The agreement, according to a statement by Lonmin, aims to enable relevant companies within the firm to meet the South African government’s requirements on Black Economic Empowerment (BEE).
Black Economic Empowerment is a government initiative aimed at remedying the socio-economic inequalities that South Africa’s black population was subjected to in the apartheid era.
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“I believe this agreement represents the most sustainable and fair way forward, and I hope that as well as bringing financial benefits to our people it helps to build stronger bonds between the Bapo and Lonmin,” Kgosi Bob Mogale, the Bapo chief, said in the statement.
The Bapo community dwell in Rustenburg, in the North Western province of South Africa.
In the addition to the agreement, the Bapo and Lonmin will also form the Bapo Community Local Economic Development Trust, which aims to promote educational initiatives and healthcare improvement, and also address the developmental needs of the Bapo, among others.
[DATA LON:Lonmin plc] is a platinum mining group headquartered in London but operates in South Africa. Lonmin was one of the major mining companies in the country that were affected by the five-month long platinum strike.
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The Bapo ba Mogale traditional community will waive their current statutory right to receive royalties from Lonmin’s operating companies Eastern Platinum Limited and Western Platinum Limited, or collectively known as Lonplats, in exchange for a lump sum cash royalty payment, which is payable by Lonplats.
Ben Magara, CEO of Lonmin, explained that the agreement will be a prime undertaking for both parties.
“It is Lonmin’s first priority to work in the interests of all our stakeholders. We are pleased to have reached an agreement as this is testimony to developing a constructive relationship with the Bapo ba Mogale,” he said.