Anglo faces headwinds in keeping restructuring on track
Anglo has been forced to accelerate its restructuring after successfully holding off a bid from BHP, the world’s biggest miner.
Mark Bristow (55) founded Randgold in the 1990s. Under his management, the company has grown to have a market value of $7 billion and be the U.K-listed biggest gold producer.
Africa-focused gold producer Randgold Resources (LON:RRS) said Monday it may consider acquiring new assets as several gold miners are in the process of shedding non-core operations to survive the current squeeze on the industry.
Delivering its 2014 annual results, the miner also said it intends to continue paying a progressive ordinary dividend that will “increase or at least be maintained annually.”
Chief executive Mark Bristow highlighted that, unlike most of the industry, Randgold has not needed to reduce its reserves and resources as the gold price dropped. On the contrary, he said the company has increased ore reserves in 2014 despite also registering record production.
“We have looked closely at all our mines to ensure that they will still be profitable at $1,000 per ounce and we’ll continue to review our operations against a range of gold price scenarios.”
Steady growth
Bristow (55) founded Randgold in the 1990s. Under his management, the company has grown to have a market value of $7 billion (4.2 billion pounds) and be the U.K.’s biggest gold producer.
A geologist by training, Bristow led the discoveries of three gold mines in Mali holding 20 million ounces in deposits. The company has also built the Kibali mine in the DRC and Tongon in Ivory Coast.
Thanks to the executive’s conservative policies, Randgold has not needed to write down its reserves and resources as the gold price dropped, unlike most of its gold peers. This is because the firm has calculated its reserves at $1,000 per ounce and its resources at $1,500 per once for the past three years.
9 Comments
Bill_Wall
With his deep knowledge of the Senegal/Mali fault, I wonder if he will be looking seriously at buying IAMGold’s Boto deposit, as well as the adjacent IAG/Merrex Gold JV Diakha and Siribaya deposit. It wouldn’t surprise me to see IAG wanting to monetize what looks like stellar properties as CEO Letwin has stated that IAG will be debt free by the end of the year. IAMGold has also been trying to reduce its exposure to higher risk countries while Rand is perfectly comfortable in that area.
Stuart Green
Sounds like he could be ready to acquire or joint venture with Birimian Gold – the Australian gold explorer that owns the tenements around the Morila mine in Mali.
Bill_Wall
That might make sense with that mill being underutilized. Also, I’m sure Anglo would sell out cheaply as there is little value left in there for them and they are in a debt reduction mode.
Wild card
What about Amara Mining’s Yaoure project in Cote d’Ivoire ?
Goldfinger
I think Amara mining will be just fine…
• Construction is expected to begin in H2 2016. We’ll complete the Bankable Feasibility Study in December 2015, we’ll then look to arrange financing and secure the mining licence for Yaoure and begin construction at the start of the dry season in October 2016. We could start building during the wet season as Cote d’Ivoire’s wet season isn’t that impactful, but it’s easier to do earthworks and pour concrete when there isn’t any rain as it dries faster
• Construction of a project of this size is expected to take approximately 18 months. We may be able to complete it in slightly less time but we prefer to be conservative
• Based on construction starting in H2 2016 and it taking 18 months, first gold is expected in H1 2018
However, there will be lots of news flow between now and pouring first gold, which will hopefully act as catalysts for the share price.
These include the announcement of the receipt of the environmental licence, drilling results during the summer, announcement of the BFS, receipt of the mining licence, securing the power tariff from the hydro-electric plant, securing financing and many other news items.
Aces Over
Securing the largest foot print in WA, and the timing of this next up cycle to be within Rands Costs, any resource eye shot are viable in reserves? The surrounding tenements of Morila will benefit all securing employment at a low capex to most.
Viggo
Interest stuff. Morila in Mali has just completed the mining of the Pushback. The team is capable and it will be a good opportunity to secure a new Mine and retain most of the experienced personnel to work on the new project.
Jumbo1515
Had a brief look at BGS Birimian Gold and found it to be of interest however not sure why the SP is so low.
Scouse4ever
Not for long IMO