Blyvoor Mine Closure

Blyvooruitzicht Gold Mine looks set to close as the mine’s current owner, Village Main Reef (Village), indicated that it would not be putting any further money into the mine.

Blyvoor, which is the oldest mine in the Carletonville area, was established in 1937 and production started in 1942.

Village announced on 30 July that its Board of Directors voted to suspend financial assistance to Blyvoor. Village assumed operational control at Blyvoor in June 2012 under the terms of the agreement reached between the company and the mine’s previous owner, DRDGOLD. According to Village, it has invested some R190 million in Blyvoor to sustain operations. In the three months leading up to 30 June this year, the mine however incurred a loss of R88 million.

“The current gold price coupled with rising costs and a series of recent operational infrastructure challenges has rendered the operation unsustainable,” Village indicated, adding that it would work closely with DRDGOLD, who remain the major shareholder of the mine, in determining the next steps.

DRDGOLD however indicated the next day that it would also not take responsibility for Blyvoor as it has transferred control and had not had any financial interest in or exposure to Blyvoor’s operation since 1 June 2012.

“Whilst the transaction was designed to be implemented in phases, enough of the deal has been finalised for the position of DRDGOLD to have been reduced to that of “notional” shareholder and for Blyvoor to have become a subsidiary of VMR, as contemplated in the Companies Act. Hence DRDGOLD confirms that it will neither intervene nor will it provide any financial assistance to Blyvoor,” the CEO of DRDGOLD, Mr Niël Pretorius, said.

Since the announcements, not much have been made clear about Blyvoor’s future.

As far as could be determined, some of the mine’s contractors have not been paid for months. When some enquired about the money owed to them, employees of the mine only forwarded them the press release in which Village indicated that it would not further assist the mine.

Enquiries of the newspaper to both Village and DRDGOLD also did not bring more information.

The spokesman of the National Union of Mineworkers (NUM), Mr Lesiba Seshoka, also did not yield any further information on the situation at the mine. Although about 960 employees were retrenched at Blyvoor earlier this year, it is not sure how many people are currently working at the mine.

In the meantime, environmentalists are concerned that Blyvoor’s closing can have negative consequences for the environment.

“We are very concerned about Blyvoor’s closing as it is not sure whether Village has got the money to do the environmental rehabilitation of the area as is required by law. Although this is supposed to be regulated by government, the fact that the government is failing in its task can be seen in the fact that there is currently approximately 6 000 ownerless or abandoned mines in the country,” the well-known environmentalist, Ms Mariette Liefferink of the Federation for a Sustainable Environment, told the Herald.

By Adele Louw

www.carletonvilleherald.com

 

Comment by the FSE

Mariette Liefferink reports raising issues at a recent Mooi River and Wonderfonteinspruit Forum meeting, a forum established by Department of Water Affairs.

These concerns about the premature cessation of operations by the Blyvoor Mine in Carletonville and the potential impacts upon downstream water users, adjacent mines and the environment include –

  • Approximately 1,700 people have been left without jobs, and are likely to soon be without housing and access to electricity. (Business Day. BDLive. 25 August 2013. “Workers fear another Aurora at Blyvoor.”)
  • Within 14 days AngloGold Ashanti’s Savuka mine would flood should Blyvoor halt pumping operations, while the water would reach its TauTona and Mponeng mines within 21 days and eventually surface and end up in the Wonderfontein Spruit.  (Business Day. BDLive. 25 August 2013. “Workers fear another Aurora at Blyvoor.”)
  • The current status of Mintails’ water use licence application;
  • The current status of the remediation action plan for the Wonderfonteinspruit Catchment Area.
  • The Close Out Report or Report by the DWA and DMR officials regarding the inspection which was conducted by the DWA and DMR of Galabyte’s Middelvlei Mine.
  • The current status of the Western Basin Technical Working Group Meetings.

 

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