South Africa’s iconic mines, from the ever-deepening gold shafts on which the economy was founded to massive iron ore pits and rich platinum seams, are about to go silent.
From midnight Thursday, March 26, 2020 all but a few coal operations needed to fuel the country’s power stations are expected to be included in a nationwide lockdown aimed at containing the coronavirus. The sweeping shutdown is unprecedented in the 150-year history of South Africa’s mining industry, which today employs more than 450,000 people.
President Cyril Ramaphosa is moving quickly to curb the virus spread as infections threaten to spiral out of control in a country with an already strained health system and rampant unemployment. The army will help police to enforce the lockdown, with grocers, pharmacies, banks, filling stations and other essential services allowed to remain open.
Producers from Harmony Gold Mining Co, the nation’s biggest producer of the precious metal, to top platinum miner Sibanye Stillwater Ltd, said they’re bracing for earnings hits as mines move to care and maintenance, an industry term for when production stops but essential services like underground water pumping continue.
Anglo American Plc said it will review the detailed regulations on the lockdown when they’re published, including for potential exemptions.
“This would be unprecedented in the history of mining in South Africa,” said Roger Baxter, CEO, Minerals Council South Africa, the main industry group. “There were certain times when components of the industry were closed, for example during the second world war, but this is unprecedented.”
South Africa’s mining industry is labour intensive, and digging underground means workers regularly enter narrow elevators together to travel beneath the surface. Many of the thousands of workers who will be affected by the shutdown live in close proximity to one another in mining communities around the operations.
“Companies whose operations require continuous processes such as furnaces, underground mine operations will be required to make arrangements for care and maintenance to avoid damage to their continuous operations,” Ramaphosa said when he declared the lockdown in a national address.