BCL Mine to close shaft, mum on job losses
Mbongeni Mguni | Thursday April 21, 2016 11:58
The mine, however, is tight-lipped on what this move and other efficiency initiatives will mean in terms of overall redundancies at the nickel and copper operation. The South East Extension shaft’s unit costs of operation at $5.20 per pound of nickel against the current average global price of $4.00 per pound, mean the mine is suffering losses for every pound recovered.
Yesterday, BCL Mine managing director, Dan Mahupela told journalists that the 1.5 kilometre deep shaft would be mined for the next 11 months, before ‘orderly closure’.
“This shaft has been a strategic one in enhancing the grade of the total ore production,” Mahupela said. “The shaft is not suitable for bulk mechanised mining methods. It is the deepest shaft with high ambient rock temperatures and requires refrigeration, which comes at excessive capital. “These factors make it impossible to reduce costs.”
At the mine’s three other shafts, BCL is initiating mechanisation, modernising and recapitalising to achieve higher efficiencies and reduce the current labour intensive methods being used.
Despite reports that up to 2,000 mine workers could be laid off, officials played their hearts close to their chests yesterday, only confirming that statutory letters informing workers of possible industrial changes, had been handed out last Monday. Mahupela said the ‘manpower rationalisation’ initiative was also aimed at raising the productivity of remaining workers, from the current 40 tonnes per man to 110 tonnes per man, with the help of mechanisation. The mine’s divisional manager (organisational capability), Motsile Sibanda said the rationalisation process was not yet at the point where figures of redundancies could be calculated. “The business reorganisation process looks at refining the business, which is driven mainly by the mine plans and also changes in mining methods. “This will lead to new resource requirements and we expect redundancies because, for instance, there will be an area where a shaft will be closed. “We expect the end will result in redundancies, but I am not able to give exact figures because this is a fluid process and once all structures have been approved and stakeholders consulted, that’s when we will have firm numbers.”
BCL Mine currently employs 4,300 workers directly and is among the country’s largest single employers. The mine’s fortunes have collapsed in recent years as the price of nickel has halved, while a major refurbishment of its smelter last year, burnt a P754 million hole in coffers. The mine’s finances have also been affected by production difficulties, which resulted in only 85 percent of targeted output last year, consequently affecting revenues.