Sibanye-Stillwater has initiated a formal consultation process under Section 189A of the Labour Relations Act, placing 1,114 jobs at risk. This significant development could lead to either the closure or the restructuring of its Kwezi shaft, a mature underground platinum group metals (PGM) mining operation located near Rustenburg. The consultation process concerns the Kwezi shaft, which has been an integral part of Sibanye-Stillwater’s Rustenburg operation for 24 years. This formal procedure aims to address the operational challenges and financial viability of the platinum group metals mining operation, which has experienced increasing difficulties in recent years. The company's decision shows the persistent pressures facing older mining assets in the current economic climate, particularly those dealing with resource depletion and rising operational costs.
Reasons for Consultation
The operation has become increasingly difficult to sustain financially due to the depletion of economically mineable reserves and declining production. Mining activities at the Kwezi shaft have reached the limits of its approved mining licence area, posing a significant constraint on future expansion and resource extraction. This limitation means that further exploration and development within the existing boundaries are no longer viable for economically sustainable mining. Additionally, a proposed Kwezi Shallows project, which was intended to extend the mine's life and access new reserves, failed to progress. This failure was attributed to a complex array of challenges, including stakeholder objections, appeals from various parties, and persistent delays in securing the necessary regulatory approvals from governmental bodies. These factors collectively prevented the project from moving forward, thereby eliminating a key opportunity to prolong the operational lifespan of the Kwezi shaft.
Financial performance further illustrates the challenges faced by the shaft. Kwezi recorded substantial losses of approximately R208 million in 2024, noting the severe financial strain on the operation. The situation did not improve significantly in the subsequent year, as the operation also incurred losses of R91 million in 2025, indicating a consistent pattern of unprofitability. According to company forecasts, Kwezi is projected to return to losses during the second half of 2026 as production continues its decline, reinforcing concerns about its long-term viability. These persistent financial underperformances and the inability to secure new mining areas or extend existing ones are fundamental drivers behind Sibanye-Stillwater's decision to initiate the formal consultation process. The company is seeking to address these deep-seated issues through the structured framework provided by the Labour Relations Act.
Financial Performance and Production
Despite the prevailing financial difficulties, higher PGM prices contributed to the Kwezi shaft returning to positive margins during the first half of 2026. This temporary reprieve offered a brief period of profitability, demonstrating the impact of external market conditions on the operation's financial health. However, even during this period of improved financial performance, Kwezi produced only 20,658 4E ounces in the first half of 2026. This output constituted less than 3% of Sibanye-Stillwater’s total managed and attributable South African PGM production for the same period. Sibanye-Stillwater reported its total South African PGM production as 734,645 4E ounces during that time, showing the relatively small contribution of Kwezi to the company's overall output.
The limited contribution of the Kwezi shaft to the company's overall production figures, even during a period of higher PGM prices, shows the operational challenges it faces. This low proportional output is a key factor in the company's assessment of the shaft's long-term viability and its decision to initiate the consultation process regarding its future. The consistent decline in production volumes, coupled with the structural limitations of the mine, suggests that even favourable market conditions may not be sufficient to ensure its sustained profitability. The 24-year-old platinum group metals (PGM) mining operation, while having a long history of production, now faces the reality of its mature status and the economic implications of dwindling reserves. The company's analysis points to a future where the Kwezi shaft would likely continue to be a financial burden without significant intervention or restructuring.
Legal Process and Labour Law
The consultation process initiated by Sibanye-Stillwater affects a significant portion of its workforce, targeting approximately 781 permanent employees and 333 contractor employees. This brings the total number of jobs at risk to 1,114. South African labour law mandates that employers and employee representatives engage in full consultations to explore possible alternatives before any retrenchments can be finalised. This legal requirement is enshrined in Section 189A of the Labour Relations Act, providing a structured framework for these critical discussions. The aim of this process is to mitigate the impact on the workforce where possible, exploring all avenues to avoid or minimise job losses.
The Section 189A process ensures that all options, including alternative employment within the company, retraining, or other mitigation strategies, are thoroughly considered by the company and employee representatives prior to any final decisions regarding job reductions or shaft closures. This legal requirement reflects the country's commitment to protecting workers' rights and ensuring fair labour practices, even in situations where operational changes are deemed necessary. The consultation period allows for a transparent dialogue between management and employee representatives, offering an opportunity to present proposals and counter-proposals that could potentially alter the outcome for the affected employees. The company is expected to provide all relevant information to facilitate meaningful engagement and to genuinely consider any proposals put forward by the employee representatives.
Management's Acknowledgment
The consultation process initiated by Sibanye-Stillwater could lead to either the closure or the restructuring of its Kwezi shaft, which is located near Rustenburg. This formal procedure aims to address the operational challenges and financial viability of the platinum group metals mining operation. The company has acknowledged the difficulty of this decision and the potential impact on its employees and their families. This period of consultation is key for all stakeholders to understand the economic realities driving these decisions and to collaboratively seek the best possible outcomes under the prevailing circumstances. The outcome of these consultations will determine the future of the Kwezi shaft and the employment status of the 1,114 individuals currently associated with its operations.
