LONDON Dec 2 Canada-listed Ivanhoe Mines
plans to pay much higher wages to South African miners
in its platinum, gold and copper project than prevailing levels,
which company founder Robert Friedland said are unsustainably
Wage disputes are a sensitive issue in South Africa, where
violence and labour unrest over miners' pay left dozens dead
Ivanhoe will pay workers "an order of magnitude greater than
the current wage" at its Platreef project in South Africa, said
Friedland, executive chairman of the Africa-focused mining firm.
The platinum industry is extremely labour-intensive and
attempts to automate it have had little success so far.
But Ivanhoe's Platreef mine is more spacious
than others and is expected to be the first fully mechanised
"In a platinum mine in South Africa today, you have to crawl
on your hands and knees on that broken rock for several hundred
metres to get to the working phase," Friedland told the
MINEAfrica conference in London on Monday.
"It's pretty claustrophobic, the men are working with muscle
power, they are getting silicosis, they are breathing what they
are drilling and they are tired of doing it for $12 a day. I
don't think they are going to do it for much longer, and I don't
think they should."
Negotiations among mining companies in South Africa and the
workforce are currently underway, while falling metals prices in
the past year have dented companies' profits.
The Platreef project is 90 percent owned by Ivanhoe and 10
percent by a consortium of Japanese companies. When it starts
production, workers will be driving air-conditioned equipment,
The Chicago-born billionaire is known for his flamboyance as
well as for his success in finding some of the world's biggest
deposits including the Voisey Bay nickel deposit in Canada and
Mongolia's Oyu Tolgoi copper and gold deposit.
The public is increasingly attentive to the ethical issues
surrounding product-supply chains, Friedland said, and
consumers' growing focus on ethics will also drive the industry
to pay higher wages.
"You have heard of blood diamonds for example, or Apple
getting criticised for what people get paid, or you see Gap
stores get worried for what people get paid in Bangladesh for
sewing your clothing. Similarly it is just not viable to pay
these workers $12 a day," he said.
Ivanhoe Mines, formerly known as Ivanplats, also owns the
high-grade Kamoa copper deposit and the Kipushi zinc and copper
asset in Congo.