Lily Mine fails to meet requirement for funding

Certain conditions needed to be met before the money could come in.


A “wrangling” between parties is threatening owners of the Lily Mine from getting a much-needed loan from the Industrial Development Corporation.

The IDC said they have not yet made a commitment to give Vantage Goldfields the money because certain attached conditions have not been met.

The loan needed is a R190 million and would assist the troubled mine begin operations.

“The wrangling among interested parties is a considerable threat to the re-opening of the mine – whose commencement of operations is also subject to the department of mineral resources approval,” Zama Luthuli of IDC said.

Some of the conditions attached to the loan are that the company provide the IDC with a Memorandum of Incorporation as well as copies of subscription and shareholder agreements.

The company still needs to provide mineral resources department with documents to show the company’s mining rights are still valid, according to reports.

Robert Devereux of Strategic Turnaround was appointed as business rescue practitioner of the gold mine since a shaft collapse in February 2018 that forced the mine to close down.

Dwaine Koch of the Barbrook Creditors Committee has accused Devereux of delaying tactics.

“The business rescue practitioner misled us and only circulated an amended business rescue plan on 23 July 2018,” Koch told Business Report.

“And they scheduled voting one day before our provisional liquidation application, self-evidently desperately trying to postpone our application again,” Koch said.

The loan was granted to Vantage Goldfields, which owns the mine in Barberton, Mpumalanga.

ALSO RELATED: We will rescue workers next year

Earlier this year, Devereaux said they had secured the R300 million which they have always been requiring to be able to rescue Yvonne Mnisi, Pretty Nkambule and Solomon Nyerende.

The three workers are still trapped underground since the shaft collapse in 2016.

“We have new investors and the R300 million we have secured is enough,” Devereaux said in April 2018.

“We have signed agreements but there are certain conditions that must be met before the money flows in,” he said.

“Once the money comes in, we will start developing a new shaft and open the mine,” said Devereaux.

“The search for the remains of the trapped miners will resume a year later for safety reasons. This is because we still have to develop a new shaft and be able to see where the container is before we can resume the search,” Devereaux said then.

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“We plan to retrieve trapped Lily Mine three next year,” company says

They are still trapped underground since February 2016 when a lamp-room container they were working in fell into a sinkhole.


The Vantage Gold Fields plans to retrieve the three Lily Mine workers next year.

That’s according to business rescue practitioner Rob Devereaux.

Devereaux said they have secured the R300 million which they have always been requiring to be able to rescue Yonne Mnisi, Pretty Nkambule and Solomon Nyerende.

“We have new investors and the R300 million we have secured is enough,” Devereaux told news agency African News Agency this week.

“We have signed agreements but there are certain conditions that must be met before the money flows in,” he said.

“Once the money comes in, we will start developing a new shaft and open the mine in July 2018,” said Devereaux.

ALSO RELATED: Lily Mine to resume operations

“The search for the remains of the trapped miners will resume a year later for safety reasons,” he said.

“This is because we still have to develop a new shaft and be able to see where the container is before we can resume the search,” Devereaux said.

A company called SSC Flaming Silver SPV agreed to invest in Vantage Gold Fields, buying 74% of it.

In November 2017, a loan of R190 million was approved by the Industrial Development Corporation for SSC Flaming Silver SPV to resume operations at the mine.

ALSO RELATED: Cosatu blames Mosebenzi Zwane for trapped Lily Mine three

Since the collapse three years ago, the mine decided to suspend operations, leaving a string of men and women unemployed.

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Lily mine to resume operations

The Industrial Development Corporation pumped an amount of R190 million to assist owners of the mine return to production.


Operations will begin soon at Barberton’s Lily Mine, Vantage Gold Fields bossMike McChesney confirmed.

McChesney said all they are awaiting for now is receipt of the cash.

He said the R190 million loan was approved by the Industrial Development Corporation to assist them begin operations at the mine.

