COMPANY COMMENT
No country for old mining heavyweights
The underlying message is that SA is no longer a gold destination for big companies
The decision to sell and close mines contributing more than half of AngloGold Ashanti’s South African gold output was clearly the right one, no matter how emotional the action might be for what was once the bedrock of the company’s annual production. The costs at these assets were dragging down the company and the large exposure to SA, with its dire regulatory framework, drastically rising labour and services costs, as well as declining output and falling grades, lower productivity and safety threats made the decision a logical one. It has meant the once dominant gold miner in the country is a mere shadow of itself, with a single deep-level mine and a tailings operation. But the South African asset base allowed AngloGold to expand strongly in Africa, Australia and South America, making it the world’s third-largest gold miner. The first-quarter results from AngloGold gave investors their first glance at what the company’s potential was without the burden of high-cost, unprofitable mi...
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