Gold Fields and AngloGold Ashanti joint venture to create Africa's largest gold mine in Ghana hits snag

The proposed joint venture between mining giants Gold Fields and AngloGold Ashanti to combine their Tarkwa and Iduapriem gold mines in Ghana has hit a roadblock, with both companies confirming that necessary permits remain outstanding. 

The collaboration, first announced in March 2023, aimed to create Africa’s largest gold mine, with Gold Fields holding a 60 percent stake, AngloGold Ashanti 30 percent, and the Ghanaian government 10 percent.

In a joint statement released on Thursday, the two companies expressed disappointment over the delay in securing government approvals before Ghana’s national elections in December. 

“We continue to believe that a combination of the two neighbouring mines into a single managed entity is compelling, given that it is anticipated to extend life of mine, increase production, and lower costs, creating value for all stakeholders,” they stated. 

However, without a clear timeline from Ghanaian authorities, both companies will now pursue individual improvements to their respective assets while continuing discussions on a potential merger.

"Notwithstanding constructive engagement with the Government of Ghana since the announcement of the Proposed Joint Venture on 16 March 2023, the requisite approvals by the Government of Ghana for the Proposed Joint Venture have not yet been obtained," the statement said.

"Gold Fields and AngloGold Ashanti have sought to secure the requisite approvals, which include approval of the Proposed Joint Venture by the Parliament of Ghana, ahead of the October 2024 Parliamentary recess before the Ghana national elections to be held in December 2024.

"The Parties continue to believe that a combination of the two neighbouring mines into a single managed entity is compelling, given that it is anticipated to extend life of mine, increase production and lower costs, creating value for all stakeholders.

"In the absence of the requisite approvals from the Government of Ghana and clear timelines for execution of an agreement, Gold Fields and AngloGold Ashanti will maintain engagement in relation to a potential asset combination while separately continuing to pursue improvements to their respective assets".

The joint venture was projected to generate an average of 900,000 ounces of gold annually over the first five years, and 600,000 ounces over its estimated 18-year lifespan. 

Gold Fields and AngloGold have both increasingly shifted focus from South Africa, their traditional base, towards international operations, including in Ghana, Australia, and the Americas. South Africa's deep and challenging geology has made gold extraction more complex and costly, prompting the miners to diversify.