An­gloGold plans to cut 8 500 jobs

Miner re­struc­tur­ing loss-mak­ing op­er­a­tions

The Star Early Edition - - BUSINESS REPORT - Di­neo Faku

AN­GLOGOLD Ashanti (AGA) yes­ter­day an­nounced that it planned to cut its work­force by nearly 8 500 across all lo­cal op­er­a­tions as it re­struc­tures loss mak­ing units in a bid to pro­tect the vi­a­bil­ity of the busi­ness.

The world’s third big­gest gold pro­ducer said it would place its loss mak­ing Kopanang mine, in the Vaal River re­gion, and the Savuka sec­tion of the TauTona mine in the West Wits Re­gion, which has op­er­ated for 59 years, on care and main­te­nance amid ris­ing costs.

AGA said it was also go­ing to as­sess the fea­si­bil­ity of in­te­grat­ing el­e­ments of the 60year old TauTona mine into the neigh­bour­ing Mpo­neng mine and would re­view the as­so­ci­ated costs at the re­gional level, par­tic­u­larly sup­port ser­vices and over­heads. The re­struc­tur­ing fol­lowed a re­view on how to keep the loss mak­ing op­er­a­tions afloat, as some of its older lo­cal mines had reached the end of their eco­nomic lives.

It said TauTona and Kopanang faced sys­temic chal­lenges, in­clud­ing near-de­ple­tion of ore re­serves, in­creas­ing depth and dis­tance from cen­tral in­fra­struc­ture. In ad­di­tion, de­clin­ing pro­duc­tion pro­files, and cost es­ca­la­tions that have con­tin­ued to out­pace both in­fla­tion and a weak gold price were prob­lem­atic.

Chief ex­ec­u­tive Srini­vasan Venkatakr­ish­nan said that the re­struc­tur­ing was a dif­fi­cult de­ci­sion to make.

“This… fol­lows a pe­riod of sig­nif­i­cant and – ul­ti­mately – un­sus­tain­able losses, and also the eval­u­a­tion of the op­tions avail­able to re­turn our South African busi­ness to prof­itabil­ity,” Venkatakr­ish­nan said.

“It is crit­i­cal that we act to pro­tect the long-term sus­tain­abil­ity of this busi­ness and the ma­jor­ity of our work­force. We are mind­ful of the sen­si­tiv­ity that this sit­u­a­tion de­mands, and are com­mit­ted to sup­port­ing all our em­ploy­ees through­out this process.”

The re­struc­tur­ing put a damp­ener on Statis­tics South Africa (Stats SA) data, which on Tues­day showed that the min­ing sec­tor added 8 000 em­ploy­ees in the first quar­ter – an 1.8 per­cent growth com­pared to the last quar­ter of 2016.

Stats SA painted a bleak pic­ture of job losses as em­ploy­ment data in­di­cated that the coun­try shed 48 000 jobs in the first quar­ter as gross earn­ings de­clined by R19.3 bil­lion dur­ing the pe­riod.

The loom­ing AGA job cuts also add to the per­fect storm fac­ing the strug­gling min­ing in­dus­try which shed 70 000 jobs in the past five years and faced fur­ther un­cer­tainty fol­low­ing the gazetting of the 2017 Min­ing Char­ter two weeks ago.

The Na­tional Union of Minework­ers (NUM), the big­gest union in the min­ing in­dus­try, con­firmed it had re­ceived Sec­tion 189 no­ti­fi­ca­tion and said its shop stew­ards would meet next week on a way for­ward.

“We there­fore call on An­gloGold Ashanti to re­think its po­si­tion to re­trench. They must cre­ate op­por­tu­ni­ties for job cre­ation rather max­imis­ing prof­its at the ex­pense of the poor minework­ers who earn poverty wages,” spokesper­son Livhuwani Mamm­buru said.

It vowed to fight tooth and nail to make sure that its mem­bers were not re­trenched cheaply. “The NUM re­main fear­less, com­mit­ted, ded­i­cated and un­shaken in fight­ing for the minework­ers,” the union said. “The NUM does not want to see minework­ers be­ing re­trenched.” Trade union Sol­i­dar­ity at­trib­uted the re­trench­ments to the gazetting of the 2017 Min­ing Char­ter.

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