Union violence halts work at South African gold mine

JOHANNESBURG (Reuters) — South Africa's Sibanye Gold suspended work at its Beatrix mine after nine workers were injured in a brawl between members of two rival unions, the company said on Friday.

Sibanye's share price fell 4 per cent, outpacing a 0.45 per cent drop on Johannesburg's Gold Mining Index, reflecting investor jitters about the prospects of fresh labour unrest ahead of wage talks in the sector later this year.

"The situation remains tense and management has decided to suspend operations ... while it attempts to restore calm," Sibanye said in a statement.

The fight between members of the Association of Mineworkers and Construction Union (AMCU) and the National Union of Mineworkers (NUM) erupted on Thursday.

AMCU was having a mass meeting at the time to get a mandate from its workers to sign a recognition agreement with the company, Sibanye said in a statement.

NUM remains the majority union at the Beatrix operation but AMCU has now reached the 30 per cent threshold, Sibanye spokesman James Wellsted told Reuters.

Tens of thousands of former NUM members have been poached by AMCU on the platinum belt in a brutal turf war that flared in 2012 and has spread by fits and starts into the gold sector.

Harmony Gold shut its Kusasalethu mine for several weeks in early 2013 because of violence stemming from the union rivalry and has struggled since to make money there.

The AMCU/NUM conflict has killed dozens of miners over the last three years and damaged investor confidence in Africa's most advanced economy.

NUM is battling to maintain its majority status in the gold shafts. According to the latest industry figures, as of the end of December 2014, NUM claimed 57 per cent of the roughly 100,000 South African gold miners who are unionised. AMCU has gone from virtually no membership in gold three years ago to 25 per cent.

Wage agreements with South Africa's main bullion producers expire at the end of June, and any deal reached with the majority union will be imposed on the others.

AMCU is more militant than NUM and will be aiming to dislodge its rival from majority status at a time when the industry has said it can ill afford steep pay hikes.

Spot gold is up 6 per cent in 2015 but remain well off peaks of just over $1,920 an ounce scaled in September 2011.

Sibanye for its part will be keen to get Beatrix up and running again as it accounts for about 20 per cent of its annual production of close to 1.6 million ounces. Officials from neither union were available for comment.