Johannesburg - Harmony Gold Mining Company [JSE:HAR] will
hold a briefing at 08:00 GMT on Monday on the outcome of a review of its
troubled Kusasalethu mine, the scene of violent protests and an illegal strike
Harmony, SA's third largest gold producer, said
last week it would delay the post-holiday restart of the mine as it was
undertaking a review of its financial and operational status.
The company could take a number of options including placing
the mine under "care and maintenance", which would mean closing it
for an indefinite time
Such a move would hit Harmony's bottom line hard at a time
when it needs cash to fund its huge Wafi-Golpu project in Papua New Guinea,
"This would be a blow to Harmony: Kusasalethu produced
around 18% of Harmony's production profit in the September quarter. If they do
put it on care and maintenance it will certainly disrupt their cash flow
regarding Wafi-Golpu," said David Davis, mining investment analyst at SBG
A brief underground sit-in was staged at Kusasalethu just
before Christmas when 1 700 workers refused to surface to protest the
suspension of colleagues who had taken part in an illegal strike.
The suspensions also sparked violence on December 20 when
several miners were injured by police firing rubber bullets to disperse a
demonstration. In November, two miners were killed in clashes between rival
The unrest at Kusasalethu was the latest labour flare-up in
South Africa's mining sector, which was battered last year by a wave of violent
wildcat strikes that claimed around 50 lives.
Harmony shares were flat at R71.50 in early trade.
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