New book ‘102 Things to Do with a Hole in the Ground‘ spotlights global reclamation projects
Stories of reinvented coal mining regions, regenerated communities and rebuilt ecosystems are told in a new book published this month.
Gold Fields Ltd. said a turnaround at its giant mine in South Africa is starting to pay off after more than a decade of losses that’s weighed on the Johannesburg-based company.
South Deep, which sits on the third-biggest known body of gold-bearing ore, almost tripled the net cash it generated to $97 million in 2021 as production rose and the rand strengthened. Output at Gold Fields’ last South African mine is expected to climb a further 30% over the next three to four years.
That will complete a turnaround after years of financial bleeding that was compounded by power shortages, labor unrest and regulatory uncertainty in South Africa. It vindicates the management’s decision to restructure the mine after investors pressured Gold Fields to either end the losses or sell the asset.
“I am absolutely convinced this was the right thing to do,” Chief Executive Officer Chris Griffith said in an interview. “Already in one year we have made up probably what people would have paid for the asset, so I think it absolutely makes sense to stay in the asset.”
Net income rose 9.2% to $789 million last year after output increased, Gold Fields said Thursday. The company will pay a final dividend of 2.60 rand a share, taking its total payout for the year to 4.70 rand.
Gold Fields, like rival AngloGold Ashanti Ltd., has shifted focus to more profitable operations in Ghana, Australia and Latin America. CEO Griffith said the company is on course to raise output to about 2.7 million ounces in 2024, with production supported by a new mine in Chile and the turnaround at South Deep.
The Salares Norte project would be almost complete by end of 2022 and is on course to start producing in the first quarter of next year, Griffith said. The mine is expected to produce 200,000 ounces in 2023, rising to more than half a million ounces a year later. That would give the Chilean operation so-called Tier 1 status.
The miner is also ramping up the search for new gold deposits in Chile, Peru and Australia and may also consider exploration in North America to boost reserves as some of its mines run out of commercially viable ore, the CEO said.
“Reinforcing our view that Gold Fields is one of the few senior gold producers in a position to deliver 20% production growth over the next few years, the company’s 2024 output guidance of 2.72-2.77 million ounces is slightly higher than our expectation. Management outlook for a 20-30% increase at South Deep is a key contributor, with the previously problematic asset signaling that a turnaround is now well underway.”
Grant Sporre & Emmanuel Munjeri, BI metals analysts
(By Felix Njini)
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