AngloGold Ashanti is an independent, global gold mining company with a diverse,
high-quality portfolio of operations, projects and exploration activities across ten countries on four continents.
We creates value by safely and responsibly mining and marketing our products. Delivering on our mission
entails ensuring that our business model and strategy are sufficiently robust and flexible to adapt to the
ever-changing, dynamic world in which we operate.
Risk 2: Inability to convert Mineral Resource into Ore Reserve
Our Ore Reserve increased by 3.5Moz (before
depletion), indicating the progress made in
extending the lives of our mining operations
After depletion and excluding South Africa,
the Ore Reserve increased by 1.1Moz
To improve operating and mining flexibility by
investing in Ore Reserve development and
Ore Reserve conversion drilling at sites with
high geological potential over the next two to
AngloGold Ashanti has two operations in its Australia region, Sunrise Dam and
Tropicana, both of which are in the north-eastern goldfields of the state of
Our operations in this region are:
Sunrise Dam, wholly-owned by AngloGold Ashanti, is located
220km north-east of Kalgoorlie and 55km south of Laverton.
Underground mining, carried out by a contract mining
company, is now the primary source of ore, following the
cessation of mining in the open pit in 2014.
Tropicana, a joint venture in which AngloGold Ashanti has a
70% holding and which it manages with 30% held by IGO Ltd, is
located 200km east of Sunrise Dam and 330km east-northeast
of Kalgoorlie. The operation is a large open pit operation with
mining carried out by a contractor.
The Australia region produced 614,000oz in 2019 compared to
625,000oz 2018. The 2% drop in year-on-year production was
largely the result of lower underground mined volumes and grades at
Sunrise Dam experienced operational challenges in the middle of
the year with limited stope flexibility and paste fill delays, which
resulted in lower underground volumes and grades. However,
mining flexibility improved in the fourth quarter of 2019 as
larger stopes came online, resulting in a record production from
underground for the fourth quarter.
A substantial exploration programme is underway to increase Mineral
Resource confidence, grow the underground Ore Reserve and
support development of additional mining areas in the long term.
Critical for success at Sunrise Dam is increasing flexibility to ensure
consistently high underground tonnages are available to displace
lower-grade surface stockpiles. Strategic drill platforms have been
established to facilitate systematic exploration of the down plunge
extents of the Vogue mineralised system, while also testing areas to
the north and south that could generate additional work areas. The
objective of the drilling is to provide data to facilitate Ore Reserve
conversion and increase confidence and reliability in the two- to fiveyear
At Tropicana, production at 360,000oz for the year, was 7% higher
year-on-year. Higher mill throughput, which set new records in
December 2019, offset lower feed grades in the second half of the
year and contributed to the increase in gold production. Annual tonnes mined also broke site records in 2019. The Tropicana
open pit was completed during the year and mining continued in
the Havana South, Havana and Boston Shaker pits. In 2020, it is
planned that open pit mining will be focused on the Havana pit.
The region’s AISC was $990/oz in 2019 compared to $1,038/oz for
2018. Despite the 2% lower production delivered in the region for
the year, a strong focus on operational excellence coupled with a
weaker exchange rate contributed to a 4% drop in total cash costs
and a 5% drop in AISC compared to 2018. Tropicana’s total cash
costs declined due to higher volumes, and improved efficiencies
partially offset by unfavourable grades, royalties and inflation while
total cash costs at Sunrise Dam were negatively impacted by lower
efficiencies, lower grade and inflation.
Operational excellence work included a successful trial of
autonomous open-pit blast hole drilling, which indicated significant
productivity gains could be achieved by converting all six drill rigs
to autonomous operation. Autonomous operation can improve drill
use by enabling their continued operation within the exclusion zone
during blasting, so extending drill bit life and reducing the number
of operators needed.
Total capital spend for the region was $149m in 2019 compared
to $156m in 2018. Capital expenditure at Tropicana increased
by $30m predominately due to the start of the Boston Shaker
underground growth project at $21m. An increase in waste
stripping capital expenditure due to the scheduling of open pit
cutbacks was partially offset by a reduction in stay-in-business
capital. Capital expenditure at Sunrise Dam reduced by $36m
due to lower Ore Reserve development and stay-in-business
capital expenditure. Several key infrastructure projects, such as
the expansion of the tailings storage facility and the upgrade to
the ventilation system were completed in 2018 resulting in a $25m
year-on-year reduction in stay-in-business capital expenditure when
compared to 2019.
Growth and improvement
At Sunrise Dam, the underground exploration programme initiated
in the second half of 2019 is expected to take two years. The
programme is designed to increase Mineral Resource confidence,
grow the underground Ore Reserve and support development of
additional mining areas in the long term. By the end of the year six
underground diamond drill rigs were in operation testing targets
including the southern strike extensions of the Midway Shear
Steeps (MSS) and Elle and areas to the south of the current Vogue
Indicated Mineral Resource. Surface diamond drilling will target
southern extensions of Vogue.
