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The gold producer says it's confident the SA mine will continue meeting its targets this year.
Gold Fields says its troublesome South Deep mine is so far meeting its targets for year - and it's confident it will continue to do so. That follows the biggest restructuring in the mine's history last year, which saw management close loss-making shafts, reduce its cost base and retrench just over 1,500 employees and contractors, leading to a 45-day strike due to strong opposition by unions at the mine.
Addressing the company's annual general meeting yesterday, chair Cheryl Carolus said the retrenchments were unavoidable as the remaining 3,500 jobs would otherwise have been at risk.
Carolus said the restructuring would achieve a significant reduction in cash losses this year and set the mine up for long-term and sustainable growth. It embarked on the restructuring after impairing the value of the mine by a further $359 million after tax.
She said investment of more than $500 million in developing the group's operations in Australia, Peru and Ghana over the past couple of years would help boost production to 2-million ounces this year and that its global portfolio outside of SA would be able to maintain a similar production level over the medium to longer term. Globalisation of its portfolio meant that over 40% of its attributable mineral reserves were now situated outside of South Africa. Two years ago, 70% of its reserves were held by South Deep.
Developments at Gold Fields in 2018 and in 2019 to date clearly underscore the company's strong, expanding and sustainable global profile," Carolus said. "Not only are our production and cash-flow already heavily weighted towards our mines in Australia, Peru and Ghana, we have increased our investment in these countries to enhance sustainability of our business."