Underground drilling
at AngloGold’s La
Colosa gold mine
in Colombia
 
Denver, United States — MININGREVIEW.COM — 17 September 2009 – AngloGold Ashanti Limited “’ the world No.3 and Africa’s top gold producer “’ has revealed that it is cautious but open for acquisitions, in the wake of the rise of the gold price above US$1 000 an ounce.

“As far as mergers and acquisitions are concerned, we still look for value,” said AngloGold CEO Mark Cutifani in an interview with Reuters on the sidelines of the Denver Gold Forum.

“With the increase in gold price, some assets are looking very attractive, but you have to be careful because in our industry prices sometimes go up and down. We do think, however, that the underlying fundamentals for gold are very strong,” he added.

AngloGold is planning to invest US$250 million (R2 billion) in Colombia during the 2009-2011 period, US$200 million (R1.6 billion) of which will go into its La Colosa project, or "The Colossus," where the deposits were discovered in 2006.

“It’s our top internal exploration prospect,” Cutifani said, referring to the South American project.

In July, African miner Randgold Resources Limited and AngloGold teamed up to make a bid worth US$488 million R3.9 billion) for Moto Goldmines, which owns a project in the mineral-rich Democratic Republic of Congo.

Also in July, Anglogold “’ which has about 20 operations in four continents “’ said safety stoppages and mill repairs had forced it to lower its full-year guidance to between 4.7 million and 4.8 million ounces, from its original target of 4.9 million to 5 million ounces. In 2008, AngloGold produced 4.98 million ounces of gold.

In terms of costs, Cutifani said that the company’s long-term average stayed at about $450 an ounce, but a stronger South African rand against the U.S. dollar was hurting cost structure.

In July, AngloGold said that it planned to slash its hedge book by 800,000 ounces a year, and to wind up all its forward sales by 2014.

Cutifani went on to say that the company had reduced its total hedge book by about 70%. By the end of 2009, the remaining hedge commitments will be around 4.1 million ounces. He said that the hedges were bought back at an equivalent price of about US$800 an ounce on average, sharply below the current trading price of gold at about US$1,006 an ounce.