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Africa-focused gold producer, Randgold Resources said yesterday it was pulling out of a joint venture with AngloGold Ashanti to redevelop AngloGold's ageing Obuasi mine in Ghana, less than four months after the deal was announced.
Randgold said in September the joint venture would not spend more than $1 billion on the redevelopment of Obuasi, which holds about 5 million ounces of gold reserves but which has not made a profit in a decade.
AngloGold stopped production at Obuasi in November and cut jobs.
Randgold said that after due diligence, it had decided the proposed project did not meet its investment criteria.
The price of spot gold has fallen almost 20% from its 2014 peaks to just above $1,000 an ounce, forcing companies to sell mines, cut spending and shed jobs.
Shares in AngloGold Ashanti were up 1.1% at 104.99 rand 0752 GMT. Randgold shares traded in London were down 0.9%.
