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Johannesburg - Sibanye Gold advised on Thursday that it will enter into consultation with relevant stakeholders in terms of section 189A of the Labour Relations Act regarding the restructuring of its gold operations pursuant to ongoing losses experienced at its Beatrix West and Cooke Operations. 

Sibanye said approximately 7,400 Sibanye employees at all levels may be affected as a result of the proposed restructuring. 

The initiation of S189 consultations comes after numerous unsuccessful attempts to contain losses at these operations in the Free State province and Westonaria, west of Johannesburg. 

Sibanye said losses experienced at these operations negatively affect group cash flow as well as the sustainability and economic viability of other operations in the Southern Africa region, in this way, posing a threat to more sustainable employment across the region.

Since listing in 2013, Sibanye has steadily grown as an employer, from 37,700 employees four years ago, to becoming one of the largest employers in the South African mining industry with 58,000 permanent employees.

Through the Section 189A consultations, Sibanye and affected stakeholders will consider alternatives to potential closure of the operations in an attempt to avoid or reduce retrenchments.

Sibanye chief executive, Neal Froneman, said the decision to commence with this restructuring process had not been taken lightly. 

"The long-term sustainability of the group as a whole is our primary focus and is necessary if we are to continue to deliver superior value to all of our stakeholders," Froneman said.

"The losses experienced at the Beatrix West and Cooke operations threaten the future of other group operations and the employment of many other South Africans. We are however aware of the difficult socio- economic environment in South Africa, and will engage with all relevant stakeholders in an effort to minimise job losses, while ensuring that additional jobs are not placed at risk in future."

Read also: Sibanye records record profit

The South African mining industry continues to be under significant economic and financial pressure. Between 2014 and 2016, the industry made an accumulative net loss of around R50 billion on the back of increasing cost pressures such as the steep increase in the price of electricity, increased labour costs and the increased cost of materials such as steel.

As a result, mining companies have been compelled to restructure to ensure their survival. Between 2012 and 2016, the industry lost around 70,000 jobs as it struggled to remain viable. 

Just last week, Bokoni Platinum in Limpopo announced that it would shut down operations for two years and retrench 2,651 workers in a bid to to achieve profitability by restructuring the mine through shaft closures and other measures.

AFRICAN NEWS AGENCY