Hundreds Of Local Workers Laid Off At MMG Gold Mine

Hundreds of local workers have been laid off at an Australian-operated gold mine in southern Laos following an announcement last year by company executives that the firm would cease mining the precious commodity due to rising costs.

About 400 of 4,000 workers at the MMG Lane Xang Minerals Limited Sepon mine in Savannakhet province were let go last week and paid compensation, a company officer told RFA’s Lao Service last week.

Most of them were locals who live in Vilabuly district, with the rest coming from neighboring provinces and other area, he said.

The company will help those who can’t find employment to find jobs, he added.

Foreign employees, mostly experts, were also laid off last year, he said.

Work at the Sepon site will now focus on copper production, which had already generated about 92 percent of the mine’s revenue, a company media release said in November.

Lane Xang Minerals Limited Sepon is 90-percent owned by its Australia-based parent company, MMG Limited, with another 10 percent ownership held by the Lao government.

‘Uneconomic’

The continued production of gold at Sepon would have proved “uneconomic” due to falling gold prices and rising costs of production, the company said in its statement.

“[But] we appreciate the significance of the Sepon gold and copper operation to our people, their families and the broader community.”

“Copper production, which generates about 92 percent of total revenue at Sepon, will continue,” the company said.

Copper is now the most commonly mined commodity in Laos, “making it probable that copper will remain as the top export commodity in Laos over the years to come,” Laos’s Vientiane Times said on Monday.

The country’s second-largest mining investment is in iron ore, with gold coming in third, the paper said.

Meanwhile, the Lao government has announced plans to revise its mining policy “with the aim to generate more revenue from mine concession projects,” according to a Dec. 30, 2013, Vientiane Times report.

“The move comes after the government has learnt that Laos has collected unreasonably little from many mining projects it has previously granted concessions to investors for.”

Officials are currently inspecting mine projects across the country with plans to finalize the government’s survey sometime this year before announcing revisions to its policy, the paper said.

Source: RFA