(Bloomberg) — Hein Westraadt, a security manager at South Africa’s largest gold producer, was finishing up some paperwork when a colleague rushed to his desk with a tip-off.
Thirty-three illegal miners had smuggled themselves into one of Sibanye Gold Ltd.’s biggest mines, and had been stealing ore undetected for three months, while living more than a mile underground.
Westraadt’s discovery is a window into South Africa’s illegal precious-metals trade, worth as much as $1.3 billion a year, spanning poor immigrants, mine employees, metal dealers, makeshift refineries and criminal gangs. The concoction of corruption and poverty that encourages men to mine illegally is spreading the problem from abandoned mines to working ones, threatening the operations of a 120-year-old industry that has produced a third of all the world’s gold.
“It’s a huge problem across South Africa,” said Graham Briggs, chief executive officer of Harmony Gold Mining Co., which shut Kusasalethu, its biggest operation, for two weeks in October after it was invaded by more than 100 alleged illegal miners. “There’s certainly more aggression and it’s more competitive. Any number of illegal miners can be a threat to your organization, especially from a safety perspective.”
At dawn the morning after he made the discovery in March 2013, ex-policeman Westraadt, 51, assembled a team of 30 security guards and made the 40-minute journey in cage lifts and underground trains to level 43 in Kloof mine, 1.1 miles deep into the earth.
Faeces Found
They crawled through disused tunnels on their hands and knees in 38 degree-Celsius (100 degree-Fahrenheit) heat, and eventually found a mined-out section filled with plastic bottles, food wrapping and faeces.
After backing the thieves into a corner, they arrested the 33 men, who appeared to have been living there for about three months, and took them to police on the surface, Westraadt said. Their skin had lightened to a gray-like color and the sunlight hurt their eyes after so long underground, he said.
“They’re not satisfied with abandoned mines anymore, they’re targeting working mines with richer ore,” he said. “This was by far our biggest bust, but they keep coming.”
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