The time has come for Africa’s gold-producing nations to band together in order to compete effectively in the global economy, according to Bobby Godsell, chief executive officer of
“More than half the world’s annual gold production comes from developing nations, and most of the future mines are to be found in those countries,” Godsell said. “This is an industry in which gold producers such as Tanzania, Ghana and South Africa can indeed compete.”
He called for Africa to take the lead in convening a gathering of governments and industry representatives to consider what is needed to ensure more stable gold markets.
“Let Africa lead,” he concluded.
Godsell made his remarks at the grand opening of the Geita mine, in the Lake Victoria goldfields region of Tanzania. The mine is a joint venture between AngloGold and
Geita is East Africa’s largest gold mine. Construction of the US$165-million project took less than a year and was completed three months ahead of schedule. The first gold bar was poured in June, and the mine has since produced 41,000 oz.
Production in 2000 is targeted at 150,000 oz., with annual output over the next five years projected at 500,000 oz. Geita is expected to incur a cash operating cost in the neighbourhood of US$180 per oz., though during startup the cost is pegged at US$220 per oz.
More than 1,700 people were employed during construction, and the current workforce is 500, most of whom are locals. Also, about 100 local companies are said to be benefiting from the mine, and mine-related infrastructure, including a roadway and a water pipeline, is benefiting the surrounding region.
In October 1999, a spike in the price of gold frustrated Ashanti’s hedging efforts and jeopardized construction at Geita. Ashanti then sought the help of AngloGold, which acquired a 50% stake in the open-pit operation in April in return for a US$335-million infusion of cash.
AngloGold contributed the Ridge 8 (or Nyamulilima Hill) target when it acquired its interest in Geita. The target, which sits within trucking distance to Geita, contains a resource of 2.1 million oz. The partners are also preparing to drill the nearby Nyamatigata target, where trenching has returned encouraging results.
Drilling will attempt to evaluate the underground resource at Geita, which currently stands at 10 million tonnes grading 8 grams per tonne, or 2.6 million oz.
The opening ceremony was also attended by Tanzania’s president, Benjamin Mkapa, Energy Minister Abdallah Kigoda, and Ashanti CEO Sam Jonah.
Jonah said Geita is “a measure by which Ashanti’s commitment to manpower and development should be judged.”
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