More than 300 workers at Masama Coal Mine have downed tools ahead of their retrenchment scheduled for March 31, as their employer, a mining contractor, continues to seek solutions for a financial dispute with the colliery’s owner, Minergy Limited.
Jarcon Opencast Mining Botswana, which has conducted mining operations for Minergy since 2019 when Masama Mine began operating, is reportedly owed tens of millions of pula by the Botswana Stock Exchange-listed company for its services.
Jarcon has filed papers with the Commissioner of Labour and the Botswana Mine Workers Union (BMWU) indicating its intention to retrench more than 300 workers on March 31. Ahead of the due date, Mmegi is informed that workers have decided to stay at home while the contractor and Minergy engage in last-minute discussions to resolve the deadlock over payments.
“What we have heard is that they have stopped production at the moment and the mining contractor has asked workers to sit at home with pay until the end of the month,” BMWU president, Joseph Tsimako told Mmegi earlier today. “We had a meeting with Jarcon and their representatives said they had given Minergy an ultimatum to last Friday to reply to their requests, failing which they would stop production.”
Mmegi is informed that the financial dispute between Minergy and Jarcon has been going on for at least two years and was uncovered when the BMWU enforced an Industrial Court ruling on wages. The contractor informed the mineworkers union that it could not pay the lump sum owed from the court ruling and asked for payments to be staggered, citing Minergy's failure to settle the bill for mining services.
The latest industrial action at Masama is not the first in the mine’s short history, as workers also downed their tools in August 2019 citing a pay dispute with Jarcon.
Earlier today, Jarcon Opencast Mining Botswana human resources officer, Obusitswe Bahumi told Mmegi there was no information the mining contractor could share on the latest situation, as discussions were ongoing.
“There’s no concrete information about whether we are closing or not and people are still sitting in meetings about that. “The people responsible for providing any further information are in meetings,” he said in a brief interview.
Answering a question in Parliament last week, Minerals and Energy minister, Lefoko Moagi, said Jarcon’s restructuring was not “an implication of the closure of” Masama Mine.
“I can confirm that there is no such plan of closure,” he said.
Minergy CEO, Morne du Plessis was said to be in meetings when reached for comment earlier today. However, as part of its listing obligations, the company is in a closed period ahead of the publication of its interim results for the period ended December 2022. The closed period means directors and other similar executives are prohibited from making significant public statements or trading in the company’s shares ahead of the results.
In a January 25 notice ahead of the closed period, Minergy directors said the six-month period to December 2022 had seen volumes up 53% higher and pricing approximately 66% better than the previous corresponding period, as the global energy crisis continued to lift the coal sector.
“The remarkable increase in demand for coal and higher prices, coupled with stable operations, continue to benefit Minergy,” du Plessis said in the announcement.
Masama, which is the country’s only other coal producer after the state-owned Morupule Coal Mine, has enjoyed soaring production, sales, and pricing levels, as global demand for coal has bounced back due to market disruption caused by Russia’s invasion of Ukraine.
Last September, Minergy executives said they expect that the 2022 financial year would record the company’s first period of operational profitability since its establishment in 2019.