Lily Gold Mine in Barberton. PHOTO: Supplied/Vantage Goldfields website
JOHANNESBURG – Rob Devereux, the business rescue practitioner of the Lily and Barbrook mines, is considering placing the mines under liquidation, charging that the new mine owners have failed to produce proof of funds that have been required to resume the operations.

Devereux is alleging Flaming Silver Trading cannot prove its financial muscle three years after Lily mineworkers Pretty Nkambule, Yvonne Mnisi and Solomon Nyirenda were buried in an underground container when the mine entrance collapsed.

Black-owned Flaming Silver, a subsidiary of Siyakhula Sonke Empowerment Corporation (SSC), acquired the mines from Australia’s Vantage Goldfields, which placed it in business rescue - resulting in about 1000 workers losing their jobs.

“We have written to Vantage because we want confirmation that SSC has funding in place and Section 11 approval has been granted by the regulators.

“We have neither seen the Section 11 approval nor funding, and we have asked for proof on numerous occasions,” Devereux said.

The Department of Mineral Resources awarded Section 11 approval transferring the ownership of Lily to Flaming Silver from Vantage last month.

Fred Arendse, SSC chief executive, blamed Devereux for leading a campaign to undermine the company, saying allegations that Flaming Silver failed to prove it had acquired funds were false.

“People are not happy that we have achieved such a huge milestone of controlling the 52-year-old Vantage (mine) and are trying to frustrate our progress.

“We need to focus on getting the mines back online,” said Arendse.

Arendse also said SSC had adjusted its schedule for reopening from February to a later date, citing that the Section 11 approval was only awarded a few weeks ago.

“Our plan to reopen the mines will be made public in due course,” he said.

Zama Luthuli, a spokesperson for the Industrial Development Corporation (IDC), said the awarding of Section 11 was one of the pre-conditions to provide R190million loan funding to Flaming Silver and cleared just one of the many hurdles in the process.

“On meeting all conditions precedent to this transaction, IDC intends to honour its commitment to Flaming Silver,” Luthuli said.

The relationship between Flaming Silver and Devereux has broken down, with Arendse blaming him for being responsible for a number of breaches of corporate governance and compliance and was approaching the court for his removal.

“We no longer recognise Mr Devereux as the legitimate business rescue practitioner,” adding that Devereux had deliberately frustrated the mine’s takeover by SSC.

He also charged Devereux had failed to timeously disclose significant tailings storage facilities (TSF) mineral assets of the company to SSC and the IDC with an estimated value of R500million over three years.

BUSINESS REPORT