Events and Special Reports

AngloGold reinstates guidance on growing certainty

AngloGold reinstates guidance on growing certainty
Mining News Pro - Gold mining company AngloGold Ashanti on Monday reinstated annual guidance on improved operating certainty amid the Covid-19 pandemic and in anticipation of the conclusion of the sale of its South African assets at the end of this month.

All conditions precedent have been met with respect to the sale of its remaining mines in South Africa to Harmony Gold and the transaction is scheduled to close on September 30, when Harmony will assume full ownership and operation of all assets and liabilities that form part of the transaction.

“We’re pleased to reintroduce guidance, which reflects our greater certainty in relation to full year operating performance,” AngloGold Ashanti interim CEO Christine Ramon stated in a release to Mining Weekly.

“Our operators have done an outstanding job managing through this period – limiting the impact of COVID-19 on production and costs, while prioritising the health of our employees and host communities.”

Updated 2020 production guidance excluding the South African assets is 2 800 000 oz to 2 860 000 oz at an all-in sustaining cost (AISC) of $1 050/oz to $1 100/oz. Total capital expenditure (capex) will be $850-million to $905-milllion and sustaining capex $570-million to $605-million. Non-sustaining capex will be $280-million to $300-million.

Annual guidance was withdrawn on March 27 as the pandemic accelerated and many governments responded by restricting travel, closing borders and ordering some businesses to cease or limit operations. The Cerro Vanguardia mine in Argentina, Minera Serra Grande in Brazil and all South African operations were ordered to close for varying periods, while border closures slowed down the Obuasi redevelopment project. All subsequently returned to full production, whilst the completion date for the Obuasi project was moved out by three months to the end of the first quarter next year and it remains on track to meet that schedule.

The company benefited from its diversified global portfolio and careful management during the intervening period, with the impact in the first half of the year limited to 85 000 oz – or 3% of production – and $53/oz, or 5% of the AISC during the period. Most of this impact was related to the South African assets, where the Mponeng mine was ordered to close from March 26 and only resumed production on May 4, after which it was initially allowed to ramp up to just 50% of capacity. The mine was closed again on May 24 until June 1.

AngloGold Ashanti has taken a number of proactive steps to protect its employees, host communities and business and has for some time employed increased screening and surveillance of employees, stopped non-essential travel, instituted mandatory quarantine for arriving travellers and increased hygiene awareness across its operations, in addition to a range of other measures to mitigate the risks presented by the virus. It has also worked with local communities to help bolster their responses to the outbreak. These initiatives have complemented government responses in each of its operating jurisdictions.

“While we expect that these measures together with our business continuity plans will enable our operations to deliver in line with our production targets, we remain mindful that Covid, its impacts on communities and economies, and the actions authorities may take in response to it, are largely unpredictable,” the company stated.

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