Assmang places Beeshoek mine on care and maintenance as AMSA halts offtake
Assmang, which is jointly owned by African Rainbow Minerals (ARM) and Assore South Africa, has decided to place its Beeshoek iron-ore mine, in the Northern Cape, on care and maintenance, with about 622 permanent employees to be retrenched with effect from November 30.
This follows the cessation of iron-ore offtake by the mine's sole customer, steelmaker ArcelorMittal South Africa (AMSA), and an extensive review of operational, commercial and financial alternatives.
Assmang points out that the Beeshoek mine is an ageing operation with legacy infrastructure and a cost base that is dependent on sales to AMSA. The steelmaker, which is shuttering some of its own operations, has significantly reduced its offtake from the mine over the past five years.
It notes that, following the expiry of a supply contract between the mine and AMSA in June 2024, AMSA has continued to buy iron-ore on a month-to-month basis. Deliveries from the mine to AMSA ceased on July 27 and no further sales to AMSA are expected for the remainder of the year.
Assmang undertook an extensive assessment of potential alternatives to avoid a shutdown of Beeshoek mine, none of which proved economically viable.
In the absence of a sustainable offtake arrangement, the mine is no longer economically feasible to operate. Mining operations were halted at the end of October.
Assmang says it is providing affected employees with the necessary support, including access to wellness programmes, financial planning and budgeting support, curriculum vitae writing assistance, employment-seeking opportunities, reskilling programme options and entrepreneurship training.
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