Johannesburg - Trade union Solidarity has hit out at Canadian miner AfroCan Resources Gold for allegedly reneging on an investment in Lily Mine that would see miners finally get paid.
In a strongly-worded statement issued on Monday, the union alleged the Vancouver-based company has not paid an agreed upon $2.5 million as part of a $11 million investment to the mine by the June 30 deadline.
The union also alleges that AfroCan CEO Brian Barret has let many similar transactions run aground.
AfroCan was not immediately available to respond to the allegations, as it is the middle of the night in Vancouver.
Lily Mine was placed under business rescue, putting 900 jobs are on the line, after a cage housing collapsed in February. It has yet to recover three bodies trapped underground, but had agreed to sink a 500 metre decline shaft in a latest bid to get to the container in which the mineworkers are trapped.
In May, AfroCan and Vantage - which owns Lily Mine - announced that the companies agreed that AfroCan would invest $11 million over two months into Vantage, which owns the Lily and Barbrook Mines in the Barberton Goldfield.
In a statement, the companies said a portion of AfroCan’s investment will be allocated to reopening of the Lily Mine, while the balance will be used to expand production at Barbrook Mine.
The Lily Mine will benefit significantly as a result of this investment by AfroCan, and “can now proceed to secure additional post commencement funding ensuring that the mine can be back in production as soon as practically possible. The reopening of the mine is expected to take place in 6 to 8 months.”
However, Solidarity alleges the promises never materialised.
Read also: Cosatu slams Lily Mine, state over trapped workers
“Two weeks ago, Barret addressed the Solidarity, Amcu and the Lily Mine leadership at the Nelspruit Head Office of Vantage Goldfields, making all kinds of promises and creating many expectations, none of which materialised,” Gideon du Plessis, the union’s General Secretary, says.
“Based on Barret’s “investment” and promises a large number of workers had entered into agreements with their creditors to the effect that they would be able to settle some of their debt this week. The outcome is that even more workers would now be facing sequestration,” Du Plessis adds.
Read also: Eerie silence of despair at Lily Mine
“As representatives of the workers, Solidarity and Amcu will not let the matter rest ... this fraudulent transaction now means that negotiations with other investors, who had shown an interest previously, would have to start afresh – thus delaying the process to find a reputable investor by months,” Du Plessis adds.
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