• A special kind of coup

    Scared or compromised ANC leaders seem ready for collective suicide, says Solly Moeng.

  • Excuses, excuses...

    ‘White monopoly capital' is just a ploy to avoid SA’s real problems, say two analysts.

  • SA Inc's performance

    If SA were a company with its own share price, how would it perform, asks Jac Laubscher.

All data is delayed
See More

Lonmin in race to restart mining

Aug 27 2012 07:59

Company Data

Lonmin plc [JSE:LON]

Last traded 14
Change 0
% Change 0
Cumulative volume 1300
Market cap 0

Last Updated: 29-03-2017 at 05:00. Prices are delayed by 15 minutes. Source: McGregor BFA

Related Articles

Lonmin hopes more workers will return

Vavi: No finger pointing over Marikana

Lonmin: We need peace

Oliphant meets Marikana parties

Lonmin 'working towards peace'

Ramaphosa: We are all responsible


Johannesburg - World No 3 platinum producer Lonmin [JSE:LON] is racing to resume ore extraction at its Marikana site, with no guarantee striking workers will return this week after a mourning period for comrades killed in a wave of labour unrest.

Lonmin's South African operations have been paralysed since an illegal strike involving 3 000 rock driller operators started two weeks ago and exploded into violent clashes that killed 44 people, including 34 striking workers gunned down by police.

Lonmin accounts for about 12% of global platinum output and the freezing of its mining operations has driven the price of the metal up by around 10%.

The company said more than half of its 28 000-strong workforce showed up for shifts on Saturday - more than last week but far short of the numbers needed to start pulling ore from the earth.

"Mining operations will only resume once we have sufficient workers in attendance and the necessary safety procedures have been undertaken," Lonmin said on Friday.

It was not clear when they would get those numbers. Some workers have signaled the "martyrdom" of their colleagues raised the stakes and it would be a betrayal if miners returned unless they won the wage increases that they have demanded.

The striking workers have been demanding a monthly wage of R12 500. The company says they get about R9800 with an average monthly bonus of R1 500.

The government said at the weekend the world's largest platinum producers were discussing a move to collective bargaining.

The platinum sector negotiates with unions on a company-by-company basis, leaving individual firms open to labour discontent as rival organisations promise workers better deals.

This has created wage disparities between platinum companies that do not exist in the gold and coal sectors, which bargain collectively.

The violence at Lonmin stems from a bloody turf war between the dominant National Union of Mineworkers (Num) and the small but militant Association of Mineworkers and Construction Union (Amcu) which has been spreading through the sector.

Lonmin's acting chief executive Simon Scott said the company was hoping a "peace accord" mediated by the department of labour could be reached between the warring sides.

"We are dealing with tragic and challenging issues, and will be for a long time to come, but for the sake of the company, its many thousands of employees and the industry which supports them, we need to find a sustainable peace accord which allows people to return to a working business," Scott said.

Lonmin last week backed down from a threat to sack the 3 000 striking workers as the country marked a period of mourning for those killed in the violence.

Lonmin has also said it may issue new shares to shore up a balance sheet hit by the lost production and revenue. Its situation will become tougher the longer its mines are idle.

Analysts have speculated the company may try to raise new capital from shareholders as existing agreements with lenders require it to keep a lid on its debt-to-profit ratios. The company said those ratios would likely be breached by September 30.

Lonmin had already slashed spending plans before the latest flare-up of violence and may miss its annual production target of 750,000 ounces.

* Follow Fin24 on FacebookTwitter and Google+.

lonmin  |  amcu  |  num  |  mining  |  mining unrest  |  platinum



Read Fin24’s Comments Policy

24.com publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
1 comment
Comments have been closed for this article.

Company Snapshot

Money Clinic

Money Clinic
Do you have a question about your finances? We'll get an expert opinion.
Click here...

Voting Booth

Do you think women are under-represented in leadership positions globally?

Previous results · Suggest a vote