Good day,
Please see following news release. Enquiries to Trevor Arran, contact details below.
Kind regards,
NEWS RELEASE
10 October 2011
EXXARO CONFIRMS CESSATION OF ZINC PRODUCTION
Diversified South African-based resources group Exxaro Resources Limited (Exxaro) announced today that the Exxaro Board of Directors has confirmed that the production of zinc at the Zincor refinery in Springs, Gauteng, will cease effective 31 December 2011.
This follows the group's announcement in July 2011 that it was planning to cease zinc production and was contemplating retrenchments in the base metals division.
A 60-day consultation period with labour unions, in accordance with labour legislation and under the auspices of the CCMA, has now been completed, and the ramp-down of the operation to a mothballed state has started.
?We are taking all feasible steps to provide the most suitable options to affected employees, customers and suppliers,? said Sipho Nkosi, Exxaro's CEO.
?For employees this includes fair retrenchment packages, training courses to acquire new skills, and affected Zincor employees being preferentially considered for vacancies in the group..? Plans are in place to meet supply agreements. Up to 796 employees are affected by the decision.
The move is part of Exxaro's strategic plan to divest from its zinc assets. The decision to cease production has been made in the context of the difficult conditions of the zinc market, including its cyclical nature, low margins as well as the significant impact of higher electricity prices and the exchange rate.
Exxaro?s current portfolio of zinc assets includes the Zincor refinery, a 50,04% interest in the Rosh Pinah zinc and lead mine, a 26% interest in Black Mountain (Pty) Ltd, which owns the Black Mountain zinc and lead mine and the Gamsberg zinc project, as well as an effective 22% interest in the Chifeng zinc smelter in China.
The sale of Exxaro?s shareholding in Rosh Pinah and Chifeng is ongoing and Exxaro is in discussions with interested parties. Stakeholders will be kept updated.
Ends
Editor?s Note:
Exxaro is one of the largest South African-based resources companies with interests in the coal, mineral sands, base metals and iron ore commodities. Zincor is an electrolytic zinc refinery producing zinc metal and sulphuric acid.. It is currently the only zinc refinery in South Africa.
www.exxaro.com
Enquiries:
Trevor Arran
Executive General Manager: Sands & Base Metals
Tel: + 27 12 307 3292
Tel: + 27 (0) 83 609 1444
Email: trevor.arran@exxaro.com
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