IDC made the loan to a company calledSSC Flaming Silver SPVinNovember 2017 and this is the company that will in fact own the mine.

Lowvelder quotesMcChesney as saying they await the final approval.

“Once the money is received and the creditors of the companies in business rescue have been consulted, the proposed transaction may be finalised,” he said.

SSC Flaming Silver SPV got into agreement with Vantage Goldfields to own 74% of it.

The mine was forced to close operations when three workers – Yvonne Mnisi, Pretty Nkambule and Solomon Nyerende – got trapped in a container during a collapse on 5 February 2016.

SEE ALSO: Cosatu blames Mosebenzi Zwane for trapped Lily Mine three

They remain trapped, two years later.

Vantage Gold Fields remains committed to working with all parties concerned to bring the outstanding matters to a speedy and satisfactory conclusion, said McChesney.

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Cosatu blames Mosebenzi Zwane for trapped Lily Mine three

This month marks 2 years since Yvonne Mnisi, Pretty Nkambule and Solomon Nyerende were trapped at the Vantage Goldfields mine.


The Congress of South African Trade Unions (Cosatu) in the Mpumalanga province is blaming the minister’s snail pace in retrieving the bodies of the three workers.

Provincial secretary Thabo Mokoena says the federation is disappointed in the manner the department of mineral resources and “responsible stakeholders” have been dealing with the Lily Mine issue.

“The federation is disappointed because all efforts to retrieve the trapped bodies of the 3 workers have since been stalled without proper explanation,” Mokoena said.

“And the painful agony of the next of kin of the 3 miners is disregarded and ignored,” he said.

The workers vanished on 5 February 2016 when a shaft at the Barberton mine collapsed, swallowing the container they were working inside of.

RELATED: “We will intervene in Lily Mine” – DD

The Vantage Goldfields pleaded broke, saying they would need R200 million to rescue the workers and didn’t have that amount.

“We are disappointed that the operations of both affected mines, that is the Babrock and Lily Mines remain suspended while workers are left in the ledge with no income and means of survival and that there are still outstanding payments of rescued mine workers who have not received a cent as compensation since the promises made by the Minister of DMR Mr Mosebenzi Zwane,” Mokoena said.

“Cosatu calls upon the department and Minister Mosebenzi Zwane to have conscious and empathy by ensuring that the crisis is resolved as matter of urgency and the affected families find closure,” he said.

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‘We will intervene in Lily Mine’

Premier David Mabuza has reportedly said his government will no longer wait for investors concerning the situation at Lily Mine.


Mabuza is quoted by the SABC saying: “I think we have come to that point, to say certain things we might do them ourselves”.

He added: “Lets not wait for external people that we think they have got money, the little resources we have, if correctly utilised, we can turn the situation around; that is our approach, so we are not talking of starting a new thing, about owning a state company, mining company, we have that arm already, it [must] just be built around that arm”.

Three weeks ago Mabuza, accompanied by Mineral Resources Minister Mosebenzi Zwane met with the families of Yvonne Mnisi, Pretty Nkambule and Solomon Nyarende – the three trapped workers.

The department said the aim of meeting Yvonne, Pretty and Solomon’s families in Baberton, Mpumalanga  “was to receive feedback from the mine’s management on progress made in securing funding that will enable the mine to compensate the affected families and mineworkers, as well as to develop a decline for retrieval of the container”.

The Minister and the Premier committed to engage neighbouring mining companies in an effort to negotiate that some Lily Mine and Barbrook employees be employed, noting that 10 job opportunities have already been created,” the department said, adding that food parcels were being “provided to the affected families”.

The Vantage Goldfields have pleaded being broke after putting rescue operations to a halt early last year, saying rescuing the three will require R200 million.

Mabuza said Exxaro will invest over R3.8bn in a new Belfast coal mine, creating hundreds of jobs, and that his government will intervene in the electricity bills of the two troubled Mpumalanga municipalities – Msukaligwa and eMalahleni.

(edited by ZK)

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