Labour practice

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Geita Gold Mine in Tanzania, which began production in 2000, is the largest of AngloGold Ashanti’s eight open-pit African gold mines. Originally a joint venture between Ashanti Goldfields and AngloGold, the operation is now wholly-owned.

Mining was initially carried out on a contract basis, with DTP Terrassement, a subsidiary of French-owned Bouygues, taking over from AMS, the original Ghana-based contractor in 2003. In April 2005, the AngloGold Ashanti Board gave the go-ahead for the move from contractor to owner mining.

“Managing our risks, particularly cost increases and low productivity, was the main driver for the move,” says project manager Henk Fourie. “We gave notice of termination to the contractor in April 2005, and took over operations on 1 August 2005. From a safety perspective, it is notable that no injuries were recorded during the three-month handover period.”

All the Tanzanian nationals employed by the contract on, approximately 900, were employed by the mine, bringing the total complement to its current 1,800.

“This involved exit and take-on medical examinations for all transferring employees,” says Fourie “as well as implementing procedures for taking over the stores and mining machinery. This was achieved without a negative impact on production.”

A number of functions remain outsourced, either because of expanding production requirements (such as ore haulage from the satellite pits to the plant) or because they are specialised in nature.

The project comprises three principal phases:

• the take-over of the contractor’s employees and equipment;
• the acquisition of a fleet of new large trucks and a shovel; and
• the development of new infrastructure such as additional housing, shift change and workshop facilities.

“We are adding 240 ton trucks to the fleet of 100 ton trucks used by the contractor,” says Fourie. The last truck was commissioned in mid-February 2006. The development of the new infrastructure is expected to be completed by October 2006, and the refurbishment of existing mining equipment is scheduled for completion in mid-2007.

“The impact of the change will only be evident after project completion,” says Fourie “but we are confident that we will meet world benchmark standards for machine utilisation and availability. This will naturally have a positive impact on production and costs. Mining cost is expected to drop from $1.95/t mined to approximately $1.40/t.

Capital expenditure for the change-over to owner mining is planned to total $81 million while a further $41 million is being spent on larger equipment fleets in the first two years.

The new equipment has required extensive operator and technical training, with representatives of the original equipment manufactures on site to supplement the training personnel. The training department at Geita, under training manager Chris Britz, is continuing to give refresher training to all operators who were taken over from the contractor. It is planned to install a truck simulator in the near future, to be used in the training of truck operators, which will further assist with improved productivities.

The change to owner mining has resulted in improved occupational health services for employees. Previously the contractor’s employees were given an inclusive package out of which they had to fund the provision of health care, while now that they are Geita employees, they and their dependants are able to access the clinic at the mine and the health facility built by the mine in the neighbouring town of Geita, both free of charge. “Employee feedback has shown a positive response to the change, and an appreciation of the improved skills development opportunities offered by a long-term working relationship,” says Fourie. An accommodation facility in the town of Geita which can cater for 85 single local employees is being refurbished.

Until the conversion, all but one of AngloGold Ashanti’s open pit African mines were mined by contractors. Fourie is confident that the move to owner mining at Geita – the largest of these operations – will help develop a skills base in AngloGold Ashanti’s African operations, providing opportunities for inter-mine and inter-country transfers for local as well as expatriate workers.