[contextly_sidebar id=”X9XnEB1tHGZRMalhTqYoZpeIGubhivcu”]AngloGold Ashanti in September this year announced it had entered into a joint venture with Randgold Resources Limited to revamp the Obuasi mine to a world-class high-grade mine.

But a few months down the line Randgold Resources Limited this morning announced it no longer had any intrest in the move and has abrogated its deal with Anglogold Ashanti.

The deal betweeen the two mining companies if succeful would have led to the revamping of the Obuasi mine which is currently going through a number of challenges. AngloGold Ashanti at the end of 2014, converted the Obuasi mine to limited operations ceasing underground production. The move led to the dismissal of thousands of its workforce.

Chief Executive Officer of AngloGold Ashanti Srinivasan Venkatakrishnan who confirmed the move to Business News at the time said the move will make the mine sustainable in the long term.

‘ ‘What it does mean is we will open up the mine and solve historical issues which we have addressed, some of them when addressed will generate a promising return not just for Anglogold Ashanti, even for all of the stakeholders. Currently gold and cocoa are the two big foreign exchange earners which effectively create the backbone of the Ghanaian economy and unfortunately gold price and cocoa have gone down and with this we need to revive the mine and get it to become profitable.’

Randgold’s Chief Executive Officer Mark Bristow also told Citi Business News in September after the announcement said “Obuasi is a world-class resource.  We now have to see if we can convert it into a world-class mine.  We have a long history of cooperation with AngloGold Ashanti and we look forward to working with them again on charting a new course towards a viable future for Obuasi.”

But Randgold Resources Limited in a statement to Citi Business News on December 21, 2015 said it has informed AngloGold Ashanti that it wishes to terminate the conditional Investment Agreement concluded in September this year for a joint venture to redevelop the Obuasi Mine.

According to Rangold its pulling out of the deal because  the investment does not meet Randgold’s investment criteria.

Rangold adds its decision to pullout ‘follows concerted efforts by both companies to improve the project’s returns and also to secure an appropriate set of consents from the Government of Ghana, within an ambitious timeframe that would have allowed for a feasibility decision on the redevelopment of the mine in early 2016’.

It says although improvements were identified, they have not been sufficient to commit to a substantial investment under the prevailing conditions.

The Minister of Lands and Natural Resources of Ghana has approved continuation of Obuasi’s limited operating phase during Q1 2016.

Limited operations will be undertaken at reduced cost, compared to 2015, including maintaining the operations, security, environmental management, optimising the feasibility study, as well as ongoing sustainability work.

“We have made a concerted effort to unlock a new opportunity for Obuasi, and the work we have done lays a good foundation for the operation in the long term,” AngloGold Ashanti Chief Executive Officer Srinivasan Venkatakrishnan said.

“But in the current environment, we believe it is prudent to conserve our resources and to revisit this opportunity when market conditions improve.”  He added.

Industry players have described the latest development as worrying and fear the move could lead to more dismissals of miners at the mine.

–

By:  Vivian Kai Lokko/citifmonline.com/Ghana

The post Randgold pulls out of joint venture with AngloGold Ashanti appeared first on Citi 97.3 FM - Relevant Radio. Always.

[contextly_sidebar id=”DEsgrjWH3d4lJKsI3PHMgnbGZRgO4ikf”]According to him the Damang mine of Goldfield Ghana Limited is currently undergoing restructuring and management and management of the company has assured the union that there will be no job cuts.

Goldfields last week announced it may be forced to lay off over two thousand Ghanaian workers in the coming months if gold prices on the global market do not recover.

The dismissals Citi Business News gathers will occur if the mining giant goes ahead with plans to shut down the Damang mine in the Western Region.

But speaking to Citi Business News General Secretary of the Ghana Mines Workers Union (GMWU) Prince William Ankrah insists that there are no plans to lay off workers asking workers of the Goldfields Damang Mine not to panic but stay calm and work.

“There isn’t any layoff at Damang mines, as we speak what am gathering from the management is that the mine is undergoing restructuring and they are making sure that tax issues that have come up, we have had discussions on challenges facing the mine and taxes that has been rolled on and its impact on the company’.

