Sibanye flags possible job cuts

Sibanye-Stillwater, a major player in the mining industry, has announced a possible restructuring at its South African gold operations, putting nearly 1,959 jobs at risk. This decision comes after a period of ongoing losses at the company's Beatrix 4 shaft, with the potential to impact an additional 465 contractors. James Wellsted, Executive Vice President of Investor Relations and Corporate Affairs at Sibanye-Stillwater, discussed the situation in an interview with CNBC Africa. Wellsted acknowledged the gravity of the situation, recognizing the economic challenges faced by the region and the potential ripple effect of increasing unemployment on the country. He emphasized that the company could no longer sustain the losses at the Beatrix 4 shaft, especially given the recent three-month strike that the gold operations had to endure earlier in the year. The viability of other gold operations was also threatened, prompting the need for consultation with stakeholders to explore alternatives and potentially mitigate the impact of the restructuring. The recent strike in the gold sector, though not the sole cause of the current predicament, has added to the mounting pressures faced by the industry. Wellsted highlighted the regulatory requirements that mandate action when profitability drops below a certain level, indicating that the decision to consider restructuring had been in the works for a while. Factors such as rising input costs, including electricity, and production disruptions due to load shedding have further strained the company's financial position. While the recent five-year wage deal signed at Sibanye-Stillwater's platinum group sector brought some relief, the situation at the gold operations remains dire. Unions, though informed about the possibility of job cuts, are understandably concerned about the potential impact on their members. Wellsted emphasized the importance of engaging openly with the unions and other stakeholders during the 60-day consultation period, in line with regulatory requirements. The company has experience in navigating such challenges, having undergone a similar restructuring process at the Beatrix 4 shaft back in 2017, which resulted in extending the shaft's operational life significantly. However, the current economic realities, combined with the dwindling reserves and aging infrastructure, have once again brought Sibanye-Stillwater to a critical juncture. As the consultations progress over the coming months, the fate of nearly 2,000 jobs hangs in the balance, underscoring the serious challenges facing the mining industry in South Africa. The company remains committed to exploring all possible solutions to minimize the impact on its workforce and the broader community, while also ensuring the long-term sustainability of its gold operations.