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Workers reject Exxaro pay offer

Johannesburg - Striking workers at five collieries owned by diversified mining firm Exxaro Resources [JSE:EXX] rejected a cash offer to get them back to work, prolonging an illegal stoppage that could eventually hit electricity supplies.

Violent labour unrest, including the police killing of 34 striking platinum miners, shut parts of South Africa's mining industry for months last year and further disruptions remain a concern.

Exxaro said on Tuesday that workers at its Matla, Arnot, Grootegeluk, Leeuwpan and Inyanda coal mines had refused a one-off offer of R2 000.

The strike began at two Exxaro mines on March 5 and spread to other operations, with workers demanding bonus payments that the company is refusing to pay because targets were not met.

"Exxaro reiterates the call for striking employees to return to work," the company said in a statement.

The protest at the Grootegeluk coal mine in the northern province of Limpopo turned violent on Monday with police firing rubber bullets at a group of 2 000 strikers.

"The protesters hijacked two trucks and blocked the roads," police spokesperson Ronel Otto said.

Production at all the affected operations has stopped, putting pressure on the supply of coal to South Africa's state electricity utility.

Exxaro is seeking an urgent court order to end the walkout.

The company is the second-largest supplier of coal to power utility Eskom, which uses coal to generate 85% of the electricity for South Africa.

"Exxaro continues to work closely with Eskom to ensure the availability of coal supply and currently there are adequate levels of supply available," the company added.

Eskom is already walking a tightrope to keep power flowing to factories, mines and smelters that had to shut for days five years ago when the national grid nearly collapsed, costing South Africa's economy billions of dollars in lost output.

The power utility has also been plagued by a nearly two-month illegal walkout at the construction site for Medupi, its first new power plant in decades.

Nearly 100 workers also went on an illegal underground protest at Palabora Mining Company [JSE:PAM] last week, halting mining operations at the country's largest copper mine, the National Union of Mineworkers (NUM) said.

"They are demanding additional danger pay for working underground," NUM spokesperson Lesiba Seshoka said.

However, refining and smelting operations at Palabora were continuing, the company said.

"This action by the crews is a significant concern and is in contravention of their obligations to the mine's policies," Palabora said in a statement.

Palabora, South Africa's only producer of refined copper, produces about 80,000 tonnes of the metal a year.

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