VZI clarifies status of Skorpion Zinc operations in Namibia

Johannesburg, 10 October 2019: Vedanta Zinc International (VZI) is today clarifying reports in the Namibian media about the status of VZI’s Skorpion Zinc operations at Rosh Pinah in Southern Namibia.

When VZI acquired the resource from Anglo American in 2011, Skorpion Zinc’s life-of-mine (LoM) was expected to be 2015. Since then, Vedanta has extended Skorpion’s LoM three times – with the most recent and final extension taking it to 2020. The 2020 LoM date has been discussed since at least 2016. VZI and Skorpion management have always been very frank with all our employees, stakeholders and business partners about these timelines.

The Refinery at Skorpion will be placed on an extended plant shutdown from early November 2019 to end-February 2020.

This move has been necessitated as the result of a slope failure in Skorpion’s Pit 112, which took place in early May 2019. The failure occurred in the active mining side of Pit 112 and meant that no further work has been possible there. This in turn has meant that the amount of ore mined from Pit 112 has reduced substantially for a period while slope failure remediation and waste mining operations continue – meaning there is less ore for the Skorpion Refinery to process.

Given the ore gap, VZI has taken the decision to place the Refinery on an extended shutdown for four months – this being the most financially sensible approach to the situation. Skorpion will use this time to conduct targeted maintenance work across the Refinery.

The extended shutdown will unfortunately have an unavoidable impact on stakeholders at Skorpion – whether direct or business partner employees. Skorpion management has successfully engaged with both unionised and non-unionised labour as well business partners on how to manage during this period.

Management has reached an agreement with the Mineworkers Union of Namibia (MUN) around voluntary severance packages and appropriate reductions in remuneration of affected employees during the shutdown period. As regards arrangements for non-unionised labour, discussions were similarly concluded on voluntary severance packages and the need for affected employees to utilise their currently available leave allocations over the shutdown.

Skorpion management has also been engaging with the Namibian Government and all relevant stakeholders on the extended plant shutdown and its possible impacts.

VZI and Skorpion are committed to ensuring that all affected employees receive all necessary support and that their redundancy packages are as beneficial as possible. We will also ensure that all employees, community members and other stakeholders are kept fully up to date with the process as it is implemented.

Vedanta Resources and VZI’s commitment to Namibia remains unchanged. We are working on a number of possible new projects, including Gergarub, as well as several greenfields options, which support Skorpion’s intention to remain Namibia and Africa’s one-stop-shop for zinc beneficiation.

Skorpion Zinc remains committed to the future development of the Gergarub project through the Gergarub Exploration and Mining (Pty) Ltd joint venture company with partner Trevali’s Rosh Pinah Zinc. Significant progress has been made in both administrative and project planning in the recent past. A feasibility study conducted in 2015 did not yield an economically viable project, but work has been ongoing since then to unlock future potential.

For queries please contact:
Mrs Nora Ndopu
+264 61 241 740
+264 81 122 2147
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Marika Muller
+27 (0)11 880 3924
+27 (0) 72 635 9262
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