Retrenched workers knew of low copper price pressures: Weatherly

19 Sep 2015 10:20am
WINDHOEK, 19 SEP (NAMPA) – The 222 retrenched workers and their representatives at the Otjihase and Matchless mines were constantly informed of the serious financial pressure that was being caused by low global copper prices and current production levels.
This was the response of Weatherly Mining Namibia on Thursday to claims made by the President of the Namibia National Labour Organisation (Nanlo), Evilastus Kaaronda, who said the company did not make the necessary arrangements to save the workers from losing their jobs. Kaaronda addressed the affected workers at a meeting on Wednesday.
The central operations include the Otjihase and Matchless mines, about 18 kilometres northeast of the capital and about 30 kilometres southwest of the capital respectively.
“All alternatives were considered before reaching this decision, but the current outlook for production levels and copper prices mean that there is no viable alternative, regardless of available measures to reduce costs,” the administration co-ordinator of Weatherly Mining Namibia, Elmarie Kurz said in an email.
Weatherly International announced on Monday that it suspended operations at the two said mines due to copper prices this year reaching the lowest level in six years. The copper production at these mines is therefore no longer commercially viable.
However, Kaaronda is not convinced that lower copper prices are the result of the closing of the two mines while the company’s other copper mine, Tschudi, is in production.
Kurz said the price received for copper is set by global copper markets and it is the same for all mines in all countries. Explaining the costs of producing copper at Tschudi, she said it is significantly lower than those at Otjihase and Matchless, which are high cost underground mines as opposed to low cost open-pit mines like Tschudi.
In the past whenh copper prices were higher, profits made at Otjihase and Matchless were reinvested in Namibia in order to do the work that has allowed the new Tschudi mine to be built, and for those jobs to be created. Weatherly has not permanently closed the Otjihase
and Matchless mines and has instead converted them to project development status, as the company intends to invest further in the mines with the expectation that they will be able to resume copper production at higher tonnages than before, creating more secure jobs in the future, according to Kurz.
Weatherly Namibia’s Chief Executive Officer (CEO) Craig Thomas said in a media statement on Monday the Tschudi mine is exceeding expectations, adding that the company will convert its Otjihase and Matchless mines to project development status, as the company prepares them for future production expansion.
When the announcement was made about Tschudi, international reports indicated that shares in Weatherly jumped over 10 per cent early on Monday, after the miner lifted production guidance for Tschudi.
“All alternatives were considered before reaching this decision, but the current outlook for production levels and copper prices mean that there is no viable alternative, regardless of available measures to reduce costs. The best solution for all parties is to prepare a credible project development plan that will allow resumption of production in the future, at larger tonnages, which will create more secure jobs,” Kurz stressed.
She further noted that Weatherly International has been constant and committed to Namibia for almost 10 years now, throughout the global financial crisis, and now through the time of the lowest copper prices in over six years.
Meanwhile, when Nampa contacted Kaaronda on Friday, he said negotiations are currently ongoing between the union and the management of Weatherly International. The results will be released in due course.
(NAMPA)
PC/LI/AS