Johannesburg - Sibanye Gold will be entering into a consultation process over possible retrenchments at its Cooke 4 underground mine and Ezulwini Gold and Uranium processing plant.
The dual-listed company, SA’s biggest producer of the yellow metal, says it will be in talks with organised labour and stakeholders over “continued operational underperformance and accumulating financial losses” at the operation. It did not indicate how many jobs may be affected.
Sibanye, which has been on an acquisitive drive, bought the operation from Gold One in May 2014 to benefit from the “significant uranium and gold mineral resources and reserves contained in the Cooke surface tailings facilities”.
It acquired Gold One’s Cooke operations in exchange for shares amounting to 17 percent and anticipated the surface tailings facilities forming a critical component of Sibanye’s West Rand Tailings Retreatment Project.
In a statement issued on Monday, it said, along with these surface resources, Sibanye acquired four operating underground mines and two processing plants, which included the Cooke 4 assets.
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“In September 2014, due to historical operational underperformance, Sibanye entered into a period of consultation with relevant stakeholders which, in November 2014, resulted in the stakeholders agreeing to implement specific measures to return the operation to profitability and thereby minimise job losses.
“Despite intense monitoring and interventions by a joint management and labour committee over the last 17 months since the previous Section 189 consultation was concluded, the Cooke 4 Operations have continued to fall short of production targets and losses have continued to accumulate,” it says.
“It is unfortunate that, despite the joint efforts of stakeholders, the Cooke 4 Operations have been unable to meet required production and cost targets and has continued to operate at a loss. Ongoing financial losses threaten the viability of the rest of the Cooke operations and we have regrettably had to give notice to affected stakeholders and begin the consultation process,” says Wayne Robinson, CEO of Sibanye’s Gold Division.
“We remain positive about the future of the Cooke 1, 2 and 3 mines and the outlook for the WRTRP project is extremely promising”, Robinson adds.
The Cooke operation, in Randfontein on Johannesburg’s West Rand, was first established as the Western Areas Gold mine in 1961. Current Mineral Reserves are estimated to sustain the operation until 2023.
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