Johannesburg, South Africa — MININGREVIEW.COM — 18 February 2010 – AngloGold Ashanti Limited “’ Africa’s largest producer of the precious metal “’ plans to cut costs in South Africa by 10% this year, amid rising labour costs and power prices that may more than double by 2012.
“We have to find ways and means of getting our cost structures down,” CEO Mark Cutifani said during a conference call here. ‘The company plans to cut costs by another 15% between 2011 and 2014,” he added.
Bloomberg News reports that South African gold producers are trying to boost output to benefit from a rally in the price of the metal, which climbed 24% last year. At the same time they are facing higher labour and power costs, with Eskom applying to raise tariffs 35% a year for the next three years.
“Robbie Lazare “’ former executive vice president of human resources “’ is leading a team that aims to boost output and cut costs by reducing safety-related stoppages,” Cutifani said.
Safety stoppages cost AngloGold 160 000 ounces of lost production last year, according to Richard Duffy, vice president of the company’s African division. After an increase in mine fatalities in 2007, the South African authorities introduced a policy of stopping activities at mines following deaths until they are satisfied that conditions are safe.
“While there are no immediate plans for job cuts, AngloGold can’t guarantee that this won’t be the case in the future,” Cutifani said, without giving further details. The company employs about 32 500 people in South Africa.