Against the backdrop of record-high prices for gold, Sibanye-Stillwater has reported a surge in illegal mining incidents and arrests around its South African operations that produce the precious metal. Known as ‘zama zamas’, most of the illegal gold miners hail from Lesotho and Mozambique, countries that once provided most of the industry’s migrant labour force.
The reasons for this growing crime wave may be linked to the red-hot price of gold, but Sibanye-Stillwater says it may also be a reflection of “enhanced vigilance”.
Data exclusively provided to MiningMX by Sibanye-Stillwater shows there were 581 recorded illegal mining incidents around the company’s South African gold operations in the first quarter (Q1) of 2024 ̶ an astonishing 241% increase over Q1 2023. Sibanye-Stillwater’s security services made 247 arrests related to illegal mining and other criminal activities such as copper cable theft in the first three months of this year, 312% more than in the same period in 2023 (See graph).
These numbers are material and shocking.
“The operating environment in the Southern African region remains challenging from a security and crime perspective, with illegal mining and cable theft the primary concerns, but general criminal activity,” said Sibanye-Stillwater spokesperson James Wellsted.
“Although the recent increase in illegal mining incidents does coincide with higher prices, it is not certain that this is directly related to the increase in the gold price. The significant increase in the number of arrests may also reflect the enhanced vigilance and success of the SPS strategy and preventative actions.”
Wellsted noted that most of the arrests in the first quarter of this year were linked to measures to cut off the supply chains that provide illegal miners with the means to spend weeks underground. “Of the 587 illegal miners apprehended during quarter one 2024, around 410 handed themselves in due to targeted disruption of supply routes established to sustain illegal miners underground,” he said.
Collusion
Wellsted also pointed to Sibanye’s policy – employed by other gold producers in South Africa – of restrictions on miners taking food underground, a measure that has been agreed with unions.
Some employees collude with illegal miners and one of the ways is through supplying food to the zamas, who access both working and disused operations. The scale of illegal employee involvement is underscored by the number of arrests in Q1 on this front.
“Collusion and complicity of employees with criminal groups continues to undermine security measures. In the first quarter, 103 mine employees and 67 contractor employees were detected assisting illegal miners. In seven incidents, 19 employees were either arrested or brought up on disciplinary charges for targeting gold-bearing material (GBM) in the gold plant environment,” Wellsted said.
Illegal gold mining is a highly organised criminal activity underpinned by a global network of crime. Much of the illicit gold makes its way to places such as Dubai, where it is laundered in refineries and then enters the global market.
In typical mafia fashion, it relies on coercion, intimidation and violence.
A senior official in a mining union once told this correspondent that zamas zamas would typically threaten the family of an employee at the gold mines ̶ usually one responsible for access control ̶ and give them a stark choice: they could make some extra cash on the sly, or some tragedy might strike their kith and kin.
One of the root causes of this scourge is the decline of the migrant labour system. Under apartheid it subjected a rural population drawn from Lesotho, Mozambique and former Black South African ‘homelands’ such as the Transkei to ruthless exploitation, which kept wages low and the miners in a state of dependency.
South Africa’s mines ̶ mostly gold ̶ once employed almost 500,000 foreign workers. That number in 2022 had fallen to 35,000, according to data compiled by the Minerals Council South Africa, which represents the country’s mining sector.
Wages and working conditions, including safety and health, have dramatically improved in South Africa’s mines over the past three decades. A rock-drill operator now earns more than a state school teacher or a cop, and the chance of accidents has been greatly reduced.
Meanwhile, an economy such as Lesotho’s, which in the past was heavily reliant on remittances from South Africa, has hardly developed. In 1987, foreign remittances amounted to 236% of Lesotho’s GDP, according to World Bank data ̶ the biggest such ratio of any country since 1975. They now amount to only about 20% of its GDP in official data.
Remittances are still returning to rural villages in the mountains of Lesotho, but the bulk are now probably the product of illicit proceeds generated by illegal gold mining.