AngloGold Ashanti plc: Q1 2024 Production Update
Filing and period: Form 6-K furnished on 10 May 2024 for the three months ended 31 March 2024. The update covers gold production and operating developments; it does not provide a clear value for revenue, net income, operating cash flow, margins, debt, or liquidity.
Business Context and Key Metrics
- Attributable group gold production, excluding the Córrego do Sítio operation on care and maintenance, increased 2% year over year to 581,000 ounces, compared with 572,000 ounces in Q1 2023.
- Subsidiary production was 505,000 ounces, versus 508,000 ounces a year earlier; joint-venture production was 76,000 ounces, versus 64,000 ounces.
- Total tonnes treated declined to 9.475 million tonnes from 9.684 million tonnes, while total recovered grade increased to 1.91 grams per tonne from 1.84 grams per tonne.
- Production improvements included Cuiabá, up 55% to 65,000 ounces; Serra Grande, up 40% to 21,000 ounces; Kibali, up 19% to 76,000 ounces; and Geita, up 16% to 114,000 ounces.
- Safety performance remained strong: no fatalities occurred at operated mines for the eleventh consecutive quarter, and first-quarter TRIFR was 1.08 injuries per million hours worked, compared with 2.66 for the most recent cited ICMM average.
Material Changes Versus Q1 2023
| Operation or region | Q1 2024 production | Year-over-year change | Primary driver |
|---|---|---|---|
| Cuiabá | 65,000 oz | +55% | Higher tonnes processed and recovered grades |
| Serra Grande | 21,000 oz | +40% | Higher recovered grades |
| Kibali | 76,000 oz | +19% | Higher grades and stronger underground performance |
| Geita | 114,000 oz | +16% | Higher recovered grade and improved underground feed |
| Siguiri | 41,000 oz | -35% | Carbonaceous Bidini ore, poor recoveries, equipment availability and lower feed grades |
| Tropicana | 53,000 oz | -17% | Flooding, suspended mining and lower tonnes processed |
| Sunrise Dam | 56,000 oz | -8% | Lower recovered grades |
| Cerro Vanguardia | 39,000 oz | -7% | Planned plant stoppage |
Guidance, Outlook, Risks and Unusual Items
- 2024 group gold production guidance was reconfirmed at 2.590 million to 2.790 million ounces, comprising 2.270 million to 2.430 million ounces from subsidiaries and 320,000 to 360,000 ounces from joint ventures.
- Production is expected to be weighted toward the second half, with Q4 expected to be the strongest quarter.
- Obuasi produced 54,000 ounces in Q1 and remains forecast to produce 275,000 to 320,000 ounces in 2024 and 325,000 to 375,000 ounces in 2025. Underground treatment averaged 91,000 tonnes per month, with higher tonnes and grades expected in the second half.
- Tropicana was affected by 312 millimetres of rain in 72 hours during March. Operations restarted after remedial work, but the impact is expected to continue into Q2 as water is removed from the Havana 5 pit. Management expects to recover a significant portion of lost production in the second half.
- Key operational risks include further weather events, power disruptions, labour or operational interruptions, delays in the Obuasi ramp-up, changes in the asset portfolio, gold-price and foreign-exchange volatility, permitting, litigation, supply-chain disruption, environmental and safety events, and geopolitical or regulatory changes.
- Obuasi’s Phase 3 redevelopment remains expected to be completed by the end of 2024. The underhand drift-and-fill trial progressed, with an annualised production rate of 360,000 ounces expected in Q3 2024.
- North Bullfrog remains scheduled to begin anticipated production in 2026, subject to required permits. The Tropicana renewable-energy project is expected to be commissioned in Q1 2025 and is projected to reduce emissions by approximately 65,000 tonnes annually.
- AngloGold Ashanti acquired an 11.7% interest in G2 Goldfields for approximately CAD 22.1 million on 19 January 2024.
- The proposed Tarkwa/Iduapriem joint venture remains under discussion with the Government of Ghana; no agreement had been reached as of the filing date.
- The company delayed its planned transition from Form 6-K and Form 20-F reporting to voluntary U.S. domestic issuer forms. Until that transition, it intends to furnish quarterly operational and financial updates, including unaudited condensed consolidated interim financial statements.
Investor Verification Items
- Verify delivery of the 2.590 million–2.790 million ounce 2024 production guidance, particularly the second-half and Q4 weighting.
- Monitor Tropicana’s recovery from flooding, Havana 5 dewatering, and the effect on Q2 production and costs.
- Assess Siguiri’s recovery following the shift away from carbonaceous Bidini ore and the arrival of new equipment.
- Track Obuasi’s underground development, Phase 3 completion, power reliability, and progression toward forecast production levels.
- Review the forthcoming quarterly financial statements for revenue, earnings, cash flow, cash balance, debt, liquidity, capital expenditure, and operating-cost metrics, which are not provided in this production update.
- Follow permitting and execution milestones for North Bullfrog, Tropicana underground development, Quebradona, and other major projects.