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    Gold Fields May Cut 6,900 Jobs on Power Restrictions (Update1)

    By Antony Sguazzin

    Feb. 25 (Bloomberg) -- Gold Fields Ltd., Africa's second- biggest gold producer, said it may eliminate 6,900 jobs, or 13 percent of its South African workforce, as limited power supplies reduce output.

    The company plans to close part of its Driefontein and Kloof mines and remodel its South Deep mine as production may fall by 15 to 20 percent, Gold Field said.

    Gold Fields is cutting job cuts after Eskom Holdings Ltd., South Africa's state-owned power utility, limited power supplies to the country's mines to 90 percent of normal consumption. A power shortfall shut most mines in the country for five days last month. The restrictions may last until 2012, Eskom said.

    ```The inability of Eskom to supply the mines with their full power requirements and to commit to additional electricity demand for new mining projects currently in development has caused a significant crisis,'' Terence Goodlace, head of South African operations for Gold Fields, said today in an e-mailed statement today.

    Gold Fields will delay sending out notices to workers to inform them of the job cuts until the National Union of Mineworkers, South Africa's biggest labor union, has met with the government and the Chamber of Mines, an industry body, on Feb. 26, 27 and 29, the company said.

    This article on Bloomberg ATM.

    Gold Fields proposes closing the No. 6 and 7 shafts at Driefontein, Africa's largest gold mine, and shelving the No. 9 shaft Depth Extension project at that mine. The No. 3 and 8 shafts may be closed at its Kloof mine. Together Kloof and Driefontein may shed 4,900 jobs.

    South Deep will be remodeled and 2,000 jobs may be cut while the Beatrix mine is unlikely to be affected, Gold Fields said.

    South Africa has an unemployment rate of 25.5 percent, the highest of 64 countries monitored by Bloomberg.

    To contact the reporter on this story: Antony Sguazzin in Johannesburg at [email protected]

    Last Updated: February 25, 2008 02:01 EST
 
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