'Eskom's power insufficient for mining'

Mine owners say the 70% power supply by Eskom is not sufficient for mining operations. Eskom has struck a deal with mines to provide some companies with 70% capacity of power supply.

However mines have to cut their electricity usage by 10% in return for this uninterrupted supply. The supplied power supply will enable mines to carry out maintenance work, clean-up work and support work but is not sufficient for production.

South African Chamber of Mines spokesperson Jabu Maphalala says they are committed to studying ways of reducing energy use. "The current focus is not on job reduction however it's on ensuring that there is unlimited power supply to resume production," says Maphalala.

Production has not resumed at many diamond, gold and platinum mines after their closure last Friday, due to the crippling power shortage.

SA's credit rating in trouble
Meanwhile international ratings agency Standard and Poor's says that South Africa's credit rating may be restrained by power shortages. The problem has stalled mining and industrial production for four days and is threatening to slow down economic growth.

The London-based agency has a sovereign credit rating of BBB+, the third-lowest investment-grade level, for South Africa. The agency's analyst, Remy Salters, says the power shortage will continue to limit the country's economic growth until more power comes online.

Some workers could go underground today at AngloGold Ashanti as limited production has commenced. Edited by Margaret Maluleka