Johannesburg - Liquidated gold mine Blyvooruitzicht has been defaulting on its water payments since 2007.
This prompted the local municipality to cut the water supply to the mine on May 12. It has also affected the local mining community and schools.
The mine was liquidated in August 2013. Eight months later, Eskom stopped supplying it with electricity, resulting in all mining operations being shut down.
Despite the shutdowns and the liquidation, the water usage in the area continued to rise at a monthly rate of R4 million.
Merafong municipal spokesman Chris Spies said the municipality had cut the water supply to the mine last week, after it failed to reach a settlement with the liquidators.
“Various actions have been taken by Merafong Municipality to ensure payment of the account, which included providing cut-off dates to the mine,” he said.
“But each time, the mine succeeded in making some form of payment to avoid the water supply being cut by the municipality.
“The water account, however, continued increasing; the mine did not service consumption and made no effort to service the arrears.
“With the liquidation of the mine and the appointment of the liquidator, Merafong appointed a firm of attorneys to act on its behalf with the executor. This has, however, also not resulted in a suitable arrangement being reached to date,” Spies said.
He added that the water usage of the mine amounted to R4.2m a month and its debt now stood at R197m.
Spies said the breakdown in talks happened after the liquidator offered to make a monthly payment of R500 000 – a shortfall of R3.7m a month.
“Accepting such an offer would, in fact, have the implication that Merafong agrees to write off over R 3.7m a month, which it cannot do in terms of legislation or the municipal policy framework.
Spies said the mine used a large amount of water for its economic activities, but was refusing to pay.
The mine had its own village that accommodated its workers, a golf course and businesses, but none of these entities paid for water, he pointed out.
“So far, this entity has not made any effort to pay its water account or any portion thereof from the rental income, in lieu of the water consumption on the mining village.
“The current indication is that many of the houses on the village are occupied illegally without the occupants being in possession of rental contracts for those properties,” Spies said, adding that the municipality did not own the land where the mine was based.
“The water supply to the individual houses, schools and businesses in the area are… not measured, and the nature of the water reticulation system in the area makes it impossible to supply water to individual consumers,” he said.
Three schools had been severely affected, but the municipality said it was helpless to do anything because they were on private land.
Spies said the municipality could also not enter into individual contracts with the house owners for the same reasons.
But he said the municipality had bought 30 10 000 litre tanks of water to be used by the village, but the locals had kept out the tanks.
Liquidator Leigh Roering confirmed that water supply to the mine had been cut.
“I do not have a solution to the problem.”
baldwin.ndaba@inl.co.za
The Star