Drilling results returned in 2019 identified extensions of Vogue
mineralisation over an approximate 180m strike length;
southern extensions to the Midway Shear Steeps ore domains,
approximately 190m south of the current Indicated Mineral Resource; and potential repetition of the Midway Sheer Steeps
ore domains, approximately 100m east of the current Indicated
Mineral Resource. Drilling also intersected mineralisation 500m to
the south down plunge of the Mineral Resource, suggesting the
continuation of the Vogue orebody.
Development of the Boston Shaker underground mine at
Tropicana began in May 2019 and at year-end the project was
on track to deliver high-grade ore in mid-2020 as planned. The
decision to go ahead with the project was announced in March
2019 and, after a feasibility study confirmed that underground
mining was technically and financially viable, demonstrating robust
economics with an anticipated internal rate of return of 39% for a
capital investment of $79.3 million (100%).
Boston Shaker is expected to contribute higher-grade mill feed,
resulting in an improved gold production profile and enhanced
cash flow, during 2021-2023 when the mine plan includes periods
of higher waste stripping in the Havana open pit.
The feasibility study was based on the mining of 6.58 million tonnes,
grading 3.84g/t, assuming the systematic conversion of Mineral
Resource to Ore Reserve over the life of the mine. The average
underground mining rate will be approximately 1.1Mtpa (including
development) over an eight-year mine life to 2026 to produce a
total of 732,000oz. Mining methods will comprise conventional
mechanised mining and underhand sub-level open stoping.
The two raises bore holes required for ventilation and emergency
egress were tracking ahead of schedule by year end, and
underground development of 1,640m was ahead of plan. Underground reverse circulation grade control drilling began in
October. Recruitment of the underground workforce is in line with
plan and the underground operation remains on track to deliver
first gold in the second half of 2020. Operational excellence work
is focused on remote bogging, the mechanical operator-controlled
digging of ore from surface, and on optimising level spacing and
In the Australia region, our principal sustainable development
activities relate to the following material issues:
Safety performance improved for the Australia region in 2019,
continuing a positive trend since the commissioning of Tropicana
in 2013. At Tropicana, the site ended the year with a record safety
performance in terms of the AIFR and the lost-time injury frequency
rate (LTIFR), achieving 14 months without a lost-time injury. At
Sunrise Dam, the AIFR and LTIFR both increased marginally from
2018, although the severity of injuries was minor.
Employee and community health
At Tropicana, a programme was initiated to improve health,
safety and productivity outcomes by identifying and supporting
people with sleep disorders. Since the start of the programme in mid-2018, there has been a 51% reduction in fatigue alarms
among haul truck operators. In 2019, this project was a finalist
in the Work Health and Safety Excellence Awards, organised
by the government of Western Australia’s Department of Mines,
Industry Regulation and Safety. See case study entitled, Tropicana
implements programme to address sleep disorders in the from the <SR>.
Contributing to resilient self-sustaining communities
AngloGold Ashanti is actively involved in communities across the
Western Australian goldfields, from Laverton to Kalgoorlie-Boulder
and beyond, including remote Aboriginal communities such as
Tjuntjuntjara. Our community projects support education, youth,
community development and health programmes and local training.
We also offer employment and business participation opportunities.
During 2019, AngloGold Ashanti Australia awarded a contract
for ore rehandling and crusher feed at Sunrise Dam to Aboriginal
contractor Carey Mining Pty Ltd, continuing a business partnership
that began more than 20 years ago. Carey Mining employs 57
people on the Sunrise Dam contract.
Responsible environmental stewardship
There were no reportable incidents in 2019 at either Australian
operation and both sites met all their regulatory reporting
obligations during 2019.
In the first half of the year, all necessary approvals were received
to enable development of the Boston Shaker underground mine
at Tropicana to proceed on schedule. During the year, the Great
Victoria Desert (GVD) Biodiversity Trust, established in 2013 by the
Tropicana joint venture as part of the biodiversity offset approach
for the Tropicana operation, had a range of projects underway
in 2019. Tropicana is on the GVD’s western edge and the trust
supports research and on-the-ground conservation in two of the
desert’s six ecological sub-regions.
The trust funded the first Sandhill Dunnart Research and Adaptive
Management Plan for the GVD, which incorporates traditional
owner land management expertise. This work identified two new
Sandhill Dunnart sites, recorded 52 more fauna species and
increased total bird and mammal species records for the region
to 172. The Sandhill Dunnart, a small carnivorous marsupial, is an
endangered species. The trust supports activities to capture and
apply traditional ecological knowledge and facilitate indigenous
land management participation. Projects include research to
increase fire-management capability and introduce traditional fire
management practices, as well as traditional owner ranger training.
Navigating regulatory and political uncertainty and risk
AngloGold Ashanti drafted a whistle-blowing policy for the region,
which is also aligned with group policy, to address specific
requirements of the Australian Whistle-blowing Act.