Tony Trahar, CEO, Anglo American
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Anglo Pt may install Esop
Allan Seccombe
Posted: Tue, 28 Nov 2006

[miningmx.com] -- ANGLO Platinum, the world’s largest platinum producer is considering a scheme to give shares to its employees as part of Anglo American’s drive to empower all its South African operations and secure new order mining rights.

Tony Trahar, Anglo American Plc CEO, said the world’s third-largest mining house wants to have black economic empowerment at all its South African operations either in line with mining legislation or exceeding it.

"By next year every operation must have black economic empowerment in line with, or exceeding, what is required," Trahar said.
every operation must have black economic empowerment
The next two big transactions are in Anglo Platinum, which is 75% held by Anglo, and Anglo Coal, a 100% owned subsidiary and South Africa’s top coal producer.

The Anglo Coal empowerment transaction should be completed early next year, while Anglo Platinum has been chipping away at earning empowerment credits at the project level, making it difficult to measure precisely how far along it is.

Anglo Platinum’s latest transaction, which it believes adds another two or three percentage points to its more than 15% level of empowerment, is underway with the sale of a 15% stake in its Union Section of its Rustenburg Platinum Mines for R420m to the Bakgatla community.

The Bakgatla community have voted in favour of the transaction at the weekend and all that remains is to wrap up some of the finer details, which should happen before year-end, said Anglo Platinum spokesman Trevor Raymond.

The Employee Share Ownership Scheme (ESOP), if implemented, will be the latest in a string of such schemes at Anglo’s subsidiaries including AngloGold Ashanti, De Beers, Kumba and Mondi.

Anglo is also formulating an ESOP for its other South African employees not falling within those divisions.
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“In terms of complying with the Act, an ESOP could form part of that. We need to do a few things to get to 26%. It’s one of the things we are doing to get compliance and that we’ve been busy with for several months,” Raymond said, adding Anglo Platinum has been working closely with the Department of Minerals and Energy on structuring its empowerment plans.

Raymond declined to give any further details.

Mining laws enacted in May 2004 oblige mining companies to have at least 26% of their shares in black hands by 2014 to qualify for new order mining rights and prospecting permits.

Anglo has noted the increased rate at which new order rights have been granted, Trahar said.

“We are really starting to make progress,” Trahar told journalists and analysts at a lunch.

“We are working further deals in Anglo Coal and Anglo Platinum to get conversions in these areas,” he added.

Anglo has R30bn to spend on South African coal, platinum, iron ore and diamond projects over the next three subject to the granting of new rights.

Anglo Platinum has $1.1bn of approved expansion projects to life output from 2.45m oz in 2005 to between 2.7m and 2.8m oz in 2006. The company will add another 230,000 oz of refined platinum in 2009. Average growth in platinum output is seen at five percent a year.

Actual and approved projects could lift Anglo’s Coal output to 89m tonnes per annum (mtpa) by 2009 and there is potential for another 25mtpa if another five projects win board approval.

Anglo was instrumental in forming the largest black-owned mining company listed on the JSE. This came through the unbundling of Kumba Resources into an iron ore group controlled by Anglo and the empowered coal, mineral sands and base metals company called Exxaro.

Anglo American has a 65% stake in Kumba Iron Ore which was listed on the JSE on November 20, and a 19% stake in Exxaro. Anglo SA acting CEO Philip Baum expects the companies to win new-order rights by March.

AngloGold has new order mining rights and De Beers has new-order rights for its Voorspoed mine and is awaiting more for the rest of its operations as well as new-order prospecting permits.