Heavy rains in South Africa could have a negative impact on mining in the country, leading to power cuts and damaging productivity.

State-owned Eskom, which runs 27 power stations, said its coal mining operations could be badly affected as open-cast mines cannot be operated during heavy rain, the South African Times reports.

Additionally, the Koeberg nuclear power plant is due to be closed for repairs in the near future, which could potentially hit mining operations hard.

It is hoped that the company will be able to avoid a repeat of the 2008 blackouts, which caused temporary closures of some of the biggest platinum mines in the world.

The power supplier was forced to ration electricity at points during that year, which in turn led to some mining operations being delayed and affecting the prices of some metals.

"Remember the big investor who withdrew from Coega because there was no guarantee of electricity supply to operate a smelter plant?" Makwe Masilela, a market analyst at BP Bernstein, asked the newspaper.

"You must also remember that platinum and gold are our largest foreign revenue earners."

However, Mr Masilela said he believes Eskom has learned its lessons from 2008 and is better-placed to avert the potential crisis this time around.

"Eskom is buying high-quality coal for affected stations and taking steps to improve operating procedures in the coal stockyards," said Eskom chief executive Brian Dames at a presentation this week, according to the newspaper.

"We are upgrading operating processes and procedures for the power station coal stockyard to improve coal handling in wet weather."

Meanwhile, Bloomberg reports that Eskom is warning of a possible shortfall of as much as 2,000 megawatts of electricity in March this year, which could affect the country's largest users of power including Anglo American, BHP Billiton and Xstrata Plc.

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SA dreads the lights going out yet again (8/01/11) 

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