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Sibanye-Stillwater has concluded its first power purchase agreement and has achieved the financial closing of an 89-megawatt wind energy project.

The clean energy for the 89-megawatt wind energy project will be generated by the Castle Wind Farm, located near the town of De Aar in the Northern Cape province of South Africa.

Clean energy will be supplied to its South African operations through a wheeling agreement with Eskom.

This will be the largest private wind farm constructed in South Africa to date and is expected to comment construction in June 2023. It is scheduled to start commercial operation in early 2025.

Under the terms of the 15-year power purchase agreement, the Castle Wind Farm will be funded, built, and operated by the consortium.

The project consortium consists of African Infrastructure Investment Managers (AIIM) through its renewable energy project development and delivery platforms, African Clean Energy Developments and Reatile Renewables.

AIIM has invested in the project through its IDEAS Managed Fund, one of South Africa’s largest domestic infrastructure equity funds. Rand Merchant Bank will be the sole mandated lead arranger for the project.

Sibanye-Stillwater chief executive officer Neal Froneman said the Castle Wind Farm marks the first step in delivering over 550-megawatts of the company’s renewable project portfolio and reaching carbon neutrality by 2040.

“The project will not only play a pivotal role in reducing carbon emissions and mitigating climate change but also results in cost savings on electricity and provides energy security benefits for Sibanye-Stillwater’s South African operations,” Froneman said.

The purchase of the Castle Wind Farm comes as Sibanye-Stillwater recently begun the compulsory acquisition of Australian base metal producer New Century Resources.