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AngloGold reopens 30 million ounce Ghana mine

Development of the underground section of Obuasi is ongoing (Image courtesy of AngloGold Ashanti.)

South Africa’s AngloGold Ashanti (NYSE:AU) (JSE:ANG), the world’s third-largest producer of the precious metal, has poured first gold at its Obuasi mine in Ghana, five years after mining activities were suspended.

The company, which seeks to access Obuasi’s 30-million-ounce ore body over the next two decades and beyond, said that following a ramp-up period, the mine will generate 2,000 tonnes a day during 2020.

The figure is expected climb to 4,000 tonnes a day by the end of next year, AngloGold added. The ultimate goal is to have Obuasi churning out between 350,000 and 400,000 ounces annually for the first ten years of operations.

The company expects its gold mine in Ghana to produce between 350,000 and 400,000 ounces per year for the first ten years

The mine, which for years battled incursions by illegal miners, had been halted since 2014. At the time chief executive, Srinivasan Venkatakrishnan, decided the company was no longer in a position to subsidize the loss-making operation.

AngloGold then moved to rebuild the mine’s foundation for what it called a “sustainable long-term future,” which is expected to cost between $495 million and $545 million spent between 2018 and the end of 2020.

Development of the underground section of mine is ongoing, with deepening of Obuasi and access to the KwesiRenner shaft on schedule for mid-2020, the miner said.

Construction of new plant infrastructure will continue in 2020, it added.

AngloGold Ashanti’s next challenge is to find a buyer for Mponeng, its last South African operation.

The sale of Mponeng, the world’s deepest mine, would be the final step in the miner’s withdrawal from South Africa, after it sold and shut other mines in the country to stem losses.

It could also be a precursor to AngloGold moving its primary listing to London or Toronto, though chief executive officer, Kelvin Dushnisky, has said the company plans to remain on the Johannesburg Stock Exchange.

AngloGold accelerated its expansion outside the country in 2004 when it acquired Ghana’s Ashanti Goldfields, and today operates mines on four continents.

Now read: Top ten biggest gold mines.