Articles by Jacob Webster

Business

AngloGold plans to raise output at flagship Tanzanian mine

AngloGold Ashanti has laid out big plans for its flagship Geita mine in a third quarter trading update, as soaring gold prices allow the group to reinvest billions into exploration and development. The mining giant plans to increase the huge Tanzanian mine’s mineral reserve by 60% while adding a decade to its lifespan through increased investment in the asset over the next three years. Geita, a tier one Tanzanian gold mine that AngloGold has wholly owned since the company’s formation in 2004, is already one of the largest gold mines in the group’s portfolio. The expansion is projected to increase Geita’s output to about 600,000oz a year for at least a decade, equal to about a quarter of AngloGold’s total gold production last year. The move reflects a broader strategy to reinvest the record free cash flows unlocked by soaring gold prices into the existing asset base rather than chasing purely inorganic growth. In a trading update for the nine months to end-September, the company said it would direct targeted spending towards exploration, mineral reserve development and turning resources into active mine sites at locations with high geological potential over the next three years. Another focal area outside Tanzania may be North America where AngloGold in recent months has consolidated its ownership of the Beatty District and Canada’s Augusta Gold. These transactions served to expand the company’s footprint and would allow it to develop one unified regional plan for “one of the most significant emerging gold districts in the US”, AngloGold said on Tuesday. Bumper earnings The miner reported bumper earnings for the first nine months, with headline earnings nearly tripling to $672m from $236m in the previous comparable period. The addition of Sukari, Egypt’s largest gold mine, in late 2024 continued to result in higher volumes compared with the past financial year, with further support coming from the Ghanaian Obuasi mine, Geita, Brazil’s Cuiabá and Kibali in the Democratic Republic of Congo. Overall guidance was maintained as the group’s gold production rose 17% in the third quarter to 768,000oz. With costs largely flat in real terms, the stronger operational performance, with a 40% jump in the average received gold price, resulted in a near-doubling of cash generated from operations. As free cash flow rose to $920m, more than double that of the previous third quarter, AngloGold rewarded shareholders with a 91 US cents dividend. “This is another record quarter for cash generation and another healthy dividend declaration,’ said CEO Alberto Calderon. “Cash costs again stayed flat in real terms, which means we can capture these stronger margins and show capital discipline by passing the benefit on to shareholders.” Due to US tariffs and ongoing conflict in the Middle East and Ukraine, gold’s unprecedented popularity among central banks and investors has grown AngloGold’s share price nearly sixfold in the past three years. The price rally has helped the company close its valuation gap with North American peers such as Barrick Gold and Newmont — one of the top ambitions set out by Calderon when he took the helm in 2021. Shares in AngloGold rose 3% on the group’s third-quarter trading update echoing a broader rally in gold mining stocks. The miner has tripled in value this year, peaking at a record R1,383.27 a share last month.