Business News of Fri, 7 Aug 20150
AGA’s hunt for partners for Obuasi project on course
AngloGold Ashanti Limited (AGA), the world’s third-largest gold miner says the company’s hunt for project partners for its Obuasi project, in Ghana, is still on course.
Graham Ehm, Executive Vice President of Planning and Technical at AngloGold Ashanti, told journalists on the sidelines of the Diggers & Dealers conference in Karloorlie, Australia, that the company was hoping to secure a development partner for its Obuasi project, as well as its projects in Columbia.
Operations at Obuasi were scaled back last year as the company moved to remedy legacy issues at the 180-year-old operation.
AngloGold incurred $147 million of costs relating to job cuts and other restructuring at Obuasi in the fourth quarter of 2014.
A feasibility study was currently under way into a future based on achieving higher production and lower costs through a scale-up of the underground mine and a rejuvenation of the plant and infrastructure.
Mr. Ehm noted that the Obuasi mine would likely require significant capital, which was why AngloGold Ashanti was hunting for a project partner of “substance”.
Chief Executive Officer Srinivasan Venkatakrishnan stated last February that AngloGold Ashanti was under no pressure to sell assets and will only do so for “full value.”
The partial or full sale of one of the company’s key operating assets “is being looked at and progressed,” Mr. Venkatakrishnan said.
The move forms part of the Johannesburg-based company’s plan to cut net debt by about $1 billion over the medium term.
“What we are not going to be doing is a fire sale of assets,” he said. “The shop is closed for bargain hunters. If we don’t get full value, we won’t sell.”
AngloGold is seeking to sell mines or share capital costs with partners in a bid to reduce its $3.1 billion of net debt, partly accumulated during the decade-long bull run in gold to 2011.
AngloGold Ashanti currently has two wholly owned and managed operations in Ghana–Obuasi and Iduapriem.
The operations are located in the Ashanti and Western regions of Ghana and were acquired following a merger between the former AngloGold Limited of South Africa and Ashanti Goldfields Company Limited of Ghana. The new entity, AngloGold Ashanti Limited, was formed in April 2004.
Obuasi is located in the Ashanti Region of Ghana, approximately 60km south of Kumasi. Mining operations are primarily underground, to a depth of 1.5km. Some surface mining in the form of open pit and tailings reclamation occurs.
Obuasi currently treats sulphide ores from underground at the south plant, following the decommissioning of the tailings treatment plant in October 2010. The south plant also treats sulphide tailings and has a capacity of 360,000 tonnes per month.
The Iduapriem mine, wholly owned by AngloGold Ashanti since September 2007, comprises the Iduapriem and Teberebie properties in a 110km2 concession.
Iduapriem is located in the Western Region of Ghana, some 70km north of the coastal city of Takoradi and 10km southwest of the Tarkwa mine. Iduapriem is an open-pit mine and its processing facilities include a carbon-in-pulp (CIP) plant.