AngloGold Ashanti has one gold mining operation in Tanzania, Geita, which produced 327,000 ounces of gold in 2007, equivalent to 6% of group production.
Description: The Geita gold mine is situated 80 kilometres south-west of the town of Mwanza in the north-west of Tanzania. The Geita gold deposit is an Archaean mesothermal orebody, largely hosted in a banded ironstone formation. It is a multiple open-pit operation with further underground potential which is currently serviced by a 6Mtpa carbon-in-leach (CIL) processing plant. Standard open-pit mining methods are employed, hard overburden is drilled and blasted hydraulic excavators are used to load waste material into a fleet of large dump trucks exposing the gold bearing ore material which is directed to the processing plant.
Safety: Overall safety standards were maintained at Geita with an LTIFR for the year of 0.68 (2006: 0.63). No fatalities were recorded.
Operating review: Production at Geita is gradually improving year on year following the serious decline in production in 2006. This was exacerbated by the collapse of part of the Nyankanga pit sidewall during the first quarter of 2007, which covered a portion of the higher grade orebody. Gold production increased from 308,000 ounces in 2006 to 327,000 ounces in 2007, an increase of 6%. The average grade of ore processed increased from 1.68g/t in 2006 to 2.01g/t in 2007. The collapse of the Nyankanga pit in the first quarter delayed access to the higher grade exposed ore in this area and resulted in the mining plan for the year being revised. Production and tonnage throughput in particular was further aggravated by wet ore, mill lubrication problems and a major shutdown of the primary crusher for planned maintenance as well as damage to the ball mill discharge which led to reduced processing plant availibility. There was a considerable improvement in the third quarter of 2007 as Nyankanga ore was accessed, however, grades were not sustainable, the material was harder and as a result plant throughput was reduced and fourth quarter gold production suffered as a result.
Total cash costs fell by 9% to $452/oz with the increased level of production. Reduced expenditure on equipment re-builds and contractor services also contributed to the containment of costs. Adjusted gross profit was $6 million (2006: loss of $2 million), boosted by the increase in gold production, and the higher gold price received for the year. Capital expenditure for 2007 was $27 million (2006: $67 million).
Growth prospects: At the end of 2007 advanced grade control drilling had begun at the Star & Comet project in preparation to start mining in the second quarter of 2008. The adjacent Roberts project will begin mining towards the end of 2008. Exploration activities during 2007 focused on strike additions at Area 3 and the detection of regolith gold anomalies below laterite cover via air core drilling. Early results suggest the potential for an approximately 1.7 kilometre zone of mineralisation on-strike at Area 3 and this will be infill drilled during 2008 to bring it into resource. The regolith programme identified a 2 kilometres gold in saprolite anomaly that requires follow-up drilling.
Metallurgical testwork continued during 2007 to identify a processing route for refractory ores at Matandani Kukuluma which still contain significant potential. A scoping study into the underground potential at Nyankanga and Geita Hill began in 2007.
Outlook: Gold production for 2008 is projected to increase to between 330,000 and 340,000 ounces at a cost ranging from $605/oz to $615/oz. Mill throughput and gold recoveries will be a key focus area to contain unit cash operating costs within an inflationary consumable environment. Capital expenditure of $64 million is scheduled for 2008. Expenditure is focused on continued equipment replacement within the mining arena as well as other value adding projects.
|Total cash costs||($/oz)||452||497||298|
|Total production costs||($/oz)||601||595||387|
|Adjusted gross profit||($m)||6||(2)||9|
|Total number of employees||3,226||3,220||2,280|
AngloGold Ashanti Annual Report 2007 – Annual Financial Statements