RIO TINTO yesterday declared force majeure on customer contracts at Richards Bay Minerals (RBM) in KwaZulu-Natal and halted operations a month after the assassination of its general manager of operations, Nico Swart.
Rio Tinto said it decided to halt operations at the mine because of the escalation of violence.
The group said operations would remain suspended until the safety and security position improved.
Chief executive for minerals Sinead Kaufman said: “The safety of our people is our top priority. We continue to offer our full support to the investigating authorities, and I would like to acknowledge the ongoing support of the regional and national governments and SAPS as we work together to ensure that we can safely resume operations.”
Kaufman said all mining and smelting operations at RBM would be halted until further notice.
He said the Zulti South project also remained on full suspension since the security and community issues arose in 2019.
RMB managing director Werner Duvenhage said criminals had disrupted
the business in the past few weeks, placing people at risk and resulting in the theft and destruction of property.
“While we work hard to make a lasting positive contribution to the areas in which we operate, the safety of our employees, contractors and communities remains our topmost priority and, therefore, we have taken the difficult decision to cease all activities at our operation,” Duvenhage said.
Swart was killed in cold blood last month on his way to work. Reports alleged that his vehicle was hit by more than 20 large calibre bullets.
Following Swart’s death, tensions escalated when community members burned mine equipment. The reasons for the community’s feud with the mine include a local traditional leadership squabble and demands for community members to be employed at the mine.
Duvenhage said although Rio Tinto and RBM would endeavour to reduce the impact of the force majeure declaration on their global customers, there was recognition that much of this could be managed only through the continued assistance of external stakeholders and partners.
“RBM is focused on restoring safe operations as soon as possible, and is engaging with all relevant stakeholders in that regard,” Duvenhage said.
Last year, RBM’s direct economic contribution to the country was R8 billion, including salaries and wages for more than 5 000 employees, and mining royalties and taxes paid to local and national governments, which helped to provide essential services and critical infrastructure, such as roads, bridges, hospitals and schools.
RMB said in this same year, as part of its social and labour plans, local communities benefited from projects valued at more than R43 million.
“In addition, RBM procured goods and services to the value of R5.5bn in 2020, of which R1.5bn was spent on local municipal businesses and over R500m in its communities, expanding business opportunities, bolstering economic development, and helping local communities become more resilient and self-reliant over the longer term,” said RMB.
The Minerals Council South Africa said it condemned in the strongest possible terms the ongoing acts of violence, criminal activity, serious threats to security and failures by law enforcement agencies to perform their constitutional mandate to uphold the rule of law and order, which were affecting mining companies with operations in the Richards Bay area and elsewhere.
BUSINESS REPORT