DRD Gold said it will cut jobs at its Blyvoor mine after a fall in production and dim prospects for a substantial rand gold price recovery in the short-term.
The company’s 74%-owned subsidiary DRD Gold South African Operations will conduct a 60-day consultation to determine the future of affected employees.
The company blamed the decline in underground production and the low rand gold price as well as a 32% increase in the power price by Eskom.
DRD Gold also cited the 6% wage increase currently on the table with unions as a factor in making the right-sizing at Blyvoor inevitable.
Underground production fell by 5% to 21,349oz due to seismic damage to high-grade panels, reducing the monthly production to 200m2 from 2,500m2 for about six months.
Average Rand gold price dropped by 16% and underground cash operating costs increased by 17%, the company said.