Goldfields total production in Ghana increased by 3%

Goldfields has said that its total production in Ghana increased by 3% to 862koz in 2020 from 840koz in 2019 mainly due to increased production at Damang as mining progressed into the main ore body at the Damang Pit Cutback (DPCB).

The mining giant said all-in cost increased by 2% to US$1,060/oz in 2020 from US$1,039/oz in 2019.

“The region produced net cash flow (excluding Asanko) of US$252m in 2020 compared to US$174m in 2019. Gold Fields received US$38m on the redemption of preference shares from Asanko in 2020. If included the total cash flow in 2020 would be US$290m. Gold Fields received US$10m on the redemption of preference shares from Asanko in 2019. If included the total cash flow in 2019 would be US$184m,” a press statement said.

The company further noted that this year is going to be a big capital expenditure year for Gold Fields, given the peak spending at Salares Norte, its project located at Atacama region of Northern Chile, as well as the increase in sustainable capex for the Group.

 This increase in sustaining capex, according to the mining giant, will enable us to spend on key projects that will allow us to sustain our production base of 2.00Moz to 2.50Moz for the next 8-10 years.

The COVID-19 pandemic is expected to continue to impact our lives and businesses in 2021, with many parts of the world experiencing second waves. The effective roll-out of the vaccine creates additional uncertainty.

In a press statement on its Reviewed Results Year ended 31 December 2020, the company said for 2021, attributable gold equivalent production is expected to be between 2.30Moz and 2.35Moz. AISC is expected to be between US$1,020/oz and US$1,060/oz, with AIC expected to be US$1,310/oz to US$1,350/oz. If we exclude the very significant project capex at Salares Norte, AIC is expected to be US$1,090/oz to US$1,130/oz.

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“The exchange rates used for our 2021 guidance are: R/US$15.50 and US$/A$0.75. Total capex for the Group for the year is expected to be US$1.177bn.

“Sustaining capital is expected to be US$538m, with non-sustaining capex expected to be US$639m. The largest component of the capex budget for the year is Salares Norte, with the US$508m expected to be spent. We expect Salares Norte to be at 70% completion by the end of 2021.

“The other increases are driven by specific projects at some of our core operations. These include the development of a second decline at the Wallaby Underground mine at Granny Smith (A$51m), plant modifications and increased development at Agnew to enhance the longer-term outlook (A$38m), and finally increased new mine development, tailings facility expansion and underground infrastructure expenditure at South Deep (US$22m).

“Group production and costs have been flexed for inherent operating risks which relate to all or some of the mines. The risk of stoppages due to COVID-19 has not been factored into any guidance estimates in the group. The extent to which COVID-19 impacts on either production or costs is indeterminable at this stage.”

By Laud Nartey||Ghana