Not applicable.
Not applicable.
Not applicable.
Not applicable.
This section describes many of the risks that could affect AngloGold Ashanti. There may, however, be additional risks unknown to AngloGold Ashanti and other risks, currently believed to be immaterial, that could turn out to be material. Additional risks may arise or become material subsequent to the date of this document. These risks, either individually or simultaneously, could significantly affect the group’sGroup’s business, operational and financial results and the price of its securities.
As a result of public concern about the perceived ill effects of economic globalisation and resource extraction activities, businesses in general and large multinational mining corporations in particular face increasing public scrutiny of their activities. The cost of measures and other issues relating to the sustainable development of mining operations could place significant demands on personnel resources, could increase capital and operating costs and could have an adverse impact on AngloGold Ashanti’s reputation, results of operations and financial condition.
Disputes with surrounding communities may also affect mining operations, particularly where they result in restrictions of access to supplies and to mining operations. The miners’ access to land may be subject to the rights or asserted rights of various community stakeholders, including indigenous people. Access to land and land use is of critical importance to the companyCompany for exploration and mining, as well as for ancillary infrastructure. In some cases, AngloGold Ashanti has had difficulty gaining access to new land because of perceived poor community compensation practices. For example, compensation remains a significant area of concern at Siguiri in Guinea. Delays in projects as well as increased costs attributable to a lack of community support can translate directly into a decrease in the value of a project or into an inability to bring the project to production. Where consultation with stakeholders is statutorily or otherwise mandated and relations do not remain amicable, disputes may lead to reduced access to properties or delays in operations.
Failure to comply with applicable environmental, health and safety laws and regulations may also result in the suspension or revocation of operating permits. For example, in Colombia, AngloGold Ashanti’s core mining concession contracts provide that the Colombian mining authority, having regard to due process, could declare the underlying concession void if the Company repeatedly or continually breaches applicable environmental laws or regulations or engages in acts of corruption or other serious
financial condition. In addition, leaks or discharges of hazardous materials could result in liabilities for clean-up or personal injury that may not be covered by insurance.
AngloGold Ashanti’s operations are heavily dependent upon access to substantial volumes of water for use in the mining and extractive processes and typically are subject to water-use permits or rights to extract water from certain natural sources that govern usage and require, amongstamong other things, that mining operations maintain certain water quality upon discharge. Water supply, quality and usage are areas of concern globally, such asacross all of AngloGold Ashanti’s operations, including with respect to the company’sCompany’s mining operations in Ghana and South Africa andBrazil, its explorationmine development projects in Colombia, where there is significant potential environmental and social impact and a high level of stakeholder scrutiny.Nevada, as well as its mine development project at Quebradona in Colombia. Any failure by the companyAngloGold Ashanti to secure access to suitable water supplies, or achieve and maintain compliance with applicable requirements of the permits or licenses,rights, could result in curtailment or halting of production at the affected operations. Incidents of water pollution or shortage can, in certain cases, lead to community protest and ultimately to the withdrawal of community and government support for AngloGold Ashanti’s operations. A failure by the companyAngloGold Ashanti to comply with water contamination rehabilitationrelated directives may result in further, more stringent, directives being issued against the company,AngloGold Ashanti, which may, in some cases, result in a temporary or partial shutdown of some of the company’sCompany’s operations.
AngloGold Ashanti’s provisions for decommissioning and for restoration (excluding joint ventures but including liabilities related to assets held for sale)and discontinued operations) totalled $724$578 million in 2017, $6372022, $673 million in 20182021 and $730$659 million in 2019.2020. Costs associated with rehabilitating land disturbed by mining processes and addressing environmental, health, safety and community issues are estimated and financial provision made based upon current available information based on ourAngloGold Ashanti’s commitments, in terms ofapplicable environmental legislation or agreements with government. Estimates notably relate to discount rates, which may vary due to changes in global economic and political risk conditions and assumptions, each of which is subject to change and certain changes may not be reasonably foreseen, and mine plans, which may change in line with variations in cash flows, designs of tailings storage facilities and methodologies used to compute liabilities (including as a result of a request from environmental regulatory authorities). As such, estimates may be insufficient and further costs may be identified at any stage that may exceed the provisions that AngloGold Ashanti has made. Any underestimated or unidentified rehabilitation costs would reduce earnings and could materially and
Mining operations and projects are vulnerable to supply chain disruption such that operations and development projects could be adversely affected by shortages of, as well as theextended lead times to deliver, strategic spares, critical consumables, mining equipment or metallurgical plant.
