Esha Vaish London
PETRA Diamonds expected its dispute with local unions over job cuts at its Helam mine in the North West to be resolved before the end of the year, its finance director said.
Petra is facing stiff opposition from the National Union of Mineworkers and Cosatu over its plans to do away with 370 Helam jobs, or roughly 7 percent of its total workforce.
The company, which acquired a 74 percent stake in the mine situated at Swartruggens in 2005, said in July it was mulling options for the mine, including putting its operations under care and maintenance.
The remaining stake is held by Sedibeng Mining.
“Our options with the mine, and we are talking with the unions, would be to either go into care and maintenance or close it,” finance director David Abery told Reuters.
Petra, which has five mines in South Africa and one in Tanzania, earlier this year disposed of its interest in Sedibeng and Star mines – which, together with Helam, made up its Fissure mines portfolio.
“Given that Helam is our smallest operation, it is not going to have a significant effect on the group’s results,” Abery said.
Petra mined 36 287 carats from Helam in the financial year to June, down 50 percent from a year ago and accounting for just over 1 percent of its overall production.
On its books, the London-listed company took impairment charges of $13.9 million (R151.9m) related to the Helam mine review.
Petra said it could pay its maiden dividend earlier than expected after higher prices for the large number of rough stones it unearthed helped it post a 47 percent jump in full-year core earnings.
The producer said growth in carat production would speed up from its next financial year, as this year would be its last of relying on stones mined from mature working areas. Its long-term goal is to raise output to 5 million carats by 2019.
Citi said it expected a higher grade from new areas in 2016 to boost operating margins, with improved volumes and efficiencies reducing costs. – Reuters