'Gupta mines can become operational again'

07 March 2018 - 10:21 By Linda Ensor
Ajay and Atul Gupta.
Ajay and Atul Gupta.

The business rescue practitioners of eight Gupta-owned mines - including Optimum‚ Brakfontein‚ Koornfontein and Shiva - are hopeful that the mines can be brought back from the brink. This was signalled in Parliament on Wednesday by Mineral Resources Minister Gwede Mantashe.

The minister made his first appearance before the portfolio committee on mineral resources‚ which is probing the situation at the mines.

Workers at Optimum have been on strike recently over concerns of non-payment of salaries. Mantashe said he had engaged with the trade union at Optimum and would go to Optimum on Thursday to discuss the situation at the mine with workers.

The minister had been assured by the business rescue practitioners that workers and creditors had been paid and that the mines were working.

"They gave hope that the mines can be brought back into operation‚" he told MPs.

Mantashe emphasised that mining was not for speculators and was a long haul investment.

"If you are in a hurry to get money and (are in) mining‚ you are in the wrong place‚" Mantashe said.

Money had to be ploughed into the operation before it could be made‚ he said.

Optimum was placed under business rescue late last month. This was precipitated by the withdrawal of their banking facilities by the Bank of Baroda.

The mine has been issued with a non-compliance notice for failing to adhere to its social and labour plan commitments and its rehabilitation obligations.

The financial provision for the rehabilitation of Optimum and Koornfontein mines is held by the Bank of Baroda. It was subjected to a freezing order in September last year granted in favour of the Organisation Undoing Tax Abuse.

The Optimum rehabilitation fund has a financial provision of R1‚6bn as against a liability of R1‚5bn.

Brakfontein has a R12m shortfall in its provision for its rehabilitation liability of R21m. Koornfontein has no shortfall and Idwala has a shortfall of R6m.

- BusinessLIVE