AngloGold Ashanti has softened its guidance for the 2021 calendar year after COVID-19 challenges and labour shortages hampered production.
The company produced 1.2 million tonnes of gold in the first half of 2021 with a 33 per cent increase to its all-in sustaining cost (AISC), which sits at $US1333 ($1819) per ounce.
AngloGold Ashanti’s original target of 2.7 million to 2.9 million ounces has since been brought down to 2.45 million to 2.6 million ounces.
Setbacks at its Australian operations were one of the main factors that contributed to the revised guidance.
According to AngloGold Ashanti, strong competition for skilled workers in the labour market has impacted production for the company’s Australian operations.
“High iron ore prices and low unemployment have resulted in a fierce competition for skills causing a higher turnover rate for operators and maintenance staff,” AngloGold Ashanti stated.
“This situation has been exacerbated by COVID-19-related border closures requiring new inexperienced workers to enter the mining industry, which has negatively impacted production.
“The region’s AISC was $US1725 per ounce for the six months ended 30 June 2021, compared to $US1166 per ounce for the six months ended 30 June 2020.”
The company produced a total of 220,000 ounces at a cash cost of $US1296 per ounce in the first half of 2021, down from 260,000 ounces at $US967 per ounce in the previous corresponding period.
In the first half of 2021, AngoGold Ashanti produced 102,000 ounces of gold at the Sunrise Dam mine in Western Australia at a cash cost of $US1372 per ounce.
This was down from the previous period due to lower production and grades, increased operational costs, and ore stockpile movement issues.
The company produced 120,000 ounces at a cash cost of $US1039 per ounce, which was also down from 144,000 ounces at a cash cost of $US822 per ounce in the same period last year.
AngloGold Ashanti also stated that the suspension of mining operations at the Obuasi gold mine Ghana due to a fatal accident in May has affected production.
The company stated no further production from Obuasi has been factored into the new guidance.