Harmony Gold outlines plan to fix lossmaking mine with fewer workers
JOHANNESBURG (miningweekly.com) – A new plan that requires fewer employees to mine lower volumes at higher grades and reduced cost, is being implemented at Harmony Gold’s lossmaking 6 300-employee Kusasalethu gold mine near Carletonville.
“Without these actions, this mine will not survive and that would be a tragedy for our company, our employees, our communities and our country,” Harmony CEO Graham Briggs said on Tuesday.
Capital investments totalling R3.9-billion have been made in the mine since 2001.
“The current situation is clearly unsustainable,” he said, adding that it was the intention of the company to restore the mine to profitability in the fourth quarter of the current financial year and in so doing, preserve as many jobs as possible.
“We’re committed to working with government, unions, employees and shareholders to arrive at a sustainable solution,” Briggs said in a media release sent to Mining Weekly Online.
The Section 189 retrenchment consultation process that is under way follows failed earlier attempts to take the mine out of the red.
Kusasalethu has recorded losses since September 2012, including a negative free cash flow of R392-million in the 12 months to June and more negative cash flow of R112-million from July to October.
Engineering infrastructure and water reticulation failures have added to its woes, as have excessive stoppages for various reasons, including illegal mining activities.
The company will consult with its workforce over the next 60 days to consider a number of avoiding measures such as voluntary separation, early retirement packages as well as transferring as many employees as possible to fill vacancies elsewhere in the company.
Kusasalethu’s current employee complement of 6 300 includes contractors.
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