Mexico’s proposed higher mining royalties could block nearly $7bn in investments
The Mexican government proposed raising mining royalties under the argument that metal prices have risen in recent years.
In response to the country’s lockdown effort to slow the spread of covid-19, AngloGold Ashanti (JSE: ANG) announced Tuesday it will temporarily suspend production from its South Africa operations for three weeks as of midnight on 26 March 2020.
South Africa will close its mines for an unprecedented 21 days as part of a nationwide lockdown announced by President Cyril Ramaphosa in a race to contain the coronavirus.
AngloGold mines will be placed on care and maintenance over that period, AngloGold Ashanti said.
The miner’s South Africa operations include the Mponeng and Mine Waste Solutions and surface rock-dump processing operations. These operations produced 419,000 oz in 2019.
AngloGold said last week that it would suspend production at its Cerro Vanguardia mine in Argentina until the end of the March, in line with a suite of covid-19-related work and travel restrictions imposed by the Argentinian government.
The rest of AngloGold Ashanti’s mines continue to operate, employing a range of measures to mitigate the risk of the spread of the Covid-19 virus.
South Africa accounts for 75% of the world’s platinum and 38% of palladium supply, and also produces minerals from gold and manganese to chrome and iron ore.
Pan African Resources said it has sufficient liquidity but would look to reschedule its short-term senior debt obligations in the event the lockdown extends into a prolonged period.
Gold Fields said that it expected a loss of around 16,000 ounces during the 21-day lockdown based on the current run-rate at its South Deep mine in South Africa.
Harmony Gold said the shutdown would “negatively impact” its annual production guidance of 1.4 million ounces and its full-year earnings.
“This is an unprecedented time in the history of the mining industry and our country,” said chief executive Peter Steenkamp.
Impala Platinum said it planning an orderly transition to care-and-maintenance status at its mining, smelting and refining operations while also working on an analysis of the impact.
“These are unprecedented and extraordinary times and we all need to make sacrifices for the greater good,” said Impala CEO Nico Muller.
While miners try to quantify the financial impact from the crisis, South Africa’s mining minister was to meet mining and energy executives on Tuesday to consider how to execute the lockdown.
