Mozambique: Montepuez Ruby Mining suspends 60% of its workforce

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Mozambique: Montepuez Ruby Mining suspends 60% of its workforce

4:04 CAT | 23 Jul 2020

File photo: MRM

Montepuez Ruby Mining (MRM), which operates the world’s largest ruby mine, in cabo Delgado, northern Mozambique, has suspended 60% of its approximately 1,400 workers due to the impact of theCcovid-19, the company’s management announced today. .

“The suspension of contracts was made through negotiations with the unions,” said Raime Pachinuapa, director of corporate relations at MRM, during a press conference in Maputo.

MRM owns 34 thousand hectares of rubies exploration concession in Cabo Delgado and presents itself as the main investor in the extraction of rubies in Mozambique, being 75% owned by Gemfields and 25% by Mozambican company Mwiriti Limitada.

Raime Pachinuapa clarified that the suspension of contracts, for a minimum period of six months, does not imply redundancies, adding that the agreement with the unions “safeguards workers’ rights”.

“It is not the primary option of the company to fire anyone. Our workers are our main asset”, he stressed.

In the case of suspension of employment contracts, defined as a “temporary stoppage”, Mozambican legislation provides that the employer pays 75% of the salary in the first month, 50% in the second and 25% in the third.

In addition to causing the cancellation of an auction scheduled for June, the impact of the new coronavirus led the company to halt some of its expansion plans, with an emphasis on suspending the construction project for the second ruby treatment plant that was budgeted at US$25 million (22 million euros).

“In the first half of last year, MRM had revenues of more than 50 million dollars (43 million euros) and, unfortunately, to date, we have not yet had revenues. In other words, we are far from reaching the figures for the same period in last year, “said MRM President Samora Machel Júnior.

The company, which has “non-critical” operations suspended since April 22, announced on July 14 that 10 employees were infected with the new coronavirus at its facilities in Cabo Delgado, thus becoming the second company to report cases of Covid-19 in that northern Mozambican province,following the outbreak at the facilities of the French company Total, which leads one of the consortia that will explore natural gas in the Rovuma basin.

MRM held a total of 13 auctions, having collected 584.1 million dollars (504 million euros) in aggregate revenue, according to company data.

MRM’s last auction took place in Singapore in December and yielded $ 71.5 million (€ 62 million).

Mozambique, which has been in a state of emergency since April 1, has recorded a total of 1,557 infections and 11 deaths since the announcement of the first case of Covid-19 in the country, on March 22.

Source: Lusa