AngloGold Ashanti’s operations and development projects could be adversely affected by both shortages and long lead times to deliver strategic spares, critical consumables, mining equipment and metallurgical plant, as well as transportation delays. Import restrictions, such as those imposed by the ArgentinianArgentinean government from 2011 to 2015, can also delay the delivery of parts and equipment. In the past, the companyAngloGold Ashanti and other gold mining companies experienced shortages in critical consumables, particularly as production capacity in the global mining industry expanded in response to increased demand for commodities. AngloGold Ashanti has also experienced increased delivery times for these items. Shortages in essential commodities, including, for example, ammonium nitrate, have resulted in unanticipated price increases and production delays and shortfalls, resulting in a rise in both operating costs and in the capital expenditure necessary to maintain and develop mining operations.
Furthermore, supply chains and rates can be impacted by natural disasters, such as earthquakes, extremesevere weather, patternssuch as storms, heavy rainfall and other impacts that may be increasing due to climate change, as well as other phenomena that include unrest, strikes, theft and fires. For example, a three-week transport strike in 2012 delayed the supply of consumables in South Africa and in February 2013, a fire destroyed the heavy mining equipment stock of spares and components at the Geita gold mine.mine in Tanzania. If AngloGold Ashanti experiences shortages, or increased lead times in the delivery of strategic spares, critical consumables, mining equipment or processing plant, the companyAngloGold Ashanti might have to suspend some of its operations and its results of operations and financial condition could be adversely impacted.
Past experience demonstrates that political, tax and economic laws and policies in countries in which AngloGold Ashanti operates can change rapidly. Examples include the 2012 coup d’état and subsequent fighting in Mali, the foreign currency regulations that were imposed from 2011 to 2015 and since September 2019 in Argentina and the ban on gold ore exports announced by the Tanzanian government in March 2017. As mining assets are fixed and largely immovable, the adverse impacts of such changes may be unavoidable and immediate.
In many of the countries in which AngloGold Ashanti operates, there is an ongoing focus by governments seeking greater economic benefit and increased financial and social benefits from extractive industries and mining in particular. This entails the review of mining codes and stability agreements, which were in many cases designed under particular economic conditions, and the formulation or amendment of laws, policies and regulations relating to issues such as mineral rights and asset ownership, royalties, taxation and taxation disputes, “windfall” or “super” taxation, non-recovery of taxation refunds, import and export duties, currency transfers, restrictions on foreign currency holdings and repatriation of earnings. The laws, policies and regulations are increasingly uncertain, changing and generally require progressively higher payments to governments, notably in the form of increased royalties and taxes, mandated beneficiation, export levies and increasing or retaining state or national ownership of resources.resources (including by way of free-carried interests in mining companies for governments). For example, the royalty rate applicable to gold increased from 2.5 percent to 3.5 percent in 2018 in the DRC and from four percent to six percent in Tanzania in 2017. In particular, changes to the fiscal terms governing AngloGold Ashanti’s operations may have a material adverse impact on the company’sits results of operations or financial condition, threaten the viability of existing operations, and discourage future investments in certain jurisdictions. This may therefore have an adverse impact on the company’sAngloGold Ashanti’s ability to access new assets and potentially reduce future growth opportunities.
Another example were the amendments to the fiscal mining regime in Ghana introduced in 2012 by the government of Ghana which, among other things, increased the corporate taxation and royalty rates. In this regard, AngloGold Ashanti (Ghana) Limited negotiated in relation to the Obuasi mine a new development agreement (Obuasi DA)(the “Obuasi DA”) and a new tax concession agreement (Obuasi TCA)
Mining is a long-term activity and assets may be located in jurisdictions with elevated risk. Political instability and the resulting unstable business environment in such countries in which companies operate may discourage future investment in those jurisdictions, and may have an adverse impact on the company’sAngloGold Ashanti’s ability to access new assets, potentially reducing growth opportunities.
The prevalence of occupational health diseases and other diseases and the potential costs and liabilities related thereto may have an adverse effect on the business and results of operations of AngloGold Ashanti.
The primary areas of focus in respect of occupational health of employees within the company’sCompany’s operations are noise-induced hearing loss and occupational lung diseases (OLD)(“OLD”), which include pulmonary diseases such as tuberculosis from various causes and silicosis in individuals exposed to silica dust. These risksdust, and which require active dust management strategies in underground operations, particularly in South Africa where a significant number of silicosis cases by current and former employees alleging past exposures are still reported each year to the board for statutory compensation.operations. If the costs associated with providing occupational health services, implementing dust control measures or supplying protective equipment increase significantly beyond anticipated or budgeted amounts, this could have an adverse effect on AngloGold Ashanti’s results of operations and financial condition. Actual and alleged health and safety incidents or breaches of standards may also adversely impact the company’sCompany’s reputation.
