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SA mine bosses talk tough with strikers

Oct 01 2012 19:06

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Lonmin plc [JSE:LON]

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Last Updated: 01/01/0001 at 12:00. Prices are delayed by 15 minutes. Source: McGregor BFA


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Johannesburg - Top global platinum producer Anglo Platinum [JSE:AMS] (Amplats) said on Monday it would fire all strikers who did not attend disciplinary hearings the following day as an illegal strike continued at four of its South African mines.

With no end in sight to a spate of wildcat strikes in South Africa, AngloGold Ashanti [JSE:ANG] warned that an illegal stoppage could lead to cuts in its operations there and said it might also have to fire workers.

Amid the tough talk from mining bosses, another illegal strike broke out on Monday at the Bokoni platinum mine run by Amplats and Canadian-based Atlatsa Resources.

The Bokoni strike is worrying because it is in the far eastern limb of the platinum belt, hundreds of kilometres from the wave of labour strife centred around the cities of Rustenburg and Marikana, where 46 people were killed in a bloody six-week stoppage at Lonmin [JSE:LON].

Police said on Monday another body had been found in the Rustenburg area near an Amplats property and they believed the death was related to the mine violence.

Amplats’ four Rustenburg mines have been shut for over two weeks at a cost of over 20 000 ounces in lost output and the company will now sack employees who do not report to disciplinary hearings by Tuesday.

“The company will be left with no alternative but to dismiss, in their absence, all employees who do not present themselves,” it said in a statement.

In total, there are around 75 000 miners on strike across South Africa’s gold and platinum sectors, about 15% of the underground labour force. Virtually all of the strikes are illegal.

The chief executive of AngloGold, the world’s third-largest gold producer, issued a stern warning on Monday about the viability of its South African operations and said the illegal strike by 24 000 of its 35 000 workers could lead to dismissals.

“If the current unprotected strike continues, it compounds risks of a premature downsizing of AngloGold Ashanti’s South African operations,” Mark Cutifani told a briefing that was webcast to employees.

He added the company could take action, potentially including dismissals, against striking employees.

Cutifani also said there were no immediate plans to scale back on R4.5bn in capital investment plans in South Africa this year but the country was becoming a tough sell to investors.

“If we don’t resolve the issue then how do I justify to shareholders that we should continue to invest in South Africa,” he said.

Unclear demands

Cutifani also said the demands being made were unclear.

“It’s mainly about money, but when you ask people what does that look like, they are unable to tell you,” Cutifani told Reuters.

He said it could be R16 000 a month or R18 000 but the demands did not specify if this was across the board or a basic wage or included the whole package. “It’s just a number. We don’t even know what that means.”

AngloGold’s South African operations accounted for 32% of the group’s production in the first half of 2012 and the company said it was losing around 32 000 ounces of production a week due to the strike.

Gold mining in South Africa is generally on the decline as resources mined for decades run out and shafts have to sink deeper to get to the ore, raising costs.

Labour violence first erupted on South Africa’s platinum belt as a turf war between the militant Association of Mineworkers and Construction Union and the dominant National Union of Mineworkers.

Fuelled by glaring income disparities, the strikes have hit also hit AngloGold’s rival Gold Fields [JSE:GFI] and smaller mining operations.

amplats  |  lonmin  |  anglogold  |  gold fields  |  mining unrest



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