Business News of Saturday, 7 August 2021
Source: bloomberg.com
2021-08-07
Obuasi is one of Africa’s largest gold mines
AngloGold Ashanti stock dropped as much as 12% Friday after it cut production forecast and said a key mine in Ghana may not resume output this year after an accident in May.
The company lowered its output goal by about 12% after removing planned gold from the Obuasi operation. Mining activities at the project will remain suspended pending the conclusion of a third-party review of the mining and ground management plans.
While AngloGold hopes to restarts the mine by year-end, it would take a “cautious approach” to limit chances of a repeat of the incident that happened in May, interim Chief Executive Officer Christine Ramon said in an interview.
The shares fell by the most in nine months in Johannesburg on Friday, before paring some of the losses to trade 8.6% lower at 256.89 rand at 12:51 p.m. local time.
The Johannesburg-based producer has underperformed rivals in the past year after the accident at Obuasi, where it had been ramping up production following $545 million of investments. The company also spent nearly a year looking for a new CEO after announcing Kelvin Dushnisky’s departure after just two years.
“Obuasi was going to be quite a big contribution this year,” Ramon said on an earlier call. “We can’t predict at this stage if there will be production by the end of the year.”