AngloGold Ashanti registered US$203 million profit in the first quarter of this year, driven by the higher gold price, as the company continued its reinvestment programme aimed at completing the redevelopment of the Obuasi gold mine.
This will add new gold reserves across its portfolio.
The US$203 million earnings or 48 cents a share is compared to US$143m, or 34 US cents per share, in the first quarter of 2020.
Adjusted net debt declined by 43% year-on-year to US$908m in the first quarter of 202, from $1.60 billion in the first quarter of 2020.
“We continue to make progress in delivering on our strategy,” Interim Chief Executive Officer, Christine Ramon said.
“Our balance sheet remains in a solid position and Obuasi is making steady progress to completion”
This year and next will be key investment years for AngloGold Ashanti as it increases production from brownfields projects and builds on strong reserve additions from exploration in 2020, to increase its overall reserve base and the life of its mines.
The company currently expects to meet its guidance for 2021.
Construction at the Obuasi Redevelopment Project, which will transform the 20 million ounces highgrade gold ore body, initially placed on care and maintenance in 2016, into a top-tier gold producer, achieved 97% completion by the end of March this year.
Production from the mine rose 53% to 46,000 ounces in the first quarter of 2021, from 30,000 ounces the prior quarter.
Production for the first quarter of 2021 was 588,000 ounces at a total cash cost of $999 per ounce, compared with 630,000 ounces at a total cash cost of $773 per ounce from continuing operations in the same period in 2020.
The company said solid production performances at AGA Mineração, Serra Grande, Siguiri and Obuasi were offset by declines at other mines in the portfolio.
In the first quarter of 2021, covid-19 accounted for an estimated 4,000 ounces of lost production and an estimated $29 per ounce of all-in sustaining costs.
The Brazilian operations and Obuasi mine were most affected by the pandemic during the first quarter, with high rates of absenteeism affecting productivity in Brazil and ongoing challenges encountered in the rotation of expatriate workers from Australia to Ghana.
In the first quarter of 2021, total cash costs increased mainly as a result of lower grades and the drawing down on ore stockpiles at some of the operations while waste stripping and underground development progressed, as well as inflationary pressures recorded across most of the portfolio.
Regrettably, one fatality occurred in February 2021 when a miner at the Serra Grande mine in Brazil was fatally injured in a fall-of-ground related incident during blasting preparation activities.
AngloGold extended its heartfelt condolences to the family and loved ones.
The company has been implementing a revitalised safety strategy across the business, with particular focus on the critical controls needed to eliminate what are called ‘high consequence, low frequency’ events.
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