Johannesburg - Impala Platinum Holdings said protests at its Marula
mine in northeast South Africa and low metal prices had led the world’s
second-largest producer of the metal to start a reorganisation process that
could lead to more than 1 000 job losses.
The mining regulator and relevant labour unions have been
contacted and all parties will work together to minimize the impact of the plan
on employment, the Johannesburg
based company said in a statement on Wednesday. Impala expects the negotiation
process to be completed by the end of June, it said.
“This is something the business and economy can ill afford,
but remains imperative if we are to protect the financial viability of our
business and preserve jobs as far as possible,” Chief Executive Officer Gerhard
Potgieter said in the statement.
The decision comes as the South African government struggles
to reduce unemployment, which was 26.5 percent in the fourth quarter of last
year. Platinum miners have battled with low metal prices and demands for higher
wages and living standards from their workers, while members of communities
surrounding the mines have protested at a lack of housing and jobs.
Community Ownership
Marula employs almost 4 400 workers and contractors,
according to Impala’s website. The company reduced its annual production
forecast for the site in February due to protests in the community, which owns
a 9 percent stake in the mine through a local trust.
The protest action that’s led to the reorganization is
related to community dissatisfaction with the way its 50 percent interest in
the Makgomo Chrome project is being managed, Impala said. Chrome is a waste
product of platinum. Marula’s production was also affected by the closing of a
hybrid mining section at one of the shafts.
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Impala said third-quarter refined platinum output dropped to
331,000 ounces from 353 000 ounces a year earlier, while full-year guidance was
maintained at 1.5 million refined platinum ounces. At Marula, production of
platinum in concentrates for the quarter decreased by 47 percent to 9 000
ounces.
The stock fell 0.3 percent by 9:15 a.m. in Johannesburg on Wednesday. That pared gains
this year to 2.4 percent, compared with a 9.4 percent advance on the FTSE/JSE
Africa Platinum Index.
BLOOMBERG