Paladin job cuts in Malawi: Production suspended, Kayelekera mine to be shut down

Paladin Africa Limited employees working at Kayelekera Uranium Mine in the northern Malawi are to be laid off and the mine is heading for shut down.

The mine which will remain with a few skeleton staff  has started the retrenchment only but more job losses may be in the pipeline  as it prepares for closure, Nyasa Times understands

The first to face the chop was Arthur Mulilo, a Mine manager from Zambia who was given his letter last Thursday.

Greg Walker, of Paladin Africa Limited explains to President  Joyce Banda of the activities carried at Kayerekera Mining.
Greg Walker, of Paladin Africa Limited explains to President Joyce Banda of the activities carried at Kayerekera Mining.

In the Mining department 31 locals will be laid off out of 34, House keeping 64  out of 98, Commercial and Administration only 9 staff will remain.

In the Plant Department 44 will be laid off out of 91.

Paladins Chief Executive John Borshoff who is already at the mine will be meeting senior Malawi Government officials to inform them  that 300 local Malawians will be laid off.

Paladin said the retrenched national employees will receive “generous redundancy packages”  that exceed Malawi’s minimum legal requirements.

“Based on length of service, allowances and entitlements and an ex:gratia payment, the average payout for nationalemployees will be the equivalent of 10.7 months’ salary. It is the Company’s hope that this gesture will assist employees in their transition from employment at Kayelekera Mine. In addition, national employees will be offeredfinancial planning advice and training in business skills,” said Paladin.

Production at at Kayelekera has since been suspended.

“The suspension will involve placing the Operation on care and maintenance until the price of uranium recovers,” Paladin said in a statement posted on its website.

“This decision will preserve the remaining ore body until a sustained price recovery occurs and Paladin determines that production may be resumed on a profitable basis,” it added.

Paladin has always claimed Kayelekera has been operating at a loss.

General Manager of Paladin at Kayelekera, Greg Walker is on record informing Malawi government that the loss making situation was unsustainable and would lead to job losses unless the uranium prices improved on the world market.

“By placing Kayelekera on care and maintenance now, we are preserving the remaining value of the ore body until it can be mined profitably to make a positive contribution to the Paladin Group. This is in the best interest of all PAL stakeholders, including the Government of Malawi,”  Borshoff said.

This is especially tragic for the local community, which gave in to Paladins mining plans in hope of improving their economic situation.

Paladin  said  it intends to maintain its presence in Malawi and to continue exploration activities in the country, with the objective of identifying and delineating additional uranium resources in order to assure the long term future of Kayelekera mine.

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