Ashanti nails colors to African mast

Ghanaian gold miner Ashanti Goldfields Ltd on Tuesday committed itself exclusively to Africa in its quest for further gold assets.

Speaking at the Investing in African Mining Conference (Indaba 2002), Ashanti chief executive Sam Jonah also said the company was looking to remove the "golden share" in a bid to improve its attraction for investors.

"We plan to pursue high-quality gold assets in Africa exclusively," Jonah said. "Our priority is at and around our mine sites and in the countries where we currently operate."

Besides the Obuasi, Ayanfuri, Iduapriem and Bibiani operations in Ghana, Ashanti has mines in Zimbabwe, Guinea and a half-stake in Tanzania's Geita. Together, they produced just under 1.66 million ounces of attributable gold in the 12 months to Dec. 31, 2001.

At Geita, an indicated resource of 313,000 ounces of gold was identified some 6km south of the mine's plant, and Ashanti is continuing its assessment of the Lake Victoria Goldfelds in Tanzania.

In addition, an initial resources of 2.8 million tons of or bearing 2.6 grams per ton of gold and 0.42% copper was outlined near the group's Freda-Rebecca mine in Zimbabwe, and a feasibility study is now under way.

Turning to the "golden share", which is vested in the Ghanaian government and effectively gives it the power of veto, Jonah said there was "a great deal of misperception."

The golden share could only be exercised in the event of the voluntary winding up or liquidation of Ashanti, the disposal of any mining lease or material assets or if there was an amendment, deletion, redemption or purchase of the golden share provision, Jonah noted.

"Still, it should be removed on account of its negative investor perception," he said.

Ghana's mining law was being reviewed, Jonah added, and said the golden share would be evaluated within that review.

"Both Lonmin (the London and JSE Securities Exchange-listed mining house) and the Ghana government declared their desire to work with Ashanti to enhance Ashanti's value at a meeting in Accra (the Ghanaian capital) in August last year," he said.