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Gold Fields Sets Oct. 18 Ultimatum for Miners to End Strikes

Oct. 16 (Bloomberg) -- Gold Fields Ltd. will dismiss miners who fail to return to work at its KDC West and Beatrix sites by Oct. 18 after the fourth-largest producer of the metal lost more than 65,000 ounces of output because of South African strikes.

“The company has exhausted all reasonable alternatives,” Chief Executive Officer Nick Holland said on a conference call today from Johannesburg, where the company is based.

About 15,000 of Gold Field’s employees are on strike at the two operations, while the company today applied to a court to declare illegal the stoppage at KDC East by about 8,500 workers.

South Africa has been wracked by labor unrest in the mining and transportation industries, with AngloGold Ashanti Ltd., the third-largest producer, and Harmony Gold Mining Co. also hit by disputes. Anglo American Platinum Ltd. fired 12,000 on Oct. 5.

Lawlessness and violence have grown, Holland said. Strikers ransacked a police station in Westonaria on the weekend and late yesterday a company driver was stabbed and his vehicle torched, the company said in a statement. Security personnel attending to the scene were fired on with live ammunition, Holland said.

The disturbances follow attacks at other companies’ mines as workers demand higher pay rises than those secured by unions. A six-week walkout at Lonmin Plc starting in August erupted into violence, with 46 people killed including 34 shot by police.

Unions last week rejected Gold Fields, AngloGold and Harmony offers to raise pay an average of 3 percent, on top of gains of 7.5 percent to 10 percent already awarded this year.

Implement Offer

Gold Fields said its offer will be valid as long as workers return by 2 p.m. local time on Oct. 18, according to Holland.

“If there were to be a return to normality by a specified date if and when such a date is set by us,” then AngloGold will also implement the offer, the company said today in an e-mailed reply to a query. AngloGold has had all of its South African mines idled by strikes since at least Sept. 25, costing the company about 90,000 ounces of production.

Harmony hasn’t ruled out the possibility of implementing a wage increase to end a strike at its Kusasalethu mine, it said in a separate e-mailed response to a question today.

Gold Fields has lost about 1.2 billion rand ($138 million) of sales because of strikes, Holland said. While some miners began returning to work at the Beatrix mine today, it’s too early to say whether the strike there has ended, he said.

Anglo American Plc’s Kumba Iron Ore Ltd. said police removed strikers occupying its Sishen mine and it will restore the site to full production as soon as possible. The company regained possession of mining equipment miners had seized.

Atlatsa Resources Corp. says a group that calls itself Bokoni Labour Forum blocked roads onto the Bokoni mine, and damaged property. Dismissed workers also burnt vehicles at the Brakfontein shaft. Only essential services continue at the mine.

Samancor Ltd. earlier sent workers on leave at its Western Chrome Mines. It today extended that until Oct. 22 from Oct. 16. Police arrested 26 after an officer was attacked in the area.

Gold One International Ltd., which dismissed about 1,417 at its Ezulwini operation, idled the mine for about 30 days and said it may not restore the operation to pre-strike levels.

Gold traded at $1,744.27 an ounce by 5:19 p.m. in London.

To contact the reporter on this story: Carli Cooke in Johannesburg at clourens@bloomberg.net

To contact the editor responsible for this story: John Viljoen at jviljoen@bloomberg.net

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