Broken promises from AngloGold signal darker days ahead | Fin24
  • Load Shedding Schedules

    Find information for Johannesburg, Durban, Cape Town and other cities.

  • Eskom

    Critical repairs being done during 21-day lockdown as demand plummets.

  • Mills Soko

    China's success in addressing the coronavirus crisis speaks to the importance of decisive leadership.


Broken promises from AngloGold signal darker days ahead

Jul 09 2017 06:00
Lesetja Malope

Orkney - Never and never again shall we allow our mine to be stopped...

These are the first words of a pledge inscribed on a billboard perched at the main entrance to AngloGold Ashanti’s Kopanang mine near Orkney in North West. The pledge goes on to mention safety assurances.

When the company, which is the third-biggest gold producer in the world, announced that it would be shutting down its 4 000-worker-strong Kopanang mine in the Matlosana municipality, fear swept through the few communities that depend heavily on the mine. When one pays a visit to the mine, the irony of the pledge kicks in.

To some, it brought memories of a recent nightmarish retrenchment saga in one of the neighbouring former mining communities where Aurora mine – owned by a Zuma and a Mandela, among others – dumped 5 000 people into abject poverty.

Many of Aurora’s workers are still at its former premises, with no electricity and running water. Many more, according to the municipality, are still illegally mining some of the shafts. Prostitution has also found a place in that local economy.

Kopanang, meaning “get together”, is a 2.3km deep gold mine that opened its doors in 1981 and has since had numerous owners. The mine was initially owned by Anglo American and had changed owners several times until AngloGold got its hands on it.

According to councillor Khaya Ndincede of ward 21, the ward that is closest and will be most affected by the job cuts, the closure will drive the local population deeper into poverty.

The area already has an estimated unemployment rate of more than 30%.

Vaal Reef ward 21, Umuzimuhle, is entirely owned by the mining company – 1 300 households, the schools, the roads infrastructure, recreational facilities such as the parks, the clinics and even the taxi rank, the municipal offices and shopping complex that houses several businesses, including a post office, all belong to the mine but are being rented out.

The company is the sole landlord in the community. The mine is even in charge of the water and electricity in the area and workers pay a fixed amount directly to the mine via deductions from their salaries.

“AngloGold is the landlord here, they regard it as farmland,” Ndincede said, adding that the mines in the area, particularly AngloGold, have operated as a parallel government on its own as they do not have many legal obligations towards the local municipality and instead communicates only with the department of mineral resources.

Ndincede also pointed out that, according to the municipal demarcation, Kopanang mine is actually not in North West as the Vaal River is considered the provincial border and the mine is only a few metres from the river on the Free State side.

He said the mine’s social labour plan, which has been approved by the department, did not respond to the needs of the local communities.

For example, the company recently built swimming pools for communities whose integrated development plans prioritised other pressing amenities.

AngloGold’s board is chaired by Sipho Pityana, a vocal anti-Zuma activist who was one of the leaders of the Save SA march earlier this year.

The municipality has in recent years earned a reputation of being one of the worst-run in the province and had been put under administration before. It is one of several still owing Eskom millions of rands.

It owed R250 million, but the figure has now been lowered to around R90 million, according to the municipality.

The shutting down of Kopanang mine – which is one of only three mines the municipality claims it discusses social labour plan projects with – might just economically paralyse the area again. The other two mines are Tau Lekoa and the Gupta-owned Shiva Uranium.

According to Mthuthuzeli Danxa, the municipality’s local economic development manager, the problems that accompany a mine shutting down are many and it would have far-reaching consequences for the municipality.

The municipal manager, Roger Mkhumise, told City Press that the municipality had requested a meeting with the company in order to get a clearer picture.

“National government has come up with initiatives. We have been identified as one of the distressed mining towns by the presidency,” he said.

Another major issue was the that the biggest employer in the area was still the mining sector, but provincial government had already put a plan in place. In 1995, it contributed 42% to the economy in the area.

The municipality did not provide latest figures.

The municipality has only around 7 827 hectares of vacant land remaining. The biggest asset on the municipality’s books is the 23 000-seater Oppenheimer Stadium in Orkney, which was donated by a mine, but has now become a maintenance burden.

According to the recent budget speech, the municipality has a budget of R2.9 billion for the current financial year, with its expenses totalling R3.2 billion.

Mkhumise said it only generated revenue through the collection of rates from Klerksdorp, the nearby township of Jouberton and through market development.

It has an indigent register of almost 20 000 people, a figure that is expected to increase drastically when Kopanang shuts down.

As part of its social and labour plans, AngloGold Ashanti intends to incorporate the mine village infrastructure into the host municipalities of Matlosana and Merafong, respectively, the company said.

The National Union of Mineworkers, which is the majority union at Kopanang, held its stewards’ council
in Carletonville this week, where it resolved to
oppose the retrenchments.

An amount of R170 million has been set aside to decommission the mine by the company. At least 51% of workers in Kopanang receive living-out allowances, with the rest living at the mine.

The mine’s promise not to allow mining to stop, as stated in its pledge, has seemingly fizzled into thin air and, once again, the community will bear the brunt.

SUBSCRIBE FOR FREE UPDATE: Get Fin24's top morning business news and opinions in your inbox. Read Fin24's top stories trending on Twitter:

anglogold  |  job losses  |  mining


Read Fin24’s Comments Policy 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
Add your comment
Comment 0 characters remaining

Company Snapshot

Voting Booth

Do you support a reduction in the public sector wage bill?

Previous results · Suggest a vote