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AngloGold cautious on Colombia 'gold frontier'
David McKay
Posted: Fri, 17 Aug 2007

[miningmx.com] -- ANGLOGOLD Ashanti had found two gold deposits in Colombia with inferred resources of not less than two million ounces but it said it could take six years to develop them if proved feasible.

"It's at the early stage," said Roberto Carvalho Silva, outgoing COO of AngloGold Ashanti's South American assets. "But they could represent a new gold frontier for AngloGold," he told journalists at a presentation in Brazil.

The two prospects - Gramalote and La Colosa - are undergoing metallurgical testwork, the first fruits of which were scheduled for completion end-August. If the results were negative, AngloGold Ashanti would consider farming out the projects to junior mining firms, said Carvalho Silva.

"Two million ounces in resource is the very minimum size project AngloGold Ashanti would take on," Carvalho Silva said.

In gold exploration, an inferred resource indicates presence of gold mineralisation but does not yet express confidence in its economic viability. AngloGold Ashanti had completed about 30 drill holes in the region.

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Gramalote was a pure gold project, but La Colosa contained copper and molybdenum, a metal used in the manufacture of steel. A third copper/gold project called Quinchia, was also under consideration.

"A programme like this would take not less than six years to complete," said Carvalho Silva who added that the company understood the political risk of investing in Colombia.

"The probability of finding a gold mine in Wall Street is very rare. If you want to find a gold mine, you have to go where the good girls aren't," he said.

"The name of the game in exploration is focus. We have been effective, on the ground in Colombia since about 2004. We had a strategy there when no-one else wanted to go," he said.