Gold Fields – AngloGold ink pact

Vancouver South African-based rivals Gold Fields (GFI-N) and AngloGold (AU-N) have elected to team up in the country’s Driefontein mining area.

AngloGold has agreed to buy a portion of Gold Fields Block 1C11 for 315 million South African rand. The 280,000 sq metre property hosts 1.4 million tonnes of material grading 12.7 grams gold per tonne and lying on the western boundary of Driefontein, it can be accessed from the adjacent AngloGold’s TauTona mining operation.

“We believe that this is not only a good deal at fair value for both companies, but a win-win situation for the local gold mining industry,” says Ian Cockerill, Gold Fields Chief Executive Officer.

Driefontein would only have been able to mine this area in about 10 years from Driefontein’s No. 1 Tertiary Shaft System. TauTona, however, which is already mining adjacent to this block, will gain access to it toward the end of 2004.

“The deal makes a lot of sense," adds Cockerill. "For Gold Fields, it brings value forward and we shall use the cash from the deal to invest in our current operations."

The sale is subject to the transaction being approved by the country’s competition commission.