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Business News of Monday, 31 May 2021


Mining suspension impacts Obuasi mines production

AngloGold Ashanti has suspended its activities at Obuasi Gold Mine AngloGold Ashanti has suspended its activities at Obuasi Gold Mine

AngloGold Ashanti has confirmed a reduction in its gold production forecast for 2021 as a result of the suspension of mining activities at the Obuasi Gold Mines, as mine rescue teams continue to work to restore normalcy following a major accident.

The gold mining giant suspended its activities at Obuasi Gold Mine after an incident two weeks ago on May 18, 2021, which resulted in the missing of a miner at the Obuasi Gold Mines.

In a release following a meeting with investors last week, the company said, “the current suspension, investigation and review of future mining fronts will result in a delay to the ramp-up of production at the Obuasi Gold Mine and reduced production in 2021 for the Obuasi Gold Mine and, consequently, the Company.”

At the beginning of 2021, Obuasi’s estimated contribution to 2021 was production of 300,000oz to 350,000oz, at an estimated total cash cost of US$660/oz to US$710/oz, and an estimated all-in sustaining cost of US$950/oz to US$1,050/oz. The mine produced 46,000oz in the first quarter of 2021 at a total cash cost of US$968/oz and an all-in sustaining cost of US$1,234/oz.

So far, total production in the second quarter, from 1 April 2021 to the suspension of underground mining activities on May 18, 2021, was 34,000oz.

AGA noted that early indications were that the geotechnical incident was likely caused by the failure of a horizontal, or sill pillar, in one of the mine’s smaller mining stopes, of which a thorough investigation has been initiated.

The company indicates that it will also undertake an in-depth area-by-area assessment of the mine design, mine schedule and ground management plans, before progressively releasing mining areas for a phased resumption in production.

“Infrastructure refurbishment and construction linked to Phase 2 of the redevelopment project are continuing, while underground development activities will recommence once they have been cleared as safe,” the company added.

“Our top priorities right now are the search for our missing colleague and to provide support to his family,” Interim Chief Executive Officer Christine Ramon said.

“As the investigation progresses and the assessment of working places advances, we will provide additional detail on the estimated impact on this year’s production and ramp-up of the Obuasi Gold Mine. In the meantime, in light of the above operational interruption at the Obuasi Gold Mine, we are suspending our production and cost guidance for 2021 as it relates to Obuasi,” AGA noted.

Obuasi Gold Mine is one of the world’s largest gold ore bodies, with 29.5Moz of Mineral Resource, at an average grade of 7.64 grams per tonne and 8.7Moz of Ore Reserve at an average grade of 8.6 grams per tonne.