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South Africa mining giants to settle stand-alone silicosis claims

South Africa

The South African mining giant Anglo American South Africa and AngloGold Ashanti on Friday agreed to set up a $30 million compensation fund to pay former miners who contracted silicosis while in their employment.

The settlement is to cover the approximately 4,400 seperate claims instituted against Anglo America South Africa. The figure also includes 1,200 seperate claims against AngloGold Ashanti.

The settlement has been reached without any admission of liability by the two companies and the terms of the agreement remain confidential.

Both companies are expected to contribute, in turns, toward a realisation of total amount of up to 464 million rand (about $30 million), which will be placed in an independent trust. The trust, to be administered by trustees, will determine medical and other eligibility and compensation to claimants.

Compensation will be determined at the discretion of the trustees, and will be based on the agreed guiding principles set out in the trust deed.

AngloGold Ashanti Chief Executive Officer, Srinivasan Venkatakrishnan said the firm believes the settlement terms are in the best interest of the claimants, their families, and the company.

He said both companies and the plaintiffs have a common interest in settling the highly-complex case that could take several years to resolve through litigation.

The settlement agreement is however not related to a pending class action certification application currently before the courts. The court is still to determine whether or not a class action law suit is the appropriate way to hear the action. Judgment on this matter is still pending.

Occupation Lung Disease (OLD) is an issue the mining industry acknowledges as of significant importance for the sector and the country. Both companies, along with several of their industry players, have also convened a working group to address issues relating to compensation and medical care for OLD in the gold mining industry in South Africa.

The companies in this working group are in the process of engaging all stakeholders in order to cooperate in the design and implementation of a comprehensive solution to compensate for OLD.

They said the compensation would be fair to past, present and future gold mining employees, and also sustainable for the sector.

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