South African Cops Fire On Miners Again As Unrest Spreads

The police killing of 34 striking miners at Lonmin's Marikana mine on Aug. 16 was the deadliest security incident since the end of white-minority rule in 1994.

The Marikana shooting has rocked South Africa and marred the image of the continent's biggest economy, as the full extent of a breakdown in labor relations in the mining sector becomes apparent. World platinum prices have risen more than 10 percent since the shooting.

In Monday's incident, mine owner Gold One International Ltd (AU: GDO) told Reuters about 60 workers at its Modder East site, 30 miles east of Johannesburg, went on a wildcat strike, blocking half its employees from reporting for their shifts.

"The group, however, refused to disperse. The South African Police Service had to use tear gas and rubber bullets to disperse the group," it said in a statement.

Police spokeswoman Pinky Tsinyane said four people were injured in what she described as a "shoot-out" between protesting ex-miners, miners and security guards.

"Police are investigating a case of attempted murder," she said, adding that four arrests had been made. "We understand that the ex-miners were assaulting the miners who were coming to work this morning."

Gold One said Monday's protest stemmed from a June strike that led to the dismissal of many workers, the Wall Street Journal reported. The dismissed workers were joined by workers from a nearby mine previously owned by Aurora Empowerment Systems, which Gold One is buying.

Aurora was run by former President Nelson Mandela's grandson, Zondwa Mandela, and President Jacob Zuma's nephew, Khulubuse Zuma. The company was kicked off the property after it failed to pay workers and bills.

The current standoff at Gold One followed a visit on Thursday to the nearby workers community by expelled African National Congress Youth League leader Julius Malema, who was kicked out for sowing divisions within the ruling party. Malema, who has gained a wide following by accusing the new black elite of betraying the people, has threatened to make mines ungovernable, even as he has chastised Zuma for not doing enough to improve the situation.

In a separate dispute born of similar social conditions an illegal strike involving a quarter of the 46,000-strong workforce at the KCD East gold mine, owned by world No. 4 bullion producer Gold Fields, entered its third working day.

The Marikana unrest stemmed from a turf war in the platinum sector between the dominant National Union of Mineworkers and the upstart, militant Association of Mineworkers and Construction Union.

The government has been trying to broker a peace accord to cool off the feud before it does lasting damage to the platinum industry and spreads across a sector that accounts for 8 percent of South African output.

On Monday, the first of 270 miners detained at the Marikana shootings were released from police custody after prosecutors withdrew murder charges brought under an obscure apartheid-era security law for the police killing of their colleagues.

Labor Minister Mildred Oliphant, part of a committee trying to broker an end to the dispute, raised hopes of a breakthrough by saying management and workers had agreed in principle to sign a two-year wage agreement.

But unions involved in the talks said a return to work was by no means certain.

"I don't share the same optimism," said Gideon du Plessis of the Solidarity trade union. "The workers have made it clear that they will not go back to work until such time that their wage demands are met."

Lonmin (LN: LMI) shares in Johannesburg rose nearly 4 percent on hopes of a speedy resumption of mining, but lost most of those gains as hopes of a breakthrough faded. Lonmin said only 4.5 percent of its shift workers turned up on Monday.

"An indefinite strike will ultimately threaten the jobs of more than 40,000 workers," Lonmin said in a statement reported by the Australian Associated Press. "We cannot go on indefinitely without normalizing operations and still escape the consequences of the mine not being operational."

Presidential aide Collins Chabane tried to calm fears about the mining sector, saying, "We would like to reassure all stakeholders and the international community that mining operations continue unhindered ... throughout the country. The events at Marikana is not a reflection of the business environment in South Africa." 

Mines Minister Susan Shabangu said the government was working to prevent violence at the Gold Fields mine.

"We are having a meeting as part of a process on how best we are going to address the situation without allowing a further occurrence," she told reporters. "We are indeed concerned with what is going on in the gold sector."

Shabangu said the government was looking at how to handle workers' grievances in the mining sector together instead of the piecemeal approach applied so far.

She also said her department would be more focused on making sure companies comply with social-responsibility targets and that the government is completing plans for a more prominent state-owned mining company, the Wall Street Journal reported.

Such prospective moves are likely to revive fears among industry executives that the ANC could push for greater state intervention in the mining sector.

Gold One chief executive Neal Froneman said he was facing a situation similar to Marikana, with a splinter union using intimidation to try and bully its way onto the mine. The key ANC conference later this year-- which will decide whether Zuma remains party leader and hence president -- has heightened political tensions and muddied the waters in the mining sector.

"We're at a very critical juncture," Froneman told the Journal.

Since the Lonmin strike began, illegal protests also have broken out at Anglo American Platinum Ltd.'s Thembelani mine, when several hundred workers refused to go underground, and one at a mine belonging to Royal Bafokeng Platinum Ltd., which briefly halted operations, in the middle of August.