{"id":851313,"date":"2026-02-18T11:00:00","date_gmt":"2026-02-18T09:00:00","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=851313"},"modified":"2026-02-18T12:01:53","modified_gmt":"2026-02-18T10:01:53","slug":"mining-giants-worth-r1-4-trillion-ask-for-electricity-price-cuts-to-save-thousands-of-jobs","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/energy\/851313\/mining-giants-worth-r1-4-trillion-ask-for-electricity-price-cuts-to-save-thousands-of-jobs\/","title":{"rendered":"Mining giants worth R1.4 trillion ask for electricity price cuts to save thousands of jobs"},"content":{"rendered":"\n

Merafe Resources has warned that its ferrochrome operations could still face job cuts despite already receiving massive electricity discounts. <\/p>\n\n\n\n

The Glencore-Merafe Chrome joint venture, which started in 2004, pooled the chrome mining and smelting operations of Glencore Operations South Africa and Merafe Resources. <\/p>\n\n\n\n

It operates several mines and smelters, including the Boshoek, Wonderkop, Rustenburg, Lion, and Lydenburg smelters. <\/p>\n\n\n\n

Glencore has a market cap of R1.4 trillion, while Merafe has a far smaller market cap of R2.9 billion. The joint venture is the only primary operating asset of Merafe, owning around 20% of the venture.<\/p>\n\n\n\n

However, the joint venture has repeatedly stressed that it could no longer afford to operate under the current power tariffs.<\/p>\n\n\n\n

In September 2025, the joint venture began the Section 189 retrenchment process on 1 September and sought to limit job losses by reviewing its operations. <\/p>\n\n\n\n

The company said that no workable proposals had been offered to address rising electricity costs, which were the biggest pressure point for the energy-intensive ferrochrome smelters.<\/p>\n\n\n\n

Glencore then announced that it would idle the Boshoek and Wonderkop smelters from 1 January, with 2,400 workers served papers.<\/p>\n\n\n\n

Electricity and Energy Minister Kgosientsho Ramokgopa noted that the government intended to offer smelters a discounted tariff to help keep them operating.<\/p>\n\n\n\n

In December 2025, Eskom signed a Memorandum of Understanding (MoU) with Samancor Chrome and the Glencore\u2013Merafe Chrome Venture. <\/p>\n\n\n\n

The MOU would be dependent on an interim tariff adjustment for the smelters, with the companies suspending their Section 189 processes for the period. <\/p>\n\n\n\n

Cuts demanded <\/h2>\n\n\n
\n
\"\"<\/a><\/figure><\/div>\n\n\n

Merafe Resources has now told shareholders that the Lion Smelter in Steelpoort, Limpopo, has achieved its first ferrochrome production tap on 16 February 2026. <\/p>\n\n\n\n

This comes from the successful recommissioning of 50% of its operating capacity. The production follows the approval by NERSA of a 12-month interim electricity tariff of 87.74c per kWh<\/strong><\/p>\n\n\n\n

The joint venture anticipates that the Lion Smelter will return to full operational capacity by 31 March 2026.<\/p>\n\n\n\n

Merafe said that the interim tariff will allow the Lion Smelter to return to full operational capacity in the short term, but it remains insufficient to support sustainable operations over the long term. <\/p>\n\n\n\n

The same position applies to Boshoek or Wonderkop smelters. <\/p>\n\n\n\n

Merafe said that all three smelter operations would require a tariff of 62 cents per kWh <\/strong>to operate on a commercially sustainable basis in the long term.<\/p>\n\n\n\n

The venture said it will engage with all relevant stakeholders to secure a long-term solution that supports the viability of all smelters and is hopeful that a tariff solution is secured by 28 February 2026. <\/p>\n\n\n\n

The end of the month is the deadline for commencing the consultation process under sections 189 and 189A of the Labour Relations Act, 66 of 1995, which affects the Boshoek and Wonderkop smelters.<\/p>\n\n\n\n

In the meantime, Merafe said that the venture will continue to implement business restructuring, streamlining, and right-sizing initiatives to ensure its long-term operational viability.

The venture said that it is working with government, regulators, labour and community stakeholders to find long-term solutions to protect jobs and the broader South African ferroalloys industry.<\/p>\n\n\n\n

Notably, the current 87.74c per kWh tariff is still significantly lower than the prices that households have to pay across the country. While it varies by area, households generally spend at least R2 per kWh. <\/p>\n\n\n\n

As reported by Business Day<\/a>, Eskom CEO Dan Marokane warned of serious flaws in negotiated electricity pricing discounts for energy-intensive firms, stating that the costs ultimately fall on households. <\/p>\n\n\n\n

Article amended. <\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

The Glencore-Merafe Chrome joint venture may need to cut jobs, claiming that its discounted energy prices are not enough to keep its operations afloat. <\/p>\n","protected":false},"author":95,"featured_media":851317,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[9874],"tags":[1164,9693,24782,2006],"class_list":["post-851313","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-energy","tag-eskom","tag-glencore","tag-merafe","tag-nersa"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/851313","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/95"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=851313"}],"version-history":[{"count":9,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/851313\/revisions"}],"predecessor-version":[{"id":851345,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/851313\/revisions\/851345"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/851317"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=851313"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=851313"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=851313"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}