JOHANNESBURG (miningweekly.com) – Despite the downturn in the gold price that has plunged much of the gold mining industry into crisis, London-listed Randgold Resources believed it could maintain its positive position in Mali.

CEO Mark Bristow said its development of the Morila operation, which had delivered in excess of six-million ounces of gold at an average cost of less than $300/oz, had enabled Mali to develop into a major gold producer and generate more than $1-billion for State coffers.

Randgold's mines in Mali, which accounted for 10.8% of the country's gross domestic product, were expected to pay some $170-million directly to the Malian State in the form of taxes and royalties.

The expansion and upgrading of the Yalea and Gounkoto operations would boost production by over 600 000 oz/y in 2014.

“Although we have stress-tested and revised some of our business plans, we have not been forced to shut down operations nor to cancel growth projects. With Loulo and Gounkoto both accessing higher grade sections of their orebodies, and efficiency initiatives under way at all our operations, we are confident in our ability to manage the business through these difficult times for the gold industry,” he said.

Randgold was currently undertaking a feasibility study on a possible underground mine at Gounkoto, while exploring for further multimillion-ounce gold deposits in the Loulo-Gounkoto region.

Bristow noted that the Malian government's 22-month royalty waiver – the period of development of the Morila pit pushback project – enabled a “more equitable share for investors and the State” and extending the mine's life by a further two years.

“In combination with a tailings retreatment project, this will also help fund the eventual rehabilitation of the mine site, as well as the establishment of a sustainable agribusiness to provide economic opportunity for the local community,” Bristow added.