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Gold bosses baulk at shaft closures Posted: Fri, 02 Nov 2007 [miningmx.com] -- A NEWLY adopted strategy to temporarily shut entire mining shafts following a fatal accident has come under fire from South Africa's mining bosses who believe it creates more harm than good. Graham Briggs, acting CEO of Harmony Gold and his predecessor, Bernard Swanepoel, both believe shutting shafts is retrograde. "If you close a mine for a week, it takes another week to restart," Briggs said. "There's a lot of cooling that needs to be restarted. It can become even more unsafe." Their disapproval has been echoed by John Sayers and Mark Cutifani, CEOs of DRDGold and AngloGold Ashanti respectively. Sayers provided details of a dispute with the minerals and energy department (DME) during the company's September quarter in which it successfully applied for a court order overturning the DME's decision to shut three shafts at Blyvoor. The DME had shut the shafts following two fatalities, but DRDGold argued closing shafts didn't help. "Our problem with the DME ruling was that they closed all shafts down. Without standard maintenance safety becomes an issue after about three days," said Sayers in an interview. "We of necessity finally went to the courts to get a ruling, which we did get. The union supported us in terms of the safety standards we were maintaining." Said Cutifani: "I understand the reason for the action and I’m supportive of the concept of closing operations to make sure all areas are safe and things are in the right place. "I’m concerned that they don’t apply that discriminately and close areas that then create additional safety concerns. It’s a genuine safety concern that I have, nothing else." So where has government's more stringent strategy come from? It could be taking the lead of Cynthia Carroll, Anglo American CEO, who shut down whole sections of Rustenburg platinum mine, owned by Anglo Platinum, in June after 12 miners had died at Anglo Platinum, five recently at Rustenburg. Ever since that date, mines minister Buyelwa Sonjica, who has a good relationship with Carroll, has been visiting the sites of mining accidents and more forcibly imposing her will. But it's not just the minister. President Thabo Mbeki has ordered a complete audit of all health and safety standards on South Africa's mines. Steve Shepherd, an analyst for JP Morgan, has acknowledged that while there's been an improvement in mine safety, 2007 has represented a difficult year for the sector. He felt the hammer could come down on the gold sector. "We’re less concerned in the platinum sector where mines are shallower and South Africa's dominant supply position means metal prices tend to rise on news of stoppages (tight market)," he said in a note. "We fear that safety issues could negatively impact the rating of South African gold shares." Swanepoel suggested the media had helped stoke the hysteria around mine accidents when, in fact, the country's mines were safer than ever before. But it's clear that according to Chamber of Mines targets, the industry is failing its own self-imposed targets. In 2003, the mining industry set itself a target of a 20% improvement in safety records a year to achieve zero harm to workers by 2013. But with the setbacks the gold sector has experienced, it has to improve by 26% a year to meet the 2013 target, said Lazarus Zim, president of the chamber, in July. The mining industry killed 199 workers in 2006 against 202 in the previous year, with the gold sector alone accounting for 113 of those deaths. Platinum and coal were the next worse, with 40 and 19 deaths respectively. This year, however, there have been 175 deaths with two months left to run, according to Solidarity which reported today the death of a worker at Exxaro Resources' Grootegeluk coal mine. This year's figures perhaps support claims that preceptions of a safety crisis in South African mining are being overcooked. In fact, 2007 could show another year-on-year improvement in total safety stats. Click Here to subscribe to our daily newsletter
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