Such diseases impair the health of workers and negatively affect productivity and profitability as a result of workers’ diminished focus or skill, absenteeism, treatment costs and allocated resources. Any current or future medical programme may not be successful in preventing or reducing the infection rate amongstamong AngloGold Ashanti’s employees or in affecting consequent illness or mortality rates. AngloGold Ashanti may incur significant costs in addressing these issues in the future, which could also adversely impact the company’sCompany’s results of operations and financial condition.
The occurrence of events for which AngloGold Ashanti is not insured or for which its insurance is inadequate may adversely affect cash flows and overall profitability.
AngloGold Ashanti maintains insurance to protect against events which could have a significant adverse effect on its operations and profitability. This insurance is maintained in amounts that the companyCompany believes to be reasonable depending upon the circumstances surrounding each identified risk. However, damage and third-party claims arising from catastrophic events may exceed the limit of liability covered under these insurance policies. Furthermore, AngloGold Ashanti’s insurance does not cover all potential risks associated with its business and may exclude certain parts of its business. For example, there are specific exclusions for third-party and public liability insurance cover with respect to certain of the Company's TSFs. AngloGold Ashanti may elect not to insure certain risks due to the high premiumspremia or for various other reasons, including an assessment that the risks are remote. For example, while AngloGold Ashanti’s insurance program includes coverage for cyber-related crimes and incidents as part of the global insurance program, such coverage is limited due to its relatively high cost and the sophisticated nature of cyber-crime. AngloGold Ashanti’s insurance coverage also contains customary exclusions for acts of war and terrorism.
In order to reduce or maintain the cost of its insurance program, AngloGold Ashanti may in some instances retain a portion of the financial loss associated with an insurable event. These financial losses could be significant and could have an adverse effect on its financial condition.
Insurance for certain risks in particular, such as loss of title to mineral property, political risks in certain jurisdictions, environmental pollution, or other hazards resulting from exploration and production, is not generally available to mining companies on acceptable terms. The availability and cost of insurance coverage can vary considerably from year to year as a
Fluctuations in the exchange rate of currencies may reduce the market value of AngloGold Ashanti’s securities, as well as the market value of any dividends or distributions paid by the company.Company.
Furthermore, AngloGold Ashanti’s Memorandum of Incorporation allows for dividends and distributions to be declared in any currency at the discretion of the board of directors or the company’sCompany’s shareholders at a general meeting. If, and to the extent that, AngloGold Ashanti is able to or opts to declare dividends and distributions in U.S. dollars, exchange rate movements will not affect the U.S. dollar value of any dividends or distributions. Nevertheless, the value of any dividend or distribution in Australian dollars, Ghanaian cedis, British pounds or South African rands will continue to be affected. If, and to the extent that, dividends and distributions are declared in South African rands in the future, exchange rate movements will continue to affect the Australian dollar, Ghanaian cedi, British pound and U.S. dollar value of these dividends and distributions. This may reduce the value of the company’sCompany’s securities to investors. Additionally, the market value of AngloGold Ashanti’s securities as expressed in Australian dollars, Ghanaian cedis, British pounds, U.S. dollars and South African rands will continue to fluctuate in part as a result of foreign exchange fluctuations.
AngloGold Ashanti’s inability to maintain an effective system of internal control over financial reporting may have an adverse effect on investors’ confidence in the reliability of its financial statements.
AngloGold Limited was formed in June 1998 with the consolidation of the gold mining interests of Anglo American plc. AngloGold Ashanti Limited, as the companyCompany exists today, was formed on 26 April 2004 following the business combination between AngloGold Limited and Ashanti Goldfields Company Limited.
While AngloGold Ashanti’s primary listing is on the Johannesburg Stock Exchange (JSE), the companyCompany is also listed on the New York Stock Exchange (NYSE), the Ghana Stock Exchange (GhSE) and the Australian Securities Exchange (ASX). AngloGold Ashanti was approved for a secondary listing on A2X Markets (A2X) in South Africa and its shares were admitted to trading on A2X on 6 June 2022. AngloGold Ashanti’s issued share capital will be unaffected by the additional listing on A2X. Our agent for service of process in the United States is AngloGold Ashanti North America Inc., 4601 DTC Boulevard, Suite 550, Denver, CO 80237. The U.S. Securities and Exchange Commission (SEC) maintains a public internet site that contains AngloGold Ashanti’s filings with the SEC and reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC (http://www.sec.gov).
