Business News of Tuesday, 12 December 2017
Information reaching Today indicates that tension is brewing at Goldfields Ghana Limited (Tarkwa Mine) over attempts to lay off close to about 1700 workers.
According to sources, the workers are so agitated over the reports, triggering a possible showdown with management later this week.
Goldfields is currently embarking on an aggressive business option dubbed: “Contract Mining,” hence its decision to lay off hundreds of workers.
Today learnt that they have actually planned to issue dismissal letters to the workers on 13th of December 2017.
Our impeccable source further revealed that Goldfields is embarking on this unpopular agenda with the lame excuse that its current Life of Mine (LoM) stands between 5-6 years and therefore, cannot purchase new mining fleet considering the short payback period.
However, relevant documents sighted by this paper have cast doubts over Goldfields’ claim that its LoM stands between 5-6 years.
Indeed a statement captured on Goldfields website, https://www.goldfields.co.za/west-africa-region.php, raises more questions than answers.
“World-class, low-cost surface mine with a 6.1Moz Mineral Reserve and 15-year life (nine years mining, followed by processing of the surface stockpile and South Heap Leach material) that remains strongly geared to the gold price – strong potential for leveraging resource ounce conversion and driving larger pits with high gold price,” the website states.
Further documents obtained by Today expose Goldfields. According to its 2016 audited Mineral Resources/Reserve reports, Goldfields currently has 6.1 million ounces in mineral reserve and 3 million ounces in mineral resource with the potential to convert most part of this resource into reserve and increase the LoM based on an aggressive exploration plan supported by a more favourable economic environment.
“With a projected average gold production for 2017 of 545,000 ounces, if you deplete that from the reserve of 6.1 million ounces as at December 2016, the mineral reserve at the close of 2017 will stand at 5.55 million ounces. This converts approximately to a 14-year life (eight years mining, followed by processing of the surface stockpile and South Heap Leach material). This however, means that with an aggressive exploration plan, supported by a more favourable economic environment, the LoM of GFG could go beyond its current 14-year life,” a source explained to this paper.
The workers therefore, believe that the decision by Goldfields to adopt contract mining strictly on the basis of a limited LoM of 5-6 years is totally “unfortunate and disingenuous.”
“On aging fleet, GFG has unsuccessfully tried to create the impression that for the business to remain viable it needs to replace all its current fleet en bloc – a situation we find extremely unrealistic both in theory and practice. It is important to state that like every business, particularly mining, a bit of capital injection from time to time remains critical to sustaining the business and expanding it. It is of this background that a fleet replacement plan remains inextricably linked to mine planning and therefore, often incorporated into every mine plan,” General Secretary Ghana Mineworkers’ Union, Prince William Ankrah, explained in a statement.
This is the second time Goldfields is laying off staff in three years. In 2014, its Damang operations sacked over 400 workers with similar excuse.
However, workers at the Tarkwa Mine are bent on resisting any attempts by management to sack them, especially when proper negotiations and engagements have not been fully completed.
This paper is following the story with keen interest and will further update readers.
Meanwhile efforts to reach the Vice President in Charge of Human Resource at Goldfields, Francis Eduku, for a reaction proved futile as he was unavailable for comment.