General Motors Co. is reopening talks with Montana's Stillwater Mining Co., Gov. Brian Schweitzer announced Thursday, after previously cancelling its contract with the mine to buy metals needed to make vehicles.

Schweitzer had previously blasted GM -- and stopped driving his Chevy pick-up -- after the company announced last month it was breaking a contract to buy platinum and palladium from the Montana mine, but was evidently honoring its contracts with foreign platinum mines.

GM made the announcement as part of a bankruptcy that resulted in the U.S. Treasury owning 60 percent of the new GM.

";Maybe we should say this is a good start," Schweitzer said Thursday morning after a press conference in the governor's wood-paneled reception room.

John Beaudry, a spokesman for Stillwater Mining, said Thursday the company is ";encouraged by the talks but we do not have any unrealistic expectations that a (new) contract may result from that any time soon."

Stillwater Mining Co. operates two mines in the Beartooth Mountains of south-central Montana. Both produce platinum, palladium and other rare metals necessary in making the catalytic converters required on all modern cars and trucks.

The mines are the only sources of platinum and palladium in the Western Hemisphere. The only other sources of the metals are two foreign mines: one in Russia, the other in South Africa.

Schweitzer wrote U.S. Treasury Secretary Timothy Geithner early in early July saying GM was evidently honoring its foreign contracts, but breaking its contract with the only American platinum company at a time when U.S. taxpayers were essentially buying General Motors.

He said Thursday he has not yet heard back from Geithner, but had been in conversations with Frank McAllister, the chief executive officer of Stillwater Mine, and Frederick ";Fritz" Henderson, president and CEO of GM.

Those talks led to the announcement that the companies would begin talking to each other about the contract. Schweitzer said the talks would begin next Thursday.

Dan Flores, a GM spokesman in Detroit, said Thursday that Bob Socia, GM's vice-president for global purchasing and supply chain, will meet with mine representatives for sit-down talks somewhere in the Detroit area.

He said the talks came at the request of Schweitzer. Montana's congressional delegation -- Democratic Sens. Jon Tester and Max Baucus, along with Republican Rep. Denny Rehberg -- have also weighed in on the issue.

Schweitzer said he will not be part of the conversation and didn't know exactly what the talks would lead to. But he did say that ";when somebody sits on a bar stool and somebody stands on the other side of the bar, there's the assumption that somebody is going to buy a drink."

Flores said GM is not buying more platinum and palladium from foreign mines as a result of cancelling its Stillwater contract. The company is simply buying less, he said, because people are buying fewer cars and trucks and GM needs less. He also said the top source of its platinum and palladium is still an American company: a Pennsylvania outfit that recycles the metals from old catalytic converters.

Beaudry said McAllister and a Stillwater vice president will meet with Socia next week. He said he understood the appetite for new cars and trucks was potentially recovering, but still down. But he also said the world's other two platinum and palladium mines were encountering problems, including labor unrest and power outages in South Africa, which may affect the global market for the metals.

";That gets into the issue as to why GM entered into contracts with Stillwater in 1998," he said. ";To have a reliable, domestic supply."

Reporter Jennifer McKee: 447-4069 or jennifer.mckee@lee.net