new

permitted disturbance


Active 00149


MTDEQ Hard Rock

Mining Program


2006 NA TSF Wildlife Fence

Construction of wildlife fence

surrounding TSF facility; no new

permit area;

Increased area Permitted for

Disturbance by 1.06

acres.


Active 00149




2006 NA Site Investigations

Drilling and excavation of test pits

to identify potential borrow sources for

future stages of the TSF; no new permit area; Increased area

Permitted for Disturbance by 0.5

acres.


Active 00149




2007 NA Event Pond

Construction of HDPE-lined event

pond; no new permit area; no new

permitted

disturbance.

258







Operating Permit


Native Borrow

Excavation

Construction of Native Borrow

excavation area to be used for supplement for the run-of-mine

embankment; Increased Area Permitted for

Disturbance by 3.07 acres





Operating Permit


New Oil Storage

Building

Construction of New Oil Storage Building; no new permitted

area and no new permitted

disturbance.





Operating Permit


EBMW-4 Replacement

Well

Construction of EBMW-4

Replacement well; no

new permit area and no new permitted

disturbance.


Active 00149




2009 NA

Site Water

Management Improvements

Construction of a small settling pond

next to the LAD pond and utilization of the

existing boulder

stockpile for treated adit water discharge.

No new permit area and no new permitted

disturbance.


Active 00149



Mining Program


2009 NA Reverse Osmosis Unit

Construction of Reverse Osmosis

Unit; no new permit area and no new

permitted disturbance.


Active 00149


MTDEQ Hard Rock

Mining Program


2009 NA In-Situ Denitrification

System

Construction of an In-

Situ Denitrification System; no new

permit area and no

new permitted disturbance





Operating Permit

Minor Revision 2010 NA Drilling Investigation

Drilling investigation of nitrogen sources

down gradient of TSF

embankment; no new permit area and no new disturbance.


Active 00149



Mining Program


2010 NA Drilling Investigation

Phase 2

Drilling investigation of and further

delineation of nitrogen sources

down gradient of TSF

embankment; no new permit area and no

259



new disturbance.


Active 00149




2010 NA Expansion of In-Situ

Denitrification

Drilling and

Construction of three additional In-Situ

wells;


Active 00149


MTDEQ Hard Rock

Mining Program


2011 NA Groundwater Capture

System

Construction

groundwater capture system including pump house and

pipelines to capture wells


Active 00149


MTDEQ Hard Rock

Mining Program


2012 NA Graham and Simpson

Ventilation Raises

Construction of Graham Creek and

Simpson Creek Vent

Raises


Active 00149


MTDEQ Hard Rock

Mining Program


2012 NA Truck Fall Arrest

System

Construction of truck fall arrest system for

loading and

unloading trucks at warehouse


Active 00149


MTDEQ Hard Rock

Mining Program


2013 NA Modification to Simpson

Creek Vent Raise

Raise changed from horizontal drift to

vertical shaft based

on new geotechnical drilling


Active 00149


MTDEQ Hard Rock

Mining Program


2013 NA TSF Nitrogen Reduction TSF Nitrogen Source

Reduction





Operating Permit


Used Oil Building

Addition

Added Steel Building Enclosure to existing

foundation





Operating Permit

Minor Revision 2013 NA GNA borehole drilling

Borehole drilling test

work for GNA well investigation


Active 00149




2014 NA Perc Pond Event Pond

Modifications/Expansion

Increase Perc

Capacity & Raised event pond elevation


Active 00149



Mining Program


2014 NA Borrow pit access road

intersection realignments (2)

Road realignment to re-establish large

equipment haulage route to lower

laydown and borrow pit


Active 00149


MTDEQ Hard Rock

Mining Program


2014 NA Two GNA Wells

(EBMW-12 and EBMW-

13)

GNA Monitoring Well Installation (2 ea.)

260







Operating Permit


Stage 3 TSF Slope Liner

Design Change

Phase 1 Replaces low permeability soil layer

on lower Stage 3 with 80 mil geosynthetic

liner





Operating Permit


Stage 3 TSF Slope

Cover Final Design

Phase 2 Replaces low permeability soil layer on upper slopes with

80 mil geosynthetic liner





Operating Permit

Minor Revision 2015 NA New BO Parts Building

New BO Parts storage

building by warehouse





Operating Permit

Minor Revision 2015 NA Geotechnical Test Holes

Future waste rock

and Tailings storage areas investigation


Active 00149




2016 NA Water Resources Monitoring Plan

Revised Water

Quality Monitoring Plan


Active 00149


MTDEQ Hard Rock

Mining Program


2016 NA Revised Biological Monitoring Plan

Revision to 2013 Plan sites EBR 004 and

004A


Authorization to Discharge

Under MPDES Active MT-0026808

MTDEQ Water

Protection Bureau

Treated Mine Water

Discharge

Groundwater or

Surface Water Nov-15 Oct-20

Application for Renewal was

completed & submitted in Jan 05;

DEQ administratively extended the permit until the application

was processed and a new permit issued.

Storm Water MPDES Permit

Active MTR-000503 MTDEQ Water

Protection Bureau Storm Water

Discharge Permit Storm Water from

site Feb-13 Jan-18

Multi-Sector General

Permit for Storm Water Discharges

Public Water Supply

Amendment 1 Active MT-0003894

MTDEQ Public Water

& Subdivision Bureau

Potable Water Mine

Site Jan-06 NA

No Expiration date

changes in system triggers permit

amendment. Warehouse and Dry

expansion

Septic Tank and Drain field

Active EQ98/B50 MTDEQ Water

Protection Bureau Septic Drain field Groundwater Nov-98 NA State of Montana

Septic Tank and Sewage

Treatment Plant Active 382 Sweet Grass County Septic Drainfield Groundwater Jan-99 NA

Sweetgrass County

Permit

Septic Tank and Drain

field - Amendment Active EQ06-3314

MTDEQ Water

Protection Bureau Septic Drainfield Groundwater Jan-06 NA

Warehouse and Dry

expansion

Hazardous Waste Active MTR-000007823 MTDEQ Waste Hazardous Waste Jan-00 NA Conditionally Exempt

261



Authorization/Classification Management Bureau Permit Small Generator /

Upgrade to Small Quantity if generation

exceeds

100kg/month

UIC Class V Injection -

Authorization by Rule Active #MT5000-05150

USEPA Region 8 Groundwater

Program

Underground Mine

Water Groundwater Apr-02 NA

Underground Mine

Water


Amendment

Active #MT5000-05150 USEPA Region 8

Groundwater

Program

Underground Mine Water

Groundwater Jun-02 NA

(Underground Water)

Change in operating methods and

conditions triggers

EPA review and approval

UIC Class V Injection -

Authorization by Rule Active #MT50000-06439

USEPA Region 8 Groundwater

Program

Septic System Groundwater Mar-05 NA

(Septic System) Change in operating

methods and

conditions triggers EPA review and

approval

UIC Class V Injection - Authorization by Rule


Groundwater

Program

Methanol Injection Groundwater Sep-09 NA Methanol Injection


Amendment


Groundwater

Program

Methanol Injection Groundwater Jan-11 NA Injection into

additional 3 wells

State Trade Waste Burn

Permit Active TW459

MTDEQ Air Resources

Bureau

Air Quality Burn

Permit Air Jul-16 Jul-17 Renew Annually

Forest Service Burn Permit Active NA USFS Fire

Management Division CGNF

Air Quality Burn Permit

Air May-16 May-17

Required for

individual burns between May 1 and October 15; apply as

needed

Statewide Exploration

Permit Active 00046

MTDEQ Hard Rock

and Placer Exploration/USFS

Mine Exploration

Permit May-16 May-17

Submit annual progress report and

fees annually in May (Sam Corson)

Yates Gravel Pit - Amendment 3

Active 1702 MTDEQ Industrial &

Energy Minerals Bureau

Open Cut Gravel Permit

Feb-15 Oct-27 Extended operation

through October 2014

Agreements Status Permit Number Regulatory Agency Permit Type Discharge Type Date Issued Renewal Date Description Comments

