Lonmin hopes protest will end
AFTER a week of protest at Marikana, Lonmin hopes that through engagement with the community it will be able to reopen its shafts and resume work today.
Lonmin has so far lost R40-million in production.
Shafts E2 and E3, which were shut down on May 2, produce about 4 000 tons of platinum group metals a day — coming to a loss of about 28 000 tons in a week.
Spokeswoman Wendy Tlou said Lonmin was monitoring the situation. If protests had indeed stopped and it was safe for employees, operations would resume today.
Protesting Bapo Ba Mogale community members were demanding that the third-largest platinum miner in the world employ more than 1 000 people from the community.
Vladimir Mogale, a spokesman for the community, said after a meeting on
Communities are putting those shafts at risk of shutdown
Thursday that calm had been restored after violence and vandalising of property.
The protests had been stopped on the promise of continued engagement with Lonmin.
“There are repercussions to staying away from work, there are repercussions for Lonmin for not operating, there are repercussions for the community,” said Mogale. So the sooner the negotiations were concluded, the sooner people could go back to work.
The issue was that for the past couple of years Lonmin had been employing people from as far away as Eastern Cape.
“There is a historical problem of agreeing to these negotiations but not implementing. That’s why the community gets upset and wants to burn things. So we need to be prioritised,” Mogale said.
Avior Capital Markets analyst Wade Napier said that closure of the shafts did not bode well for Lonmin. Once the shafts reopened the company would have to ramp up output fast, adding to production costs. It is already one of the highestcost platinum producers in the country.
Although the two shafts contribute only about 3% to production, Lonmin could not afford to lose it. The shafts were already marginal and risked being permanently shut down.
“The communities are putting those shafts at risk of closure,” Napier said.
Drikus Combrinck, a portfolio manager at Capicraft Investment Partners, said Lonmin was burning cash and not spending money on expansion but rather focusing on shorter production gains.