Rio Tinto Group has declared force majeure on customer agreements at the Richards bay minerals after rapid increase of violence compelled it to temporarily halt activities at the minerals sands set-up in South Africa.
This is according to the Managing Director Werner Duvenhage who said the organization takes the safety of its 50 workers at the Richards Bay Minerals seriously. RBM, which has been known for exporting titanium dioxide slag, created ingredients for items such as plastics, paint and toothpaste. The shutting down of Rio Tinto’s only South African trade comes after the demise of RBM manager Nico Swart, who got shot by unknown assailants on his way to work sometime last month.
“It has become impossible for us to run the business, we won’t go back until its safe for our people,” Duvenhage said by phone.
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The declaration of force majeure at RBM is a downside to the country as the South African government has put in effort in the recent past to attract new investors. In 2019, another incident of violence around RBM caused a temporary shutdown, which saw a subsequent halt in a $463 million expansion project that was on-going.
The community protests experienced in the recent weeks have resulted to mining equipment and infrastructure being destroyed, mine workers being intimidated and access roads blocked. Among the issues causing these protests are poor municipal services and labour conditions. According to Duvenhage, there were reports that the most recent violence may be related to youth unemployment.
The South African Minerals Council said the frequent unrest around mining communities hurts the country’s reputation as a potential investment destination.
“The closure of mining operations due to security concerns negatively impacts on production, employment and investment, and will ultimately have severe adverse economic and social consequences,” the council said in a statement.
Richard’s Bay Minerals’ furnaces are presently being operated on minimal power as shutting them down completely is not an option. The firm is in liaison with both regional and national governments to have a clear idea of what the violence is all about.
