Killing, arson spark fear for future of Rio Tinto’s South Africa mine

On a Monday morning last month, Nico Swart was driving to Rio Tinto’s mine in Richards Bay, South Africa, where he worked as a general manager. It was 6.45am, the sun was just rising. As he came around a corner, three gunmen emerged. They started firing and sprayed his car with 20 bullets.

Swart, a 47-year-old and a father of two, was the third employee of Rio Tinto’s majority-owned Richards Bay Minerals to be killed since 2015.

“Such killings taint the image of mining in South Africa,” said the nation’s mineral resources minister Gwede Mantashe following a meeting with company executives last week.

“If there is a view out there that it is dangerous to invest in South Africa, we will not see investment.”

The investment risk may be real. Rio Tinto, the Anglo-Australian mining giant, owns 74 per cent of the Richards Bay mineral sands mine which produces ilmenite, rutile and zircon. It has already had to curtail production and shelve a planned $500 million growth project due to violent protests.

The problems in South Africa are the latest headache for the $185 billion, ASX-listed miner, as it seeks to ensure safe and responsible operations across its sprawling global business.

Since Swart’s death, the situation at Richard’s Bay Minerals appears to be getting worse; community members have begun setting fire to bulldozers and other heavy machinery.

Barclays analyst Duffy Fischer said Rio Tinto in 2019 had been forced to temporarily shutter the site. The events of the past week, he said, called into question Rio’s future there and the “durability” of the mine’s future output of titanium dioxide – an ingredient used to whiten a wide range of products such as paint, textiles and paper.

Staff among Richards Bay Minerals’ 5000-strong workforce are also fearful Rio may follow through with a threat to close the site entirely.