Wesizwe warns of “huge losses” after protests force suspension of Bakubung Platinum project

WESZIWE Platinum’s Bakubung Platinum project has been interrupted for the last two weeks following protests by the North West province community at Ledig, the company said in an announcement on Tuesday.

Wesizwe Platinum, which is 45% controlled by China Africa Jinchuan Ltd, warned of “huge economic losses” as a result of a delay in the project. Shares in the company fell 6.5% in late Johannesburg trade.

Protests initially kicked off with a march towards the Bakubung mine by the Ledig Community Members on January 26, Wesizwe Platinum said. There appeared to be a settlement the next day following signing of an agreement with local leadership.

However on January 31, additional demands were made against the mine resulting in another meeting on February 4 involving management and community leaders. A court interdict was served on January 31 but Wesizwe said intimidation of the workforce continues, as well as “damage to mine property”.

There was little assistance from the South African Police Services, Wesizwe Platinum said, adding that Bakubung Platinum Mine is currently closed.

“Bakubung Platinum Mine is currently in a critical stage of project construction. The construction of the mining and concentrate processing system has not yet been completed and the schedule of the construction is tight with high targets,” it said.

“The forced closure seriously affects the progress of the project, causing Wesizwe Platinum company to suffer huge economic losses, and this has a serious impact on the employment of local community members, construction contractors and subcontractors.”

Last year, South African mining companies warned that community unrest was being stoked by opportunistic groups wanting to extract business contracts, as well as prominent community members seeking political advance.

In May, Errol Smart, CEO of Orion Minerals, described protests by local community members near its Prieska Copper-Zinc Project in the Northern Cape province as “mafia-type behaviour”.

“The danger is that this kind of behaviour has become normal in South Africa,” said Smart. “What is scary for me is that when something like this happens CEOs phone each other for consolation and to share their experiences. This is how commonplace it has become.”

“People who are in positions of responsibility need to take responsibility now. It needs to stop,” Smart said. “This is just a teething problem, and we’ll get through it like all our peers have,” he added.

Wesizwe Platinum said management was working “tirelessly” to get the project back into operation. The Bakubung Platinum Mine has been in development since the Nineties under various production configurations and leaders.

The latest information is that Wesizwe Platinum is shooting for production of platinum group metals and gold of about 420,000 ounces a year.