He tells Citi Business News the company was working around the clock to turn its fortunes. ‘Goldfields has currently put on hold plans to outsource mining operations  at the Damang mines to another contractor. Therefore there should not be any panic now as events unfold’.

–

By:  Norvan Acquah – Hayford/citifmonline.com/Ghana

The post GMWU urges miners to stay calm over Goldfields layoff appeared first on Citi 97.3 FM - Relevant Radio. Always.

[contextly_sidebar id=”gNPhjRNzM6IQOcXdRamME0mLdNq5OhCg”]The dismissals will occur if the mining giant goes ahead with plans to shut down the Damang mine in Western Region.

Citi Business News has gathered the company is however currently deciding whether to place the Damang mine under “care and maintenance” by pulling back on certain mining activities until gold prices recover or whether to inject cash to access deeper higher quality ore.

The company is expected to take a decision on the two options by early next year.

According to the chief executive of Goldfeilds Nick Holland “If the results of the study indicate that we are going to need higher gold prices to make it work we may decide to pull back,”

A decision on the operation, which contributes 7% of the company’s output, will be announced early next year.

“The costs at Damang are way too high – they are higher than the gold price. If you get rid of loss-making operations you are better off,” Hochreiter told Reuters.

Damang did not benefit from weaker currencies like its mines in other regions, leaving it exposed to sinking gold prices.

Gold Fields, which also operates mines in Australia and Peru, said normalised earnings for July-September reached $22m, the same as the previous quarter. It also said it cut net debt by 3.4% to $1.42bn.

By:  Vivian Kai Lokko/citifmonline.com/Ghana

The post Goldfields to sack about 2,000 workers in Ghana appeared first on Citi 97.3 FM - Relevant Radio. Always.

[contextly_sidebar id=”Ok5mByWHbGRAjKvIZ95tDqr5CWtyosZk”]Cavalla Resources is a wholly-owned subsidiary of investment holding company Jonah Capital, a private company with a portfolio of assets primarily in the mineral resource sector in sub-Saharan Africa and owned by business mogul Sam jonah.

Cavalla has been granted the exclusive rights over the four exploration areas of Goe Fantro, Kitoma, St John River South and Toto, as Jonah Capital’s exclusive iron-ore holding company.

Work has begun at Goe Fantro and the development of the other assets will follow in a phased approach.

Scoping studies indicate that Goe Fantro can be brought into production by 2018 at a capital cost of between $160-million and $230-million to produce five-million tons a year of 58% to 62% iron at an estimated operating cost of $22/t, free-on-board at Buchanan port.

“We look forward to working closely with government and the local communities where we operate, to contribute towards the continuing growth of the Liberian economy,” Jonah Capital and Cavalla executive chairperson Sir Sam Jonah said in a media release to Creamer Media’s Mining Weekly Online.

Sir Sam, who began his career in mining at Obuasi gold mine in Ghana in 1969 as a $73-a-month shovel boy, is a former Ashanti Goldfields CEO who helped to form the JSE- and NYSE-listed AngloGold Ashanti with current Business Leadership South Africa chairperson Bobby Godsell.

The combined defined 1.9-billion ton resources are calculated to include 132-million tons of direct shipping ore at 57% iron.

Jonah said he hoped that the transaction would serve as a catalyst for attracting further investment to Liberia, where the development of the mineral resource sector was well under way.

Cavalla, which also has a further exploration licence at Kitoma II as well as the right of first refusal over three additional exploration areas, now has the opportunity to become a low-cost producer of quality iron-ore, with minimal logistics and infrastructure risk.

The transaction is also said to enjoy the full Liberian government support as it fosters economic growth following the eradication of the ebola virus in the country.

–

Source:  miningweekly.com

The post Sam Jonah takes over BHP Billiton’s Liberian iron-ore interests appeared first on Citi 97.3 FM - Relevant Radio. Always.

[contextly_sidebar id=”onPxyeRSWJYhLlrstSLrON7bHxQXLY5m”]Bullion for immediate delivery retreated as much as 0.5% to $1 108.43 an ounce, the lowest since September 16, and traded at $1 110.02 by 08:44, according to Bloomberg generic pricing. Prices fell 3.2% this week, the most since the five days ended March 6.

