Company is financially quite well positioned right now to challenges still persist, but recently they have been more endure a period of relatively low PGM prices. than offset by the precipitous drop in PGM demand (and prices) that began in July of 2008. That said, under present circumstances it is essential that we monitor metal prices, operating results – both as Viewed from a perspective in early 2009, worldwide to production and cost – and cash balances rigorously. PGM production has declined to a rate substantially For the year 2009 our plan shows mine production of below where it was in early 2008. Several of the higher- 495,000 PGM ounces at an all-in cash cost (including cost South African mine workings have been scaled back capital spending and corporate overheads) of about or curtailed altogether, North American ’s Lac des Iles Mine in is on care and maintenance, $520 per ounce, with some potential for the cost to Norilsk Nickel’s PGM production has been declining, come in lower than that. At present our weighted average and our own mine output has been rationalized at a realized price for mined and palladium is about lower level. Operational challenges at various production $515 per ounce. The 2009 plan includes Stillwater Mine facilities also have constrained the industry’s PGM output producing 370,000 PGM ounces, about 6% more than recently. Coupled with the lower PGM volumes being in 2008 with the added miners from East Boulder, and recycled currently, the overall reduction in PGMs being a scaled-back East Boulder Mine producing 125,000 supplied to market is substantial. While quantifying this ounces, about 16% less than in 2008. with any precision is difficult, it appears that 2008 annual palladium supply may be lower by roughly one million PGM SUPPLY ounces and platinum by about 500,000 ounces than Stillwater Mining Company is the sole U.S. producer their year-earlier levels. of mined PGMs. Other significant commercial PGM The fact that recycling volumes are off – perhaps by mining occurs in South Africa and Zimbabwe (as primary as much as 50% currently – is an important element of the production), and in the Russian Federation and Canada supply story. This may change as 2009 progresses, but if (as by-products). Stillwater’s mining operations account for present volumes persist, the drop in recycling activity would about 3.5% of worldwide PGM production. Total worldwide production of PGMs in 2008 was about six million ounces take about one million ounces per year of PGMs out of the of platinum, seven million ounces of palladium and just marketplace. That would represent a further 8% decline in 800,000 ounces of rhodium. Putting these volumes in platinum and palladium supply, split about evenly between perspective, there are about 80 million ounces of gold and the two metals, and an 11% decline in rhodium supply. 400 million ounces of mined each year. Assessing the outlook for PGM supplies in 2009, unless Most of the bullish PGM price growth in the first demand recovers significantly the story is probably similar to half of 2008 was driven by challenges on the supply late 2008. The power shortages in South Africa that initially side – augmented to some degree by speculative interest constrained PGM production there have now reportedly in precious metals. To a large extent, these supply been offset by the slowing local economy, resulting in lower

PGM SUPPLY PLATINUM PALLADIUM (Thousands of Ounces) 2007 2008 2009 2007 2008 2009 Actual Estimate Outlook Actual Estimate Outlook South Africa 5,050 4,650 4,650 2,615 2,400 2,400 Russia 860 700 675 3,900 3,165 3,050 North America 340 300 250 1,080 925 750 Others 435 475 475 420 440 440 Total Mine Supply 6,685 6,125 6,050 8,015 6,930 6,640 Recycling supply 885 925 500 870 1,025 560 Worldwide Supply 7,570 7,050 6,550 8,885 7,955 7,200

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