JOHANNESBURG - The minerals Council is exploring measures to prevent the South African lockdown leading to permanent damage to the mining industry.
President Cyril Ramaphosa announced a 21-day national lockdown from midnight tomorrow to prevent further transmission of Covid-19 as confirmed cases spiked to 554 yesterday.
The council said yesterday that it was engaging with senior government leadership over the details of the lockdown, including the nature of essential services and what would be required for placing mines on care and maintenance for non-operating facilities.
“There are marginal and loss-making mines that would likely be unable to reopen should they be required to close fully, without remedial measures,” the council said.
Ramaphosa said all of South Africa's mining operations were required to be placed on care and maintenance as he announced a broad range of measures to be taken to mitigate the impact of the lockdown on South Africa's economy.
Harmony Gold Mining Company said Covid-19 would impact its bottom line and its board, executive and management were at work on detailed arrangements to manage the effects of the lockdown on the business and would disclose the details by tomorrow.
Harmony chief executive Peter Steenkamp cautioned shareholders that the Covid-19 directive would have a negative impact on the company’s annual production guidance of 1.4million ounces and on the company’s 2020 earnings.
“This is an unprecedented time in the history of the mining industry and our country.
"The health and safety of all South Africans must take precedence and as such we are committed to making decisions that will ensure the continued viability of our company,” said Steenkamp.
Diversified global mining company Anglo American said it would prioritise the health and safety of its employees, and communities.
“We are, therefore, also working together with the government of South Africa to ensure the continuity of our business where appropriate in order to minimise any unintended consequences of the announced lockdown,” said the group.
AngloGold Ashanti said it would temporarily suspend production from its South African operations by placing mines on care and maintenance for the three-week duration of the lockdown.
“Plans will be developed to help safely regain production delayed by this shutdown, where possible,” said the company.
AngloGold sold its remaining South African assets, including the Mponeng mine, to Harmony Gold and the transaction was expected to close in June.
The Minister of Mineral Resources and Energy Gwede Mantashe said the department, working with both the petroleum and mining industries, was developing a framework of practical steps to execute the national call for a lockdown.
“The primary objective remains that of protecting the lives of people working in these industries - while ensuring that critical sectors of the economy are able to continue with essential service - and to put in place plans to ensure that beyond the lockdown, they are able to quickly restart production to support the economy,” said the department.