Gold and platinum miner Sibanye-Stillwater may cut as many as 6,670 jobs as rising labour and electricity costs and a flat gold price mean efforts to make five shafts profitable have failed.
Sibanye, which has been hit by a three-month strike at its gold operations, said the restructuring was not directly related to the work stoppage by the Association of Mineworkers and Construction Union (Amcu).
The union downed tools on November 21 to demand a wage increase of R1,000 a month.
The proposed job cuts, which Sibanye said it hoped to
avoid through constructive engagement with stakeholders, would add to 7,000 job cuts it made in 2017, when it shut its unprofitable Cooke mines west of Johannesburg.
Employment in SA’s gold sector dived to 112,000 in 2018, from nearly 400,000 jobs in 1994, as production plunged from 583 tons over the same period to 138 tons.
The Minerals Council SA has warned that the country’s gold output could fall to just 20 tons and a single mine from the 21 held by listed companies if Eskom is allowed to hike its electricity prices 15% per annum over the next three years.
Eskom has since increased the hikes it requested.
Tariff increases since 2006 had resulted in a 523% increase in electricity prices for mining companies, resulting directly
in the loss of 18,300 jobs, the council said.
Affected shafts
Sibanye spokesperson James Wellsted said that there had been monthly engagements with the unions about the five loss-making shafts, "so it’s not new and not directly as a result of the strike".
The affected shafts are Beatrix 1 in the Free State and numbers 2, 6, 7 and 8 at Driefontein. There are 5,870 employees at the mines and a further 800 contractors. However, the Amcu strike "has meant that we’ve not had the unions coming forward to suggest ways to resolve the problems the way they did at Beatrix a few years ago," Wellsted said.
Sibanye had twice saved its Beatrix 4 shaft by talking to unions and finding ways to keep the mine profitable, CEO Neal Froneman said.
"Our best attempts to address the ongoing losses at these operations have, however, been unsuccessful and sustaining these losses may threaten the viability of our other operations," Froneman said.
"We hope to engage constructively with our stakeholders to find ways to minimise and avoid job losses during this process, while ensuring that additional jobs are not placed at risk in future."
Sibanye had warned in June 2018, at the start of wage talks with four unions, that thousands of jobs could be lost if there was an unfavourable wage settlement, said Solidarity general secretary Gideon du Plessis.
Improvement
Meanwhile, Sibanye said on Thursday its full-year loss would narrow to R1bn for the 12 months to end-December, from R4.4bn a year earlier.
The improvement is thanks to stronger prices for its platinum group metals that were offset by losses at the gold operations. There were also large impairments against the discontinued Cooke mines and assets at Beatrix during 2017 that would not be repeated in 2018’s numbers.
Sibanye will report full-year results on February 21 when Froneman will elaborate on the effect of the strike on the
gold business.
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