FDR 205 and FDR 6644 Road Maintenance

Agreement Active

USFS Custer Gallatin National

Forest/MTDEQ Hard

Rock Mining Program

Agreement Aug-96 NA USFS Road

Maintenance Agreement

Snotel Active No. 65-0325-14-001 NRCS - National

Resource

Conservation Service

Agreement Jan-16 Jan-17 USDA - Annual Renewal

State Lands Lease Active DNRC Trust Land

Management Division Lease Mar-16 Mar-17

262



GNA 2009 Amendment Active Jan-09 NA Good Neighbor

Agreement

Boe Ranch Grazing Lease Active Private party lease Mar-16 Mar-17

Appendix 9: Smelter Current Permit Summary and Status

Permits Status Permit Number Regulatory Agency Permit Type Discharge Type Date Issued Renewal Date Description Comments

Storm Water MPDES Permit

Active MTR-000469 MTDEQ Water

Protection Bureau Storm Water

Discharge Permit Storm Water from site Dec-13 Jan-18

Multi-Sector General Permit for Storm Water Discharges

Appendix 10: Current Water Rights Summary and Status

Water

Right Key

Water

Right ID

Water Right

Number

Water Right

Description

Water Right Status

Description Right Type

Enforcing

Party Date Source Name

Diversion

Description

Use

Description Owner Maximum Flow

Maximum

Volume

Maximum

Acres

335081-1 107240 43BJ 107240 00 PROVISIONAL

PERMIT ACTIVE

ORIGINAL

RIGHT 19991004 GROUNDWATER WELL INDUSTRIAL

Stillwater

300 GPM 483.9

209138-2 120282 43BJ 120282 00 STATEMENT OF

CLAIM ACTIVE

CHANGE

AUTHORIZATION

18901028 EAST BOULDER RIVER HEADGATE INDUSTRIAL

Stillwater

1.38 CFS 48.4

209138-2 120282 43BJ 120282 00 STATEMENT OF

CLAIM ACTIVE

CHANGE

AUTHORIZATION

18901028 EAST BOULDER RIVER FUELED PUMP INDUSTRIAL

Stillwater

1.38 CFS 48.4

209138-2 120282 43BJ 120282 00 STATEMENT OF

CLAIM ACTIVE

CHANGE AUTHORIZATIO

N

18901028 EAST BOULDER RIVER HEADGATE IRRIGATION

Stillwater

1.38 CFS 48.4

209138-2 120282 43BJ 120282 00 STATEMENT OF

CLAIM ACTIVE

CHANGE AUTHORIZATIO

N

18901028 EAST BOULDER RIVER FUELED PUMP IRRIGATION

Stillwater

1.38 CFS 48.4

79474-1 40294 43BJ 40294 00 STATEMENT OF

CLAIM ACTIVE

ORIGINAL

RIGHT 18950701 EAST BOULDER RIVER HEADGATE IRRIGATION

Stillwater

7.5 CFS 1500 872

296313-1 40295 43BJ 40295 00 STATEMENT OF

CLAIM ACTIVE

ORIGINAL

RIGHT 19080716 EAST BOULDER RIVER HEADGATE IRRIGATION

Stillwater

4 CFS 872

79477-1 40296 43BJ 40296 00 STATEMENT OF

CLAIM ACTIVE

ORIGINAL RIGHT


Stillwater

3.75 CFS 750 872

79479-1 40297 43BJ 40297 00 STATEMENT OF

CLAIM ACTIVE

ORIGINAL RIGHT


Stillwater

3.75 CFS 872

263


Water Right Key

Water Right ID

Water Right Number

Water Right Description

Water Right

Status Description

Right Type Enforcing Party Date

Source Name Diversion

Description Use


Maximum Volume

Maximum Acres

79480-1 40298 43BJ 40298 00 STATEMENT OF

CLAIM ACTIVE

ORIGINAL RIGHT


Stillwater

7.5 CFS 1500 872

79482-1 40299 43BJ 40299 00 STATEMENT OF

CLAIM ACTIVE

ORIGINAL RIGHT

19020301 EAST BOULDER RIVER PUMP/HEADGATE

W/DITCH OR

PIPELINE

IRRIGATION

Stillwater

1.88 CFS 872

79484-1 40300 43BJ 40300 00 STATEMENT OF

CLAIM ACTIVE

ORIGINAL

RIGHT 18950404 EAST BOULDER RIVER

PUMP/HEADGATE W/DITCH OR

PIPELINE IRRIGATION

Stillwater

3.75 CFS 750 872

79486-1 40301 43BJ 40301 00 STATEMENT OF

CLAIM ACTIVE

ORIGINAL

RIGHT 19500501 EAST BOULDER RIVER

PUMP/HEADGATE W/DITCH OR

PIPELINE IRRIGATION

Stillwater

15 CFS 872

400682-1 30063189 43C 30063189

GROUND

WATER CERTIFICATE

ACTIVE ORIGINAL

RIGHT 20120430 GROUNDWATER DEVELOPED SPRING MINING

Stillwater

25 GPM 10

403144-1 30065686 43C 30065686

GROUND

WATER CERTIFICATE

ACTIVE ORIGINAL


Stillwater

35 GPM 9.43

403652-1 30066217 43C 30066217 GROUND WATER

CERTIFICATE

ACTIVE ORIGINAL

RIGHT 20130418 GROUNDWATER DEVELOPED SPRING INDUSTRIAL

Stillwater

25 GPM 9.94

404389-1 30066997 43C 30066997 GROUND WATER

CERTIFICATE

ACTIVE ORIGINAL

RIGHT 20130801 GROUNDWATER DEVELOPED SPRING INDUSTRIAL

Stillwater

25 GPM 9.94

406305-1 30068635 43C 30068635 PROVISIONAL

PERMIT ACTIVE

ORIGINAL

RIGHT 20140131

UNNAMED TRIBUTARY OF

NYE CREEK PUMP INDUSTRIAL

Stillwater

35 GPM 33.1

406305-1 30068635 43C 30068635 PROVISIONAL

PERMIT ACTIVE

ORIGINAL

RIGHT 20140131


NYE CREEK PIPELINE INDUSTRIAL

Stillwater

35 GPM 33.1

409952-1 30072887 43C 30072887 PROVISIONAL

PERMIT ACTIVE

ORIGINAL RIGHT

20150407 BURNT CREEK PUMP MINING

Stillwater

25 GPM 26.95 26.95

441510-1 30104050 43C 30104050

GROUND

WATER CERTIFICATE

ACTIVE ORIGINAL


Stillwater

35 GPM 9.82

67319-1 33307 43C 33307 00 STATEMENT OF

CLAIM ACTIVE

ORIGINAL RIGHT

19681231 NYE CREEK FLOWING COMMERCIAL

Stillwater

1 CFS 12

67320-2 33308 43C 33308 00 STATEMENT OF

CLAIM ACTIVE

CHANGE AUTHORIZATIO

N

19681231 GROUNDWATER WELL COMMERCIAL

Stillwater

240 GPM 4.3

67324-1 33310 43C 33310 00 STATEMENT OF

CLAIM ACTIVE

ORIGINAL

RIGHT 19681231 STILLWATER RIVER PUMP COMMERCIAL

Stillwater

300 GPM 1.1

67326-1 33311 43C 33311 00 STATEMENT OF

CLAIM ACTIVE

ORIGINAL

RIGHT 18940224


STILLWATER RIVER

HEADGATE W/DITCH OR PIPELINE/FLOOD

AND DIKE IRRIGATION

Stillwater

2 CFS 60

264


Water Right Key

Water Right ID

Water Right Number

Water Right Description

Water Right

Status Description

Right Type Enforcing Party Date

Source Name Diversion

Description Use


Maximum Volume

Maximum Acres

67327-1 33312 43C 33312 00 STATEMENT OF

CLAIM ACTIVE

ORIGINAL RIGHT

18940224 NYE CREEK HEADGATE W/DITCH OR PIPELINE/FLOOD

AND DIKE

IRRIGATION

Stillwater

2.27 CFS 60

67330-1 33313 43C 33313 00 STATEMENT OF

CLAIM ACTIVE

ORIGINAL RIGHT

19681231 STILLWATER RIVER PUMP IRRIGATION

Stillwater

300 GPM 6

295526-1 33314 43C 33314 00 STATEMENT OF

CLAIM ACTIVE

ORIGINAL

RIGHT 19671231 STILLWATER RIVER PUMP STOCK

Stillwater

83373-1 42543 43C 42543 00 GROUND WATER

CERTIFICATE ACTIVE

ORIGINAL

RIGHT 19820311 Groundwater WELL DOMESTIC

Stillwater

70 GPM 1.5

113279-1 60470 43C 60470 00 PROVISIONAL

PERMIT ACTIVE

ORIGINAL RIGHT

19851216

Groundwater

WELL DOMESTIC

Stillwater

200 GPM 322

113279-1 60470 43C 60470 00 PROVISIONAL

PERMIT ACTIVE

ORIGINAL RIGHT

19851216

Groundwater

WELL MINING

Stillwater

200 GPM 322

116566-1 62372 43C 62372 00 GROUND WATER

CERTIFICATE

ACTIVE ORIGINAL

RIGHT 19860414

Groundwater

WELL DOMESTIC

Stillwater

5 GPM 4

116580-2 62380 43C 62380 00 PROVISIONAL

PERMIT ACTIVE

CHANGE AUTHORIZATIO

N

19860509

Groundwater

UNKNOWN INDUSTRIAL

Stillwater

500 GPM 806.5

116580-2 62380 43C 62380 00 PROVISIONAL

PERMIT ACTIVE

CHANGE AUTHORIZATIO

N 19860509

Groundwater

PUMP INDUSTRIAL

Stillwater

500 GPM 806.5

116695-1 62447 43C 62447 00 PROVISIONAL

PERMIT ACTIVE

ORIGINAL

RIGHT 19860717

Groundwater

WELL MULTIPLE

DOMESTIC

Stillwater

100 GPM 160

329209-1 66406 43C 66406 00 PROVISIONAL

PERMIT ACTIVE

ORIGINAL RIGHT

19870929

Groundwater

WELL INDUSTRIAL

Stillwater

200 GPM 322.58

329209-1 66406 43C 66406 00 PROVISIONAL

PERMIT ACTIVE

ORIGINAL RIGHT

19870929

Groundwater

WELL MULTIPLE DOMESTIC

Stillwater

200 GPM 322.58

124957-2 67232 43C 67232 00 PROVISIONAL

PERMIT ACTIVE

CHANGE AUTHORIZATIO

N

19880517

Groundwater

PUMP INDUSTRIAL

Stillwater

500 GPM 806.5

164385-1 92943 43C 92943 00 GROUND WATER