AngloGold Ashanti’s main product is gold. Once mined, the gold ore is processed into doré (unrefined gold bars) on site and then dispatched to precious metals refineries for refining to a purity of at least 99.5%,99.5 percent, in accordance with the standards of ‘good delivery’ as determined by the London Bullion Market Association (LBMA). This refined gold is then sold directly to bullion banks.
By-products of our gold mining operations, often a function of local geological characteristics, include silver in Argentina and sulphuric acid in Brazil.
Greenfields and brownfields exploration takes place in both established and new gold-producing regions through managed and non-managed joint ventures,arrangements, strategic alliances and wholly-ownedwholly owned ground holdings. AngloGold Ashanti’s discoveries include La Colosa Gramalote and Quebradona (Nuevo Chaquiro) in Colombia.Colombia and Silicon, North Bullfrog, Mother Lode and Sterling in Nevada, USA.
$27.8 billion, a seven-year high. Technology demand for gold weakened contributing to a 2 percent fall in demand for gold in the sector.
Total supply was slightly higher in 2019, up two percent year on year from 4,673.0 tonnes in 2018 to 4,776.1 tonnes in 2019. This growth was attributable to the price performance of gold over the year, primarily through its impact on recycling, but also on net hedging to a certain extent. While mine production fell by 1 percent year on year, a sharp increase in gold recycling to its highest level since 2012 (up 11 percent year on year) helped boost higher total supply. Modest net producer hedging, the first year of net hedging since 2016, also contributed to overall supply.
The average gold price for the year was $1,394/oz (2018: US$1,268/oz). AngloGold Ashanti achieved an average price of $1,387/oz for gold sold during the year, a 10% increase over 2018 at $1,261/oz.
COMPETITION
As gold mining is a mature and regulated industry, and very significant volumes of gold and gold derivatives trade in the world markets independent of gold mine supply, AngloGold Ashanti does not consider that competition for sales plays any role in its operations as a gold producer. For more information on a geographical analysis of gold income by destination, refer to “Item“Item 18: Financial Statements-Note 2-SegmentalStatements—Note 2—Segmental Information”.
However, gold producers do compete against each other for acquisition of mining assets, exploration opportunities and human resources. See “Item“Item 3D: Risk Factors”Factors—AngloGold Ashanti faces strong competition and industry consolidation”.
SEASONALITY
Subject to other factors and unforeseen circumstances, in the first quarter one production is generally lower than production during the rest of the year as a result of the ramp-up of operations after annual holiday production declines.
RAW MATERIALS
AngloGold Ashanti uses chemicals, including cyanide and lime, in the production of gold. These chemicals are available from a large number of suppliers and do not represent a material portion of the company’sCompany’s costs. We are not currently experiencing any supply shortages on critical consumables utilised in the production of gold across our global operations. In addition, our stocking strategies account for potential lead time variation and supply constraints, thus minimising the risk of changes in the marketplace. While commodity pricing is subject to volatility over time, our contractual terms limit future changes. However the war in Ukraine has led to a sharp increase in oil and energy prices, which are important costs for the Company's business. In 2022, prices for several hard and soft commodities had reached their highest levels in a decade or more, or in some cases had set records. The higher cost for basic commodities used in our host countries and communities, and as key production inputs, could impact the costs of our raw materials.
STRATEGY
AngloGold Ashanti’s core strategic focusThe overall aim of our strategy is to generate sustainable cash flow improvements and returns by focusing onover the longer term and, in so doing, to create and preserve value for all our stakeholders.
We have five key strategic focus areas namely: people, safetywhich enable us to deliver on our overall strategy which is to create value. They guide decision-making and sustainability; ensuring financial flexibility; actively managing all expenditures; improving the qualityare aimed at generating increased cash flows; extending mine lives; creating an organic pipeline of economically viable orebodies; and enhancing our portfolio; and maintaining long-term optionality.social licence to operate.
Strategic focus areas
AngloGold Ashanti’s five strategic focus areas are set out below:
Focus on•Prioritise people, safety, health, environment and sustainabilitycommunities. People areThis strategic focus area embodies our corporate ethos and encompasses our sustainability performance. It underpins our business strategy and the foundationdelivery of our business. Our business must operate according tosustained, long-term value creation and is aligned with our values if it is to remain sustainable inand responsibilities as a corporate citizen. This strategic focus area covers our employees, their safety, health and wellbeing, communities and the long term.
environment.Promote•Maintain financial flexibility. We must ensure our balance sheet always remainsis able to meet our core funding needs.
•Optimise overhead costs and capital expenditure. All spending decisions must be thoroughly scrutinised to ensure they are optimally structured and necessary to fulfil our core business objective.
objectives.•Improve portfolio quality. AngloGold Ashanti builds on its portfolio quality through projects such as our FP programme to ensure optimal mine performance. We haveare flexible in delivering on our mine plans, allowing for the best results, as we progress our projects and replace our production with a portfoliogrowing Mineral Reserve and Mineral Resource base.
