Costs could "spiral out of control" for the South African mining industry if the lack of skilled workers continues and retention bonuses remain, it has been claimed.

According to David Brown, Chief Executive Officer of Impala Platinum, cost increases could be between 12 and 15 per cent for the next two years.

Speaking to Mining Weekly, he said that South Africa faced a skills shortage and that retention bonuses were above "normal mine inflation".

"I don't think that it is a position that we can continue in this country forever and a day, otherwise costs, literally, are going to continue to spiral out of control for the whole industry," he explained.

Mr Brown feels skills are the "single biggest issue" faced by the industry and felt the industry should work together to try and tackle the problem, emphasising the fact that labour made up 60 per cent of mine costs.

Meanwhile, Impala Platinum is in a good position to reach the 51 per cent Zimbabwean mine ownership necessary if potential legislation becomes law.

Legislation affecting the sector has been tabled in Parliament although it has not been addressed because Parliament was adjourned.

"If the 51 per cent were to come to pass, we are well positioned to meet it," said Les Paton, Executive Director.

He also said the production at Zimplats would be extended to 160,000 oz of platinum each year.

Sources:

Mine costs to 'spiral out of control', Implats CEO Brown warns, 14/02/08
http://www.miningweekly.co.za/article.php?a_id=126979

We're well positioned to meet 51% Zimbabwean ownership, says Implats, 14/02/08
http://www.miningweekly.co.za/article.php?a_id=127005


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