Paladin (Africa) Limited has laid off 22 more workers at Kayelekera Uranium Mine in Karonga following the suspension of production at the mine three years ago.
The latest to face the chop are 18 Malawians and four expatriates as a cost reduction measure since the mine was placed in care and management.
Africa’s second largest uranium mine has not been spared the effects of the uranium price crash on the global market and the once vibrant Kayelekera, with over 2 000 employees when it opened in 2009, is remaining with just over 200 on site.
According to an internal memo issued on Friday, March 31 2017 to all employees signed by the general manager (operations) Alec Sharland, the company said the situation was beyond control.
There are no exploration activities taking place at the mine, a situation which has resulted in several episodes of retrenchments since 2013.
According to the memo, some of the jobs would no longer be required since the mine is no longer producing uranium and the company could no longer afford to keep everyone employed.
Reads the memo: “Those people doing jobs that are no longer required/essential at the moment must unfortunately be retrenched.
“Against this background, 18 Malawian nationals will be retrenched as of 30 May, 2017. The decision has also resulted in the termination of four expatriate employees.
“We fully understand the implications to the employees concerned and the emotional stress that results from a decision of this nature. This is not an easy decision and we do not take it lightly. The payments for employees who are leaving will be generous and will be explained to those concerned in more detail.”
In the letter, Sharland also states that Paladin would maintain the plant and equipment as it awaits resumption of production once global uranium prices stabilise.
In an interview yesterday, Paladin Africa consultant and senior adviser Grain Malunga confirmed that since the mine was non functional, a lot of people were not working.
He said there were 220 Malawians working at the plant when it was fully functional, but with the retrenchment, the number would remain slightly above 200. He said the largest wage bill was for expatriates who are now reduced to less than 10.
“Since the plant is under care and maintenance, the expatriate staff is not required at the moment. Paladin would like to empower Malawians to continue caring for the mine,” said Malunga, a former minister of Natural Resources, Energy and Mining.
Malunga also confirmed that the Ministry of Labour and Manpower Development and Ministry of Natural Resources, Energy and Mines have been informed of the planned retrenchments.
The OpenOil financial model and analysis of Kayelekera mine conducted earlier this year found that Paladin Limited had lost $387 million following the suspension of operations.
To break even and resume production, uranium prices must reach $58/lb but was pegged at $20 to $26/lb in October, 2016.