Amplats considers shutting down mines

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OrbitalDawn

Ulysses Everett McGill
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http://www.bdlive.co.za/business/mining/2014/03/31/amplats-considers-shutting-down-mines

ANALYSTS warn of the "disastrous" effect on jobs and economic growth if Anglo American Platinum (Amplats) closes its Rustenburg and Union mines.

Amplats is asking itself at what point it would have to close the mines because of a 10-week strike that will render them unprofitable this year.

Amplats, Impala Platinum (Implats) and Lonmin, the world’s three largest suppliers of platinum, have shut their Rustenburg operations since January 23.

About 70,000 Association of Mineworkers and Construction Union (Amcu) members are striking for a basic wage of R12,500 a month for entry-level workers, a more than doubling of salaries, which the companies say would destroy the industry.

Amplats, the largest platinum miner in the world, restructured its Rustenburg mines last year, closing two of them and cutting 7,500 jobs to restore profit.

"We think that we had a profitable solution for Rustenburg but it was borderline," Amplats CEO Chris Griffith said last week. "Now … a third of the year’s production is gone … Rustenburg cannot make a profit this year."

He said if the strike continued for another month or two, the Rustenburg mines would have "no chance" of being profitable in the next two years. "The longer this continues … we’ve got to ask ourselves: ‘At what point in time do we have to shut down Rustenburg?’

"That is a conversation we are having internally, we are looking at different scenarios to say ‘When do we shut down Rustenburg?’ The same goes for Union mine ."

Independent labour consultant Tony Healy said employers could shut down more shafts if they felt employment costs rendered the business unviable. "The effect will be massive on jobs and on Amcu because not only have they not gained the increase … it will have resulted in mines being closed, jobs being lost ."

Efficient Group chief economist Dawie Roodt said the platinum price could "shoot up, the rand will take a knock and economic growth will be affected" if Amplats shut more shafts.

Investment Solutions chief strategist Chris Hart said even if the strike were to end, the shafts that had already been closed were unlikely to come back into operation. "It will be very costly to do so and the industry is facing a period where it is starved of capital."

Mr Griffith said the strikes were undermining Rustenburg’s viability, and management had started to talk about job cuts at the strike-affected mines, which contribute 40% of Amplats’ output. "While the strike continues there’s certainly a very real likelihood we will enter section 189 conversations with labour ."

Companies considering job cuts have to issue section 189 notices under labour law.

"If this isn’t solved in the near term we will have no choice but to start looking at those options," Mr Griffith said. "The first ones we are looking at as we speak are Union and Rustenburg.

"If it continues for longer, then we’ll look at Dishaba and Tumela ."

Dishaba and Tumela are two mines near Thabazimbi in Limpopo.

"Ultimately, the final solution for the mining industry must be more mechanised, productive work," Mr Griffith said. Implats said this week it was looking at mechanising its mines.

"For us to settle at Amcu’s demands we might just as well shut down Rustenburg and Union now. Giving that settlement, getting everyone back and then having to shut the mines down is lying to people," Mr Griffith said.
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Shut the mines down, all of them and make the reasons clear
Teach the country a lesson
The mob will probably kill the union bosses for loosing them their jobs
Unions lose support, ANC loose the unions
Economy starts to pick up as labor becomes easier to control by employers

I like the sound of that :D
 
Yeah, or give them to Malema, he's an expert in running mines.

Years of experience. :whistle:
 
Yeah, teach them a lesson. Seriously? Much as these varmints and critters need their rumpus kicked, the economy cannot afford it in any shape or form. There are countless thousands in and around Rustenburg who earn their living indirectly from the mines. And many of these scumbags come from the Eastern Cape.

So in the process of teaching these swines a lesson the economy in Rustenburg and the EC both go belly up, as well as the economy nationally. This includes the current account and the currency.
Platinum mines were already teetering on the edge before this strike. This strike could be the straw that breaks the camels back.

If platinum cannot be sourced here, another mine will step in elsewhere in the world and take that market share away from us.

Damn good thing you're not at the helm of the ship!
 
Give me a miners salary and ill live with it, it might not be the best life but it least I wont be starving, jobless or homeless.


These people need a fking clue on how they are shooting themselves in there foot.
 
Close and fire everyone, even the exects. Come back in 6 years and mechanised, with the price of platinum soaring. Rehire exects.

GG.
 
McT said:
Yeah, teach them a lesson. Seriously? Much as these varmints and critters need their rumpus kicked, the economy cannot afford it in any shape or form. There are countless thousands in and around Rustenburg who earn their living indirectly from the mines. And many of these scumbags come from the Eastern Cape.

So in the process of teaching these swines a lesson the economy in Rustenburg and the EC both go belly up, as well as the economy nationally. This includes the current account and the currency.
Platinum mines were already teetering on the edge before this strike. This strike could be the straw that breaks the camels back.

If platinum cannot be sourced here, another mine will step in elsewhere in the world and take that market share away from us.

Damn good thing you're not at the helm of the ship!
Click to expand...

Neither is it a good thing that unions are [-]running[/-]ruining this country. What's your solution for this problem then?
 
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This is going to hurt in so many ways and its going to take years to recover from this. With that said, it might just be the wakeup call our 'organised' labour and government needs.

