Gold mining company AngloGold Ashanti reported strong year-on-year improvements in production, all-in sustaining costs (AISC) and cash flow for the third quarter of 2022, as higher grades and efficiency gains helped offset the impacts of rising inflation.
The Johannesburg- and New York-listed AngloGold recorded free cash flow of $169-million in the third quarter of 2022 compared with $17-million in the third quarter last year, with AngloGold CEO Alberto Calderon continuing to prioritise execution, efficiency and careful allocation of capital.
“We’re focused on regaining competitiveness versus our peers, and we still have some way to go before we will be satisfied,” Calderon added in a release to Mining Weekly.
AISC improved 6% year-on-year to $1 284/oz in the third quarter of 2022, from $1 362/oz in the third quarter of 2021.
Total cash costs increased to $966/oz in the three months to the end of September, 4% higher than the $927/oz in the same period last year, with the improved operating performance partly offsetting both cost increases across several input categories, and lower by-product revenues.
Production for the third quarter of 2022 rose 20% to 738 000 oz compared with 613 000 oz in the third quarter of last year, underpinned by higher grades across most assets.
The Obuasi gold mine in Ghana continued its ramp-up to remain on track for this year’s production guidance of 240 000 oz to 260 000 oz.
Third-quarter adjusted earnings before interest, taxes, depreciation and amortisation increased 5% to $472-million, from $448-million in the corresponding period of last year, despite the lower gold price received.
The Kibali joint venture in the Democratic Republic of Congo remitted third-quarter cash flow of $71-million, up on the $53-million in the corresponding period of last year, despite the lower gold price and lower production from the Kibali mine. The outstanding value added tax balance in Tanzania was further reduced through corporate tax offsets.
The balance sheet was described as remaining in a solid position after paying an interim dividend, with approximately $2.5-billion in liquidity, including cash and cash equivalents of $1.2-billion at end September.
The proposed $150-million upfront cash acquisition of Coeur Mining Inc’s Nevada properties, adjacent to AngloGold Ashanti’s own deposits in the area, will further consolidate its foothold in the prospective Beatty district in southern Nevada, US, where production is expected to commence in about three years.
The new carbon emissions reduction target announced by AngloGold aims to achieve a 30% absolute reduction in its Scope 1 and Scope 2 greenhouse-gas emissions by 2030, as compared with 2021, through a combination of renewable energy projects, fleet electrification and lower-emission power sources.
The capital cost required to achieve these reductions over the coming eight years is anticipated to be about $1.1-billion, of which $350-million is expected to be company funded and the remaining $750-million through third-party funding, including from providers of renewable energy infrastructure.
This programme is expected to be net present value positive, adding value to the business by reducing energy cost and improving energy security.
