Lily mine hopes meet­ing with IDC will stop it sink­ing

CityPress - - Business - SIZWE SAMA YENDE sizwe.yende@city­

Van­tage Gold­fields is hop­ing that a meet­ing this week with the In­dus­trial De­vel­op­ment Cor­po­ra­tion (IDC) will yield fund­ing to keep the com­pany in busi­ness and save more than 900 jobs at its trou­bled Lily gold mine in Mpumalanga.

Mandla Mpan­gase, spokesper­son for the de­vel­op­ment cor­po­ra­tion, con­firmed this week that Van­tage Gold­fields had ap­plied for R250 mil­lion in fund­ing. The IDC was still as­sess­ing the ap­pli­ca­tion, he added.

This fol­lows a costly, failed ex­er­cise to re­trieve the bod­ies of three trapped mine work­ers. The sus­pen­sion of op­er­a­tions has left the min­ing com­pany in dire straits and in need of a bailout.

Van­tage Gold­fields has hired busi­ness-res­cue prac­ti­tioner Rob Dev­ereux to save the mine in Louisville, out­side Bar­ber­ton, from fi­nan­cial ruin that threat­ens clo­sure and job losses.

If the com­pany had not re­sorted to vol­un­tary busi­ness res­cue, it would have faced cer­tain liq­ui­da­tion and been li­able to law­suits from cred­i­tors.

The com­pany failed to pay work­ers their salaries on April 25 be­cause of its fi­nan­cial trou­bles.

Min­eral Re­sources Min­is­ter Mosebenzi Zwane in­structed Lily gold mine man­age­ment to sus­pend op­er­a­tions af­ter a steel con­tainer of­fice with the three un­for­tu­nate work­ers in­side it was pulled into a sink­hole on Fe­bru­ary 4.

The bod­ies of Pretty Nkam­bule, Yvonne Mnisi and Solomon Ny­erende are still trapped un­der­ground af­ter the fail­ure of var­i­ous res­cue op­er­a­tions.

The 76 work­ers who were in­side a tun­nel were res­cued, but gold ex­trac­tion could not con­tinue be­cause the sink­hole hap­pened right at the en­trance to the mine’s shaft.

Ge­o­log­i­cal ex­perts who were sub­se­quently called in warned that it was dan­ger­ous for the res­cue teams to con­tinue try­ing to find the con­tainer and the three work­ers.

Dev­ereux said that Lily gold mine em­ployed 900 work­ers, with a salary bill of R10 mil­lion a month.

“The pil­lar stone of the busi­ness-res­cue process is to save jobs and, as you know, each worker sup­ports about 10 de­pen­dants in the com­mu­nity. We are seek­ing fund­ing from var­i­ous peo­ple and are work­ing out a plan to pay our cred­i­tors,” said Dev­ereux.

He added that the mine had so far al­most man­aged to keep up to date with pay­ing salaries, even though it had not been op­er­at­ing since Fe­bru­ary.

The com­pany’s plan, said Dev­ereux, was to de­ploy some of the work­ers to its Bar­brook gold mine and reskill others while the Lily mine re­mained closed.

Dev­ereux said that part of the bailout would be used to fund the drilling of a new open­ing to re­trieve the con­tainer.

The com­pany – in con­sul­ta­tion with the fam­i­lies of the trapped work­ers, the depart­ment of min­eral re­sources and the As­so­ci­a­tion of Minework­ers and Con­struc­tion Union (Amcu) – agreed on the new shaft as the cheap­est and safest op­tion.

Dev­ereux said that the failed res­cue and re­cov­ery mis­sions to reach the con­tainer of­fice had cost Van­tage Gold­fields “tens of mil­lions of rands”.

Al­though he was re­luc­tant to re­lease ex­act fig­ures, Amcu in­di­cated that they were told drilling a new open­ing would cost R70 mil­lion and take six months, as op­posed to re­mov­ing the soil on top of where the con­tainer is be­lieved to be.

The se­cond op­tion could cost R500 mil­lion and take two years to com­plete, said Amcu’s branch sec­re­tary, Abed­nego Magongo.

There are also min­ing ma­chines un­der­ground that need to be re­trieved and ser­viced.

“As work­ers, we are hop­ing that the funds will come and we will be paid our salaries this month.

“When we met the [busi­ness-res­cue] prac­ti­tioner on April 21, he said he was look­ing for funds and we might be paid on April 29,” said Magongo.

“The prac­ti­tioner has promised us that he is look­ing for short-term funds to pay salaries, and, in the long term, to get the money to find the con­tainer,” he added.

Van­tage Gold­fields has thus far failed to pay R4.4 mil­lion in com­pen­sa­tion that it promised to the three be­reaved fam­i­lies and the sur­viv­ing work­ers in Fe­bru­ary.

Com­pany chief ex­ec­u­tive Mike McCh­es­ney and Zwane an­nounced that each sur­viv­ing worker would get R50 000, while rel­a­tives of Nkam­bule, Mnisi and Ny­erenda would pocket R200 000 each.

“The mine said the com­pen­sa­tion would come from the funds they are sourc­ing,” said Magongo.

Trade union Sol­i­dar­ity this month said that the main pri­or­ity of Lily mine’s busi­ness-res­cue prac­ti­tion­ers and man­age­ment should be to find the bod­ies of the three miss­ing min­ers, but it was as im­por­tant to pro­vide job se­cu­rity to the hun­dreds of min­ers who stood to lose their jobs if an al­ter­na­tive stream of rev­enue or fi­nanc­ing could not be found.

Sol­i­dar­ity gen­eral sec­re­tary Gideon du Plessis said the con­se­quences of the min­ing ac­ci­dent would be even more tragic if the 900 work­ers, each with an av­er­age of six to 10 de­pen­dants, were plunged into poverty due to lay­offs.


A scene show­ing the col­lapsed area, the ex­tent of the dam­age caused by the sink­hole and the res­cue op­er­a­tions re­quired at Lily gold mine in Bar­ber­ton

Newspapers in English

Newspapers from South Africa

© PressReader. All rights reserved.