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Rio halts operations in South Africa

Rio Tinto’s mineral sands operations at Richards Bay in South Africa have been halted following violent attacks on workers and plant and equipment.

Rio Tinto chief executive of minerals Sinead Kaufman confirmed the report and said the company declared force majeure on customer contracts at Richards Bay Minerals has citing an “escalation in the security situation at the operations”.

“We continue to offer our full support to the investigating authorities and I would like to acknowledge the ongoing support of the regional and national governments and South African Police Service as we work together to ensure that we can safely resume operations,” said Kaufman.

The shutdown includes all mining and smelting operations at Richards Bay, where three Rio employees have been killed since 2015. The Rio shutdown sent the share price of Perth-based mineral sands producer Iluka Resources soaring. Iluka stock was up more than 10 per cent in early trade to US $9.03.

Local employment problem

In an attack in May, Richards Bay general manager Nico Swart was ambushed and shot dead by three gunmen on his way to work in what local media have described as an assassination. The Zulti South project at Richards Bay has been suspended since 2019 for security reasons and because of community unrest.

Rio had planned to spend almost US $500 million building the Zulti South project as part of a plan to sustain Richards Bay’s capacity and extend mine life. Richards Bay operates four mines in the Zulti North lease area, a mineral separation plant and smelting facility. The operations produce ilmenite, rutile and zircon plus titanium dioxide.

Unions have linked the escalating violence, including the attacks on workers and burning of heavy machinery, to issues around the employment of locals at the mine. They have urged South African President Cyril Ramaphosa and police to step up efforts to end the violence and save jobs.

“Following the tragic death of our colleague Nico Swart, we have faced serious challenges in recent weeks, with business disruptions orchestrated by criminals, which have put our people at risk and resulted in the costly destruction and theft of property,” said Richards Bay managing director Werner Duvenhage.

 

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