•Maintain long-term optionality. As part of assets that must be actively managed to improve the overall mixfocused and responsible management of our production base as we strive for a competitive valuation as a business.
Maintain long-term optionality. While we are focused on ensuringMineral Resource and Mineral Reserve, our exploration programme and related planning is vital in optimising the most efficient day-to-day operationoperating lives of our portfolio. Through continued exploration and the acquisition of properties that are a good fit with our business and offer reserve potential, we must keep an eye on creating a competitive pipelineadd to the long-term sustainability of long-term opportunities.
AngloGold Ashanti.
INTELLECTUAL PROPERTY
AngloGold Ashanti, as a group, is not dependent on intellectual property (including patents or licences), industrial, commercial or financial contracts (including contracts with customers or suppliers) or new manufacturing processes for the conduct of its business as a whole.
THE REGULATORY ENVIRONMENT ENABLING ANGLOGOLD ASHANTI TO MINE
AngloGold Ashanti’s rights to own and exploit Oredevelop Mineral Reserve and deposits are governed by the laws and regulations of the jurisdictions in which these mineral properties lie.are located.
AngloGold Ashanti is subject to a wide range of laws and regulations governing all aspects of its operations, including such areas aswith respect to environmental protection, reclamation, exploration, development, production, taxes, immigration, labour standards and employment issues, occupational health, mine safety, dam safety, toxic substances and wastes, securities and foreign corrupt practices. AngloGold Ashanti has made, and expects to make in the future, significant expenditures to comply with these laws and regulations. Non-compliance can result in violations and legal claims, as well as substantial fines, penalties, reputational damage and delays
in or suspension of day-to-day operations. Pending or proposed changes to existing laws and regulations, as well as any proposed or contemplated new laws or regulations, could also have significant impacts on AngloGold Ashanti’s business and results of operations, the extent of which cannot always be predicted.
There are in some cases certain restrictions on AngloGold Ashanti’s ability to independently move assets out of certain countries in which it has operations, or transfer assets within the group,Group, without the prior consent of the local government or minority shareholders involved. See “Item“Item 10D: Exchange controls” for details.
For more information on the risks and uncertainties associated with AngloGold Ashanti’s mining rights, see “Item“Item 3D: Risk factors”Factors”, in particular the risk factors entitled “AngloGold Ashanti’s mining rights in the countries in which it operates could be altered, suspended or cancelled for a variety of reasons, including breaches in its obligations in respect of such mining rights”, “Failure to comply with laws, regulations, standards and contractual obligations, breaches in governance processes or fraud, bribery and corruption may lead to regulatory penalties, loss of licences or permits, negative effects on AngloGold Ashanti’s reported financial results, and adversely affect its reputation”, “Title to AngloGold Ashanti’s properties may be uncertain and subject to challenge”, “AngloGold Ashanti’s mineral deposits, OreMineral Reserve, and mining operations are located in countries where political, tax and economic laws and policies may change rapidly and unpredictably and such changes and policies may adversely affect both the terms of its mining concessions, as well as its ability to conduct operations in certain countries” and “AngloGold Ashanti’s OreMineral Reserve, deposits and mining operations are located in countries that face instability and security risks that may adversely affect both the terms of its mining concessions, as well as its ability to conduct operations in certain countries”.
SOUTH AFRICA
As part of the South African asset sale, AngloGold Ashanti Limited sold its remaining three mining rights in South Africa to Golden Core Trade and Invest (Pty) Ltd (“Golden Core”) and Harmony Gold Mining Company Limited pursuant to a sale agreement concluded on or about 12 February 2020, as amended and reinstated from time to time (the “SA Sale Agreement”). These mining rights relate to operations in the West Wits area.
General laws relating to mining
The Mineral and Petroleum Resources Development ActMPRDA
Mineral and Petroleum Resources Development Act
The Mineral and Petroleum Resources Development Act, No. 28 of 2002 (MPRDA)(the “MPRDA”) came into effect on 1 May 2004. The objectives of the MPRDA are, amongst other things, to allow for state sovereignty over all mineral and petroleum resources in the country, to promote economic growth and the development of these resources and to expand opportunities for the historically disadvantaged. Another objective of the MPRDA isdisadvantaged and to ensure security of tenure for the respective operations concerning prospecting, exploration, mining and production. By virtue of the provisions of the MPRDA, the state ensures that holders of mining and prospecting rights contribute to the socioeconomic development of the areas in which they operate.
