Harmony has suspended employees over illegal mining
Harmony Gold has suspended 77 employees and 45 contractors since January from its Free State operations for helping illegal miners, a company spokeswoman told a newswire service on Friday.The spokeswoman said most of these employees had helped illegal miners underground with supplies or accepted bribes for access to mining properties.This followed the death of 76 illegal miners at Harmony’s Eland Shaft operations at Welkom in the past week. Most of the miners were allegedly killed by inhaling poisonous gas after an underground fire started on May 18. They were working in an abandoned area of the mine, a newswire service reported.
Rio Tinto: Chinese burn for Albanese
Indeed, almost every decision taken by the Rio board since it received a bid from Australian rival BHP Billiton in 2007 has proved a wrong turn.Faced with the choice of a rights issue to all shareholders and selling a chunk of equity to China it chose the latter, in the face of opposition from chairman designate Jim Leng, who tendered his resignation. This also meant that former Rio chairman Paul Skinner ended up being dropped from the bench as the leading candidate to succeed Peter Sutherland at BP. Now that Rio has to reverse itself and go to the market for up to £10bn of funding, new chairman Jan du Plessis faces a formidable task. For the moment he seems to have convinced shareholders - still stinging after being excluded from the original Chinese fundraising - that this is not the time to be rid of Albanese. But the chief executive is on probation, and unless he can produce a trading miracle amid the worst global recession since the Second World War, he is likely to join Leng and Skinner in the stands. That may be the least of du Plessis’s troubles. As part of the reengineering of the group, he will be looking to old enemy BHP to help resolve Rio’s problems by putting together an iron ore joint venture in Australia. Given that Pilbara Iron was the asset that BHP most desired when it was trying to buy Rio, this too represents a climb down for Albanese and the board. The likely attitude of the Australian authorities to such a deal is unknown, but nationalism would likely triumph over competition worries. As for Beijing - which Rio has long assured us is its most promising and important market - the relationship is in for a hard time. Making any deal with the Chinese is hard enough, as du Plessis may know well enough from past experience at BAT, where he is also chairman. BAT once thought it had agreement to build the biggest cigarette plant in the world in China, only to find plans scuppered by bureaucratic rivalries. The risk is that Rio has so alienated Beijing it will never be trusted in the same way again. There is a perfectly respectable argument that financial circumstances have changed dramatically since the Chinalco deal was announced. Back then the capital markets were all but closed, and no one relished a jumbo Rio fundraising - except at the most massive of discounts. Rival Xstrata also had problems, although it eventually was able to raise the cash needed. As a result of Rio’s zig-zags, its best-placed customer, its relationship with shareholders and its board have all been hurt. Du Plessis is going to have his work cut out in sorting this mess.