Kumba Iron Ore says it will be closing its Limpopo Thabazimbi mine and has started a retrenchment process.
The coal miner, a business unit of the Anglo American group, says its decision “follows an extensive review of the Thabazimbi mine and is in response to a combination of factors that have affected the mine’s economic viability”.
Kumba explains these factors include that the mine is more than 80 years old and has, over the past 15 years, had its closure postponed 6 times through a number of mine life extension plans.
In addition, says Kumba, it faces difficult mining conditions due to the inherent geo-technical complexities, which are now exacerbated by a limited remaining iron ore resource.
The mine also has very high operating costs because of high waste stripping requirements and experienced a slope failure on 6 June 2015, which has rendered the iron ore resources in the one remaining pit uneconomic to mine.
Closing the mine will affect about 800 employees and 360 contractors, with whom Kumba is conducting extensive consultations.
Kumba CEO Norman Mbazima, CEO of Kumba Iron Ore, says: "These are challenging times for the iron ore industry and difficult times for our employees and the mine’s contractors.
“ We are however taking the steps necessary to ensure we have a viable and resilient business for the long term. Closing a mine is a difficult and painful process and its impact cannot be taken lightly.
“We have looked at all options to further sustain the mine, having already extended its life several times in recent years, and have come to the inevitable conclusion that this mine has now come to the end of its life."
Mbazima adds Kumba is committed to supporting all its employees and treating them with care and respect through this difficult process, “mindful of the sensitivity the situation demands”.
Kumba adds it will take employees, the environment, Thabazimbi town and its community into consideration throughout the process.
IOL