The jobs data will be scrutinized for signs of whether China’s slowdown and the steepest quarterly rout in global stocks since 2011 have shaken the US recovery.

The Labour Department report is projected to show payroll gains accelerated last month compared with August.

Gold fell for five straight quarters through September 30.

“This payrolls could cement the October-December argument for the Fed,” Victor Thianpiriya, a Singapore-based analyst at Australia & New Zealand Banking Group., said in an email. “If it’s well above expectations I think the market will seriously start to consider October.”

Traders are pricing in a 44% chance the Fed will move in December and odds of 18% in October, according to data compiled by Bloomberg.

Holdings in exchange-traded funds backed by gold rose 1.9 metric tons to 1 532.06 tons as of Thursday, the highest since July 30, data compiled by Bloomberg show.
Platinum fell 5.1% this week, the most since October 2014, while palladium headed for a fourth weekly advance, the longest rising streak since July 2014.

–

Source:  Fin24

The post Gold poised for biggest weekly loss since March appeared first on Citi 97.3 FM - Relevant Radio. Always.

[contextly_sidebar id=”bkxlo4LxStQuYlwUZ18Y1eyUBrUCUsbF”]The move according to AngloGold Ashanti, operators of the Obuasi mine, is part of the company’s partnership with Randgold Resources Limited.

Late last year AngloGold Ashanti Ghana laid off some 4,300 of its workers as part of cost-saving measures and part of measures undertaken by the mining company to make the Obuasi mine profitable. AngloGold Ashanti budgeted to spend 220 million dollars in the major retrenchment exercise.

AngloGold Ashanti currently is in an investment agreement with Randgold Resources Limited aimed at the formation of a joint venture to redevelop and operate AngloGold Ashanti’s Obuasi gold mine in Ghana.

In an exclusive interview with Citi Business News, Chief Executive Officer of AngloGold Ashanti Srinivasan Venkatakrishnan confirmed that some workers who were laid off will be reengaged but insisted opportunities were available for qualified personally only.

‘We have to look at what the feasibility studies and labour plan shows for restarting the line and it will be the case of the best person for the job, at the end of the day you cannot run an operation in Ghana without the participation of the Ghana workforce’

–

By:  Norvan Acquah – Hayford/citifmonline.com/Ghana

The post Anglogold to reinstate dismissed workers appeared first on Citi 97.3 FM - Relevant Radio. Always.

[contextly_sidebar id=”eCZwfWwsAWLNqrtfREZcrg0fb1G6Honl”]Chief Executive Officer of AngloGold Ashanti Srinivasan Venkatakrishnan who confirmed the move to Business News said “Obuasi given the range of issues had to have a tough decision taken because you cannot fix the tyre of a car in motion you have to stop and relook at it and you got to say, how do I actually modernise the mine. What this does is effectively it opens up a path way for Obuasi to be sustainable in the long term like 10 to 20 years’.

AngloGold Ashanti at the end of 2014, converted the Obuasi mine to limited operations ceasing underground production.

The move led to the dismissal of thousands of its workforce.

Despite the partial shutdown the mining giant continued to process tailings and embarked on a feasibility study on the redevelopment of the mine.

According to the Chief Executive Officer of AngloGold Ashanti Srinivasan Venkatakrishnan both mining firms will ensure the mine is revive.

‘What it does mean is we will open up the mine and solve historical issues which we have addressed, some of them when addressed will generate a promising return not just for Anglogold Ashanti, even for all of the stakeholders. Currently gold and cocoa are the two big foreign exchange earners which effectively create the backbone of the Ghanaian economy and unfortunately gold price and cocoa have gone down and with this we need to revive the mine and get it to become profitable.’ Srinivasan Venkatakrishnan said.

Meanwhile a development plan will be built within four months following a feasibility study with the intention of establishing a more focused, efficient, mechanised high-grade operation.

