Mine Health and Safety: Update on Mining in South Africa

0

Rate this Article: (4.0 Stars | 1 Vote)   Thanks for your rating!

If you consider that 40% of the world’s natural resources are contained within the continent of Africa and that mining is a key platform for growth in South Africa, the question being asked is why then is ‘big mining’ not putting more effort into developing much needed infrastructure to truly capitalise on the potential in this area? Why is South Africa still only ranked 54^thout of 93 global mining jurisdictions as a destination for investment?

It seems that safety is a key factor. Safety regulation has been attributed to the slowing of production over the South African mining sector as a whole. The prickliest of the regulations being Section 54 of the Mine Health and Safety Act which states that the Department of Mineral Resources are able to shut down an entire mine in the event of an accident or a safety breach. This is something which mining companies are saying has a large impact on their production and miners are saying is unnecessary when you can often shut down the area in which the incident occurred.

As of the end of May 2012, mining production has tapered by an annualised 16.8 percent. Gerhardt Bouwer, Statistics SA’s executive manager for national accounts was reported to have put this down to being largely due to safety and maintenance halts and labour action which slowed mining output. This was further backed by platinum producer Lonmin, who announced that its profit before tax fell to $18m in the six months to March compared to $159m the year before, losing a reported 464,000 tonnes of production through Section 54 stoppages. Figures that could hinder South Africa being seen as an ideal destination for investment.

With mining companies and mine employees being in agreement that overzealous safety regulation is a key issue in the slowing of production for the mining sector and government acknowledging that mining is a crucial platform for South Africa's growth so by extension it affects the country as a whole,  it seems that business, labour and government are all chasing a common goal. Anglo American Platinum CEO Neville Nicolau has indicated that issues facing the South African mining industry and its attractiveness as an investment destination, need to be brought to the table of the lekgotla, a planned annual dialogue.

The National Union of Metalworkers of SA (Numsa) has recently advocated policy review stating "Mining, banks (and) industries and sectors that are very monopolised, must be nationalised… the world needs our minerals and they will seek to trade with us, however we redefine the ownership and control question,".

According to government this attitude has already been detrimental to South Africa’s reputation as an investment friendly nation, South Africa now needs to ensure that over-regulation does not do any more harm. While safety is an important factor in business improvement, both sub-par and over-zealous regulation can have far-reaching effects on productivity, reputation and by extension investment potential.           

With the mining industry believing that it has the capability to create 200,000 more jobs and having created significant economic growth for the benefit of secondary industry and services as well, dialogue amongst all parties especially in the world’s richest mineral continent, is more important than ever.