Police ready for Lonmin workers' return

2012-09-10 07:58

Johannesburg - South African police are braced for possible violence ahead of today's back-to-work deadline for striking workers at Lonmin's flagship platinum mine, where 44 people died in labour strife last month, most of them at the hands of police.

Mineworkers have been given until Monday to report for duty after a month of wildcat industrial action but union officials suspected that these calls would be ignored, increasing tensions at Lonmin's mines.

"The situation is tense. Anything can happen at any given moment," police spokesperson Thulani Ngubane said.

Scores of police have been camped out near the mine for more than three weeks since a bloody clash with the striking workers on August 16. Ngubane said more could be called in should there be any sign of trouble.

Union officials said they had heard reports that the striking miners, many of whom are unaffiliated with any known union, planned a march in defiance of a "peace accord" signed by the mine management and the main National Union of Mineworkers (Num).

The workers have vowed to stay off the job until they get wages of R12 500 a month, double what they now earn.

"Our hope is that people will respect the peace accord and return to work," said Num spokesperson Lesiba Seshoka. "People have indicated that they wish to return to work but the high level of intimidation has stopped them."

Num represents the majority of Lonmin's 28 000 employees but its dominance has been questioned by the militant Association of Mineworkers and Construction Union (Amcu), which has been blamed for instigating the strike in its bid for more members.

Amcu and representatives of the striking workers refused to add their names to last week's "peace accord". Amcu officials did not answer their phones on Sunday.

Negotiations on the wage demand are scheduled to start at noon on Monday but only if the miners return to work first.

"If workers don't come to work, we will still pursue the peace path. That is very, very necessary for us to achieve because this level of intimidation and people fearing for their lives obviously does not help anybody," said Barnard Mokwena, Lonmin's executive vice president in charge of human resources.

"For now it is a fragile process and we need to nurture it," he said.

Conceding to the demands in full would set Lonmin back an additional $30m a year and set a precedent for other producers, such as Anglo Platinum [JSE:AMS] and Impala Platinum Holdings [JSE:IMP], to do the same.

The world's third largest platinum producer is already under financial pressure to restart operations as its idle mines are costing it 2,500 ounces in daily lost production.

Lonmin [JSE:LON], which has had $524m knocked off its market capitalisation since the strike started, has already cautioned that it is in danger of breaching debt covenants and may need to turn to the markets.

Analysts say it could need between $1bn and $1.25bn in new capital, or nearly three quarters of its current stock market value.

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  • ChrisGRoyle - 2012-09-10 08:42

    Will it really only cost $30m per year to get back to production?

      ChrisGRoyle - 2012-09-10 10:08

      For all the down voters - it's about being pragmatic and playing the long game. $30m is a trivial amount to get back into production and look at improving mechanisation.

      pieter.calitz - 2012-09-10 10:24

      @ChrisGRoyle - Trivial, yes. Seeing that the mine only made a gross profit of -$7 million last year.

      ChrisGRoyle - 2012-09-10 15:52

      @Pieter - the Lonmin financial reports make for better reading - and it's their share price which is affected -

  • tshepo.maganedisa - 2012-09-10 08:55

    the more you are not meeting the workers demands is the more your figures will rise.At times you need to spend money to make money, think of it this way while the platinum price was high and you were enjoying the profits it was nice now that things are bad you are going to have to take a knock - speak to your shareholders because the longer you stall the uglier it will get

      merven.halo - 2012-09-10 09:02

      I got a better solution, fire them all, there is more than enough people that are willing to work for R7000 a month.

      malcolm.macleod.562 - 2012-09-10 09:13

      They DO already spend money to make money, huge amounts of it, and they DO already run at a loss in bad years. I can guarantee that they also do speak to their shareholders. What you are asking for is for them to run at a continuous loss and never make money, so that a bunch of greedy workers can earn more, this suggestion is simply ludicrous.

      justin.andrews.522 - 2012-09-10 09:15

      I work for 7000 a month with degrees and longer hours they they have. suck it up miners.

      maritza.beukes - 2012-09-10 10:25

      The workers won't return yet so I say fire all of them, get the good ones that do wanna work out and save. If they don't stop this strike soon a lot of people will loose more than just their jobs. The contractors who is renting homes will have to pack up and leave cause there won't be money to pay the rent. But most of all what about food and stuff?

      petronella.dutoit.1 - 2012-09-12 14:00

      It is totally wrong to for employees to sign contract and then force other terms and equally wrong for Business and Gov allowing importing cheap foreign labour at the expense of local public and business. What I do find strange is why employees does not have some kind of profit sharing deal as is the case in other industries, or do they?

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