Power costs and carbon tax a double whammy for mining, warns Amplats CEO
When the head of a company as big as Amplats says carbon tax is a bad idea, someone in the government would do well to listen
Even the most cursory glance and briefest of considerations of comments from Chris Griffith, CEO of the world’s largest platinum miner, should spark deep concern within the government. Griffith, the head of Anglo American Platinum (Amplats), spoke of electricity costs going up to R1bn a year within the next three years as Eskom implements its new tariffs, while the carbon tax that kicks in from June will add another R300m to its costs.That’s just one company, albeit a large one that uses a lot of power, 550MW, but by the same token it employs 25,000 people.While Amplats is at the lower end of SA’s platinum industry’s cost curve and the industry has finally moved back to profit with higher metal prices, there is no chance a number of the recently unprofitable mines will withstand cost increases of this magnitude.The mining industry has already absorbed a 523% increase in electricity prices since 2006 and the results are clear. The mining sector has bled jobs over the past decade, wit...