AngloGold agrees Middle East alliance

Ines Schumacher | Wed, 10 Jun 2009 13:24
[miningmx.com] -- SOUTH African gold miner AngloGold Ashanti has formed an alliance with United Arab Emirates exploration company Thani Dubai Mining to develop and operate mines across the Middle East and parts of North Africa.

The company has the opportunity to participate in any of the projects Thani currently owns. It has one project at the prefeasibility stage with recently defined measured and indicated reserves of 234,000 ounces of gold and an inferred resource of 930,000oz.

AngloGold said Thani is conducting a surface and underground exploration programme at this site to increase the resources and reserves. Exploration is underway at other concessions in Yemen and Egypt .

"What we are doing is looking at the projects Thani currently owns and also at other opportunities. It is too early to say," AngloGold spokesperson Alan Fine told Miningmx.

Each company will have a 50% interest in the alliance which will conduct explorations for gold, precious and base metals.

Rishard Camball, chief executive officer of Thani Holding which owns Thani Dubai Mining, told Reuters that the reason his company formed the alliance is because it needed a partner who had the know-how and technology of mining, while Thani specialized in acquiring assets.

"As an initial investment a total of $15 million was made by both companies for the business development aspect of the project," he said.

AngloGold said Thani is well-placed to bring regional technical expertise to the partnership. "We consider there to be some promise in the Middle East," Fine said.

Project acquisitions and exploration programmes will be equally funded by AngloGold and Thani, up to and including the completion of the project prefeasibility study.

Under the terms of the agreement AngloGold would develop, manage and operate any subsequent mining operations.

“The alliance has already identified opportunities in the region and an evaluation process of these opportunities is currently in progress,” AngloGold said in its media release on Wednesday.

Savuka gold mine

Meanwhile, AngloGold, South Africa's largest gold producer, is assessing damage caused by a series of seismic events at its Savuka gold mine, which is a small contributor to the group's output.

The primary and tertiary shafts were not damaged, but a sub-shaft barrel was affected as was the infrastructure supporting carbon leader reef production.

On May 22, a pump attendant died of his injuries caused by the seismic event. All employees who were underground at the time when the activity was first reported were evacuated through the shaft infrastructure at the neighbouring TauTona mine.

AngloGold is assessing how to rehabilitate the sub-shaft infrastructure while still continuing to mine Savuka. “There will only be a low volume of production from the main shaft area for the remainder of the second quarter,” the company said.

The group will not release guidance to the market on the impact of production losses until the June quarter comes to an end. AngloGold has also had a number of safety-related stoppages at its other mines after a spate of fatalities.

Savuka produced 66,000 ounces of gold in 2008, which is around one percent of total group production. The mine recorded a production of 14,000 oz in the first quarter of 2009.

The company will update annual guidance with the release of its second-quarter results on July 31.