Fewer illegal miners at Obuasi mine – AngloGold Ashanti

AngloGold Ashanti said yesterday that illegal miners who have occupied its Obuasi mine in Ghana were slowly leaving the site after the military returned to the area.

Up to 5,000 miners were working at Obuasi in mid-October, a more than 100-year-old mine where production was halted in 2014 when falling gold prices made it uneconomic to access new and deep-lying reserves.

“The government ordered the military to return in mid-October. And that has been a very pain-staking process and one that we support,” AngloGold spokesman Stewart Bailey told Reuters in Johannesburg after the company unveiled its third-quarter update.

“The illegal miners are slowly leaving … There is still a significant number of illegal miners on the site albeit far less than there was before,” he said.

The illegal miners agreed to move to a different part of the AngloGold concession under a deal worked out by a committee that included small scale miners set up by the government regulator, the Minerals Commission.

“We are counting on them to leave on their own, or be pushed out and also lose the ground that we have earmarked for them,” Toni Aubynn, Chief Executive Officer of the Commission, has warned.

Commenting, Eric Asubonteng, Managing Director of AngloGold Ashanti Ghana, said the company will continue to monitor and hope to see results on the ground.

According to AngloGold’s figures, at least 130 illegal miners have been killed since the illegal miners occupied its Obuasi mine.

The presence of the illegal miners has hampered efforts to attract new investment or complete a study on how much it would cost to bring the mine back to life,the mining company has said.

AngloGold Ashanti currently has two wholly owned and managed operations in Ghana – Obuasi in the Ashanti Region and Iduapriem in the Western Region.

Meanwhile, a higher spot gold price helped AngloGold realise free-cash flow of $161 million in the three months to the end of September compared to a $50 million outflow in the third quarter of 2015.

Adjusted earnings before interest, tax, depreciation and amortisation (Adjusted EBITDA) rose 36 per cent to $395 million from $291 million in the corresponding period last year, the company said.

Production in the quarter declined to 900,000 ounces from 974,000 ounces in the same period in 2015, in part because of lower ore grades.

“We generated strong free cash flow in the third quarter, taking this year’s cumulative free cash flow to nearly a quarter of a billion dollars, further reducing debt,” Chief Executive Officer Srinivasan Venkatakrishnan said.

“Work is already well advanced to turn around our operating performance in the near term by improving volumes and accessing higher grades as per our plans, and over the medium term by investing in our low-capital, high-return brownfields projects.”

 

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