Randgold’s Chief Executive Officer Mark Bristow said “Obuasi is a world-class resource.  We now have to see if we can convert it into a world-class mine.  We have a long history of cooperation with AngloGold Ashanti and we look forward to working with them again on charting a new course towards a viable future for Obuasi.”

Randgold is expected to deliver the new development plan to both parties’ boards by 31 January 2016.

Formation of the joint venture is conditional on the satisfaction of a number of conditions, which include the approval by the boards of Randgold and AngloGold Ashanti of the final development plan prepared by Randgold.

In addition, formation of the joint venture is conditional on the receipt of the approvals necessary for the implementation of the development plan and formation of the joint venture from the Government of Ghana on terms acceptable to the parties, including agreement of a revised stability agreement and a development agreement reflecting the agreed development plan.

–

By:  Norvan Acquah – Hayford/citifmonline.com/Ghana

The post AngloGold Ashanti enters joint agreement with Randgold to revive Obuasi mine appeared first on Citi 97.3 FM - Relevant Radio. Always.

gold export

[contextly_sidebar id=”cgj7u7hkjefNwjhNhBUKqwmEtgFmH4QW”]The new rules which will take effect from Tuesday, September 15, 2015 will affect all gold exports.

According to the central bank per the new measures all exports of gold must be done only through the Precious Minerals Marketing Company Limited (PMMC).

PMMC is a limited liability company operating under the Companies’ Code, with the Government of Ghana as the sole shareholder.

Prior to this move PMMC among other services exports gold on behalf of third parties for a commission.

Per the new rules Licensed Gold Exporters (LGEs) will also not be permitted to export gold for third parties.

According to the BoG authentication would also be required of all LGEs thus the exporters must  download Form FEX A4 from the Bank of Ghana website (www.bog.gov.gh) for completion and submission in connection with gold exports.

While all LGEs intending to export gold should contact Bank of Ghana with proof of license to export gold for their access credentials.

The central bank warns the downloaded Form FEX A4 is non-transferable and is non-assignable while LGEs would not be permitted by Ghana Revenue Authority (Customs Division) to export gold unless the completed Form FEX A4 bears Bank of Ghana’s embossment.

Exporters of gold must also provide proof of independent certification by PMMC of the weight, quality and value of the gold earmarked for export which is a necessary requirement to secure the Bank of Ghana’s embossment.

According to the BoG the new measures is pursuant to Section 2, subsection 3 of the Foreign Exchange Act 2006 (Act 723).

It warns that gold exporters who fail to comply with the new measures on or after the effective date would not be able to export gold.

–

By:  Vivian Kai Lokko/citifmonline.com/Ghana

The post BoG sets new guidelines for gold exports appeared first on Citi 97.3 FM - Relevant Radio. Always.

[contextly_sidebar id=”5CT8GUW5psW7Th8ulxa7xVQAaiPMTuvz”]According to the miners, they will use their right to collective bargaining to demand their due.

The union has been crying foul about the current trend, insisting most underpaid locals have better capacity and training than their foreign counterparts.

“Government used to say that the mining sector income gap may distort the economy, but the reality is that this sector employs less than one percent of the work force in the job market. So why wouldn’t we have the situation where we get people to be paid good money to pay their taxes then we grow the mining economy “, the general secretary of the Miners Union, Prince William Ankrah lamented.

In an interview with Citi Business News he insisted the miners would ensure the trend would be reversed.

“We have collective bargaining to correct the internal mess and we will use that muscle to deal with it. If we raise the issue and it’s not getting the right attention we have many strategies … if they don’t come clean we will bring the mining sector to a standstill.”,   William Ankrah charged.

By:  Rabiu Alhassan/citifmonline.com/Ghana

The post Miners threaten to bring industry to a standstill appeared first on Citi 97.3 FM - Relevant Radio. Always.

Finance Minister, Mr Seth Terpker told the Graphic Business on the sidelines of a media briefing in Accra that the government is instituting the necessary measures for a refund of the VAT surplus to mining companies.

[contextly_sidebar id=”zbt2YHDaTdT2pdmJYis6Wn9UpL94hpxZ”]“It is true that we owe the mining companies so much, but we have begun instituting the necessary framework to refund those monies to them and we are also in discussions with the mining firms in that regard”, Mr Terkper said.

