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Podcast - February 27, 2008
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Podcast 27 February 2008
 
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27th February 2008
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This podcast is brought to you by Group Five. Exceptional provider of building, infrastructure and engineering solutions.


From Creamer Media in Johannesburg, I’m Chanel Pringle.

In our lead story this week:

Gold major Gold Fields could cut about 6 900 jobs and will close three shafts in South Africa, scale back output at one, and suspend a life-extension project at a fourth, after considering the implications of operating at 90% of historical power consumption until at least 2012.

As a result of the power uncertainty, Gold Fields will direct power supply to higher-margin, revenue-generating operations, at the expense of lower-margin shafts, says South African operations chief Terence Goodlace.

The company has already ceased operations at number 7 shaft at its Driefontein mine, and will scale back activities at number 6 shaft, ahead of final closure by the end of the year.

Most of South Africa’s mines were forced to shut down for a week last month, after power utility Eskom could not guarantee electricity supply.

Gold Fields is holding talks with mining unions and associations regarding the expected job losses, and has agreed to a request by the biggest union, the National Union of Mineworkers, to hold back on issuing formal retrenchment letters while the union meets with government and the Chamber of Mines.

Meanwhile, the group is investigating opportunities for self-generation at its operations, and will spend about R200-million on additional emergency power by the end of the year.



Arm CEO Andre Wilkens says that about 20 other coal prospects will be interrogated to potentially increase the 3,5-million tons of coal that Arm Coal and Xstrata Coal will supply to embattled power utility Eskom, once the R3,2-billion Goedgevonden joint venture is at full production in 2011.

Eskom will procure an additional 45-million tons of emergency coal over the next two years to increase stockpiles at its power stations to at least 20 days.

Arm CEO Andre Wilkens:


Wilkens reveals that the partnership is in receipt of 20 new prospecting licences and that the properties could now be studied.



Gold miner Pamodzi Gold chairperson Ndaba Ntsele says South African mining will in time move increasingly towards a nonracial approach "to show that business is about people, not black or white."

But that time has not yet arrived, which is why it will take steps to return to its status of being a black-controlled business in the next 12 to 18 months, when it expects to be involved in additional acquisitive activity.


Pamodzi Gold chairperson Ndaba Ntsele:


Meanwhile, Pamodzi Gold CEO Peter Steenkamp says that the company's conclusion of the two major Orkney and President Steyn acquisitions means that it will have to take both over in the same week, which is "quite a challenge".



Also in this week’s Mining Weekly online:

The South African Department of Minerals and Energy has granted new order mining rights to all Anglo American mining operations, including platinum, coal, iron-ore and base metals mines, subject to completing the final documentation.


The South African Mining Development Association, or Samda, has called for government to create a "resources bank" funded by royalties that mining firms will pay under the Royalty Bill, which Samda chairperson Bridgette Radebe suggests could be mining's equivalent of the agricultural sector's Land Bank.



Gold-miner Gold Fields will accelerate infrastructure development and cut back production over the next 18 months at its South Deep operation, as the mine continues to miss targets, and after conventional mining at the operation ground to a halt because of geological conditions.



TSX-listed Forsys Metals has received permits from the Namibian Ministry of Agriculture, Water and Forestry to remove local ground water for use at its Valencia uranium project.

The permits allow the company to abstract up to 1 000 cubic metres of water a day, which is enough to allow it to continue with the development of Valencia.



Copper producer First Quantum Minerals will hold urgent talks with government officials in Zambia and the Democratic Republic of Congo to “resolve uncertainty” over the future of its investments in these countries, CEO Clive Newall says.




And in this week’s Mining Weekly magazine, out on Friday, read our cover story on emerging platinum miner Lesego Platinum’s planned $30-million raising on the JSE’s main board. We also report on Malawi’s first uranium mine, which is set for commissioning in December, and how the revised Mineral and Petroleum Resources Development Amendment Bill appears to have worsened South African mining’s regulatory uncertainty.

Finally, don’t miss our features on mining in Botswana, as well as a preview of Tyre Expo Africa.

That’s a round up of this week’s stories on Creamer Media’s Mining Weekly. For more on these and other stories, visit miningweekly.com


Edited by: Shannon de Ryhove

 

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