300 new jobs for Thabazimbi community

ERNEST MABASA

Sishen Iron Ore Company Proprietary Limited (SIOC) to transfer Thabazimbi mine to ArcelorMittal South Africa Limited (AMSA) was a move to create jobs as a company that offers 1,5 percent of its gross domestic product (GDP) to the country, company Corporate Communication manager Themba Sepotokele has said.

On Thursday SIOC, a subsidiary of Kumba Iron Ore Limited announced that they have entered into an agreement to transfer Thabazimbi mine to ArcelorMittal South Africa Limited (AMSA) on an undisclosed amount of money.

Thabazimbi mine is located in Waterberg district, Limpopo province, until 2014 Thabazimbi was a captive mine owned and run by SIOC, but supplying ore exclusively to and funded by AMSA. As a result, AMSA is accountable for 96% of the Mine’s current rehabilitation liability, with SIOC responsible for the site’s management and the remaining liability. The transfer would simplify this arrangement by making AMSA solely responsible for Thabazimbi’s closure and rehabilitation.

According to Sepotokele, “Mining operations at Thabazimbi ceased on 1 September 2016. The identified assets and liabilities of the Mine will be transferred at a purchase consideration of R1 plus the assumed liabilities.

"The remaining 63 SIOC employees currently engaged in mine rehabilitation and the preparation and finalisation of the Mine closure plan will transfer to AMSA on comparable terms, conditions and benefits,” he said.   

Sepotokele also said that the company will employ around 300 people who are may be coming from local communities. He said this will benefit the country and the province as the fight against unemployment intensifies.   

“The needs of the Thabazimbi community were identified and have been incorporated into the Mine’s social closure plan. AMSA, as part of its current financial obligation, will take over the entire social closure plan and will be responsible for the execution, implementation and funding of these identified projects while SIOC will retain a right of oversight," he said. 

However, the transfer is said to dependent on certain conditions to be met, most notably: competition authority approval, cession of the Thabazimbi mining rights in terms of section 11 of the Mineral and Petroleum Resources Development Act (“MPRDA”), and a satisfactory due diligence investigation by AMSA. On fulfilment of these conditions, the employees, assets and liabilities will transfer to AMSA. If the conditions are not satisfied by 28 April 2017 (or a later date agreed to by the companies), the agreement will lapse and SIOC will proceed with the closure of the Mine. 

“In line with our strategy to manage our costs more efficiently in what is a particularly difficult time for the local steel industry, this agreement allows us to take full management control of the processes and costs related to the rehabilitation liability at the Thabazimbi mine.  In addition, we will investigate the feasibility of different options to possibly restart operations at the mine in order to supplement the company’s sources of iron ore and with the potential of job creation,” ArcelorMittal South Africa CEO Wim De Klerk said.