CERTIFICATE

ACTIVE ORIGINAL

RIGHT 19950323

Groundwater

WELL DOMESTIC

Stillwater

10 GPM 3.9 1

164385-1 92943 43C 92943 00 GROUND WATER

CERTIFICATE ACTIVE

ORIGINAL

RIGHT 19950323

Groundwater

WELL LAWN AND

GARDEN

Stillwater

10 GPM 3.9 1

164385-1 92943 43C 92943 00 GROUND WATER

CERTIFICATE ACTIVE

ORIGINAL

RIGHT 19950323

Groundwater

WELL STOCK

Stillwater

10 GPM 3.9 1

265


Appendix 11: SAMREC Code Table 1 References

SAMREC CODE TABLE 1 Section in CPR

Section 1: Project Outline

1.1 Property Description

(i) Brief description of the scope of project (i.e. whether in preliminary sampling, advanced exploration, scoping, pre-feasibility, or feasibility phase, Life of Mine plan for an ongoing mining operation or closure).

2.1.3

(ii)

Describe (noting any conditions that may affect possible prospecting/mining activities) topography, elevation, drainage, fauna and flora, the means and ease of access to the property, the proximity of the property to a population centre, and the nature of transport, the climate, known associated climatic risks and the length of the operating season and to the extent relevant to the coal project, the sufficiency of surface rights for mining operations including the availability and sources of power, water, mining personnel, potential tailings storage areas, potential waste disposal areas, heap leach pad areas, and potential processing plant sites.

2.2 2.3 2.4

2.5 2.8.2

(iii) Specify the details of the personal inspection on the property by each CP or, if applicable, the reason why a personal inspection has not been completed. 1.6

1.2 Location

(i) Description of location and map (country, province, and closest town/city, coordinate systems and ranges, etc.). 2.2

(ii) Country Profile: describe information pertaining to the project host country that is pertinent to the project, including relevant applicable legislation, environmental and social context etc. Assess, at a high level, relevant technical, environmental, social, economic, political and other key risks.

2.6

2.7

(iii) Provide a detailed topo-cadastral map. Confirm that applicable aerial surveys have been checked with ground controls and surveys, particularly in areas of rugged terrain, dense vegetation or high altitude.

2.3.3

1.3 Adjacent Properties (i) Discuss details of relevant adjacent properties if adjacent or nearby properties have an important bearing on the report, then their location and common coal deposit structures should be included on the maps. Reference all information used from other sources.

3.5

1.4 History

(i) State historical background to the project and adjacent areas concerned, including known results of previous exploration and mining activities (type, amount, quantity and development work), previous ownership and changes thereto.

3.1

(ii) Present details of previous successes or failures with reasons why the project may now be considered potentially economic. 3.1 3.2

(iii) Discuss known or existing historical Mineral Resource estimates and performance statistics on actual production for past and current operations. 3.3

(iv) Discuss known or existing historical Mineral Reserve estimates and performance statistics on actual production for past and current operations. 3.4

1.5 Legal Aspects and Permitting

Confirm the legal tenure to the satisfaction of the Competent Person, including a description of the following:

(i) Discuss the nature of the issuer’s rights (e.g. prospecting and/or mining) and the right to use the surface of the properties to which these rights relate. Disclose the date of expiry and other relevant details.

2.7 2.8

2.8.2

(ii) Present the principal terms and conditions of all existing agreements, and details of those still to be obtained, (such as, but not limited to, concessions, partnerships, joint ventures, access rights, leases, historical and cultural sites, wilderness or national park and environmental settings, royalties, consents, permission, permits or authorisations).

2.8.2 2.9

266



(iii) Present the security of the tenure held at the time of reporting or that is reasonably expected to be granted in the future along with any known impediments to obtaining the right to operate in the area. State details of applications that have been made.

2.8

2.8.2

(iv) Provide a statement of any legal proceedings for example, land claims, that may have an influence on the rights to prospect or mine for minerals or an appropriate negative statement.

2.8

2.11

(v) Provide a statement relating to governmental/statutory requirements and permits as may be required, have been applied for, approved or can be reasonably be expected to be obtained.

7.12.5

1.6 Royalties (i) Describe the royalties that are payable in respect of each property. 2.9

1.7 Liabilities (i) Describe any liabilities, including rehabilitation guarantees that are pertinent to the project. Provide a description of the rehabilitation liability, including, but not limited to, legislative requirements, assumptions and limitations.

2.1

Section 2: Geological Setting, Deposi, Mineralisation

2.1 Geological Setting, Coal Deposit

(i) Describe the regional geology. 4.1

(ii) Describe the project geology including deposit type, geological setting and style of Mineralisation. 4.2

(iii) Discuss the geological model or concepts being applied in the investigation and on the basis of which the exploration program is planned. Describe the inferences made from this model.

4.3

(iv) Discuss data density, distribution and reliability and whether the quality and quantity of information are sufficient to support statements, made or inferred, concerning the Exploration Target or Mineralisation.

4.4

4.5

(v) Discuss the significant minerals present in the deposit, their frequency, size and other characteristics. Includes minor and gangue minerals where these will have an effect on the processing steps. Indicate the variability of each important mineral within the deposit.

4.4

(vi) Describe the significant Minerised zones encountered on the property, including a summary of the surrounding rock types, relevant geological controls, and the length, width, depth, and continuity of the Coal Deposits, together with a description of the type, character, and distribution of the Coal Deposit.

4.4

(vii) Confirm that reliable geological models and / or maps and cross sections that support interpretations exist. 4.4

Section 3: Exploration and Drilling, Sampling Techniques and Data

3.1 Exploration

(i)

Describe the data acquisition or exploration techniques and the nature, level of detail, and confidence in the geological data used (i.e. geological observations, remote sensing results, stratigraphy, lithology, structure, alteration, mineralisation hydrology, geophysical, geochemical, petrography, mineralogy, geochronology, bulk density, potential deleterious or contaminating substances, geotechnical and rock characteristics, moisture content, bulk samples etc.). Confirm that data sets include all relevant metadata, such as unique sample number, sample mass, collection date, spatial location etc.

