How an odd vision sparked South Africa’s latest zama zama illegal gold mining rush

A farm lying beside tailings from historical gold mines near Johannesburg has joined the legion of illegal mining sites in South Africa in an unusual way. It began with a traditional healer’s dream of gold buried beneath a neighbour’s cattle enclosure.

Just days after the story spread in February at the Gugulethu informal settlement in Springs, hundreds of people had descended on the property of Nontombi Mgijima with shovels, buckets, water pumps and equipment.

Children arrived after school, changed out of their uniforms, and helped their parents dig. Mercury and sodium cyanide were being used on-site to separate gold from ore, according to the BBC. The local police came, cleared the site, and left. The holes were reopened within hours.

Black market

Some diggers – called zama zamas in local slang – were selling material on the black market at roughly $160 (C$225) per gram. Even small recoveries can represent days of income in a country with roughly 40% unemployment.

Four months later, South Africa has deployed troops across Gauteng province and arrested dozens, yet the digging continues.

“We don’t want our photos taken, we don’t want to trend on social media,” one woman at the site told visiting journalists who shot the accompanying video. “We know we don’t own the property, but why don’t you take photos of the surroundings, not of what we’re doing?”

 

Massive jump

In the big picture of South Africa’s illegal mining crisis, Gugulethu is not a major incident. What makes it significant is its prevalence; a spontaneous community-level response to the same forces costing the formal mining sector an estimated at 60-70 billion rand ($3.7-$4.32 billion) annually, up from just 7 billion rand eight years ago, according to the government.

The Witwatersrand Basin that arcs across Gauteng province, centred on Johannesburg, is responsible for about half of all gold ever mined in human history. It is also around 95% exhausted at depths commercial operators can profitably access.

South Africa’s gold output has fallen 83% since 1993, reducing its share of world production from nearly 27% to less than 3%, according to Metals Focus. The decline extends a much longer trend from the early 1970s, when the country accounted for about two-thirds of global mine production, according to The Minerals Council, an industry advocacy group. It projects output to remain flat.

Exploration investment has collapsed from $900 million in 2006 to just $43 million in 2025, a 95% decline that has continued even as the gold price climbed 60% through 2025 to a record of $5,500 per oz. in January.

The elevated prices haven’t reopened deep shafts, but they have sharpened the incentive for informal extraction of the residual deposits that are viable for networks operating without capital costs. The illegal mining industry has grown accordingly.

Theft

Illegal miners are stealing explosives, diesel, copper cables, and making illegal connections to mine power infrastructure, The Minerals Council said. Sibanye-Stillwater (JSE: SSW; NYSE: SBSW) reported 1,720 copper theft incidents in 2024, costing 53.4 million rand. Illegal miners “often threaten employees and their families to assist in the crime,” an internal security risk that compounds the direct operational exposure, the council said.

Illegal mining “poses serious risks to the cost and operational safety of legitimate mining operations” according to PwC’s most recent SA Mine report in October. “The country forfeits critical investment opportunities,” PwC added.

But the wider industry might have a template for managing it: Aris Mining’s (TSX: ARIS; NYSE-A: ARMN) Segovia operation in Colombia has integrated 2,500 small-scale miners into a formal program with employment and safety training. Those miners now contribute 45% of total site production.

South Africa published a formal Artisanal and Small-Scale Mining Policy in 2022 specifically aimed at formalizing illegal/informal miners. There was also a pilot in Kimberley where mine owners granted over 800 unlicensed small-scale miners rights to legally mine about 600 hectares of diamond-bearing waste fields.

However, implementation has been rocky. The Kimberley project was hit by violence from excluded informal miners, and the broader zama zama situation shows that South Africa is far from having successfully integrated informal miners at scale.

President Cyril Ramaphosa has authorized a crackdown under Operation Prosper with 2,200 troops across five provinces at a cost of 80 million rand. In late May alone, joint operations across Johannesburg and its satellite areas of West Rand and Ekurhuleni yielded 36 arrests, 16 unlicensed firearms, and more than 800 rounds of live ammunition alongside mining equipment. On June 3, 43 further suspects were arrested in nearby Westonaria.

The original Operation Prosper in 2023 deployed 3,300 personnel and temporarily cleared 6,500 miners from sites, but activity resumed within weeks of withdrawal.

Deaths

The most consequential test came at Stilfontein, 150 km southwest of Johannesburg, in late 2024, where authorities blockaded the Buffelsfontein shaft and cut off food and water to an estimated 4,000 miners. The standoff ended in January 2025 with 78 confirmed deaths and 246 survivors, while local groups believe more bodies remain underground in unsearched shafts.

Critics, including Parliament’s Joint Standing Committee on Defence, say enforcement displaces illegal mining without resolving the problem itself.

For operators and investors assessing South Africa, the crisis intersects with every structural challenge the sector already carries. Regulatory uncertainty, infrastructure decay, and the security premium imposed by illegal mining are compounding risks.

The Gugulethu cattle enclosure, 3 km from the Modder East mine held by China-controlled Gold One Group that files no public reports, is a small example of the formal industry’s 60-billion-rand annual loss. And while Gugulethu has avoided violence and casualties, those threats always lurk in illegal mining.

“If you came here last week, you wouldn’t have been able to step closer,” a small group tending a sluice at the site said. “You would have had a bad encounter with the older men who work with us. They wouldn’t allow you here.”