South Africa blames AngloGold, Sibanye of refusing to comply with safety laws

The South African government has singled out two of the country’s biggest gold miners, Sibanye Gold (JSE:SGL) (NYSE:SBGL) and AngloGold Ashanti (JSE:ANG) (NYSE:AU), as responsible for risking workers lives by refusing to comply with mining laws.

“If companies cannot mine safely, they should not be mining at all, and should allow other potential holders,” the Department of Mineral Resources said in an e-mailed statement quoted by Bloomberg.

19 out of the 73 miners who died in South Africa last year lost their lives at operations run by AngloGold and Sibanye, the mines minister said.

But the companies argue they have significantly reduce fatalities over the past decade and believe the government has been overreacting in the past few months, rushing to temporarily shut mines over safety concerns they believe are just minor.

South Africa's fatality frequency rate — a ratio of deaths per million hours worked — fell to 0.08 in 2015 from 0.3 in 2003. That remains higher than other mining jurisdictions, such as Australia and Canada, but the gap is narrowing.

Last week mines minister Mosebenzi Zwane said the number of workers killed in the country’s mines dropped in 2016 to a new record low of 73 from 77 they year before.

However, he also said the platinum and gold industries were the two biggest contributors by sector to mine fatalities last year, adding that 19 miners died at AngloGold Ashanti and Sibanye Gold operations.

The news coincides with Sibanye’s announcement of potential job cuts at the platinum operations it acquired from Anglo American Platinum and Aquarius Platinum.

The company, South Africa’s largest gold producer, said Thursday it may have to cut up to 330 jobs at its Kroondal and Rustenburg operations.