5.1

(ii) Identify and comment on the primary data elements (observation and measurements) used for the project and describe the management and verification of these data or the database. This should describe the following relevant processes: acquisition (capture or transfer), validation, integration, control, storage, retrieval and backup processes. It is assumed that data are stored digitally but hand-printed tables with well organised data and information may also constitute a database.

5.1

5.8

267



(iii) Acknowledge and appraise data from other parties and reference all data and information used from other sources. 1.3 1.5

5.8

(iv) Clearly distinguish between data / information from the property under discussion and that derived from surrounding properties 5.8

(v) Describe the survey methods, techniques and expected accuracies of data. Specify the grid system used. 5.1.45.7

(vi) Discuss whether the data spacing and distribution is sufficient to establish the degree of geological and grade quality continuity appropriate for the estimation procedure(s) and classifications applied.

(vii) Present representative models and / or maps and cross sections or other two or three dimensional illustrations of results, showing location of samples, accurate drill-hole collar positions, down-hole surveys, exploration pits, underground workings, relevant geological data, etc.

5.8

(viii) Report the relationships between mineralisation widths and intercept lengths are particularly important, the geometry of the Coal Deposit with respect to the drill hole angle. If it is not known and only the down-hole lengths are reported, confirm it with a clear statement to this effect (e.g. ‘down-hole length, true width not known’).

5.8

3.2 Drilling Techniques

(i) Present the type of drilling undertaken (e.g. core, reverse circulation, open-hole hammer, rotary air blast, auger, Banka, sonic, etc) and details (e.g. core diameter, triple or standard tube, depth of diamond tails, face-sampling bit or other type, whether core is oriented and if so, by what method, etc.).

5.1.2

(ii) Describe whether core and chip samples have been geologically and geotechnically logged to a level of detail to support appropriate Mineral Resource estimation, technical studies, mining studies and coal processing studies.

5.1.3

(iii) Describe whether logging is qualitative or quantitative in nature; indicate if core photography (or costean, channel, etc.) was undertaken 5.1.3

(iv) Present the total length and percentage of the relevant intersections logged. 5.1.3

(v) Results of any downhole surveys of the drill hole to be discussed. 5.1.4

3.3 Sample method, collection, capture and storage

(i) Describe the nature and quality of sampling (e.g. cut channels, random chips, or specific specialised industry standard measurement tools appropriate to the minerals under investigation, such as down hole gamma sondes, or handheld XRF instruments, etc.). These examples should not be taken as limiting the broad meaning of sampling.

5.2.1

(ii) Describe the sampling processes, including sub-sampling stages to maximise representivity of samples. This should include whether sample sizes are appropriate to the grain size of the material being sampled. Indicate whether sample compositing has been applied.

5.2.1

(iii) Appropriately describe each data set (e.g. geology, density, quality, diamond breakage, geo-metallurgical characteristics etc.), sample type, sample-size selection and collection methods.

5.2.1

(iv) Report the geometry of the mineralisation with respect to the drill-hole angle. State whether the orientation of sampling achieves unbiased sampling of possible structures and the extent to which this is known, considering the deposit type. State if the intersection angle is not known and only the downhole lengths are reported.

5.2.1

(v) Describe retention policy and storage of physical samples (e.g. core, sample reject, etc.) 5.2.1

268



(vi) Describe the method of recording and assessing core and chip sample recoveries and results assessed, measures taken to maximise sample recovery and ensure representative nature of the samples and whether a relationship exists between sample recovery and grade and whether sample bias may have occurred due to preferential loss/gain of fine/coarse material.

5.2.1

(vii) If a drill-core sample is taken, state whether it was split or sawn and whether quarter, half or full core was submitted for analysis. If a non-core sample, state whether the sample was riffled, tube sampled, rotary split etc. and whether it was sampled wet or dry.

5.2.1

3.4 Sample Preparation and Analysis

(i) Identify the laboratory(s) and state the accreditation status and Registration Number of the laboratory or provide a statement that the laboratories are not accredited. 5.2.2

(ii) Identify the analytical method. Discuss the nature, quality and appropriateness of the assaying and laboratory processes and procedures used and whether the technique is considered partial or total.

5.2.2

(iii) Describe the process and method used for sample preparation, sub-sampling and size reduction, and likelihood of inadequate or non-representative samples (i.e. improper size reduction, contamination, screen sizes, granulometry, mass balance, etc.)

5.2.2

3.5 Sampling Governance

(i) Discuss the governance of the sampling campaign and process, to ensure quality and representivity of samples and data, such as sample recovery, high grading, selective losses or contamination, core/hole diameter, internal and external QA/QC, and any other factors that may have resulted in or identified sample bias.

5.2.3

(ii) Describe the measures taken to ensure sample security and the Chain of Custody. 5.2.3

(iii) Describe the validation procedures used to ensure the integrity of the data, e.g. transcription, input or other errors, between its initial collection and its future use for modelling (e.g. geology, grade, density, etc.)

5.2.3 5.3

(iv) Describe the audit process and frequency (including dates of these audits) and disclose any material risks identified. 5.2.3

3.6 Quality Control/Quality Assurance

(i) Demonstrate that adequate field sampling process verification techniques (QA/QC) have been applied, e.g. the level of duplicates, blanks, reference material standards, process audits, analysis, etc. If indirect methods of measurement were used (e.g. geophysical methods), these should be described, with attention given to the confidence of interpretation.

5.4

3.7 Bulk Density

(i) Describe the method of bulk density determination with reference to the frequency of measurements, the size, nature and representativeness of the samples. 5.5

(ii) If target tonnage ranges are reported state the preliminary estimates or basis of assumptions made for bulk density. 5.5

(iii) Discuss the representivity of bulk density samples of the material for which a grade range is reported. 5.5

(iv) Discuss the adequacy of the methods of bulk density determination for bulk material with special reference to accounting for void spaces (vugs, porosity etc.), moisture and differences between rock and alteration zones within the deposit.

5.5

3.8 Bulk-Sampling and/or trial-mining

(i) Indicate the location of individual samples (including map). 5.6

(ii) Describe the size of samples, spacing/density of samples recovered and whether sample sizes and distribution are appropriate to the grain size of the material being sampled.

5.6

(iii) Describe the method of mining and treatment. 5.6

(iv) Indicate the degree to which the samples are representative of the various types and styles of mineralisation and the mineral deposit as a whole. 5.6

269



Section 4: Estimation and Reporting of Exploration Results and Coal Resources

4.1 Geological model and interpretation

(i) Describe the geological model, construction technique and assumptions that forms the basis for the Exploration Results or Mineral Resource estimate. Discuss the sufficiency of data density to assure continuity of mineralisation and geology and provide an adequate basis for the estimation and classification procedures applied.

6.2

(ii) Describe the nature, detail and reliability of geological information with which lithological, structural, mineralogical, alteration or other geological, geotechnical and geo-metallurgical characteristics were recorded.

6.2

(iii) Describe any obvious geological, mining, metallurgical, environmental, social, infrastructural, legal and economic factors that could have a significant effect on the prospects of any possible exploration target or deposit.

6.2

(iv) Discuss all known geological data that could materially influence the estimated quantity and quality of the Mineral Resource. 6.2

(v) Discuss whether consideration was given to alternative interpretations or models and their possible effect (or potential risk) if any, on the Mineral Resource estimate. 6.2

(vi) Discuss geological discounts (e.g. magnitude, per reef, domain, etc.), applied in the model, whether applied to mineralised and / or un-mineralised material (e.g. potholes, faults, dykes, etc.).

6.2

4.2 Estimation and modelling techniques

(i) Describe in detail the estimation techniques and assumptions used to determine the grade and tonnage ranges. 6.3 6.4

(ii) Discuss the nature and appropriateness of the estimation technique(s) applied and key assumptions, including treatment of extreme grade values (cutting or capping), compositing (including by length and/or density), domaining, sample spacing, estimation unit size (block size), selective mining units, interpolation parameters and maximum distance of extrapolation from data points.

6.3 6.4

(iii) Describe assumptions and justification of correlations made between variables. 6.3

6.4

(iv) Provide details of any relevant specialised computer program (software) used, with the version number, together with the estimation parameters used. 6.3 6.4

(v) State the processes of checking and validation, the comparison of model information to sample data and use of reconciliation data, and whether the Mineral Resource estimate takes account of such information.

