Lonmin Says Two Employees Killed Amid Union Fighting
08/12/2012| 01:11pm US/Eastern
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JOHANNESBURG--Lonmin PLC (LMI.LN, LNMIY) said Sunday that two employees died at one of its platinum mines in South Africa due to what it believes is interunion fighting, a further escalation of mine violence that has hit the country's platinum sector.
Lonmin, the world's third-largest primary platinum producer, said two Lonmin security guards were killed Sunday as a large group attempted to attack Lonmin Western Platinum facilities.
The deaths followed an illegal strike on Friday by 3,000 Lonmin rock-drill operators, which turned violent. Four employees have also been hospitalized since Friday for gunshot wounds "allegedly by rival union supporters," Lonmin said.
South Africa's platinum-mining industry has been rocked by fighting between an emerging union called Association of Mineworkers and Construction Union and the country's largest mine union, incumbent National Union of Mineworkers.
As AMCU seeks to gain ground against NUM, interunion fighting has regularly turned violent in the past year and caused mines to close and lose thousands of ounces of output. Just this month, Aquarius Platinum PLC (AQP.LN, AQPTY) said three people died at one of its mines after about 200 people, some of whom were armed and throwing petrol bombs, forced their way on to the property in connection with union fighting.
Impala Platinum Holdings Ltd. (IMP.JO, IMPUY) shut its Rustenburg mine for several weeks earlier this year due to interunion fighting.
Lonmin said mining operations haven't been stopped yet but the "situation remains tense" and police are present.
"This is almost a replica of what happened at Impala," said , executive vice president for human capital and external affairs at Lonmin.
Mr. Mokwena said the protesting workers on Friday were wearing AMCU shirts. AMCU national treasurer Jimmy Gama said he hadn't heard about the deaths and didn't know about the violence that happened over the weekend.
AMCU president Joseph Mathunjwa denied earlier this month that the union advocates or encourages violence.
But mining companies say the fighting between unions has become a bigger concern for the industry, which is already losing money amid a drop in demand and prices for the metal, largely used in automotive catalytic converters that scrub car exhaust. South Africa produces about 80% of global platinum output and the industry forecasts the metal to be in surplus this year.
Lonmin executive vice president for mining Mark Munroe said in July that the mining industry will see many more problems associated with the union rivalry as AMCU tries to become the larger union at mine sites.
Write to Devon Maylie at devon.maylie@wsj.com
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