Covid-19 infections prompts AngloGold Ashanti to shut Cerro Vanguardia for 10 days

ANGLOGOLD Ashanti said it would lose about 8,000 ounces in gold production from its Cerro Vanguardia mine in Argentina after deciding to shut the operation for 10 days amid an outbreak of Covid-19 disease.

It described the decision as “precautionary”.

Operations are expected to resume on November 20 but access to the mine would remain restricted to “essential personnel” for another ten days until November 30, it said.

Local health and labour authorities are being engaged and a full sanitisation process of the site will commence. Essential activities would continue for the duration of the voluntary suspension. “The balance of AngloGold Ashanti’s mines continue to operate as normal, employing a suite of measures to mitigate the risk of the spread of the Covid-19 virus,” AngloGold said in a statement to the JSE.

AngloGold said on November 2 that including the contribution to date of the Mponeng and Mine Waste Solutions operations in South Africa, which it sold to Harmony Gold for $300m in October, production for 2020 will be between 3.03 to 3.1 million oz at an all-in sustaining cost (AISC) of $1,050 to $1,100/oz.

This was after recording third quarter production of 837,000 oz at an AISC of $1,044/oz (Q2: 825,000 oz at $1,031/oz).

The performance, coupled with a stronger gold price, resulted in third quarter adjusted earnings before interest, tax, depreciation and amortisation increasing to $803m compared to $468m in the second quarter. Cash generation increased $252m to $339m.

AngloGold subsequently said it would pay a dividend of 20% of free cash flow before capital expenditure.