6.4

(vi) Describe the assumptions made regarding the estimation of any co-products, by-products or deleterious elements. 6.4

7.10.5

4.3 Reasonable prospects for eventual economic extraction

(i) Disclose and discuss the geological parameters. These would include (but not be limited to) volume / tonnage, grade and value / quality estimates, cut-off qualities, strip ratios, upper- and lower- screen sizes.

6.5

(ii) Disclose and discuss the engineering parameters. These would include mining method, dilution, processing, geotechnical, geo-hydraulic and metallurgical parameters. 6.5

(iii) Disclose and discuss the infrastructural including, but not limited to, power, water, site-access. 6.5

(iv) Disclose and discuss the legal, governmental, permitting, statutory parameters. 2.8 6.5

(v) Disclose and discuss the environmental and social (or community) parameters. 2.12 6.5

270



(vi) Disclose and discuss the marketing parameters. 6.5

(vii) Disclose and discuss the economic assumptions and parameters. These factors will include, but not limited to, commodity prices and potential capital and operating costs 6.5

(viii) Discuss any material risks 6.5 10.1

(ix) Discuss the parameters used to support the concept of "eventual" 6.5

4.4 Classification Criteria (i) Describe criteria and methods used as the basis for the classification of the Mineral Resources into varying confidence categories. 1.9.2 6.6

4.5 Reporting

(i) Discuss the reported low and high-grades and widths together with their spatial location to avoid misleading the reporting of Exploration Results, Mineral Resources or Mineral Reserves.

6.7

(ii) Discuss whether the reported grades are regional averages or if they are selected individual samples taken from the property under discussion. 6.4 6.7

7.10.5

(iii) State assumptions regarding mining methods, infrastructure, metallurgy, environmental and social parameters. State and discuss where no mining related assumptions have been made.

6.7

(iv) State the specific quantities and grades/qualities which are being reported in ranges and/or widths, and explain the basis of the reporting 6.7

(v) Present the detail for example open pit, underground, residue stockpile, remnants, tailings, and existing pillars or other sources in the Coal Resource statement 6.7

(vi) Present a reconciliation with any previous Mineral Resource estimates. Where appropriate, report and comment on any historic trends (e.g. global bias). 6.8

(vii) Present the defined reference point for the tonnages and grades reported as Mineral Resources. State the reference point if the point is where the run of mine material is delivered to the processing plant. It is important that, in all situations where the reference point is different, such as for a saleable product, a clarifying statement is included to ensure that the reader is fully informed as to what is being reported.

6.7

(viii) If the CP is relying on a report, opinion, or statement of another expert who is not a CP, disclose the date, title, and author of the report, opinion, or statement, the qualifications of the other expert and why it is reasonable for the CP to rely on the other expert, any significant risks and any steps the CP took to verify the information provided.

1.6

6.7

(ix) State the basis of equivalent metal formulae, if applied. 6.7

10.6.1

Section 5: Technical Studies

5.1 Introduction

(i) State the level of study – whether prefeasibility, feasibility or ongoing Life of Mine. The Code requires that a study to at least a Pre-Feasibility level has been undertaken to convert Mineral Resource to Mineral Reserve. Such studies will have been carried out and will include a mine plan or production schedule that is technically achievable and economically viable, and that all Modifying Factors have been considered.

2.8 2.12

7.1 7.2 7.1

7.11 7.13

(ii) Provide a summary table of the Modifying Factors used to convert the Mineral Resource to Mineral Reserve for Pre-feasibility, Feasibility or on-going life-of-mine studies. 7.6

271



5.2 Mining Design

(i) State assumptions regarding mining methods and parameters when estimating Mineral Resources or explain where no mining assumptions have been made. 7.2 7.7

(ii) State and justify all modifying factors and assumptions made regarding mining methods, minimum mining dimensions (or pit shell) and internal and, if applicable, external) mining dilution and mining losses used for the techno-economic study and signed-off, such as mining method, mine design criteria, infrastructure, capacities, production schedule, mining efficiencies, grade control, geotechnical and hydrological considerations, closure plans, and personnel requirements.

7.2 7.6

7.7 7.12.1

(iii) State what Mineral Resource models have been used in the study. 7.7

(iv) Explain the basis of (the adopted) cut-off quality parameters applied. Include metal equivalents if relevant 7.7

(v) Description and justification of mining method(s) to be used. 7.2

7.7

(vi) For open-pit mines, include a discussion of pit slopes, slope stability, and strip ratio. 7.27.7

(vii) For underground mines, discussion of mining method, geotechnical considerations, mine design characteristics, and ventilation/cooling requirements. 7.2

7.7

(viii) Discussion of mining rate, equipment selected, grade control methods, geotechnical and hydrogeological considerations, health and safety of the workforce, staffing requirements, dilution, and recovery.

7.3 7.4 7.5

7.7 7.8 7.9

7.11

(ix) State the optimisation methods used in planning, list of constraints (practicality, plant, access, exposed Mineral Reserves, stripped Mineral Reserves, bottlenecks, draw control).

2.12

7.6 7.7 7.8

7.9 7.1 7.12

5.3 Mineral Processing and Testwork

(i) Discuss the source of the sample and the techniques to obtain the sample, laboratory and Mineral processing testing techniques. 7.10.1

(ii) Explain the basis for assumptions or predictions regarding Mineral processing amenability and any preliminary Mineral processing test work already carried out. 7.10.2

(iii) Discuss the possible processing methods and any processing factors that could have a material effect on the likelihood of eventual economic extraction. Discuss the appropriateness of the processing methods to the style of Mineral Deposit. Describe the processing method(s) to be used, equipment, plant capacity, efficiencies, and personnel requirements.

5.9

7.10.3

(iv) Discuss the nature, amount and representativeness of Mineral processing test work undertaken and the recovery factors used. A detailed flow sheet / diagram and a mass balance should exist ,especially for multi-product operations from which the saleable materials are priced for different chemical and physical characteristics

7.10.4

(v) State what assumptions or allowances have been made for deleterious elements and the existence of any bulk-sample or pilot-scale test work and the degree to which such samples are representative of the ore body as a whole.

7.10.5

272



(vi) State whether the Mineral processing process is well-tested technology or novel in nature. 7.10.6

5.4 Infrastructure

(i) Comment regarding the current state of infrastructure or the ease with which the infrastructure can be provided or accessed 7.8 7.9

(ii) Report in sufficient detail to demonstrate that the necessary facilities have been allowed for (which may include, but not be limited to, processing plant, tailings dam, leaching facilities, waste dumps, road, rail or port facilities, water and power supply, offices, housing, security, resource sterilisation testing etc.). Provide detailed maps showing locations of facilities.

7.8 7.9

7.10.3

7.10.8

(iii) Statement showing that all necessary logistics have been considered. 7.8 7.9

7.10.7

5.5 Environmental and Social

(i) Confirm that the company holding the tenement has addressed the host country environmental legal compliance requirements and any mandatory and/or voluntary standards or guidelines to which it subscribes

7.12 7.12.1

(ii) Identify the necessary permits that will be required and their status and where not yet obtained, confirm that there is a reasonable basis to believe that all permits required for the project will be obtained

7.12

7.12.5

(iii) Identify and discuss any sensitive areas that may affect the project as well as any other environmental factors including I&AP and/or studies that could have a material effect on the likelihood of eventual economic extraction. Discuss possible means of mitigation.

7.12.2 7.12.3 7.12.4

(iv) Identify any legislated social management programmes that may be required and discuss the content and status of these. 2.12

7.12.4 7.12.5

(v) Outline and quantify the material socio-economic and cultural impacts that need to be mitigated and their mitigation measures and where appropriate the associated costs. 2.12

5.6 Market Studies and Economic criteria

(i) Describe the valuable and potentially valuable product(s) including suitability of products, co-products and by products to market. 7.13

(ii) Describe product to be sold, customer specifications, testing, and acceptance requirements. Discuss whether there exists a ready market for the product and whether contracts for the sale of the product are in place or expected to be readily obtained. Present price and volume forecasts and the basis for the forecast.

7.13

(iii) State and describe all economic criteria that have been used for the study such as capital and operating costs, exchange rates, revenue / price curves, royalties, cut-off qualities, reserve pay limits.

