Possible retrenchments at Sibanye-Stillwater’s Beatrix 4 shaft and Kloof 1 plant

Up to 1 959 employees and 465 contractors could be retrenched at Sibanye-Stillwater’s Beatrix 4 shaft and Kloof 1 plant.

Sibanye-Stillwater will enter into Section 189 consultation in terms of the Labour Relations Act with organised labour and other affected stakeholders. The consultation is with regard to the possible restructuring of its SA gold operations pursuant to ongoing losses experienced at the Beatrix 4 shaft and the impact of depleting mineral reserves to the Kloof 1 plant.

The purpose of the Section 189 consultation process is to engage in a meaningful joint consensus seeking process in an attempt to avoid job losses. It is anticipated that the consultation process will reduce the number of employees that may potentially be retrenched through the implementation of, amongst other things, possible retrenchment avoidance measures, including natural attrition, retirements, voluntary separation and the transfer of suitably skilled employees to vacant positions.

The initiation of Section 189 consultations follows numerous unsuccessful attempts to address productivity and other operational issues at the Beatrix 4 shaft and the depletion of Surface Rock Dump (SRD) mineral reserves to Kloof 1 plant. “To allow shafts and operating plants that are no longer sustainable to continue operating at a loss, will threaten the remaining life of mine of the other SA gold operations, and ultimately also the employees of the broader Group,” commented Richard Stewart, Chief Regional Officer: Southern Africa.

Through a formal Section 189 consultation process, Sibanye-Stillwater and affected stakeholders will together consider measures to avoid and mitigate possible retrenchments and seek alternatives to the potential cessation or downscaling of operations and associated services.

The proposed restructuring could potentially affect employees at Beatrix 4 shaft, those employees who provide support services to the shaft, and Kloof 1 and 2 plants. In addition, employees may be affected in associated companies, including Sibanye Gold Protection Services Limited and Sibanye Gold Academy Proprietary Limited.

Beatrix 4 shaft and Kloof 1 plant

The life of the Beatrix 4 shaft was previously prolonged, following Section 189 consultations in 2017, which, through the successful adoption of productivity enhancement and cost containment measures implemented following consultation with stakeholders, enabled it to remain in operation as long as it made a profit, on average, over any continuous period of 3 months (after accounting for all-in sustaining costs).

The SRD mineral reserves that are treated at Kloof 1 plant are nearly depleted, and the Kloof Main SRD will be completely mined out by December 2022. As a result, Kloof 1 plant will not be able to operate at full capacity, with its only remaining primary source of ore coming from Kloof 4 SRD. Cost reduction efforts have been ineffective in addressing the ongoing lack of profitability.

Ongoing engagement with stakeholders through regular Future Forum meetings to address the plight of Beatrix 4 shaft and Kloof 1 plant have been unsuccessful. It has become increasingly evident that, due to increasing costs and an inability to achieve targeted productivity levels, it will be difficult to secure the profitability levels required for the sustainability of the mine and plant.

“We are committed to minimising the impact of the proposed restructuring and will constructively engage with all relevant stakeholders in an effort to avoid job losses, while attempting to limit the impact on the remainder of the operations employees and the sustainability of the Group,” concluded Stewart.

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