Royal Bafokeng Said to Be Ordered to Suspend Mining at Shaft

(Bloomberg) -- South Africa’s Royal Bafokeng Platinum Ltd. was ordered Thursday by mining inspectors to suspend operations at its North shaft, the second such closure in about a week, according to two people familiar with the situation.

The company was issued with a Section 54 notice for the entire shaft, said the people, who asked not to be identified because the information isn’t public. The suspension follows a similar notice a week ago which resulted in the shutdown of the operation at parts of the South shaft for safety reasons.

Section 54 notices enable inspectors to close all or part of a mine if they have reason to believe it may endanger workers’ safety.

Inspectors from South Africa’s Department of Mineral Resources returned to the mine earlier on Thursday, according to the people. Ayanda Shezi, a spokeswoman for the department, didn’t immediately return calls made to her mobile phone. Emails to the department weren’t immediately responded to.

Royal Bafokeng Platinum dropped 3.9 percent to 32.49 rand in Johannesburg on Friday, the biggest decline since Oct. 3. It was the worst performer among five companies in the FTSE/JSE Africa Platinum Mining Index.

The Johannesburg-based miner informed Aforika Borwa Mining Solutions -- a company linked to the politically connected Gupta family -- that it won’t renew its contract, Royal Bafokeng said last week.

The Gupta family, who are friends of President Jacob Zuma and have been in business with one of his sons, have been accused by politicians and civil society groups of using that relationship to influence state contracts and cabinet appointments. Zuma and the Guptas have denied wrongdoing.

Gary Naidoo, a spokesman for the Gupta family, didn’t answer several calls to his mobile phone.

“Any attempt to close the mine will be met with fierce resistance from the communities around the mines,” Paul Sebegoe, North West provincial chair of the South African National Civic Organization, said Thursday in a statement. “Our fathers, brothers, uncles and members of the community are dependent on these mines.”

To contact the reporters on this story: Paul Burkhardt in Johannesburg at pburkhardt@bloomberg.net, Loni Prinsloo in Johannesburg at lprinsloo3@bloomberg.net.

To contact the editors responsible for this story: Antony Sguazzin at asguazzin@bloomberg.net, Gordon Bell, Liezel Hill

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