Coal miners jobless as operation shuts down

Bame Piet
SHUTTING DOWN : Medie coal mine

Employees of Jarcon Opencast Mining were treated to the shock of their lives when they reported for duty last Thursday morning, only to be told to go back home since there was no money to pay them.

Jarcon Opencast Mining is the principal Contractor for the Masama Coal mine which is situated a few kilometers from Medie village near Lentsweletau. Its operations were commissioned in 2019 creating 305 jobs to date.

However, the future looks bleak due to a dispute between their employer and the license holder Minergy Limited. The latter has indicated that it is ceasing operations by end of this month due to financial constraints, but there are suspicions that there is a dispute between the two entities.

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Minergy Limited is the mining license holder and has been granted exclusive mining rights for 25years and listed in the Botswana Stock Exchange.

Botswana Mine Workers Union has intervened and made demands that Minergy should not shut down Masama Coal Mine operations, but should pay the outstanding invoices urgently.

“On the 27th February 2023, Jarcon served the Union and the Commissioner of Labour with a notice of shutdown in terms of section 9(3) of the Employment Act. The notice gives parties 30days before shutting down its operations. Jarcon’s motivation for the shutdown was the non-payment by Minergy Limited (client) of services it rendered at the coal operations under its mining agreement. Given that core mining human resources are employed by Jarcon, non-fulfillment of the payment obligations owed to it, directly impacted employees. As a result, Jarcon had no choice but to retrench its employees,” said BMU General Secretary Maenge Maenge.

He added that it is surprising that Minergy Limited reported a positive financial year in its Integrated Annual Report of 2022 and therefore, financial constraint as a justification for shutdown by Jarcon is unacceptable.

BMWU said that a shut-down will be illegal as it does not comply with any mining laws and regulations, or Employment laws.

“The Minister ought to have been notified of the intended shutdown one year before it was effected. Minergy Limited, reported a positive financial year with a positive financial outlook for the year 2023. 30days notice period for retrenchment is insufficient and inadequate for a fair and meaningful consultative process”.

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BMWU accused Minergy Limited of derogating from good mining and business practice and called on the Minister to interdict the planned shutdown and cause an investigation on this cessation of production.

BMWU demanded among others, Immediate payment of Jarcon invoices by Minergy Limited.

BMWU also want an urgent meeting with Directors and/or CEOs of the two companies to explore ways of saving employees jobs.

The union has communicated their displeasure to the Minister of Minerals Lefoko Moagi and were still awaiting his response at the time of going to press.

Principal Public Relations Officer at the ministry, Boikhutso Rabasha said she was not aware of these developments.

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“I am hearing this for the first time and I will make enquiries with the relevant officers,” she said.

With a significant increase in global coal prices recently, Minergy Limited reported in Annual Report of 2022;

  • Coal extraction increased by 54% resulting in more than 1 million tonnes extracted in the financial year.
  • Sales volumes increased by 41% including monthly sales. Seaborn thermal coal exports markets via Walvis Bay to Europe were successful and Pure Coal Revenue increased by 77% to P297million from P167million in 2021, and 41% volume increase with average price sales increasing by 26% .
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