Mining industry ‘bloodbath’ continues

Amplats to cut 1 000 jobs, with 47 000 already lost in troubled sector over three years

ANGLO American Platinum (Amplats) will cut 1 000 jobs at its struggling Twickenham mine in Limpopo, it said yesterday. But chief executive Chris Griffith ruled out selling the mine, which is losing money.

The announcement was made as Chamber of Mines chief executive Roger Baxter said the domestic mining sector had cut 47 000 jobs between 2012 and early last year as the industry grappled with soaring costs and low commodity prices.

On top of that, Mineral Resources Minister Mosebenzi Zwane said recently that a further 32 000 jobs were under threat, and the industry was working closely with the government and labour to minimise job losses.

Reacting to the Amplats’ announcement, the National Union of Mineworkers (NUM) said it would oppose the cuts.

“We are worried about the jobs bloodbath in the South African mining industry,” NUM spokesman Livhuwani Mammburu said.

“Are mining companies here to create jobs or are they here to cut jobs?

“It looks like the companies are here to cut jobs and focus on profits.”

Earlier yesterday, Amplats reported an 86% drop in fullyear profit hit by write-downs and restructuring costs amid plunging commodity prices.

Amplats, a unit of global mining group Anglo American, is changing its strategy to concentrate on newer and more mechanised mines and removing unprofitable ones following a record five-month strike in 2014 that damaged viability.

Platinum prices have been battered by growth concerns in China and oversupply worries, forcing companies to abandon projects and sell mines to cope.

Griffith said on the sidelines of a mining conference in Cape Town that the job losses were “unfortunately one of the outcomes of putting a project like that [Twickenham] on care and maintenance”.

Amplats said last year that its mechanisation drive would be implemented at Twickenham, a mine project it has been developing as it prepares to shed labour-intensive assets.

Griffith said the company had ruled out selling Twickenham and would consider restarting the project when the market improved.

It was not immediately clear exactly how many people work at the mine, or when the job cuts would take effect.

Griffith said about 1 000 jobs would be affected.

Amplats had started a consultation process with unions.

At yesterday’s conference, Baxter said the gold industry, followed by platinum and coal, had cut the bulk of the 47 000 jobs lost in recent years.

Mining costs had increased by an average 20% a year for the past five years, he said, and electricity was the core component in those increases.