Mineral and Petroleum Resources Development Amendment Act
The Mineral and Petroleum Resources Development Amendment Act, No. 49 of 2008 (MPRDAA) was passed by Parliament in 2008 and(the “MPRDAA”) became effective on 7 June 2013. Its purpose is to amend the MPRDA in order to, amongst other things:
makeOn 23 April 2004, the Minister of Mineral Resources and Energy (MRE Minister) the responsible authority for implementing the requirements of the National Environmental Management Act, No. 107 of 1998 (NEMA) and specific environmental legislation as they relate to prospecting, mining, exploration, production and related activities incidental thereto on the prospecting, mining, exploration or production area;
align the MPRDA with the NEMA in order to provide for one environmental management system;
remove ambiguities in certain definitions;
add functions to the Regional Mining Development and Environmental Committee;
amend transitional arrangements so as to further afford statutory protection to certain existing old order rights; and
provide for matters connected therewith.
When the MPRDAA came into effect on 7 June 2013, only selected provisions became effective immediately. The MPRDAA contains the following provisions, amongst others:
Environmental authorisations: Provides for a prohibition on any prospecting and mining, or conducting technical co-operation operations, reconnaissance operations or any incidental work without an environmental authorisation (since 7 December 2014), permit and at least 21 days’ written notice to the landowner or lawful occupier.
Historic residues: Provides that the definitions of “residue stockpile” and “residue deposit” now include an old order right. This provision is intended to make old order dumps subject to the MPRDA so that old order dumps which are part of a mining area covered by a new order mining right could only be treated by the holder of the new order rights. Old order dumps not covered by a new order mining right would be considered a residue deposit to which the MRE Minister would have discretion to grant rights.
Applications: Provides that applicants for prospecting and mining rights must (since 7 December 2014) lodge an application for an environmental authorisation simultaneously with the application for rights. The Department of Mineral Resources should no longer accept more than one application in respect of the same area and mineral.
Environmental regulation: Provides that the MRE Minister is the responsible authority for implementing environmental provisions under NEMA as it relates to prospecting, mining, exploration, production or activities incidental thereto on a prospecting, mining, exploration or production area. An environmental authorisation issued by the MRE Minister shall be a condition prior to the issuing of a permit or the granting of a right in terms of the MPRDA.
Closure certificates: Provides that previous holders of old order rights or previous owners of works that have ceased to exist remain responsible for any environmental liability until the MRE Minister issues a closure certificate.
Draft Mineral and Petroleum Resources Development Bill & Draft Upstream Petroleum Resources Development Bill
In 2012, the MRE Minister published the Draft Mineral and Petroleum Resources Development Bill, 2012 (2012 MPRDA Bill) and, in 2013, a revised version of the 2012 MPRDA Bill (2013 MPRDA Bill) was submitted to Parliament. Following several amendments, the 2013 MPRDA Bill was eventually withdrawn by the South African government in September 2018.
On 24 December 2019, the MRE Minister published the Draft Upstream Petroleum Resources Development Bill, 2019 for public comment. This new bill provides for the upstream petroleum industry to be governed under a separate piece of legislation which does not come under the umbrella of the MPRDA. At this stage it is unclear whether the MRE Minister will submit a new bill in respect of the mineral resources industry proposing any of the amendments originally contained in the withdrawn 2013 MPRDA Bill.
