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Johannesburg - Gold production in world leader South Africa has fallen by more than 10% compared to the second quarter of last year, the industry announced on Thursday, blaming an ongoing power crisis and warning that urgent action is needed.
The country's total production was down 10.4% between April and June, compared to the same period last year, while that of leading miners belonging to the Chamber of Mines fell by 12.9%, the chamber said in a statement. It said chamber members produced 47 330 kilograms of gold between April and June.
That was an improvement on the first quarter, when the power shortage forced gold mines to close for one week and production was down 16.8% compared to the same period in 2007. Since then, companies have been limited to 90% of normal power usage.
"The key reason was the national electricity emergency," said the statement, which claimed the mining industry bore the brunt of the power curtailment and "effectively bailed the country out of a potentially serious situation."
South Africa's coal-powered electrical grid nearly collapsed in January, with massive power cuts that damaged its mining industry.
Resources depleted
South Africa's government has blamed rising demand and cheap prices for its power problems, although it also has conceded ignoring warnings 10 years ago that more investment in power-generating facilities was needed.
The Chamber of Mines said the industry continues to bear much of the burden of power shortages and that other electricity users must urgently do more to cut power use, "given the significant export earnings and employment intensity of mining."
Mines - one of the biggest employers, providing jobs for 400 000 people - had warned that the electricity crisis would force them to lay off thousands of workers. This brought an outcry from trade unions which claim hundreds of miners have been laid off as a result of the crisis. Mining companies have given other reasons for the layoffs and voluntary retrenchments.
South Africa's position as the biggest world supplier of gold continues to fall as resources are depleted. The United States is threatening to win top position, with Australia and China lagging far behind. South Africa produced 80% of the world's supply in 1970, but production has slumped from 1 000 tons that year to 275 tons last year.
- AP