Mine boss imagines year without death
| Coming off a year in which seven died in his mines, CEO insists it is possible to keep everyone alive
THE CEO of Anglo American Platinum, Chris Griffith, says his goal is to turn the world’s largest producer of platinum into a company where no miners are killed. Ever.
At its AGM this month he was taken to task by shareholder activist Theo Botha over the deaths of seven miners in 2016.
Griffith insists that zero fatalities is not a pipe dream. Nor is he just trying to tell the politicians what they want to hear.
Fatalities have been falling over the years, he says.
“By improving the technology, the level of skills, the level of commitment by management to zero harm, we’ve been able to drastically reduce fatalities.”
Except that in spite of these “solutions”, they rocketed from two in 2015 to seven last year?
“That was very disappointing,” he says. But it hasn’t shaken his belief that it is possible to mine without fatalities.
Zero fatalities was what former Anglo American boss Cynthia Carroll demanded of Amplats CEO Ralph Havenstein in 2007. Then 12 miners were killed in six months and Havenstein quit.
She appointed Neville Nicolau, who committed to the same goal. In the following six months 10 miners died.
When Nicolau was effectively fired in 2012, Carroll appointed Griffith.
She was under huge pressure from a hostile minister when she declared that there would be zero fatalities. Griffith, along with the entire industry, is under even more pressure.
But he is not just saying this to be politically correct, he insists.
“Fifteen years ago we were having an average 35 fatalities a year. Over the last several years there was a reduction to two in 2015.”
He lists the measures that were taken to bring this about, including anti-collision technology to stop locomotives running into each other, fatigue monitoring to stop people falling asleep on the job, underground netting and bolting to save them from falling rocks, better training and management systems and more mechanisation.
It sounds terribly impressive. In addition, the company has around 60 000 fewer miners on the job — 29 000 — than it did six years ago.
So why has the fatality rate gone up?
“There’s been a lot of introspection about last year’s performance,” he says.
“At the same time as we had this spike in fatalities we had probably one of our best year-on-year improvements on the underlying safety statistics.”
This does even less to explain the spike in fatalities.
Four of them were in Rustenburg where Amplats has been selling off unproductive mines.
He believes the deaths may be related to the flurry of corporate activity.
“We’ve asked ourselves if the long process of disposal there had an impact on the mindset, the amount of focus people have got on their day-today work when there is corporate activity happening.”
If everything possible is being done to curtail fatalities, and seven miners are still being killed in one year, isn’t it disingenuous to claim that zero fatalities in such an inherently dangerous industry is an attainable goal? Isn’t he talking rubbish?
“Imagine if we had had that attitude when we were having 35 fatalities a year,” he says.
“We cannot take a fatalistic approach to mining. So when we have a setback it makes us stop and look harder for more and better technical solutions.”
If the industry claims that it can stop all fatalities, isn’t it inviting government retribution when, as in his case, fatalities increase?
“We’re not there yet where we can guarantee there will be zero fatalities,” he says.
“But . . . believing we can get there means the journey we’re on is ab- solutely believed in.”
The industry complained last year about what it felt were unnecessary mine closures after every accident, which cost it hundreds of millions of rands in lost production.
Mining Minister Mosebenzi Zwane responded by accusing mining companies of prioritising profits above the safety of their employees, which Griffith says is nonsense.
“It’s not as if our production targets are putting undue pressure on people to take risks.”
He says he doesn’t need to be ordered by a Department of Mineral Resources inspector to shut down production after an accident.
“We close down our own production by a factor of 10 more than government does. We explain this to the department.
“When we go underground and find a working place that is not safe, we expect of the management team to stop and fix things up.
“They have a right not to work in an unsafe area.”
He was “very unhappy” when the department “abruptly stopped” the company’s precious-metal refineries when there was “a very minor risk”.
“We’re not averse to stoppages if they’re commensurate with what the department has found wrong,” he says.
He refuses to support speculation that there is a political agenda behind the stoppages.
“There were 70 or 80 fatalities in the industry last year, so I think the minister has some role to play to keep the pressure on to make sure that every year we continue to improve.”
So the “section 54s”, as the government-imposed stoppages are called, have concentrated minds?
“If the department had more stoppages than us I would say so. But we have 10 times more stoppages than they do, where we stop ourselves.
“I don’t need the department to stop our unsafe working places. We frequently stop working places that are not in our view up to standard.”
Griffith says he is awaiting the soon-to-be-revealed third iteration of the mining charter “with a bit of trepidation”.
He says he “hopes” the once-empowered, always-empowered clause (“the continuing consequences of the BEE deals that we have done”) has been entrenched in the new charter.
“But this is just one of a number of elements in the charter that could be equally as problematic.” These include elements around procurement, housing and employment equity.
“I guess there will be a desire for ongoing transformation, which is acceptable.”
He’s worried about the rate at which targets will be set, he says.
“If they’re set out of reach of the ability of the mining industry, that could be problematic.”
What does he make of the minister’s belligerent warnings that industry had better meet the targets or else?
“We would argue that we have met our targets and therefore that kind of language is not necessary.
“But let’s wait and see what the new charter looks like and whether the targets are achievable. If we think they’re not then we’ll say so.”
Another dark cloud is a persistently low platinum price that is putting Amplats under pressure and driving smaller miners to their knees.
Given the socioeconomic consequences if they go under, should Amplats as the biggest platinum miner in the world not be scaling back production so that a deficit can finally kick in?
“That’s exactly what we have done,” says Griffith.
When we have a setback it makes us look harder for more and better technical solutions If targets are set out of reach of the ability of the industry, that could be problematic
A number of years ago it started shutting down unprofitable production and so far 350 000oz to 400 000oz of platinum have been taken out.
He says his operations are “cash-positive” and certainly not “a place to shut profitable production”.
“There’s enough unprofitable production. But I can’t tell other producers what they should do.”
He says Amplats has worked hard to raise demand for jewellery from India from 16 000oz to more than 220 000oz. It is aiming for 500 000oz.
It also set up the World Platinum Investment Council a couple of years ago to persuade investors to add the white metal to their portfolios.
“That is much more positive for the industry than trying to shut more production down,” he says.
What would also help is a weaker rand. With the rand as strong as it has been, 60% to 70% of the industry will be loss making, he says.
Which is not to say he welcomes South Africa’s downgrade to junk.
“We would like a weaker rand but you don’t want it to come off big, oneoff events.”
This creates uncertainty, which is bad for investors and for miners, including the marginal companies.
“That’s why all of us in South Africa have got to now consolidate and bring more certainty to the prospects of the country.”