Are We Shaft-Sinkers Or Shaft-Fillers?

“Are there certain things in our universe that always go faster but can never go ‘slower’ than the speed of light?”

Likewise – central bankers continually warn whoever will listen – that interest rates cannot go below 0%. But never do we ever hear a rational explanation of why they can’t. For thousands of years people have been happy to pay a few percentages per annum just to have someone store/protect their silver, gold, bronze and other money without ever receiving any interest per annum. Isn’t that a below 0% interest rate?

From 1890-1970, South African gold production per year only seemed to grow. Only the Boer War and World War II subverted that trend – and even then – only temporarily. But since 1970, SA’s annual gold production has been in a falling trend – which accelerated rapidly from the early 1990s. And while this figure cannot fall below 0 (same with interest rates we are told) – another South African gold mining figure can and finally has now gone below 0. Shaft-sinking!

For over 100 years SA’s gold miners averaged 8km of new shafts sunk every year – sometimes reaching 20km and 25km in a single year. Simply unbelievable when one now looks back! And especially so when one looks back to the period from 1905-1910, when SA was sinking 17km/pa in some years. And we know how basic the technology was back then, when almost everything done inside the shaft was done manually.

Those who were simply mind-boggling human and engineering achievements!

Which makes today’s reality of shaft ‘filling’ – all the more devastating! Because, not only has South African gold mining virtually stopped sinking shafts these past 10 years – but, even worse – companies are now filling them in. Stupefying! When one thinks of the hundreds of billions of dollars that went into those shafts and their related surface and underground facilities and workings over all these decades. Millions of man-years of work and dedication. And now they are being filled in because SA has temporarily (we hope) lost the desire to mine the hundreds of millions of remaining ounces they contain? Criminal! Stalin would have executed people for that. The previous South African government’s administrations would have jailed or at least charged anyone committing such an act. And what government on earth would allow such a heinous crime? The destruction of national assets and sterilising 10’s of billions of dollars in gold.

Considering that SA was the dominant gold producer in the world for over 100 years. And that the gold price averaged under $400/oz [in today’s terms] from 1892-1972 and considering how mining was done between 50 to 100 years ago. And here we are today, with all our modern gadgets and gizmos and education and training, cheap money and excess cash and low interest rates and 200 countries all following the capitalist model. And yet we can’t even cover our costs mining our gold at three times $400 oz? What is going on? And it can’t be depth or grades – as many of SA’s mines were over 3km deep in the 1960s. And grades in the 1930s and 1940s were close to those of today!

SA’s Department of Mineral Resources’ 2015 budget of R1.6bn for 1100 employees is R1.45m per man. And even the Chamber of Mines’ puny +R100m a year budget still leaves some scope – does it not? – to figure how/why SA now has ‘negative’ shaft-sinking per year going on – instead of positive shaft-sinking like we did for 125 continuous years?

And especially considering we still have 40%-50% of the world’s known gold remaining near our existing mines. And we still have a lot of the skilled
450 000 gold miners who have lost their jobs over the past few decades who still want to work.

Certainly, with all of the aforementioned and all our new technology and desperation for jobs (SA’s +7m people endemic unemployment); and with a local company like Master Drilling which can now bore a 1300m long by 8-metre-wide shaft with almost no chance of serious injury, let alone death. Given all of that, shouldn’t we just ban shaft-filling for the next few years and go back to shaft-’sinking’, and mining, and creating jobs and producing gold? Isn’t that better for all – compared to what we have been doing in these past 10-20 years?