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Platinum major Impala Platinum (Implats) has commenced plans to restructure its Marula operation which could result in major job losses at the mine.

Implats made this announcement as part of its third quarter production results for the period 1 January to 31 March 2017.

Operational performance at Marula has been severely disrupted by community protest action during the quarter under review and for the first nine months of the 2017 financial year.

The protest action is directly related to certain community members being dissatisfied with the way in which the community’s 50% interest in the Makgomo chrome project is being managed by their appointed/elected representatives.

Despite on-going engagement with all stakeholders to restore operational continuity and secure the financial sustainability of the operation, continued community protest action and persistently low metal prices have now necessitated a fundamental restructuring of the business in order to secure the financial viability of the operation in the current operating environment.

As a result, Marula has given notice to the regulator and representative trade union in terms of Section 189A of the Labour Relations Act of its intention to restructure the operation in a process that may impact more than 1 000 job opportunities.

The formal engagement process commenced on 28 March 2017 and will jointly explore initiatives that seek to minimise job losses as far as possible, this process is envisaged to be concluded before the end of the 2017 financial year.

Marula’s production performance

Production performance during the quarter ended 31 March 2017 was also impacted by the closure of the hybrid mining section at the Clapham shaft during the review period.

As a consequence, tonnes milled decreased by a significant 43.3% to 221 000 t for the quarter ended 31 March 2017, compared to 390 000 t reported in the prior corresponding period.

Platinum in concentrate for the quarter consequently decreased by 47% to 9 000 platinum ounces (17 000 platinum ounces in the quarter ended 31 March 2016).

Tonnes milled over the nine-month period ended 31 March 2017 decreased by 11.4% to 1.13 Mt, compared to 1.28 Mt in the prior corresponding period.

In line with this, platinum in concentrate for the nine-month period ended 31 March 2017 declined 11.9% to 52 000 platinum ounces (59 000 platinum ounces in the nine-month period ended 31 March 2016).

“I am pleased to report that there has been encouraging progress across the Group in meeting our strategic objectives, despite persistently low metal prices and a challenging operating environment, including further community disruptions at our Marula operation,” says Implats’ acting CEO, Gerhard Potgieter.

“Regrettably, the ongoing community disruptions and low metal prices have resulted in a further restructuring process at Marula that could result in large scale job losses at this operation. This is something the business and economy can ill afford, but remains imperative if we are to protect the financial viability of our business and preserve jobs as far as possible”.

Featured image credit: Implats