1.8

(iv) Summary description, source and confidence of method used to estimate the commodity price/value profiles used for cut-off qualiity calculation, economic analysis and project valuation, including applicable taxes, inflation indices, discount rate and exchange rates.

1.8

(v) Present the details of the point of reference for the tonnages and Mineral qualites reported as Mineral Reserves (e.g. material delivered to the processing facility or saleable product(s)). It is important that, in any situation where the reference point is different, a clarifying statement is included to ensure that the reader is fully informed as to what is being reported.

8.3

(vi) Justify assumptions made concerning production cost including transportation, treatment, penalties, exchange rates, marketing and other costs. Provide details of allowances that are made for the content of deleterious elements and the cost of penalties.

1.8

(vii) Provide details of allowances made for royalties payable, both to Government and private. 2.9

7.10.5

273



(viii) State type, extent and condition of plant and equipment that is significant to the existing operation(s). 7.10.8 7.14

(ix) Provide details of all environmental, social and labour costs considered 7.14

7.14.4

5.7 Risk Analysis (i) Report an assessment of technical, environmental, social, economic, political and other key risks to the project. Describe actions that will be taken to mitigate and/or manage the identified risks.

9.3

10.1

5.8 Economic Analysis

(i) At the relevant level (Scoping Study, Pre-feasibility, Feasibility or on-going Life-of Mine), provide an economic analysis for the project that includes: 7.15.3

(ii) Cash Flow forecast on an annual basis using Mineral Reserves or an annual production schedule for the life of the project 7.15.3

(iii) A discussion of net present value (NPV), internal rate of return (IRR) and payback period of capital 7.15.3

(iv) Sensitivity or other analysis using variants in commodity price, grade, capital and operating costs, or other significant parameters, as appropriate and discuss the impact of the results.

7.15.3

Section 6: Estimation and Reporting of Mineral Reserves

6.1 Estimation and modelling techniques

(i) Describe the Mineral Resource estimate used as a basis for the conversion to a Mineral Reserve. 8.1

(ii) Report the Mineral Reserve Statement with sufficient detail indicating if the mining is open pit or underground plus the source and type of Mineral Deposit, domain or ore body, surface dumps, stockpiles and all other sources.

8.1

(iii) Provide a reconciliation reporting historic reliability of the performance parameters, assumptions and modifying factors including a comparison with the previous Mineral Reserve quantity and qualities, if available. Where appropriate, report and comment on any historic trends (e.g. global bias)

8.1

6.2 Classification Criteria (i) Describe and justify criteria and methods used as the basis for the classification of the Mineral Reserves into varying confidence categories, based on the Mineral Resource category, and including consideration of the confidence in all the modifying factors.

8.2

6.3 Reporting

(i) Discuss the proportion of Probable Mineral Reserves, which have been derived from Measured Mineral Resources (if any), including the reason(s) therefore. 8.3

(ii) Present details of for example open pit, underground, residue stockpile, remnants, tailings, and existing pillars or other sources in respect of the Mineral Reserve statement. 8.3

(iii)

Present the details of the defined reference point for the Mineral Reserves. State where the reference point is the point where the run of mine material is delivered to the processing plant. It is important that, in all situations where the reference point is different, such as for a saleable product, a clarifying statement is included to ensure that the reader is fully informed as to what is being reported. State clearly whether the tonnages and Mineral qualities reported for Mineral Reserves are in respect of material delivered to the plant or after recovery.

8.3

(iv) Present a reconciliation with the previous Mineral Reserve estimates. Where appropriate, report and comment on any historic trends (e.g. global bias). 8.1

8.3.1

(v) Only Measured and Indicated Mineral Resources can be considered for inclusion in the Mineral Reserve. 8.3

(vi) State whether the Mineral Resources are inclusive or exclusive of Mineral Reserves.

8.3

274



Section 7: Audits and Reviews

7.1 Audits and Reviews

(i) State type of review/audit (e.g. independent, external), area (e.g. laboratory, drilling, data, environmental compliance etc.), date and name of the reviewer(s) together with their recognised professional qualifications.

8.4 10.9

(ii) Disclose the conclusions of relevant audits or reviews. Note where significant deficiencies and remedial actions are required. 8.4 10.9

Section 8: Other Relevant Information

8.1 (i) Discuss all other relevant and material information not discussed elsewhere. 9

Section 9: Qualification of Competent Person(s) and other key technical staff. Date and Signature Page

9.1

(i) State the full name, registration number and name of the professional body or RPO, for all the Competent Person(s). State the relevant experience of the Competent Person(s) and other key technical staff who prepared and are responsible for the Public Report.

1.4 1.5

(ii) State the Competent Person’s relationship to the issuer of the report. 1.4 1.5

(iii) Provide the Certificate of the Competent Person, including the date of sign-off and the effective date, in the Public Report. 13

275


Appendix 12: SAMVAL Code Table 1 References

SAMVAL CODE TABLE 1 Section in

CPR

T1.0 General

The Valuation Report shall contain:-

The signature of the CV. 13

The CV's qualifications and experience in valuing mineral properties, or relevant valuation experience.

Appendix 1

A statement that all facts presented in the report are correct to the best of the CV's knowledge. 10.1

A statement that the analyses and conclusions are limited only by the reported forecasts and conditions. 10.1

A statement of the CV's present or prospective interest in the subject property or asset. 10.1

A statement that the CV's compensation, employment, or contractual relationship with the Commissioning Entity is not Synopsis, contingent on any aspect of the Report. 10.1

A statement that the CV has no bias with respect to the assets that are the subject of the Report, or to the parties involved with the assignment. 1.4

10.1

A statement that the CV has (or has not) made a personal inspection of the property. 1.6 10.1

A record of the CP's and experts who have contributed to the valuation. Written consent to use and rely on such shall be obtained. Significant contributions made by such experts shall be highlighted individually. Appendix 1

T1.1 Illustrations

There are numerous instances (especially in the non-listed environment) when a valuation is not accompanied by the CPR on which it is based. In these cases, especially, diagrams/illustrations are required and shall be in the required format.

Diagrams, maps, plans, sections, and illustrations shall be legible and prepared and an appropriate scale to distinguish important features. Sections 1 - 9

Maps shall be dated and include a legend, author or information source, coordinate system and datum, a scale in bar or grid form, and an arrow indicating north. Sections 1 - 9

A location or index map and more detailed maps showing all important features described in the text, including all relevant cadastral and other infrastructure features, shall be included. Sections 1 - 9

T1.2 Synopsis

Provide the salient features of the report:-

Brief description of the terms of reference, scope of work, the Valuation Date, the mineral property; its location, ownership, geology, and mineralization; history of exploration and production, current status, Exploration Targets, mineralization and/or production forecast, Mineral Resources and Mineral Reserves, production facilities (if any); environmental, social, legal, and permitting considerations; valuation approaches and methods, valuation, and conclusions.

1.1 10.1

T1.3 Introduction and Scope

Introduction and scope, specifying commissioning instructions including reference to the valuation, engagement letter, date, purpose and intended use of the valuation. 1.1

The CV shall fully disclose any interests in the Mineral Asset or Commissioning Entity. 1.1

Any restrictions on scope and special instructions followed by the CV, and how these affect the reliability of the valuation, shall be disclosed. 1.1

T1.4 Compliance

A statement that the report complies with SAMVAL shall be included. Any variations shall be described and discussed. 1.9

T1.5 Identity, Tenure and Infrastructure

The identity, tenure, associated infrastructure and locations of the property interests, rights or securities to be valued (i.e. the physical, legal, and economic characteristics of the property) shall be disclosed. 2.8

T1.6 History

History of activities, results, and operations to date shall be included. 3.1

T1.7 Geological Setting

Geological setting, models, and mineralization shall be described. 4.1 4.2

4.3 4.4 4.5

276



CPR

T1.8 Exploration Results and Exploration Targets

Exploration programmes, their location, results, interpretation, and significance shall be described. 5.1.1

5.1.2 5.1.3

5.1.4 5.2.1 5.2.2

5.2.3 5.3 5.4

5.5 5.6 5.7

5.8 5.9

Exploration Targets shall be discussed. 5.1.1 5.1.2

5.1.3 5.1.4

5.2.1 5.2.2 5.2.3

5.3 5.4 5.5

5.6 5.7 5.8

5.9

T1.9 Mineral Resources and Mineral Reserves

Mineral Resource and Mineral Reserve statements shall be provided. They shall be signed off by a Competent Person in compliance with the SAMREC Code or another CRIRSCO code. 6.7 8.3

The CV shall set out the manner in which he has satisfied himself that he can rely upon the information in the CPR. 6.7 8.3

10.4.2.2

T1.10 Modifying Factors and Key Assumptions

A statement of Modifying Factors shall be included, separately summarizing material issues relating to each applicable Modifying Factor. 1.9 7.6

10.4.2.2

The CV shall set out the manner in which he has satisfied himself that he can rely upon the technical information provided. 1.9 7.6

10.4.2.2

Note:-

All the Modifying Factors shall be listed, or references provided to relevant definitions). This shall include an explanation of all material assumptions and limiting factors. 1.9

7.6 10.4.2.2

When reporting on environmental, social and governance modifying factors, reference should be made to the ESG reporting parameters as required by the Southern African Minerals Environmental, Social and Governance Guideline (SAMESG) or other recognised code, e.g. Equator Principles.

