AngloGold to abandon Freda Rebecca

Godfrey Marawanyika

JOHANNESBURG Securities Exchange (JSE)-listed AngloGold could abandon its only remaining operating mine in the country, Freda Rebecca, after its merger with Ghana’s Ashanti.
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Although the firm has indicated that it could abandon operations it was not immediately clear if it would lease or sell the mine, as no decision had been taken.


Anglogold Ashanti chief executive officer Bobby Godsell indicated that they could dump the Zimbabwe operations.


“Of the combined assets, the only asset on which there is any serious question is Freda Rebecca,” Godsell said.


AngloGold spokesperson Shelash Blackmen on Wednesday said although Godsell had made those remarks no concrete decision had been made to dispose of the operations.


“He made those comments when he was looking at Ashanti’s assets which are operating. Obviously his comments were necessitated by the Ashanti merger,” she said. “So there will be a lot of discussions which will have to be taken into account on the issue. Godsell never came out stating that they would abandon Freda Rebecca, but indicated that this was a possibility.”


While AngloGold’s local operations are now in doubt, the firm has set an exploration office in China.


Analysts said overhead costs of Freda Rebecca, which are higher than other mines owned by AngloGold, could also contribute to the decision being taken by the Johannesburg firm.


Between January and March this year, Ashanti’s Freda Rebecca produced 7 000 ounces of gold at a total cash cost of $764 per ounce, which is almost three times Ashanti’s average cost of $261.


The extraction of the yellow metal locally is greatly affected by problems of power supplies because of loadshedding, and tariff charges. This is worsened by the scarcity of spare parts due to the shortage of foreign currency.


Anglo has over the past six months closed Isabella and Bubi gold mine.