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Gold’s outlook and fundamentals remain really bullish.
South Africa’s AngloGold Ashanti (JSE:ANG) (NYSE:AU), the world’s third-biggest producer of the precious metal, plans to boost production and extend the life of its Tropicana joint venture mine in Western Australia.
The expansion of the mine, in which AngloGold has a 70% stake and Independence Group NL holds the remaining 30%, is expected to add 2.1 million ounces and extend the mine’s life by approximately seven years to 2027.
Expansion is expected to add 2.1 million ounces and extend the mine’s life by approximately seven years to 2027.
“This project is in line with our approach of developing cost-effective brownfield projects with attractive payback periods that extend life and improve margins,” Michael Erickson, AngloGold Ashanti’s senior vice president Australia, said in the statement.
He added the partners plan to start mining the Havana South and Boston Shaker pits before the next two major decisions are made. By 2020, they plan to determine whether to strip the Havana main pit, and — by 2022 — whether to start the final stages of the Havana main pit.
This phased approach provides optionality, and the flexibility to adjust to prevailing economic conditions, AngloGold said.
Tropicana’s gold production is expected to be between 478,000 ounces and 492,000 ounces next year, and between 530,000 ounces and 548,000 ounces in 2019.
Total output over the mine’s remaining life is now forecast to be about 4 million ounces. This, said AngloGold, does not include potential future underground production from mineralization at the Boston Shaker ore body, which remains open at depth. A pre-feasibility study on underground mining will be commissioned in 2018.
Including gold produced to date, Tropicana — located nearly 330 km east-northeast of the Western Australian town of Kalgoorlie — has delivered a 72% increase in ore reserves since the project was approved in November 2010.
