New joint venture to revive Obuasi Gold Mine

Randgold Resources Limited and AngloGold Ashanti Limited have concluded an investment agreement aimed at the formation of a joint venture to redevelop and operate AngloGold Ashanti’s Obuasi gold mine in Ghana. 

Under the Agreement, Randgold will lead and fund a development plan designed to rebuild Obuasi as a viable long-life mining business with an attractive cost structure and returns.

Obuasi has a large, high-grade deposit with proven and probable ore reserves of 24.53Mt part of a substantial mineral resource base.  

At the end of 2014, AngloGold Ashanti converted Obuasi to limited operations, ceasing underground production, retrenching the workforce, but continuing to process tailings and starting a feasibility study on the redevelopment of the mine.  Development of the decline ramp has continued over this period.

“Obuasi is a world-class resource.  We now have to see if we can convert it into a world-class mine.  We have a long history of cooperation with AngloGold Ashanti and we look forward to working with them again on charting a new course towards a viable future for Obuasi,” said Randgold chief executive Mark Bristow in a statement.

Randgold is expected to deliver the new development plan to both parties’ boards by 31 January 2016.

“AngloGold Ashanti has since 2012 effected a range of improvements to modernise Obuasi and – in line with its strategy – has progressed a feasibility study as the critical next step toward breathing new life into this important mine,” AngloGold Ashanti CEO Srinivasan Venkatakrishnan said.

“Our partnership with Randgold has proved successful for well over a decade in bringing value from sustainable gold mining to all stakeholders and we believe that pooling the extensive expertise and the capital of these two companies will improve our ability to bring Obuasi’s world-class high-grade gold deposit to account.”