New power challenge for South Africa’s miners

South Africa’s mining companies are facing a new challenge over power supplies, with the news that Eskom, the state owned utility company, is delaying connections to all construction projects for up to six months.

According to a report in the country’s Beeld newspaper today, the move is aimed at enabling the the mining industry to operate at full power rather than the current 90%.

A power crisis forced a shutdown of the mining sector for five days in January of this year, since when rationing has remained in force.

Gold Fields, the world’s fourth-largest gold miner, has already warned that this could result in 6,900 job losses and on Tuesday of this week, South Africa’s Chamber of Mines said it was expecting the government to announce ways to mitigate job losses in the industry.

Under the new measures Eskom will not issue electricity certificates for any building project bigger than a residential home for between four and six months.

The company plans to rectify the underinvestment in South Africa’s electricity generating industry by investing $43.74 billion on increasing capacity over the next five years. A new nuclear power station is included in the plans.