Andre Janse van Vuuren
IMPALA Platinum Holdings and Lonmin began talks with unions on closing unprofitable shafts as mining firms battle rising costs and low prices.
Job cuts were unlikely as the second-and third-largest producers of the metal planned to raise output at newer, higher- margin shafts, said Franz Stehring, head of mining at the United Association of South Africa trade union, on Tuesday.
Implat’s Rustenburg operations, with 14 shafts, and Lonmin’s Marikana mines would be affected, Stehring said.
“We’ve been told they’re looking at the future design of the mines to take the current pay-limits into account,” he said, referring to each shaft’s profitability. “This is all theoretical still, nothing has been approved.”
Platinum producers in South Africa, which has more than 70 percent of the world’s reserves, are battling rising costs amid a 35 percent plunge in prices since 2011. Power prices rose as much as 26 percent a year in the period, while workers gained 20 percent annual increases in basic pay in settling a five-month strike at Anglo American Platinum (Amplats), Implats and Lonmin in 2014.
Implats would reduce the number of shafts at the Rustenburg complex, the world’s largest platinum mine, from 14 to nine even as it planned to raise the operation’s output and open two new shafts, chief executive Terence Goodlace said in February.
“Instead of having fewer people in many shafts, we have more people concentrated in the new shafts,” Goodlace said.
Implats was already transferring some mining teams from the older shafts to new working areas, Johan Theron, a spokesman for Impala, said yesterday.
Lonmin named its Hossy-shaft as a long-life operation where it seeks to improve unit costs, while another five shafts were considered “old-depleting shafts”, according to a presentation posted on its website in April.
Sue Vey, a spokeswoman, did not immediately respond to a text message.
Amplats is selling three mines that were consolidated from five in 2013 after announcing as many as 14 000 job cuts. In the end, it reduced the number to 474 by finding vacancies elsewhere in the group and offering voluntary severance packages. – Bloomberg