1.9 7.6

10.4.2.2

277



CPR

T1.11 Previous Valuations

The valuation shall refer to all available and relevant previous valuations of the Mineral Asset that have been performed in at least the previous two years, and explain any material differences between these and the present valuation.

10.2

T1.12 Valuation Approaches and Methods

The valuation approaches and methods used in the valuation shall be described and justified in full. 10.4 10.5 10.6

10.7

T1.13 Valuation Date

A statement detailing the Report Date and the Valuation Date, as defined in this Code, Title Page, and whether any material changes have occurred between the Valuation Date and the Report Date. 10.7

T1.14

Valuation Results

For the Income Approach, the valuation cash flow shall be disclosed. 10.4 10.4

10.4.1

10.4.2 10.4.3 10.4.5

10.4.6

For the Market Approach, the market comparable information shall be disclosed. 10.5

10.5.1 10.5.2

10.6 10.7

For the Cost Approach, the relevant and applicable cost shall be disclosed. N/A

T1.15 A summary of the valuation details, consolidated into single material line items, shall be provided.

The Mineral Asset Valuation shall specify the key risks and forecasts used in the valuation. 10.7

10.9

A cautionary statement concerning all I forward-looking or forecast statements shall be included. CPR Preface

The valuation's conclusions, illustrating a range of values, the best estimate value for each valuation, and whether the conclusions are qualified or subject to any restrictions imposed on the CV, shall be included. 10.7

T1.16 Identifiable Component Asset (ICA) Values

Component Asset Values (an ICA valuation) equalling the Mineral Asset Value. This could be, for example, due to the requirements of other valuation rules and legislative practices including taxation (i.e. fixed property, plant, and equipment relative to Mineral Asset Value allocations such as in recoupment or capital , gains tax calculations or where a commissioned Mineral Asset Valuation specifies a need for a breakdown of the Mineral Asset Valuation).

10.4.3 10.4.5 10.4.6

In such cases, the separate allocations of value shall be made by taking account of ! the value of every separately identifiable component asset. Allocation of value to only some, and not all, identifiable component assets is not allowed. This requires a specialist appraisal of each identifiable component asset of property, plant and equipment, with the 'remaining' value of the Mineral Asset being attributed to the Mineral Resources and Reserves. Such valuations shall be performed by suitably qualified experts, who may include the CV.

10.4.3 10.4.5 10.4.6

If the Mineral Asset Valuation includes an ICA Valuation, the CV shall satisfy himself or herself that the ICA Valuation is reasonable before signing off the Mineral Asset Valuation. 10.4.3 10.4.5

10.4.6

T1.17 Historic Verification

A historic verification of the performance parameters on which the Mineral Asset Valuation is based shall be presented. 10.8

278



CPR

T1.18 Market Assessment

A comprehensive market assessment should be presented. 7.13

T1.19 Sources of Information

The sources of all material information and data used in the report shall be disclosed, as well as references to any published or unpublished technical papers used in the valuation, subject to confidentiality. 1.3

A reference shall be made to any other report that has been compiled, for the purpose of providing information for the valuation, including SAMREC-compliant reports and any other contributions or reports from experts. 1.3

279


Appendix 13: JSE Section 12 References

JSE Section 12 Section in CPR

12.9 A Competent Person’s Report must comply with the SAMREC and SAMVAL Codes and must:

(a) have an effective date (being the date at which the contents of the Competent Person’s Report are valid) less than six months prior to the date of publication of the pre-listing statement, listing particulars, prospectus or Category 1 circular;

CPR Preface 10.1

(b) be updated prior to publication of the prelisting statement, listing particulars, prospectus or Category 1 circular if further material data becomes available after the effective date; N/A

(c) if the Competent Person is not independent of the issuer, clearly disclose the nature of the relationship or interest; CPR Preface 1.4 1.5

(d) show the particular paragraph of this section, the SAMREC Code (including Table 1) and SAMVAL Code (including Appendixes and Tables) complied with in the margin of Competent Person’s Report; Sections 1-11

(e) contain a paragraph stating that all requirements of this section, the SAMREC Code (including Table 1) and SAMVAL Code (including Appendices and Tables) have been complied with, or state that certain clauses in the SAMVAL code were not applicable and provide a list of such clauses; and include a statement detailing:-

1.1 1.9

1.9.2

(i) exploration expenditure incurred to date by the applicant issuer and by other parties, where available; N/A

(ii) planned exploration expenditure that has been committed, but not yet incurred, by the applicant issuer concerned; and N/A

(iii) planned exploration expenditure that has not been committed to by the applicant issuer but which is expected to be incurred sometime in the future, in sufficient detail to fairly present future expectations; 9.2

(f) contain a valuation section which must be completed and signed off by a Competent Valuation in terms of and in compliance with the SAMVAL Code (including Appendixes and Tables); Section 10

(g) be published in full on the applicant issuer’s website; N/A

(h) be included in the relevant JSE document either in full (which includes Incorporation by reference pursuant to paragraph 11.61) or as an executive summary. The executive summary must be approved by the JSE (after approval by the Readers Panel) at the same time as the Competent Person’s Report is approved by the JSE and the Readers Panel. The executive summary should be a concise summary of the Competent Person’s Report and must cover, at a minimum, where applicable:

N/A

(i) purpose; 1.1

(ii) project outline; 2.1

(iii) location map indicting area of interest; 1.1

(iv) legal aspects and tenure, including any disputes, risks or impediments; 2.8

(v) geological setting description; 4.1

(vi) exploration programme and budget; 9.2

(vii) brief description of individual key modifying factors;

2.12 7.2

7.3 7.4 7.6

7.8 7.9 7.1

7.11 7.12

7.13

(viii) brief description of key environmental issues; 2.7.3 7.12

280


JSE Section 12 Section in CPR

(viii) brief description of key environmental issues; 2.7.3 7.12

(ix) Mineral Resource and Mineral Reserve Statement; 6.7

8.3

(x) reference to risk paragraph in the full Competent Person’s Report; 9.3

10.1

(xi) statement by the Competent Person that the summary is a true reflection of the full Competent Person’s Report; and Executive

Summary

(xii) summary valuation table. Where the cash flow approach has been employed, the valuation summary must include the discount rate(s) applied to calculate the NPV(s) (net present value(s) per share with reference to the specific paragraph in the Competent Person’s Report. If inferred resources are used, show the summary valuation with and without inclusion of such inferred resources.

10.4 10.5

10.6 10.7

281


Appendix 14: SAMESG Code References

SAMESG CODE TABLE 1 Section in CPR

SECTION CRITERIA

1 General Reporting Requirements

1.1 Relevant dates

1.1.1 Date of Statement CPR Preface

1.1.2 Disclose the effective date of statement CPR Preface

1.1.3 Disclose the preparation date of statement CPR Preface

1.1.4 The frequency of reporting for matters arising in this Guideline should reflect the same dates of appraisal as the SAM Codes, include all new listings, and should consider information that, where relevant, is not older than 1 (one) year from the time of reporting. For the purposes of understanding significant and existing trends, information older than 1 (one) year must be included. N/A

2 Exploration Results

2.1 General

2.1.1 Provide a description of organisational structure, systems, policies, procedures and management plans, and governance procedures in place to manage ESG issues. N/A

2.2 Key plans, maps and diagrams

2.2.1 Provide a map which identifies the locality of sensitive receptors within the prospecting right area and at least the zone of influence of the site. All surface water features to be included on maps. N/A

2.2.2 Describe the location of any sensitive areas within and around the project area including within the prospecting right area and within the zone of influence of the site. N/A

2.3 Legal aspects

2.3.1 Outline the applicable ESG legal compliance requirements and any mandatory and/or voluntary standards or guidelines to which the project target subscribes. N/A

2.3.2 Identify the ESG permits, authorisations and licences that have been issued to the project target as well as those permits, authorisations and licences that that have been identified as required but not yet applied for or issued. Motivate whether there is a reasonable basis to believe that all ESG permits, authorisations and licences can be obtained.

