AngloGold Ashanti achieves key milestones

AngloGold Ashanti says its Obuasi deeps decline development and the resource enhancement drilling programme are on track, the company said in a Statement on Thursday.

It said the feasibility study remained on course and was currently being optimised to inform the investment case for a simpler, modern underground mechanised mine.

The Obuasi mine is currently in the Limited Operating Phase (LOP) after halting its primary and core underground operations at the end of 2014, in line with the government approved Amendment to the Programme of Mining Operations (APMO).

The advent of the LOP in December 2014 resulted in the laying off 4,762 employees at a total cost of $ 240 million.

The statement said the core elements of this phase include legacy environmental clean-up works, which during the quarter produced 14,000oz from retreatment of old tailings.

“This is about ensuring that we have a sustainable and profitable operation that benefits all of its stakeholders,” said Mark Morcombe, the Senior Vice President of Obuasi Operations.

“Obuasi has a world-class ore body, but we need to reconfigure the entire mine which comes at a significant capital reinvestment cost and establish a new operating culture to make it a sustainable business for the long-term.”

The company also owns and operates the Iduapriem mine in Tarkwa.

It said Iduapriem’s production for the quarter climbed 20 per cent to 48,000oz at a total cash cost of $ 1,029/oz compared to the previous quarter’s gold output of 40,000oz at a total cash cost of $ 1,046/oz.

It said tonnage throughout in the current quarter had stabilized, following the SAG mill upgrade towards the end of last quarter.

“We intend to build on this important milestone as we evolve our plan to extract further operational efficiencies, in keeping with the group effort towards a leaner, more efficient company able to weather the current low gold price environment and thrive if the price recovers,” said Sicelo Ntuli, Managing Director of the Iduapriem Mine.

Meanwhile, AngloGold Ashanti said it generated $71 million of free cash flow in the second quarter on the back of strong performance from its international mines and a recovery from its South African operations.

A statement issued by AngloGold Ashanti and copied to the Ghana News Agency on Thursday said production was 1.007Moz at a total cash cost of $718/oz in the three months to June 30, 2015, compared with 1.098Moz at a total cash cost of $833/oz in the second quarter of 2014.

It said the result compared with guidance of 960,000oz to One million ounces at $770/oz to $820/oz.

It noted that AngloGold Ashanti Chief Executive Officer Srinivasan Venkatakrishnan and his Executive team continue to lead an effort across the company’s 19 mines to improve margins, despite a depressed gold price environment.