Sibanye-Stillwater, the multinational precious metal mining group led by South African businessman Neal Froneman, has announced a planned restructuring of its operations that could have dire consequences for the job market in South Africa.
The mining group under Froneman revealed that as many as 4,095 jobs are at risk as it contemplates the closure of four loss-making platinum group metal (PGM) shafts in the country. Among those affected are 3,500 permanent employees and 595 contractors.
With high operating costs and declining PGM prices impacting the profitability of the PGM industry, Sibanye-Stillwater, South Africa’s largest mining sector employer, is faced with the difficult decision to restructure its operations, affecting the livelihoods of thousands of workers.
The recent disclosure by Sibanye-Stillwater updates its earlier statement about the potential impact on the workforce due to its restructuring plan for one of its gold mines, which could affect 2,970 workers.
Sibanye-Stillwater sheds light on decision, spotlighting South African PGM operation
In recent years, the global platinum group metals (PGM) industry has faced rising costs, including electricity, water, wages, and fuel. At the same time, PGM prices have declined significantly recently, impacting industry profitability.
Sibanye-Stillwater’s South African PGM operations are suffering, with some shafts operating at a loss, risking overall sustainability. Simunye Shaft ceased operations in 2022 as planned, leading to employee consultations.
The 4 Belt (4B) shaft at Marikana exhausted reserves, and consultations will occur for its closure. Rowland Shaft at Marikana underperformed, proposing employee reductions for viability.
The Siphumelele Shaft in Rustenburg faced seismic activity, leading to rightsizing plans. The industry’s profitability is challenged by cost increases and falling prices, prompting strategic decisions for closure or rightsizing to ensure sustainability.
Sibanye-Stillwater has grown into a leader in the mining industry under Neal Froneman
Sibanye-Stillwater, a multinational precious metal mining company with operations in South Africa and involvement in gold and base metal mining projects in South Africa and the Americas, plays a pivotal role in the global precious metals industry.
Froneman, who has been instrumental in driving the company’s transformation into one of the world’s leading primary producers of platinum, palladium, and gold, presently holds a 0.3-percent stake, equivalent to 8,382,849 ordinary shares, in the precious metal mining group.
The proposed restructuring has raised concerns and sparked debates about the balance between maintaining mining companies’ financial health and preserving workers’ livelihoods in a struggling industry.