South Africa’s high-flying precious metals mining company, Sibanye Gold, has shown good faith in calling its employees and unions back to the table to reopen what labour threw out during last year’s wage talks. Sibanye CEO Neal Froneman, who could well have left things to idle, has instead opted to show the industry’s genuineness in offering a new social and economic compact, which was spurned during the talks. In an unprecedented move, he decided to put the company’s money where its mouth is and urged a return to the table, not to reopen wage negotiations, but to enter into a dialogue on protecting jobs when profit margins are low and exercising greater wage latitude when margins recover. Read on page 12 of this edition of Mining Weekly of the outreach being prompted by the soaring of the rand price to well over R600 000/kg. Froneman made the point at last week’s presentation of financial results that anyone who had watched the rise of the rand price of gold in the last few months would know that the unions had not done their members any favours by spurning the compact. To watch a video on this, scan the barcode on page 12 with your phone’s QR reader, or go to Video Reports on www.miningweekly.com.

Platinum mining company Northam is bucking the trend by advancing growth projects at a time when the platinum price is down and the idea of even brownfield expansion is something many other platinum miners have erased from their minds during this period of low platinum prices. Northam calculates that the steps it takes now to get more ounces out of its new Merensky project at Booysendal North and greenfield activity that it is planning at Booysendal South will fill what the company foresees as a supply gap in 2020. To handle the combined additional 500 000 oz/y, it is also taking steps to increase processing capacity at its platinum smelter on the western side of the Bushveld Complex. Read on page 15 of this edition of Mining Weekly of Northam’s appointment of project house Tenova Pyromet to create matching smelting capacity at the Zondereinde platinum mine, which will be required to take in more upper group two reef in particular. Northam makes the point that mining’s cyclical nature requires investment through the cycle, which is conspicuous by its absence nowadays.

In the 1980s and early 1990s, gold-price hedging was commonplace but went out of favour when calculations showed that the forward sale of gold at a fixed price was favouring banks more than it was favouring mining companies. The exception has been the locking in of the gold price during project phases, which is still in widespread practice. But what Harmony Gold opted for last week was somewhat different in that the hedging it entered into is to lock in rand weakness. Read on page 14 of this edition of Mining Weekly of how Harmony has entered into contracts to fix the rand:dollar exchange rate on $400-million (R6.2-billion) of the gold it will sell in the next 12 months at a time when the dollar price of gold has also been rising. The rand gold price at more than R600 000/kg is something the company does not want to pass up and is locking it in for at least a third of the gold it sells in the period. Long-serving Harmony FD Frank Abbott described current rand weakness and volatility as an opportunity for Harmony to establish a “very attractive” minimum exchange rate on the dollars it received on its gold sales, while at the same time keeping shareholders fully exposed to the upside of the dollar gold price.