While the entire country knew that last night’s briefing by President Cyril Ramaphosa on the COVID-19 pandemic was going to be of significant importance for the country‘s short-term future, all we could do was surmise on the content thereof hoping that what he had to say would have meaningful impact on how the country planned to deal with a virus that had the world in a choke-hold.
When Ramaphosa took to the podium a little before 8pm, little did we know that his pronunciation of a 21-day lock down in South Africa, would also see each and every mining operation in the country be forced to shut its doors, starting first thing on Friday.
Having thus far proven to be unscathed by COVID-19, reporting no cases within South Africa’s mining industy, the industry was dealt its first blow by the global pandemic, which has wreaked havoc on commodity prices and stock markets everywhere.
But the industry’s second and biggest blow, came with the announcement that mines would forcibly be placed on care and maintenance during this lock down period.
Several local mining companies have already responded to this call seeking clarity on the extent to which operations will be impacted, as this is yet to be determined. As such, most mining companies will soon be communicating their contingency plans during this time of uncertainty.
Harmony Gold Mining Company announced that it would ensure the orderly implementation and management of placing its mines on care and maintenance for the duration of the lockdown, while AngloGold Ashanti has said that it will also temporarily suspend production from its South African operations, safely placing them on care and maintenance. The company said it would develop plans to help safely regain production delayed by the shutdown where possible.
Base metals developer Orion Minerals’, which is underway with the development of its Prieska copper-zinc project in South Africa’s Northern Cape Province, where there are currently two confirmed COVID-19 infections, today announced that it has re-evaluated the process and timing of its project finance activities. This has resulted in the postponement of debt financing activities until global macro-economic and market conditions stabilise.
The Minerals Council said in a statement that it is engaging with senior government leadership over the detail of the lockdown where the industry is concerned, which will include the nature of essential services and what will be required in terms of care and maintenance for non-operating facilities.
The Minerals Council is also exploring what will be required to prevent the lock down leading to permanent damage of the industry as there are marginal and loss-making mines that would likely be unable to reopen should they be required to close fully, without remedial measures.
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