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The Globe and Mail

Striking S. African coal miners reject Exxaro offer

A miner is seen underground at Lonmin PLC’s Karee platinum mine in Marikana. Recent labour unrest at S. Africa coal mines has rekindled memories of last year’s violent strikes in the platinum sector.


Striking workers at five collieries owned by South African mining group Exxaro Resources Ltd. rejected a cash offer to return to work, prolonging an illegal stoppage that could eventually hit electricity supplies.

The labour strife at Exxaro turned violent this week, raising concerns that last year's violent mining strikes – which included the police killing of 34 striking platinum miners – could hit the coal sector after causing major damage to platinum firms.

Exxaro said workers at its Matla, Arnot, Grootegeluk, Leeuwpan and Inyanda mines had refused a one-off offer of 2,000 rand ($220 U.S.).

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"Exxaro reiterates the call for striking employees to return to work," the company said in a statement. The group obtained a court order to stop the strike but there was no indication workers would comply.

The strike had began at two mines on March 5 and spread to other operations, with workers demanding bonuses that the company is refusing to pay because targets were not met.

The unrest has rocked Exxaro shares, which extended losses on Tuesday and hit lows last seen in December. They closed down 2.5 per cent, compared with a 0.4 per cent fall in the JSE's Top-40 index.

Police on Monday fired rubber bullets at a group of about 2,000 strikers at the Grootegeluk mine in the northern province of Limpopo. Police spokesman Ronel Otto said protesters had hijacked two trucks and blocked roads.

Production at all the affected mines has stopped, putting pressure on state utility Eskom, which said it had adequate coal supplies for now.

The company is the second-largest supplier of coal to Eskom, which uses coal to generate 85 per cent of the electricity for Africa's biggest economy.

Eskom is already walking a tightrope to keep power flowing to factories, mines and smelters that had to shut for days five years ago when the national grid nearly collapsed, costing billions of dollars in lost output.

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In a separate dispute, nearly 100 workers have been on an underground strike at Palabora Mining Co. Ltd. for about a week, halting mining operations at the country's largest copper mine.

However, refining and smelting operations at Palabora were continuing, the company said. Palabora also obtained a court order to stop the illegal strike.

Palabora, South Africa's only producer of refined copper, produces about 80,000 tonnes of the metal a year.

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