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David Bond interviews Hecla CEO; Jason Hommel updates silver stock valuations
Confident that job losses can be minimized
By Hilton Stone
Sunday Times, South Africa
Sunday, April 11, 2004
http://www.sundaytimes.co.za/2004/04/11/business/companies/comp04.asp
The National Union of Mineworkers (NUM) and Harmony
Gold are confident they will find a way to avoid widespread
job losses at the country's third-biggest gold producer.
At issue is the possible closure of six shafts at Harmony,
which employ 5,000 people and account for 6 percent of
the company's total annual gold output, on account of the
strong rand and some of the shafts running out of minable
reserves.
Speaking after the opening of a permanent minerals
exhibition at Johannesburg International Airport on
Thursday, NUM general secretary Gwede Mantashe said
South Africa' s biggest labour union "was putting our
best brains into resolving this dispute. I will be
happy if we can save four of the shafts and delay the
closure of two." He said NUM would send geologists from
the Council for Geoscience to assess the shafts and
investigate alternatives to closure.
Patrice Motsepe, Harmony's chairman, was equally
optimistic, noting that Harmony and the NUM had
overcome "serious challenges" in the past.
The two parties are scheduled to meet again on April
16. Motsepe said the talks "will produce a result that
will be good for both parties. I'm quite confident of that."
Minerals and Energy Minister Phumzile Mlambo-Ngcuka
said the two sides were talking "and I'm sure the results
will be something they can live with."
Sandile Nogxina, the director-general in the Department
Minerals and Energy, also expressed his confidence that
the dispute would be settled.
He pointed out that the industry had been able to avoid
mass retrenchments in the wake of the gold crisis in
1999, when England announced it would sell 415 tons
of its gold reserves, sparking a plunge in the gold price
to a 20-year low of $252.80/oz.
"Jobs were saved at the time of the gold crisis and I'm
sure jobs can be saved now too," Nogxina said. "We
must find alternatives."
The latest talk is a far cry from developments a day
earlier, when NUM said it had declared a formal dispute
with Harmony -- the precursor to possible strike action --
and would refer the matter to the Commission for
Conciliation, Mediation, and Arbitration.
NUM also said it would withdraw from an agreement to
work continuous operations ("conops") at Harmony, as
this deal had been concluded in bad faith.
Harmony has touted conops as a way of saving jobs, as
some of the workers at the shafts under threat of closure
could be deployed elsewhere within the Harmony group
to meet the additional demand for labour required to work
a seven-day week.
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