Mineral and Petroleum Resources Development Regulations
On 23 April 2004, the MRE Minister(the “MRE Minister”) published, under the terms of the MPRDA, the Mineral and Petroleum Resources Development Regulations in Government Gazette No. 26275 under GNR. 527 (MPRDA Regulations). On 28 November 2019,order to implement the MRE Minister published, for public comment, the Draft Amendments to the Mineral and Petroleum Resources Development Regulations, 2019 (Draft MPRDA Regulations). Interested and affected parties were invited to submit written representations to the Draft MPRDA Regulations within 30 days of the publication thereof. The proposed amendments contained in the Draft MPRDA Regulations, include, inter alia, the following:
“Interested and affected parties”: Section 10 of the MPRDA requires consultation of interested and affected parties. The MPRDA Regulations currently define “interested and affected parties” as “a natural or juristic person with a direct interest in the proposed or existing operation or who may be affected by the proposed or existing operation”. The Draft MPRDA Regulations expand on the aforesaid definition by specifying that these include but are not limited to “host communities, landowners (traditional and title deed owners); traditional authority; land claimants; lawful land occupier; holder of informal land rights; the Department of Agriculture, Land Reform and Rural Development; any other person (including on adjacent and non-adjacent properties) whose socio-economic conditions may be directly affected by the proposed prospecting or mining operation; the local municipality and the relevant Government Departments, agencies and institutions responsible for the various aspects of the environment and for infrastructure which may be affected by the proposed project”;
“Meaningful consultation”: Meaningful consultation envisages a consultation process where “the applicant, has in good faith engaged the landowner, lawful occupier or interested and affected party in respect of the land subject to the application about the impact the prospecting or mining activities would have to his right of use of the land by availing all the information pertaining to the proposed activities enabling these parties to make an informed decision regarding the impact of the proposed activities”;
Information requirement: A new requirement is introduced requiring a mining company to provide certified copies of its right or permit in question, environmental authorisation and any relevant authorisations to landowners and lawful occupiers before commencing with operations;
Social and Labour Plans: A new requirement is introduced obliging mining companies to publish Social and Labour Plans (SLP) relating to their operations in English and one other dominant official language commonly used in the mine community on the mining company’s website, in local newspaper(s), as hard copies in local libraries, municipal offices, traditional authority offices and company/mine offices within 30 days of approval. Furthermore, the availability and content of the approved SLP must be announced, where feasible, in local radio stations and in relevant news outlets;
Repeal: Regulations 47-55 and 58-60 of the MPRDA Regulations are repealed as the topics governed by these regulations have since been incorporated into NEMA and the Environmental Impact Assessment Regulations, 2014 (as amended);
Disputes: A process is prescribed according to which the Regional Manager may resolve land access and “resettlement” disputes in terms of section 54 of the MPRDA . A procedure is also created for resolving land disputes which gives the MRE Minister or the Director-General certain powers to deal with complicated land disputes; and
Appeals: New procedures are proposed for lodging internal appeals in terms of section 96 of the MPRDA.
The Mining Charter
Mining Charter, 2004
The Broad-Based Socio-Economic Empowerment Charter for the South African Mining Industry, 2004 (Mining Charter, 2004) was published in August 2004. The Mining Charter, 2004 was developed in terms of section 100(2)(a)provisions of the MPRDA and took effectMPRDAA. These implementation regulations were amended on 1 May 2004. 27 March 2020.
The Mining Charter,mining charter
Since 2004, committed all stakeholdersa series of mining charters have been adopted in South Africa with the mining industry to transfermain purpose of transferring part of the ownership of 26 percent of theirmining assets to black or historically disadvantaged South Africans (HDSAs)(“HDSAs”) within 10 years. The Mining Charter, 2004a certain time period. Such mining charters also set targets for, amongst other things, the advancement of HDSAs into management positions, the employment of women, procurement of goods and services from HDSA-owned companies, training, community development and the upgrading of mine housing. Mining companies are required to formulate plans to achieve the aforementioned targets, identify current levels of beneficiation and indicate opportunities for growth.
The objectives of the Mining Charter,In 2004, were to:
promote equitable access to the nation’s Mineral Resources by all the people of South Africa;
substantially and meaningfully expand opportunities for HDSAs, including women, to enter the mining and minerals industry and to benefit from the exploitation of the nation’s Mineral Resources;
use the industry’s existing skills base for the empowerment of HDSAs;
expand the skills base of HDSAs in order to serve the community;
promote employment and advance the social and economic welfare of mining communities and the major labour-sending areas; and
promote beneficiation of South Africa’s mineral commodities.
The Mining Charter, 2004 envisaged measuring progress on transformation of ownership by:
taking into account, amongst other things, attributable units of production controlled by HDSAs;
allowing flexibility by credits or offsets, so that, for example, where HDSA participation exceeds any set target in a particular operation, the excess may be offset against shortfalls in another operation;
taking into account previous empowerment deals in determining credits and offsets; and
considering special incentives to encourage the retention by HDSAs of newly acquired equity for a reasonable period.
Under the Mining Charter, 2004, the mining industry agreed to assist HDSA companies in securing finance to fund participation in an amount of ZAR 100 billion over the first five years of the Mining Charter, 2004 being in effect. Beyond the ZAR 100 billion commitment, HDSA participation was to be increased on a willing seller, willing buyer basis, at fair market value, where the mining companies are not at risk.
