AngloGold Ashanti, the Ghana Stock Exchange-listed mining company has robustly responded to a Third World Network article which was published on December 3, 2014.
To set the record straight on current restructuring of the Obuasi mine, the AGA release said ?we note the article published on December 3, 2014 in which the Third World Network (TWN) Africa expresses its concern at the tapering of production from the Obuasi mine, whilst a feasibility study into the modernisation of the operation is completed. It is worth addressing some of the points made by TWN?.
According to the release, firstly, it is important to reiterate that the aim of this period of limited operations at the Obuasi mine is to allow AngloGold Ashanti to make a systemic change to its design and operation to counter the trend of declining productivity, lack of mining flexibility, falling tonnages and soaring costs.
As the operator of a range of different mines, from large open pits to the world?s most successful ultra-deep gold mines, AngloGold Ashanti is well placed to evaluate the options to modernise the Obuasi mine and help it provide good jobs for the long-term while contributing meaningfully to the local, regional and national economy.
The release said without this intervention, the mine is simply not sustainable or viable under any ownership structure and it will almost certainly be lost to Ghana?s economy. Despite AngloGold Ashanti?s best efforts for more than a decade, the performance trajectory of the mine has been consistently poor and a valid critique is that (with the benefit of hindsight), this difficult decision to fundamentally redesign the operation might have been taken earlier.
?AngloGold Ashanti?s intention is to reverse the Obuasi mine?s downward, unprofitable trend and make it into a vibrant contributor at every level. To be clear, tapering production whilst this period of redesign is concluded was not an easy decision, but at every step AngloGold Ashanti has made its intentions clear in a series of transparent dialogues with all stakeholders, including employees. And while reducing employment numbers at the mine is not a decision taken lightly, those affected have been provided full and generous severance packages as provided for by law?. The Ghana Mineworkers Union, with a mandate from its members at Obuasi mine, has been fully supportive of this action.
Similarly, the company has at every stage been fully compliant with its tax and royalty obligations to Ghana?s exchequer throughout its ownership of the mine, the release said.
AngloGold Ashanti has two mines in Ghana, Obuasi and Iduapriem, have together paid more than $577m in direct and indirect taxes since 2004, making AngloGold Ashanti one of the largest tax payers in the country. Obuasi alone has paid $324m over that period, a number that is likely to have been markedly higher if the mine was profitable. In addition, more than $1.2bn in capital investments has been made over the past decade.
While a large portion of Obuasi mine will be on care and maintenance in 2015, AngloGold Ashanti has still budgeted expenditure there of some $100m for the year, which includes development of the ramp decline to high-grade underground areas, and also the necessary cost of ensuring infrastructure remains secure and in good condition, the release noted.
?The Obuasi Community Trust fund will also continue to run efficiently over that time, adding to the $55m in social projects funded by AngloGold Ashanti in Ghana in 2014. (This excludes the $133m in malaria prevention provided by the Global Fund)?.
One of AngloGold Ashanti?s values is to leave communities better off for its presence. In this case, that requires making some hard decisions in the short-term so that the economic engine that is the Obuasi mine can drive the wheels of the economy in the long-term. It will require cohesion and an honest and clear-sighted view of what it takes to make the mine viable for the long-term. It will also need an enduring partnership from a range interest parties across the spectrum from the company, to labour and from government to civil society. Anything less would sell short this important asset, and those that it supports, according to the release.
The media contact for the statement is: Mr. John Owusu: General Manager – Corporate Affairs, AngloGold Ashanti, Ghana
