ANGLOGOLD said it would increase gold production from its Tropicana mine in western Australia after extending the mineral reserves of the operation some 45%.
Annualised production at the mine would increase to between 450,000 to 490,000 ounces a year from the second half of the 2017 calendar year. It has produced 290,000 oz in the first nine months of AngloGold’s financial year but was once a much larger mine having yielded around 500,000 oz of gold in the 2015 financial year.
Tropicana is a joint venture between AngloGold Ashanti Australia, which owns 70% of the mine and is the manager, and Independence Group.
The operational update seeks to highlight the group’s potential for organic growth in production following announcements by its South African rivals – Sibanye Gold and Gold Fields – which have been involved in corporate activity.
Although it has its own organic growth project in Ghana, Gold Fields unveiled in November $270m bid for Gold Road Resources whilst it may also make a $1bn re-bid for Kirkland Lake, a Canadian gold producer.
Sibanye Gold, meanwhile, gobsmacked investors last week with a R30bn offer for Stillwater Mining, a transaction it said it had been assessing for nine months. The bid, which will make it the third largest palladium and platinum producer in the world, may see a minimum R10bn rights offer.
AngloGold said today, however, that further increases in Tropicana’s production were anticipated depending on the outcome of the Long Island Study.
The Long Island study is an investigation into the feasibility of large cutbacks “… to the pits utilizing low-cost mining options including strip mining and backfilling to minimise waste haulage costs”.
“We’ve adopted an innovative, holistic approach that demonstrates the quality of this asset and the enhanced returns it will deliver to stakeholders,” said Michael Erickson, AngloGold Ashanti’s senior vice-president Australia.
“The Tropicana mineralised system remains open along strike and at depth and the recent exciting drilling results make us optimistic that we can further improve the outlook,” he said.
AngloGold said in November that it anticipated 2016 production of between 3.6 million and 3.65 million ounces, a slight reduction on the upper end guidance of 3.8 million ounces owing to safety-related stoppages in South Africa which resulted in output loss of some 82,800 ounces in the first nine months of the year.