N/A

2.3.3 rovide a description of any recognised claims received during the reporting period. N/A

2.3.4 Provide a description of any penalties, fines and damages which are due and payable by the target in response to an order of court, decision by a mediator or a decision by an arbitrator whether or not subject to an appeal process.

N/A

2.3.5 Provide a description of any pending administrative enforcement action such as, but not limited to directives or compliance notices instituted against the project target, including a notice received by the project target of an authority’s intention to issue a directive or compliance notice, by any authority concerned with the regulation of ESG issues whether or not such pre-compliance notice or compliance notice has been suspended pending corrective action.

N/A

2.3.6 Provide a description of any known future financial liabilities that arise by virtue of recognised claims, penalties, fines, damages and administrative enforcement action that will become due and payable in future including the due date for payment.

N/A

2.4 Environmental parameters

2.4.1 Provide a high level analysis of the environmental context within which the project is located and give an appropriate analysis of the material aspects and impacts that may need consideration. Include issues that are likely to remain material despite the implementation of proposed mitigation measures.

N/A

2.4.2 Describe, assess and prioritise the risks associated with any obvious environmental factors that could have a material modification to the planned exploration programme. N/A

2.5 External social and political parameters

2.5.1 Provide a high-level analysis of the external social and political context within which the project is located. N/A

2.5.2 Describe and prioritise current social and political risks, and potential risks that take into account how exploration activities may exacerbate or mitigate existing risks. N/A

282



2.5.3 Report on any social and political issues that may have a material effect on the planned exploration programme. Include issues that are likely to remain material despite the implementation of proposed mitigation measures

N/A

2.6 Internal social parameters

2.6.1 Describe and assess the risks associated with any obvious internal social factors and/or specific contextual details that could have a material effect on the planned exploration programme. N/A

2.7 Conformance and compliance audits

2.7.1 Provide a description of legal compliance audits undertaken during the period including a summary of material findings and management plans to address these findings. N/A

2.7.2 Provide a description of ESG management system conformance audits undertaken during the reporting period including a summary of material findings and management plans to address these findings. N/A

2.8 ESG liability

2.8.1 Describe the project target’s current closure, social obligations, rehabilitation activities, material remaining liability and compliance costs. N/A

2.8.2 Provide a description of mechanisms in place to address unplanned closure N/A

2.9 Risk analysis process

2.9.1 Provide a description of the existence of a risk assessment process which has been undertaken to identify material ESG issues. Describe programmes in place to continuously update and monitor identified material ESG issues.

N/A

2.9.2 Describe how the risk assessment process is integrated with the overall risk management framework. N/A

3 Resources

3.1 General

3.1.1 Provide a description of organisational structure, systems, policies, procedures and management plans, and governance procedures in place to manage ESG issues. 2.7.3

2.12


3.2.1 Provide a map which identifies the locality of sensitive receptors within the prospecting right area and at least the zone of influence of the site. All surface water features to be included on maps.

2.8

3.2.2 Describe the location of any sensitive areas within and around the project area including within the prospecting right area and within the zone of influence of the site.

7.12

3.3 Legal Aspects

3.3.1 Outline the applicable ESG legal compliance requirements and any mandatory and/or voluntary standards or guidelines to which the project target subscribes. 2.7

7.12.6


2.8 7.12.5 7.12.6

3.3.3 Provide a description of any recognised claims received during the reporting period. 2.8 7.12.6

3.3.4 Provide a description of any penalties, fines and damages which are due and payable by the target in response to an order of court, decision by a mediator or a decision by an arbitrator whether or not subject to an appeal process. 2.1


2.11


2.1 2.11

7.14.4

283





2.7.3 7.12

3.4.2 Describe, assess and prioritise the risks associated with any obvious environmental factors that could have a material modification to the planned exploration programme. 7.12.1


3.5.1 Provide a high-level analysis of the external social and political context within which the project is located.

2.6 2.7.3

3.5.2 Describe and prioritise current social and political risks, and potential risks that take into account how activities may exacerbate or mitigate existing risks. 2.6

3.5.3 Report on any social and political issues that may have a material effect on the planned resource programme. Include issues that are likely to remain material despite the implementation of proposed mitigation measures. Focus on issues that are likely to remain significant despite the implementation of proven and economically viable mitigation measures.

2.12


3.6.1 Describe and assess the risks associated with any obvious internal social factors and/or specific contextual details that could have a material effect on the planned exploration programme.

2.12


3.7.1 Provide a description of legal compliance audits undertaken during the period including a summary of material findings and management plans to address these findings. 7.12.6

3.7.2 Provide a description of ESG management system conformance audits undertaken during the reporting period including a summary of material findings and management plans to address these findings. 7.12.6

3.8 ESG liability

3.8.1 Describe the project target’s current closure, social obligations, rehabilitation activities, material remaining liability and compliance costs. 7.14.4

3.8.2 Provide a description of mechanisms in place to address unplanned closure 7.14.4



3.9.2 Describe how the risk assessment process is integrated with the overall risk management framework. 7.12

7.12.1 9.3

4 Reserves

4.1 General

4.1.1 Provide a description of organisational structure, systems, policies, procedures and management plans, and governance procedures in place to manage ESG issues. 2.7.3 2.12


4.2.1 Provide a map which identifies the locality of sensitive receptors within the prospecting right area and at least the zone of influence of the site. All surface water features to be included on maps. 2.8

4.2.2 Describe the location of any sensitive areas within and around the project area including within the prospecting right area and within the zone of influence of the site. 7.12

4.3 Legal Aspects

4.3.1 Outline the applicable ESG legal compliance requirements and any mandatory and/or voluntary standards or guidelines to which the project target subscribes. 2.7 7.12.6

284




2.8 7.12.5 7.12.6

4.3.3 Provide a description of any recognised claims received during the reporting period. 2.8 7.12.6

4.3.4 Provide a description of any penalties, fines and damages which are due and payable by the target in response to an order of court, decision by a mediator or a decision by an arbitrator whether or not subject to an appeal process.

2.1


2.11


2.1

2.11 7.14.4



2.7.3 7.12

4.4.2 Describe, assess and prioritise the risks associated with any obvious environmental factors that could have a material modification to the planned exploration programme. 7.12.1


4.5.1 Provide a high-level analysis of the external social and political context within which the project is located.

2.6 2.7.3

4.5.2 Describe and prioritise current social and political risks, and potential risks that take into account how activities may exacerbate or mitigate existing risks. 2.6

4.5.3 Report on any social and political issues that may have a material effect on the planned resource programme. Include issues that are likely to remain material despite the implementation of proposed mitigation measures.

2.12


4.6.1 Describe and assess the risks associated with any obvious internal social factors and/or specific contextual details that could have a material effect on the planned exploration programme. 2.12


4.7.1 Provide a description of legal compliance audits undertaken during the period including a summary of material findings and management plans to address these findings. 7.12.6

4.7.2 Provide a description of ESG management system conformance audits undertaken during the reporting period including a summary of material findings and management plans to address these findings. 7.12.6

4.8 ESG liability

4.8.1 Describe the project target’s current closure, social obligations, rehabilitation activities, material remaining liability and compliance costs. 7.14.4

4.8.2 Provide a description of mechanisms in place to address unplanned closure 7.14.4

4.8.3 Describe the bonding obligations in place to ensure that these liabilities can be funded on a qualitative and quantitative basis. 7.14.4



7.12

7.12.1 9.3

4.9.2 Describe how the risk assessment process is integrated with the overall risk management framework. 7.12

7.12.1 9.3

competent person's report of the montana platinum group metal mineral assets for sibanye gold

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