Gold Fields Ghana held its first stakeholder engagement forum for the year on the company’s 2012 full year and fourth quarter performance. The “Facts behind the figures” forum was instituted last year to engage with and update key stakeholders on the company’s operations and activities on a quarterly basis, following the release of Group’s results in Johannesburg, South Africa.

The forum focuses on the Ghana operations at Tarkwa and Damang, and their contribution to the Group’s performance, and serves as a platform to interact with stakeholders, answer pertinent questions and solicit feedback from them.

The recent forum was held at the Movenpick Ambassador Hotel in Accra and was attended by a cross-section of stakeholders including Government, Regulatory Ministries and other authorities, civil society, financial institutions and corporate organisations, diplomatic missions and the media.

Executive Vice President and Head of Gold Fields MENA and Eurasia (West Africa,) Peet Van Schalkwyk, explained the role of the Ghana operations in the new Gold Fields structure following the unbundling of some of its assets into a new company, Sibanye Gold. He said the Tarkwa and Damang mines now play a more prominent role in the Gold Fields portfolio, accounting for 43% of production in 2012, with the other mines in Australia, South America and the remaining South African asset, South Deep, together recording 57%. He added that even in 2016 when the developing mine, South Deep comes into full operation, the Ghana operations will continue to remain the largest contributor to the Group’s production with 35%.

Mr van Schalkwyk explained that Tarkwa and Damang accounts for the second largest mineral reserves base of Gold Fields with 14 million ounces (22%) out of the total 64 million ounces.

Discussing the fourth quarter and 2012 full year performance, he indicated that Tarkwa and Damang showed a solid performance. Whilst gold production for the group was slightly lowered by 7% from 811,000 ounces in September 2012 to 754,000 ounces in December 2012, attributable gold production at the Ghana operations however increased by 11% mainly due to the resumption of full operations of the Heap Leach facilities at Tarkwa and improved operational performance at Damang.

Mr van Schalkwyk noted that rising costs prevented the company from leveraging a rising gold price to increase returns. The way forward for the new Gold Fields therefore is to focus on cash generation and superior returns and not ounces at any cost. This he said will mean a smaller, more focused yet solid platform for growth, low -risk high-return projects and focus on sustainable development.

Country Manager for Gold Fields Ghana, Pierre Coussey, outlined the direction for the two mines in Ghana, indicating that the company was focusing on bringing the significant reserves at Tarkwa and Damang into account.

The Tarkwa mine is considering its sixth expansion phase. This will entail suspension of all heap leach facilities and processing of ore through Carbon-in-Leach plants to improve gold recovery. Damang is in transition. With the discovery of new mineral resources and reserves, significant recapitalisation of the mine will be required to unlock value. Gold Fields is considering various options on how best to achieve this.

Mr Coussey however stated that the tightening fiscal regime such as increase on royal tax, corporate tax, capital gains tax, stool land rent, introduction of windfall tax and ring fencing coupled with increase in production costs was having an adverse impact on the company’s operations. He was hopeful of a favourable outcome arising from negotiations with Government to ensure a win-win situation for all stakeholders including Government, communities, employees and investors.

Gold Fields Ghana continues to chalk up achievements. It remains the largest producer of gold in Ghana and the largest private sector employer, with over 5,273 direct and 83,167 indirect employees. It also continues to be named as the largest company in Ghana by the GIPC Club 100. In September 2012, the Ghana Club 100 recognised Abosso Goldfields (Damang Mine) and Gold Fields Ghana (Tarkwa Mine) as the number 1 and 2 in the mining and petroleum sector. In the over ranking of top 100 companies in the country, Damang and Tarkwa took the fourth and seventh positions respectively.

In line with its commitment to sustainable development, Gold Fields Ghana has invested over US$34 million in community socio-economic development projects in the communities in which it operates, from 2002 to date. It focuses on education, health, water and sanitation and infrastructural development. A world class state–of-the art water treatment plant was recently constructed and is fully operational at Tarkwa, providing communities with sustained access to clean water. Though the new global strategy for Gold Fields focuses on cash generation, sustainable development remains a key focus area to ensure that the company leaves a legacy of an economically-viable and socio-economically developed community.

Significant progress has been made in the localisation of the operations into a totally Ghanaian operated company – 97% of employees are Ghanaians.

In the last two editions of the GIPC Ghana Club 100 awards, Gold Fields Ghana was recognised as the highest taxpayer in Ghana. In 2012 the company paid over US$250 million to government in direct taxes, royalties and dividend.

Stakeholders were given the opportunity to gain further clarity on issues regarding Gold Fields Ghana’s operations as well as on the mining industry in general and the effect on the company’s business. They commended Gold Fields Ghana for its commitment to engage and share information on its operations noting that one of the key issues was the knowledge gap between government, mining companies and other stakeholders.