* Mines minister has said industry inspections to rise
* Platinum production down sharply in October
(Recasts background, details)
By Ed Stoddard
JOHANNESBURG, Dec 12 Northam Platinum
, one of South Africa's smaller platinum producers, said
on Monday its only producing mine has been hit by several
stoppages due to government safety inspections, part of a wider
campaign that has hit the sector.
Analysts have speculated that a sharp fall in overall
platinum production in South Africa in October was the result of
increased stoppages related to surprise inspections as part of a
government drive to boost safety.
"Northam's Zondereinde mine has, for a number of months,
been the subject of unannounced inspections from the DMR's
safety inspectorate," Marion Brower, a spokesperson for Northam,
"These have frequently resulted in DMR-enforced safety
stoppages in certain sections of the mine," she said in an
e-mailed response to questions from Reuters.
Mines minister Susan Shabangu said in November her
Department of Mineral Resources (DMR) would be increasing health
and safety audits of mines in the face of a "culture of
Northam did not say how many ounces it had lost in output
from the stoppages.
Platinum group metals production (PGMS) in South Africa, the
world's largest supplier of the precious metals, fell by over 36
percent in October from September, a slide attributed to an
increase in safety inspections and stoppages.
Impala Platinum (Implats), the world's second
largest platinum producer, has said it lost 8,000 ounces of
output in October through having to issue Section 54 notices,
referring to government orders to halt mining activity for I
JP Morgan Cazenove called October's fall in output "an
unprecedented slump" and attributed it to a jump in Section
54-related disruptions in a research note last week.
"The potential impact of ongoing disruptions of this nature
must not be underestimated. The impact on mine profitability
would be profound," the note said.
The drop was the highest percentage drop in October in
recent years according to Statistics South Africa data though
output does usually fall in October. In October 2010, PGMS
output in fell almost 22 percent.
Graphic on S.African Oct platinum output 2004-2011:
South Africa's gold sector has more fatalaties and deeper
mines than platinum but there have been no reports of gold
miners being subjected to surprise inspections.
Yet Gold Fields, the world's third largest gold
miner, said it was about to be audited.
"We have been informed that we will be audited and the
process will start next week and continue into January,"
spokesman Sven Lunsche said.
Officials at the department of mineral resources could not
immediately be reached for comment.
Gold production in October fell 3.3 year on year versus a
27.3 percent fall for platinum.
(Reporting by Ed Stoddard; editing by Jason Neely)