East Rand Proprietary Mines (ERPM) has proposed closing its underground mining activities over 10 months as they are economically unviable, the company announced on Friday.
ERPM said in a statement that phasing out the operations, and reducing its employees, was imperative to allow for its ”surface re-treatment operations to grow”.
Meeting trade unions on Thursday, the company said the option of saving the underground operations, presented by a task team, was not economically viable.
It said the option did not consider the ”additional immediate cash injection of R150-million needed to continue the operation” and also ignored the low rand gold price.
The company told the meeting, facilitated by the Commission for Conciliation, Mediation and Arbitration that the option was vulnerable to failure should forecasts not be achieved.
Although ERPM agreed with the trade unions’ appeals for state assistance, the government would not endorse proposals that were not viable. The mine currently employs 3 000 workers and closing the operations would affect about 2 600 workers working underground.
ERPM proposed to phase out the operations between July 2004 and May 2005. – Sapa