Intelligence Analysis
South African Mining Incident Highlights Risk Illegal Miners Pose to the Extractive Industry
Key Takeaways:
- Illegal mining in South Africa is surging due to economic hardship, unemployment, and declining opportunities in formal mining jobs.
- Authorities launched Operation Vala Umgodi (“close the hole”) to combat illegal mining; its controversial strategy has allegedly led to fatalities and legal challenges.
- Without addressing underlying socioeconomic issues, enforcement efforts are unlikely to succeed, risking additional casualties and business instability.
A recent deadly incident in a disused gold mine in South Africa underscores the current security challenges faced by companies and could portend future legal issues that may exacerbate operations in the country’s already complex mining sector. Illegal mining is growing as socioeconomic difficulties deepen and the price of gold rises. The government’s current response is essentially to blockade facilities targeted by illegal miners in an effort to force them to the surface and subsequently arrest them; however, the approach has failed to produce the desired result. To the contrary, it has led to a six-month-long standoff between miners remaining underground and authorities waiting to apprehend them at the surface. A major reason for the lack of success is that the root causes of the crisis appear systemic; companies in the mining sector could begin to face a series of new legal hurdles if South African courts begin to rule that mine operators share at least some of the liability for such incidents.
Illegal Mining Surges amid Economic Hardship and Declining Formal Employment
Mining compounds in South Africa have increasingly been the target of illegal miners, locally referred to as “zama zamas,” the majority of whom are nationals of neighboring countries seeking employment in the mining industry. South Africa sits atop an estimated 5,000 tons of gold, the third-largest deposit in the world. Yet, many of the country’s mines are closed, with a reported 6,000 lying abandoned after the deposits grew too dangerous and expensive to extract. Mines are also employing fewer foreigners, with current estimates being around 30,000 – down from the 500,000 foreign miners in the 1980s. The surviving workforce, struggling with high levels of unemployment, has reverted to illegal mining as a means of subsistence. Illegal miners do not restrict their activities to disused mineshafts, allegedly bribing private security and gaining access to active mines as well. The gold funds powerful transnational gangs – some with alleged ties to southern African politicians – and supports a wider informal, mostly lower-income community living adjacent to the shafts, benefitting from the criminal enterprise.
Crisis Escalates as Authorities Struggle to Contain the Threat
The crisis has reached epidemic proportions, costing the economy as much as USD 3.2 billion a year and forcing authorities to adopt a new radical policy. In December 2023, the South African Police Service (SAPS) began Operation Vala Umgodi (“Close the Hole”), a nationwide strategy aimed at disrupting illegal mining activities. Miners can spend months underground, relying on a steady stream of provisions to sustain them; SAPS locate their supply points, prevent them from re-entering the mines, and arrest the miners once they resurface. The tactic was recently employed in August 2024 in the Buffelsfontein gold mine in Stilfontein, some 130 km (80 miles) southwest of Johannesburg. By early November 2024, some 500 miners had returned, but about 1,500 remained underground; by January 2025, several hundred still remained in a 2,000-meter (6,500-foot) deep shaft and were unable to reach the surface. An NGO representing the Stilfontein miners subsequently petitioned the Constitutional Court, alleging that the Buffelsfontein Gold Mine (BGM) company should have taken responsibility for the miners’ rescue. Authorities refused to send emergency services over safety concerns; after a court order, they eventually used a crane to hoist miners to the surface. In the end, 1,882 miners were arrested, 121 others were deported, 46 others were sentenced for illegal mining, and 87 deceased were retrieved from the shaft.
Vala Umgodi is unlikely to succeed in deterring further mine invasions as the issue primarily stems from societal factors that are external to mining per se. On the contrary, any further deadly incidents related to the government’s response could harm South Africa’s business climate. Illegal mining has already attracted thousands of individuals – some 30,000 in 2019. Simultaneously, socioeconomic conditions are unlikely to improve in South Africa and neighboring countries; moreover, the price of gold has reached record highs, increasing by over 4.5 percent since January 2023, providing greater motivation. Vala Umgodi, by its nature, appears to target the proverbial “symptoms” rather than the underlying “disease.” As such, it is unlikely to produce a long-term solution or pose an effective deterrent. Rather, the approach could result in additional casualties, potentially resulting in further court actions and new legal ramifications for mining companies. Mining companies should monitor security legal developments closely, as this may also set a precedent in the event of their abandoned or even active compounds being invaded by illegal miners.
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