CAPE TOWN // Under the dusty hills of northern South Africa is a vein of platinum so rich it supplies most of the worlds’ demands – but extracting it takes money, sweat and, at times, blood.
Lonmin, a century-old London registered company, is one of those operating there. Despite its venerable age, the Africa-focused Lonmin remained little known outside mining circles until a terrible day in 2012 when dozens of its workers were gunned down by police during a protest.
The miners were striking over wages and charged towards police who panicked and gunned down 34 of them in full view of television cameras. The incident has gone down as the Marikana massacre, named for the area where the miners held their protest.
Today, Marikana is peaceful again but, underneath the soil, miners still toil to extract platinum. Many had wanted the company to close down after the tragedy. However, more than 35,000 employees and surrounding communities are dependent on the operation and what has followed has been a painful rebuilding process to recreate the business.
"It has been a challenging three years," the executive vice president for human resources at Lonmin, Abey Kgotle, tells The National.
“Coming from the tragedy of 2012, and building a relationship with a new union, has made for a difficult time. But we are getting there.”
In 2015 the company was nearly broke and asked shareholders for support through a US$400 million rights issue. It also had to write down $2.05 billion in assets. As a result the company, valued at more than $13bn at its peak in 2007, was worth a mere $210m by January this year.
Over the past few months, though, it has doubled in value, as work on rebuilding has started to pay off. The miners themselves have been an integral part of it, says Evert Coetzer, who manages one of Lonmin’s most productive operations at Marikana.
“These are tough crews, and we’ve worked hard at putting the right guys together with the right supervisors,” says Mr Evert. “The mood of resentment and anger that emerged from the period of strike unrest has now disappeared. Everyone just wants to get on with the job.”
Putting together men from deeply different cultures, speaking up to a dozen different languages, is not easy and with the killings of 2012 hanging over the company, managers had to be especially sensitive to communication.
“I know it sounds trite but getting everyone to talk to each other and understand where the other guy is coming from has turned things around for us,” says Mr Evert.
The world’s third-largest producer of platinum, Lonmin is a resource institution. It was founded in 1909 to acquire mining rights in northern and southern Rhodesia, now Zambia and Zimbabwe, and for the next century continued to build its mining presence in the region.
Unlike gold, with which it shares the status of a precious metal, platinum has a wide variety of industrial uses. It is the key element of catalytic converters mandated in many countries to keep vehicle emissions low. It is also used in the fuel cells that convert hydrogen to energy, which could some day replace fossil-based fuel in cars and power plants.
The Marikana mines are relatively shallow compared with those operated by the gold producers who often must push below 4 kilometres to find ore. Platinum operations rarely go deeper than a kilometre. Even so, the conditions would put anyone to the test.
Crews operate in spaces as narrow as a kitchen table. Thudding rock drills create holes for charges, in a set pattern determined by the rock engineer. Blasting takes place early evening and, two hours later, the night shift arrives to begin cleaning and removing the ore.
Workers still die doing this. At least three have been killed at Lonmin this year, and more still at other platinum operations in the area.
“It is dangerous but we do it because it’s work,” says Sipho Mchunu, a rock driller at Lonmin’s mine.
“Our families must eat and they wait for us to come home. This is why we do it.”
business@thenational.ae
Follow The National's Business section on Twitter
