Rockwell Diamonds Announces Tirisano Mine Placed on Care and Maintenance as Industrial Action Persists

By Staff,

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Rockwell Diamonds Inc. (RDI.TO) has decided to place its operations at the Tirisano Mine on care and maintenance following persistent industrial relations issues and ongoing losses incurred by the mine. The term 'care and maintenance' is used when a mine has stopped production and is temporarily closed for technical, environmental, financial or labour relations reasons (Minerals Act, 1991).

The Tirisano Mine, last week, was impacted by a second unprotected (illegal) strike within a period of four months. It has also been subjected to persistent industrial relations issues relating to pay increases despite the fact that the mine has continued to operate at a loss and these issues being dealt with in full compliance to the Labour Relations Act of South Africa.

The mine's challenges have been exacerbated by operational complexities as well as a slower than anticipated recovery in the price of smaller diamonds that make up much of Tirisano's production profile, that led to the persistent poor financial performance. The burden of these losses has been carried entirely by Rockwell whose black economic empowerment ( BEE ) partner at the mine, Mogopa Minerals, has been unable to contribute any funding since the mine's inception.

Rockwell is trading near a yr low.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Copyright (C) 2014 All rights reserved. Unauthorized reproduction is strictly prohibited.

This article appears in: Investing Commodities
Referenced Stocks: BEE

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