Pressure Group Petitions Asantehene

Otumfuo Osei Tutu II.

The Alliance for the survival of Obuasi (AFSO), a pressure group has petitioned the Asantehene, Otumfuo Osei Tutu II to intervene in an impasse between AngloGold Ashanti (AGA) Limited and the Mining and Building Contractors (MBC) Limited over the renewal of a contractual agreement between the two.

MBC, which employs about 1,300 workers, has been working for the Obuasi Mine since 1921 (90 years) as a development contractor who prepares the ore body underground and makes it ready for mining to take place.

But according to the pressure group, it had information that AGA had deliberately reneged on its commitment to renew the contract between it and MBC and that there were reports that AGA intended to bring in a new wholly foreign owned company by name Byrncant to take over the development activities of MBC.

This, according to the pressure group would deprive a number of indigenes of Obuasi of employment if it were allowed to go on. This is because the group said MBC was the second largest employer in Obuasi after the AGA.

In a petition to the Asantehene signed by Mr Edward Kwasi Akuoko, Spokesperson, the group said AGA had failed to honour its financial obligation to MBC in recent times, thereby making MBC unable to honour its obligation to its workers and suppliers by way of advance salary payments and supplier item payments respectively.

The petition was copied to the Minister of Land and Natural Resources.

According to the group the normal practice between the two companies had been to renew the contract every three to four years but when it expired in August last year, AGA extended it for only one year and gave some thematic areas for MBC to improve upon before a renewal.

This, they said included the need for MBC to restructure its governing system by separating management from ownership, improving on its financial capacity, do away with obsolete equipment and improve productivity.

The pressure group stated that a joint technical committee was formed and it was realised that MBC finances were low but AGA was to blame because it owed MBC US$18million.

On the obsolete equipment MBC argued that the equipment was sold to it by AGA in 2004 and since they were old machines they borrowed US$5million to keep them in shape.

With regards to the governance structure, the pressure group said MBC had since restructured and separated ownership from management and had also formed a board, which now has Mr Paul Victor Obeng as its chairman.

However on the productivity level, MBC said it would be able to increase it when it got new equipment to which the AGA had offered to assist them in getting new ones.

The pressure group stated that in May this year, AGA wrote a commitment letter to MBC and said it was willing to renew the contract for five years but surprisingly later wrote another letter to the Board Chairman, Mr P.V. Obeng indicating that it was not going to renew the contract since it was not happy with the output of MBC.

AFSO alleged that in pursuant to AGA’s agenda to severe the contract, it had deliberately designed to frustrate the production efforts of MBC through the cutting off of underground compressed air valves, the cutting off of underground drilling water and the intermittent cutting of underground power (electricity) to the MBC working areas all intended to give the “dog a bad name”.

“A specific case in point, is when one worker alleged that on Monday morning August 23, 2010 a mine manager of AGA by name Mr Nsarkoh reportedly prevented some MBC underground workers from doing their job”, the group alleged.

The pressure group also accused AGA of deliberately sabotaging activities of MBC in other to justify their intent of severing the contractual relationship between them.

It alleged that some leading officials of AGA and some former employees of MBC who had been contracted by AGA went round the mine on Monday August 23, 2010 interrogating some MBC staff as to whether they had been paid their salary advances or not and subsequently called on them to agitate against the MBC management.

“These actions we think are part of the orchestration by AGA Ashanti to weaken the administrative, financial and production capacity of MBC to give it (AGA) a genuine platform not to renew the contract between them”, the group said.

They explained further that Anglogold on Friday August 20, 2010 sent a letter to the management of MBC and circulated copies throughout the mine, informing all concerned that the contractual relationship between it (AGA) and MBC was over and that they were to absorb the 1,300 workforce of MBC into AGA.

They said the situation between the two if not addressed could even cause deaths underground and that these among many others were the critical concerns of members of the Alliance for the survival of Obuasi (AFSO) which, they wanted the Asantehene to intervene and subsequently address to bring sanity to the Obuasi municipality.