But then again, who cares, there is 6 million jobs in the making.....
 
McT said:
Yeah, teach them a lesson. Seriously? Much as these varmints and critters need their rumpus kicked, the economy cannot afford it in any shape or form. There are countless thousands in and around Rustenburg who earn their living indirectly from the mines. And many of these scumbags come from the Eastern Cape.

So in the process of teaching these swines a lesson the economy in Rustenburg and the EC both go belly up, as well as the economy nationally. This includes the current account and the currency.
Platinum mines were already teetering on the edge before this strike. This strike could be the straw that breaks the camels back.

If platinum cannot be sourced here, another mine will step in elsewhere in the world and take that market share away from us.

Damn good thing you're not at the helm of the ship!
Click to expand...

We'll probably need to experience some pain before things get better, the rand, current account, in general everything will probably go belly up, only after this the blind masses will hopefully see whose to blame (apart from themselves) and actually make an active contribution to society by
1) Stopping support for the unions
2) Take their anger out on the existing government
3) Appreciating the value of the Rand and labor

I'd think after the unions loose their power and SA has received a dose of chemo for the cANCer, the economy will grow at its full potential and life will slowly become better for the masses, this is over quite a few years though, minimum of 10 I'd say?
 
McT said:
Yeah, teach them a lesson. Seriously? Much as these varmints and critters need their rumpus kicked, the economy cannot afford it in any shape or form. There are countless thousands in and around Rustenburg who earn their living indirectly from the mines. And many of these scumbags come from the Eastern Cape.

So in the process of teaching these swines a lesson the economy in Rustenburg and the EC both go belly up, as well as the economy nationally. This includes the current account and the currency.
Platinum mines were already teetering on the edge before this strike. This strike could be the straw that breaks the camels back.

If platinum cannot be sourced here, another mine will step in elsewhere in the world and take that market share away from us.

Damn good thing you're not at the helm of the ship!
Click to expand...

It doesn't matter if the miners come back to work tomorrow; the damage is done. The mining companies have already written off the SA labour force as unreliable, which leaves mechanisation as the only option. Yes, it was going to happen sooner or later, but now it will definitely be sooner; I reckon the bite will be felt before the 2019 elections, and by 2024 elections I forsee millions of unskilled labourers sitting with no jobs.

South Africa's economy is unfortunately a 1-trick pony - far too many depend on the mines for their livelihood, and when that livelihood is gone they will have nothing. The ANC of course, has done nothing to attempt to stave off this inevitable crisis; when it comes I'm sure they'll blame the white man.
 
Another scenario is that the cANCer will buy the mines over for some ridiculous low amount

then safety will go all the way to zero, output will drop and so on...


Bah, humbug. Shut the mines down, people will starve, then they'll practically beg for any sort of job.
 
The_Librarian said:
Bah, humbug. Shut the mines down, people will starve, then they'll practically beg for any sort of job.
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Wrong. They'll come and steal/demand from those of us who are thankful for, and actually do, our jobs.
 
The majority of the respondents in this thread have blinkers on. Shutting down our mines will have disastrous effects on not just the workforce employed by the mines, but with all the other companies that provide services and products to the mines and then to the rest of the companies in tiers below. My company will be hit hard as Amplats is our largest client, with Lonmin and Impala being large contributors to our revenue stream as well. You've got other contractors that perform maintenance on the mines, new installations and provide other supporting services. What about them? They're not part of the problem, yet they'll be negatively affected to. If such a closure happens, you're looking at losing far more than 70 000 jobs, I'd guess somewhere in the region of 150 000 employees will be left without jobs, from the mines and it's supporting companies alone. I hope you guys can sleep well in your deluded smugness that closing down the mines is a good idea and what this country needs (or what it deserves).

The unions need to be dealt with, but closing the mines down is not the way to go. This is a complex problem and a linear solution will not solve it.
 
Im wondering; IF they shut down the mine, will they be able to hold on to the rights indefinitely? Meaning that they still own it, they are just not using it? Just wondering if someone has some clear insight in this.
 
koosbeer said:
Im wondering; IF they shut down the mine, will they be able to hold on to the rights indefinitely? Meaning that they still own it, they are just not using it? Just wondering if someone has some clear insight in this.
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Mining rights are use it or lose it, so if they close down the clock would start ticking and the government will try to pressure them into giving them or not shutting down at all after a while.
 
I think there may be a use it or lose it clause in the Mineral Rights grants...
 
XennoX well said!!!!!! I work for Amandelbult Concentrators so closing down mines doesn't sound very good to me!!!

In any case close down the mines where do you think the people will strike next, how the goverment handles this situation will set forth how future labour disputes can be handled. How it currently is going is not looking good for SOUTH AFRICA not just the mines. All of you voting to close the mines where do you think allot of international investors are investing their money? The problem should be looked at the root cause and that is AMCU. AMCU is promising wage increases to their members that are unrealistic most of the mine employees that work underground doesn't have any clue that these increases are unrealistic they hear an amount and get motivated to strike for it.

The ANC will also not step in to resolve this problem before the elections take place as this could cost them dearly if they declare it an illegal strike.

In my opinion this should be made an illegal stike, fire the employees that doesn't want to work and rehire and train those that actually still want a job
 
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