Chief Executive of the Ghana Chamber of Mines, Mr Sulemana Koney is worried that the delay in the refund to mining companies VAT surplus estimated at GH¢250 million is affecting the cash flow position of the companies.

“The government was benefiting from mining companies by way of inordinate delays in the refund of surplus VAT, which was estimated at about GHC250 million as of June 2014”, Mr Koney said at a day’s workshop on mining organised by the Journalists for Business Advocacy (JBA) in Accra.

Mr Koney shares the view that one motivating factor that seems to encourage such excessive taxing is the ‘Cash Cow Syndrome’ cautioning that the mining industry should not be seen as a cash or fat cow but rather as catalysts for national development.

“Our concern is that production is going down,” Mr Koney stressed, and added that the high cost of production is a key factor that must be considered in addressing the production deficits.

He cites the very distinct electricity tariff regime for mining companies as well as special petroleum tax. On the petroleum tax he said; “we already pay a premium and there is 17.5 per cent being slapped on that. If costs are too high, our competitiveness will be eroded”.

According to him, on a monthly basis, the mining sector cross subsidised the consumption of social fuel such as premix by about US$5 million.

Excessive taxes
Mining companies in Ghana face the brunt of a business unfriendly tax regime, some analysts say. And yet, there have been calls for more taxes with suggestions for the replication of a controversial Zambian model that the Zambians themselves have abandoned.

The Zambian government in response to popular concerns for more mining revenue for the State increased royalty to be paid by mining companies to a whopping 20 per cent. That spelt doom for the mining industry; ultimately, the government realised that the mining industry was not so fat a cow. “That killed a lot of the companies and the new regime has renegotiated the fiscal regime,” Mr Koney stated.

One pressing challenge Ghana faces is how to sustain the gains that have been made partly as a result of the investment in the past. Cote d’Ivoire and Burkina Faso, two of the country’s neighbours have turned on an aggressive pursuit for mining investment.

Their strength, unlike Ghana, is that they do not charge taxes on exploration. Mining companies in Ghana are worried that that may give them some edge and ultimately impact on the ability of the mining industry in Ghana to attract more FDIs.

Because of the risks involved in exploration, some analysts believe that charging exploration taxes is inimical to the growth of the industry in Ghana. Mr Koney enforces this view and argues that any discussion on the mining industry should be placed within the context that it is a risky business.

Indeed, mining exploration is believed to have a success rate of just about 20 per cent and it is an area many governments, including the Ghanaian government, have kept their investments from.

Where do the royalties go?
Nine per cent of royalties paid by mining companies is expected to be used to develop the mining communities. The utilisation of these monies after it they are paid to the State is as opaque as an eclipsed moon.

When it comes to the utilisation of mining royalties, there are serious transparency issues; “There is no transparency in mining revenue use. The only transparency is in the payment of royalties,” CEO of the Ghana Chamber of Mines, Mr Sulemana Koney, recently noted at a day’s workshop on mining organised by the Journalists for Business Advocacy (JBA) in Accra.
The royalties paid to mining communities may not be getting optimised utilization, one may easily discern.

Mr Koney fears the priorities have been lost; “for instance, between 2011 and 2013, US$854,407,800 was ploughed back into seven mining districts but was there a manifestation of commensurate development?” he questions.

He explained further that 30 per cent of the nine per cent of royalty paid to the district assemblies was used in the management of waste and queried whether it was a judicious way of exploiting revenue from a finite resource.

“This is a finite resource. It will finish one day. What plans are we putting in place to ensure that we have balanced development?” he asks.

While waste management is an important area, the absence of easily measurable outputs as against the financial inputs made, makes it easy alibi for wasteful dissipation of resources.

At the heart of the challenge is the absence of Mineral Management Revenue Act, which mining companies argue will also make government more responsible in the utilisation of mining revenue.

–

Source: Graphic Online

The post Govt to refund GH¢250m to mining companies appeared first on Citi 97.3 FM - Relevant Radio. Always.