President Nana Addo Dankwa Akufo-Addo has charged AngloGold Ashanti to leverage the newly-opened mechanised underground mine and other redevelopment plans to lift Obuasi and its adjourning communities out of poverty.
Speaking at the official opening of the state-of-the-art underground mine, part of the Redevelopment Project for Obuasi Mine, the president said the project’s vision is to deliver a modern state-of-the-art mechanised underground mine that will enable AngloGold Ashanti to carry out its operations over the next two decades.
Since the mine’s shutdown more than five decades ago, President Akufo-Addo noted, every sector of the Obuasi Municipality whose major occupation is mining was affected. He said efficient production at the mine will make it a profitable venture.
“I am counting on the mine to pull the adjoining communities out of poverty,” he said, adding that already the mine has paid US$250,000 into the Community Trust Fund while continuing to embark on other projects which will contribute to development of the Municipality.
The president added that he will see to it that Parliament works with AngloGold Ashanti to ensure all social and environmental concerns in respect of the reclamation efforts are satisfactorily met.
At the launch, management of the newly-redeveloped AngloGold Ashanti Obuasi Mine noted that the targetted gold production is between 350, 000 and 400,000 ounces annually, within the first 10 years of the mine.
It is estimated that Obuasi will be mining at a rate of 2,000 tonnes of ore per day in 2020, progressing to 4,000 tonnes per day by year-end, at an all-in sustaining cost of around US$800/ounce.
Efforts continue to mechanise operations of the Mine, which has at the moment seen ‘Phase 1’ of the redevelopment completed with a capital injection estimated at around US$550million.
Following the Redevelopment Project’s launch, it has been disclosed Obuasi Mine achieved the first gold pour on time and on budget. It has completed the first phase of redevelopment in line with the plan to create a modern, mechanised mine. Refurbishment of existing plant and construction of new infrastructure and underground development, in line with a new mine plan, has taken place over the past 18 months.
The Obuasi Mine will enter Phase 2 of development this year, wherein construction of new infrastructure and further work on the processing plant and underground will be carried out.
AngloGold Ashanti Chief Executive Officer, Kelvin Dushnisky said: “The commemoration of first gold pour is a significant achievement for the company, Obuasi, communities around the mine, and Ghana. The work to revive this historic operation shows the importance of teamwork, partnership, commitment and the enduring power of shared values”.
He said what has been achieved so far could not have been done without the support of government and authorities in the Ashanti Region, and the mine looks forward to operating safely henceforth.
Speaking ahead of a ceremony to mark the milestone of achieving first gold-pour at Obuasi Mine, he said: “We are very confident that with some of the lessons learnt and circumstances from the past, we are able to move past that; and highly optimistic we won’t run into the same issues as before”.
The Managing Director of Obuasi Mine, Mr. Eric Asubonteng said: “I’m proud that our team at Obuasi Mine achieved the first gold-pour on schedule and within budget. Most importantly, the significant work throughout the year that culminated in the first gold-pour was completed without any major safety incident”.
AngloGold Ashanti has delivered on its commitment to its labour plan, wherein the majority of employees and contractors are Ghanaians or Ghanaian companies. A total of US$268million has been spent on the redevelopment – 80 percent of which (US$216million) has been spent in-country.
In addition, the company said it has so far employed about 3,500 people including contractors. “It is important for us to work together to build an industry of indigenous businesses, and also create jobs and wealth for the communities in Obuasi and Ghana,” said Mr. Asubonteng.
The redevelopment project, expected to fully revive the mine, is happening on the back of declining gold production at the mine since 1995 – attributed to underground infrastructure issues, and development and backfill constraints.
In 2014, gold production totalled 243,000oz for the last year of full production. This was a level last seen in 1980. The mine had a negative cash flow in all but two years since 2004, disguised somewhat by successive 10-year rises in the gold price. The fall in gold price since 2012 exacerbated cash flow losses, which ballooned to unsustainable levels and forced the mine to be placed on limited operations in late 2014.
AGA Ghana however applied to the Ghanaian government for approval to amend its programme of mining operations, while all employees were retrenched and paid full benefits and entitlements.
But in June 2017, the company commenced negotiations with government – with the aim of delivering a long-life, efficient and profitable mine that delivers value to its shareholders, as well as other stakeholders in the host country and community.