Sibanye Stillwater to Shut Marikana Shaft and Cut Jobs Amid PGM Price Dip

South Africa’s Sibanye Stillwater is set to close down its 4 Belt shaft at the Marikana mining operations, leading to the loss of 855 jobs. The decision comes as the shaft could not achieve a profitable run in the face of declining prices for platinum group metals (PGMs), according to a statement released by the company.

The mining sector in South Africa, including firms like Anglo American Platinum and Impala Platinum, has been undergoing a restructuring phase aimed at cost containment after witnessing a significant slump in PGM prices last year.

Earlier in February, Sibanye had undertaken a restructuring of its PGM operations which resulted in around 2,000 job cuts. This included the shutdown of older and unprofitable shafts. The company had initially deferred the closure of the 4 Belt shaft during a restructuring phase in October, with the hopes of turning it profitable.

Despite the shaft’s continued operation since 2019, buoyed by a surge in metal prices, it has not been sustainable. In their latest move, Sibanye indicated that 643 workers have accepted voluntary separation or early retirement packages. Additionally, contracts for 93 fixed-term employees will not be renewed. Outright layoffs were announced for 65 employees and 54 contractors.

To mitigate the impact, Sibanye has relocated 469 employees to other PGM operations. Natural attrition accounted for a further reduction of 226 workers from the company’s payroll.

Sibanye CEO Neal Froneman emphasized the inability of the company to keep shouldering ongoing losses without jeopardizing the overall health of the PGM operations in South Africa, which would negatively affect all stakeholders.

This development follows closely on the heels of Sibanye's announcement on April 11 regarding its plans to restructure South African gold operations. This could lead to further job losses, with a potential 4,022 positions at risk at the Beatrix 1 shaft, which has fallen short of production targets. Further job cuts are anticipated at the Kloof 2 plant, owing to a shortfall of processing materials due to the earlier closure of the Kloof 4 shaft in 2023.