Conversion From Open Pit Mining To Underground Min
PRESS RELEASE
PALABORA MINING COMPANY LIMITED
("Palabora" or "the Company")
On 6 March 1996, Palabora announced that it was to spend R1.5 billion to
construct an underground mine which would extend the mine's life to 2023.
Wells Ntuli, present chairman of Palabora states categorically that "The choice
at the time was either to construct a smaller underground mine, employing
lesser people or close Palabora completely by year 2002.
A study had been conducted before the decision and it was clear that the
consequences of going underground would cause some suffering, but closure would
be disastrous. Closure would affect not only Palabora, but neighbouring
companies who receive supplies from Palabora. It would affect contractors and
would affect the economic survival of the town.
The communities around Phalaborwa would not only be adversely affected through
loss of employment but also through cessation of socio-economic programmes
provided by industry."
Palabora has now reached the stage to better define the details of transition
from an
80 000 tonnes per day open-pit mine to a 30 000 tonnes per day underground
mine. Aspects varying from physical mine planning, cost containment in the
face of diminishing operations are receiving critical attention.
Better definition of the mining plans and resources now indicate that the
expected reduction in zirconia available to the baddeleyite plants is occurring
earlier than anticipated. In order to continue extracting the maximum possible
business value from the remaining resources, the zirconium sulphate
tetrahydrate (ZST) plant will cease operations on 31 May 2001. Current
indications are that the baddeleyite and grade 5 plants will continue
operations for the foreseeable future.
One of the most significant milestones in the transition to the underground is
the formal cessation of mining activities in the open pit. It has now been
determined that mining in its present form will come to an end on 31 January
2002. By this date, the pit will be virtually exhausted and will have reached
its final planned depth.
It is Palabora's stated objective to mitigate as far as possible the effects of
the inevitable reduction in manpower numbers and to avoid involuntary
retrenchment. To achieve this the following steps have already been taken in
recent years:
* Recruitment has been reduced to only essential positions.
* Permanent employees whose jobs became redundant were re-deployed.
* Fixed term contract employees have been engaged.
In order to further facilitate the aim of avoiding involuntary retrenchment,
Palabora is offering all employees with more than 10 years service, who have
reached the age of 53 years by 30 April 2001 the opportunity of taking
voluntary early retirement without penalty. This offer will be open from 1 May
2001 to 30 June 2001.
Wells Ntuli stated that "The transition is a complex process and the Company
would endeavour to keep stakeholders informed throughout this difficult
period." He emphasised that "the cut in numbers employed would be across the
board and not confined to shop floor positions."
Phalaborwa
25 April 2001.
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