As record gold prices embolden more so-called zama zamas to try their luck, SA’s gold mining heavyweights are fighting an expensive underground war to protect their ageing assets.
Harmony Gold, the country’s largest gold producer by volume, reported a striking surge in illegal mining activities in its latest annual results, with 1,451 arrests taking place at its non-operating shafts alone — nearly a 10-fold jump from the year before and more than the combined number of illegal mining arrests at the group’s operations over the previous six years.
The uptick was attributed to Operation Vala Umgodi, a controversial police-run anti-illegal mining programme launched in 2023, which came under international scrutiny this year after it blocked food and essential supplies from being sent down Stilfontein’s Buffelsfontein shaft, contributing to the deaths of 72 illegal miners.
While Harmony did not own the infamous mine shaft, several illegal miners involved in the Stilfontein saga used the group’s nearby Margaret Shaft as an escape route after traversing for kilometres underground to escape authorities.
According to Harmony, Vala Umgodi resulted in 2,603 arrests overall in the year to end-June, 2,109 of which were illegal immigrants.
“There were 741 registered criminal cases [in financial year 2025]. Key confiscations included gold processing equipment, gold-bearing material, firearms, vehicles and money,” the company said.
Soaring bullion prices have seen most of SA’s gold majors complain of escalating security costs and an onslaught of theft.
Pan African Resources told Business Day in August that it had arrested about 4,000 illegal miners at its underground operations in Mpumalanga over the past year. Sibanye Stillwater said in April that it had witnessed its highest number of illegal mining incidents in more than a decade, with 1,487 arrests recorded at its SA gold operations last year.
Harmony’s business, which primarily hinges on extending the lifespan of old, legacy gold mines in SA, makes the group particularly vulnerable to illegal mining activities, which often escalate towards the end of a mine’s life.
Mine closures inevitably lead to deep job losses and without proper security and rehabilitation abandoned mines have become targets as former employees resort to illegal mining to keep food on the table. Criminal syndicates are also exploiting the situation.
“Illegal mining leads to loss of revenue and increased costs to legitimate miners and governments,” Harmony said, adding that “links to criminal networks increase theft of explosives, diesel, copper cables and other mining equipment, undermining state authority and the rule of law”.
A 2021 report by the auditor-general estimated that about 6,000 mines remained abandoned or derelict across the country. Meanwhile, the department of mineral resources & petroleum has estimated that the illicit precious metal trade cost SA’s economy R60bn last year.
Policy crossroads
The growing toll that precious metal smuggling takes on the domestic economy puts local policymakers at a critical juncture. They must weigh up the need for pro-poor artisanal and small-scale mining policy against the need to crack down on rampant criminality and lawlessness.
The latest PwC review of the local mining sector called for illegal mining to be treated as a national priority, with the consultancy warning that “zama zama-ism” is deepening the country’s perceived operating risk and that of its African peers, perpetuating the valuation gap between African mining companies and their competitors.
However, much to the formal industry’s chagrin, so-called illegal mining is not, in its own right, illegal. Rather, zama zamas are being charged with trespassing, breaking and entering, the unauthorised possession of gold-bearing material and other adjacent offences.
In the words of Sibanye Stillwater, these are “not a significant disincentive”, leading to growing industry concerns about the state’s ability or willingness to protect local mining companies.
At the same time, after publishing its ASM policy in 2022, the state has doubled down on its proposal to formalise previously informal ASM operations this year in its draft Mineral Resources Development Bill.
In theory, the formalisation of artisanal and small-scale mining is a valiant attempt to open up SA’s mineral wealth to the country’s most vulnerable citizens, creating a new avenue for inclusive economic growth. Regulations formalising the artisanal and small-scale mining industry have enabled governments in Ghana and Kenya to crack down on illegal mining and collect more tax revenue.
However, lingering concerns about the state’s narrow definition of illegal mining and inability to combat it make such heady aspirations look premature.
“Although the SA government has committed to legalising artisanal mining, this is not viable without addressing illicit gold trading, corruption and territorial battles,” Harmony said.
The company spent R70m more on security than it did in the previous financial year, and with most of the illegal mining incidents occurring at idle shafts, much of the group’s R713m security bill went towards sealing “redundant” mines and rehabilitating decommissioned infrastructure.
The miner has demolished or sealed 48 shafts since 2008.
Illegal miners and syndicate leaders have, in some instances, intensified their use of complicit employees to gain access to the underground workings and compromise access controls.
At some point, Sibanye uncovered a modus operandi in which some of its employees cloned their fingerprints through latex moulds and gave their clock cards to illegal miners.
Outside of gold, local trade regulators have sounded alarm bells about SA’s booming black market for chrome, with recent estimates suggesting that 10% of the country’s annual chrome ore output is mined illegally.
Trade, industry and competition minister Parks Tau announced earlier this month that chrome ore would be placed under export control by the International Trade Administration Commission so that only credible players would be allowed to export chrome out of the country.
