Gold major - AngloGold Ashanti- doesn't appear too worried by rampant illegal mining at its portfolio of operations in Ghana. The company will be investing about US$200 million at its Obuasi and Iduapriem mines in 2008.
The company's vice president for west Africa Christian Rampa-Luhembwe told journalists in Accra that AngloGold will be spending US$130 million on exploration, ore reserve development and stay-in-business expenses at its Obuasi mine this year.
In addition, Rampa-Luhembwe said the company will spend a further US$44.4 million to turn around business at the mine. All this is aimed at sustaining and expanding the mine in order to produce more quality ounces at low cost.
AngloGold also plans to modernize its Iduapriem mine. In this endeavour, it will be investing US$57 million. Iduapriem produced 185,000 ounces of gold in 2007. The modernization project is expected to end at the end of this year and production will be enhanced by 15 percent.
The company's investment comes at a time when it is paying dearly for illegal mining. Rampa-Luhembwe concurs with Accra Mail that the problem of illegal mining, continues to be a major source of obstacles in the company's determination to produce more gold.
Threats posed by illegal miners popularly known as Galamseys have become more vicious than ever as some now sneak into mining concessions with sophisticated weapons, ready to combat any resistance that come their way. According to Rumpa-Luhembwe, this has led to illegal miners continuing to operate underground freely - drill and blast, steal ore, destroy mine infrastructure, steal cables and brutalize the workforce.
The 100-year old Obuasi mine which is budgeted to produce 450,000 ounces of gold this year is the worst hit. The mine has been receiving state security apart from the company's expenditure of US$40,000 per month in providing extra security to protect it.
In February this year, the media reported that despite maximum state security at the mine, the galamseys invaded the mine and set ablaze electrical wire in what seemed to be a co-ordinated event in an attempt to steal copper cables. They set fire into 6.6kv cables serving the central ventilation shaft main fans, which affected power supply and trapped 37 miners underground.
AngloGold spent US$5 million to replace the burnt cables.
Now the problem could worsen following the announcement by the government that it will no longer provide military protection for mining companies operating in the country.
Ghana's Attorney General and Minister of Justice Joe Ghartey told a hearing at the Human Rights Council meeting in Geneva that the government will longer be providing mine security services following reports of human rights abuses perpetrated by soldiers and policemen assigned to guard the mines.
FoodFirst and Information Network (FIAN) and other civil society organizations dragged Ghana to the Human Rights Council.
Said Ghartey at the Council: It is true that at a certain point, joint military and police teams were protecting mining companies driving away illegal miners, but that was a short term measure and we have reviewed it and we don't intend to continue it.