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Ending mine fatalities most pressing 2017 priority – AngloGold

AngloGold COO South Africa Chris Sheppard

AngloGold COO South Africa Chris Sheppard

Photo by Duane Daws

21st February 2017

By: Martin Creamer

Creamer Media Editor

     

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JOHANNESBURG (miningweekly.com) – The first and most pressing of AngloGold Ashanti’s key 2017 priorities is to put an end to mine fatalities by improving workplace conditions and bettering legal compliance, AngloGold Ashanti chief operating officer South Africa Chris Sheppard said on Tuesday, when the company posted stunning cash-rich 2016 financial results and resumed paying dividends to shareholders – but presided once more over the deaths of employees, this time six, in the 12 months to December 31.

Against the background of a national sadness mounting around perennial fatality reportage by South Africa’s mines and the company doubling its free cash generation to $287-million in the period, Sheppard spoke of much focus being placed by the JSE- and NYSE-listed gold mining company on ensuring sustainable and effective adoption of safer production processes, including technology rollouts.

He told Mining Weekly Online that he was still upbeat about the company’s reef-boring component on the Mark IV machine, which would take people out of the vulnerable areas and allow for around-the-clock mining.

In the current drill-and-blast environment, the death and injury rate remains on an unacceptably high plateau in South Africa as a whole and unless significant change is made to address why this plateau exists, death and injury in mines will continue.

The proper level of investment into research and development (R&D) has potential to save employees' lives and generate unprecedented benefits for shareholders.

The current mining method is clearly not the one that should take South Africa into the future.

In fact, if it continues to be pursued, gold mining will end long before the Witwatersrand basin’s billions of ounces of remaining gold are extracted.

On the progress of the Mark IV initiative, Sheppard told Mining Weekly Online that the company’s R&D programme was still on track and added that the Mark IV had bored four holes this quarter, achieving 90 hours a hole, compared with the benchmark of 72 hours a hole – and the initial eight to nine days a hole.

“The key issue still outstanding is that we’re not on a 24/7 and that 72 hours productivity level is based on being able to operate the machine on a 24/7 basis, which we don’t have at present,” he said.

Meanwhile, options were being studied, he said, to assess the most appropriate manner to integrate the remaining life of the TauTona and Savuka gold mines into its long-life Mponeng operation, where pleasing momentum is continuing to be seen as it is positioned as a long-life tier-one asset.

Mponeng and Moab Khotsong are the two strong cash generating mines within AngloGold’s South Africa portfolio.

A comprehensive programme is under way to realise both on-mine and off-mine cost reductions as the company manages the transition on production.

The Mponeng Below 120 phase one project production ramp-up remained critical with rock-handling and logistics infrastructure being completed in mid-2017.

The Mponeng life-of-mine extension project would be progressed to feasibility study stage for finalisation by mid-2018, with critical path activities continuing through the rest of this year.

“Our significant commitment to our technology programme will remain driven by a project management team fully focused on delivering a viable mining production system,” said Sheppard, who is currently progressing the authorisation of continuous operations with the regulator to enhance the business case of this capital intensive technology.

At Moab, a prefeasibility study is being progressed around Zaaiplaats.

The areas of challenge remain both the Kopanang and TauTona mines, with Kopanang a lower-grade operation needing higher productivity and TauTona poised to benefit in the next 12 to 24 months from its integration into Mponeng.

Deutsche Bank mining analyst Patrick Mann made the point that AngloGold’s South African and Australian operations were generating less cash than their South American and African counterparts, to which CEO Srinivasan ‘Venkat’ Venkatakrishnan countered that the company’s South African mines remained a strong cash generator, with volume mined the biggest driver.

Edited by Creamer Media Reporter

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