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By Devon Maylie
JOHANNESBURG-Gold Fields Ltd. (GFI) Monday said the illegal
strike at its KDC gold mine has spread to the west section, pulling
15,000 workers away from production in another sign of unrest that
has upended South Africa's mining sector.
Meanwhile, Lonmin PLC (LMI.LN) failed Monday to lure back
workers to its platinum mine, as a wildcat strike continued to
simmer at the site of August's deadly clash with police.
In the latest standoff, miners at Gold Fields followed
co-workers from the east side last week and walked off the job, the
company said. It added that about 400 workers at KDC west went
around the mine Sunday to intimidate workers and demand they stay
away and join their strike.
An internal union dispute prompted last week's strike on the
east side of the mine, located outside Johannesburg in the
northeast of the country. The dispute was later resolved and
production resumed on Thursday.
Gold Fields said it received a list of demands from those who
went on strike Monday, including a demand for 12,500 rand ($1,488),
the same amount strikers at Lonmin are asking for, and new union
leadership. The strike suspended all output at the KDC west
section, which produces about 1,440 troy ounces of gold a day. Gold
Fields said it would now meet with the workers to engage on the
demands, which were presented to the company after a group of 400
workers marched to the local office.
South Africa's mining sector is reeling from a series of strikes
over the past month that have resulted in 44 deaths at Lonmin alone
and has hit production of metals such as gold and platinum. The
unrest has also exposed deep rifts in the country's labor movement,
threatening a contagion of work stoppages and undermining mine
production in South Africa-the lifeblood of the country's
economy.
The disruptions come as new unions recruit for members and
worker frustrations are fanned by political groups.
Police said Monday about 3,500 protesters marched between
different parts of Lonmin mine, singing songs and carrying sticks
and machetes.
The strikes started Aug. 10, when 3,000 rock drillers downed
tools at Lonmin's Marikana mine. Workers clashed in the following
days, resulting in 10 deaths, before police fired live ammunition
into a crowd of the protesters on Aug. 16, killing another 34
people.
Strikes have also been held at Anglo American Platinum Ltd.'s
(AMS.JO) Thembelani mine, when several hundred workers refused to
go underground in mid-August, while operations at a Royal Bafokeng
Platinum Ltd. (RBP.JO) mine were halted briefly at the same time.
Impala Platinum Holdings Ltd. (IMP.JO) said it too has received a
renewed wage demand for another 10% increase from its workers last
week following a similar strike that shut its largest mine for six
weeks in February. The strike action spread into the gold sector
with the events at Gold Fields and a clash with fired workers and
security guards outside Gold One International Ltd.'s (GDO.AU) mine
earlier this month, which left four in the hospital from rubber
bullet wounds.
At the heart of many of the strikes are worker grievances around
pay and the slow pace of change at the mines since the end of
apartheid. Taking advantage of those sentiments, an emerging union
called the Association of Mineworkers and Construction Union has
been actively recruiting at the mines with promises to get workers
higher pay. That has sparked clashes and internal disputes at the
country's largest mine union, the National Union of Mineworkers, an
ally of the country's ruling African National Congress.
Expelled ANC youth league leader Julius Malema has also taken
advantage of the unrest, visiting mines such as Lonmin and Gold
Fields, calling for workers to make the country's mining industry
"ungovernable" as well as for South African President Jacob Zuma to
resign.
Gold Fields said during the strike at the east section of KDC
last week that workers told mine management they wanted new NUM
leaders. Many of the workers on strike at Lonmin have echoed the
same sentiments-saying that they think NUM has lost touch with the
workers, is too close to mine management and too cozy with ANC
leaders who now have business interests in the country's mines.
Lonmin has struggled to get workers back at the mine. A
government-backed attempt to broker a peace accord between mine
management, unions and worker groups has floundered.
Lonmin and all the parties were set to meet Monday to start wage
negotiations. Workers are demanding a salary of 12,500 rand
($1,500) a month, almost triple what many say they make now after
taxes. But Lonmin said the worker representatives failed to show
for the meeting so it could be delayed another day, adding more
pressure on Lonmin's finances. The strike has so far cost Lonmin
50,000 troy ounces of lost platinum production and analysts
estimate about $100 million in revenue as a result.
Solidarity, a smaller union represented at Lonmin, said the
worker representatives told the meeting through local church
leaders that they were too tired to attend and would only return to
work when they wage demand was met.
Write to Devon Maylie at devon.maylie@dowjones.com