Mining Charter, 2010
Following a reviewof the progress made in the transformation of the mining industry against the Mining Charter, 2004 objectives, the DMRE amended the Mining Charter, 2004. The Amendment of the Broad-Based Socio-Economic Empowerment Charter for the South African Mining and Minerals Industry, 2010 (Mining Charter, 2010)2004 was published on 20 September 2010. The Mining Charter, 2010 retained the requirement to achieve a 26 percent HDSA ownership of mining assets by the year 2014, initially introduced under the Mining Charter, 2004. It also introduced further amendments to the Mining Charter, 2004 which required mining companies to:
facilitate local beneficiation of mineral commodities;
procure a minimum of 40 percent of capital goods, 70 percent of services and, 50 percent of consumer goods from HDSA suppliers (i.e. suppliers in which a minimum of 25 percent + one vote of share capital is owned by HDSAs) by 2014. The aforesaid procurement targets are, however, exclusive of non-discretionary procurement expenditure;
ensure that multinational suppliers of capital goods put a minimum of 0.5 percent of their annual income generated from South African mining companies into a social development fund (effective 2010) to contribute to the socio-economic development of South African communities;
achieve a minimum of 40 percent HDSA demographic representation by 2014 at executive management (board) level, senior management (EXCO) as well as positions requiring core and critical skills, middle management level and junior management level;
invest up to 5 percent of annual payroll in essential skills development activities; and
implement measures to improve the standards of housing and living conditions of mineworkers by converting or upgrading mineworkers’ hostels into family units, attaining an occupancy rate of one person per room and facilitating home ownership options for all mineworkers in consultation with organised labour, by 30 April 2014.
In addition, mining companies were required to monitor and evaluate their compliance with the Mining Charter, 2010 and submit annual compliance reports to the DMRE.
The South African government takes a “Scorecard” approach to the different facets of promoting the objectives of the Mining Charter, 2010, e.g. when considering applications for the conversion of existing old order rights into new order rights. The Scorecard sets out the requirements of the Mining Charter, 2010 in tabular form which allows the DMRE to “tick off” areas where a mining company is in compliance, such as: human resource development; employment equity; migrant labour; mine community and rural development; housing and living conditions; ownership and joint ventures; beneficiation; and reporting.
The Scorecard attached to the Mining Charter, 2010 made provision for a phased-in approach for compliance with the view of achieving the abovementioned targets over a 5-year period ended on 30 April 2014. For measurement purposes, the Scorecard allocated various weightings to the different elements of the Mining Charter, 2010.
Failure to comply with the provisions of the Mining Charter, 2010 amounted to a contravention of the MPRDA, which may have resulted in the cancellation or suspension of a mining company’s existing mining rights and prevented its South African operations from obtaining any new mining rights. To date, AngloGold Ashanti has not yet received its “Scorecard” from the South African government in order to assess its compliance with the requirements of the Mining Charter, 2010.
In March 2015, the MRE Minister announced that the DMRE and the Minerals Council South Africa (Minerals Council) had agreed to submit certain matters relating to the interpretation of the Mining Charter, 2010 including the qualification of certain historical BBBEE transactions (defined below) for meeting the HDSA ownership thresholds, to the courts in South Africa for determination and clarification. Papers were filed by the Minerals Council and the DMRE, but the matter was not heard in court and was subsequently postponed.
Separately, the law firm Malan Scholes launched an application challenging the constitutionality of the Mining Charter, 2004 and the Mining Charter, 2010 requesting that the Charters be set aside. This application was dismissed.
On 9 March 2016, AngloGold Ashanti received a notice from the DMRE stating that the company was not compliant with the 26 percent HDSA ownership requirement. The notice directed the company to remedy the non-compliance within 60 days. Failure to comply with the order could constitute an offence under the MPRDA and negatively impact AGA’s “Scorecard” assessment. On 14 March 2016, AngloGold Ashanti timely responded to the non-compliance notice. The DMRE provided no further response and, consequentially, the notice has lapsed.
Mining Charter, 2017
On 15 June 2017, the MRE Minister gazetted the Broad-Based Black Socio-Economic Empowerment Charter for the South African Mining and Minerals Industry, 2017 (Mining Charter, 2017), which came into effect on the same day. The Mining Charter, 2017 sought to align the Mining Charter, 2010 with the Broad-Based Black Economic Empowerment Act, No. 53 of 2003, in order to ensure meaningful participation of black people in the mining industry and to provide for policy and regulatory certainty to ease the investment in and development of the mining industry. The Minerals Council launched an urgent application to interdict the implementation of the Mining Charter, 2017 and set it aside. The DMRE filed papers in court and the urgent application was due to be heard in court on 14 September 2017. Notwithstanding the aforesaid urgent application in court, the MRE Minister and the Minerals Council reached an agreement on 13 September 2017 wherein the MRE Minister undertook to suspend the Mining Charter, 2017 pending the outcome of the DMRE/Minerals Council application.
The DMRE/Minerals Council application was heard on 9 and 10 November 2017 and judgment was handed down on 4 April 2018. The High Court of South Africa held that:
Once the MRE Minister or his delegate is satisfied in terms of section 23(1)(h) of the MPRDA that the grant of a mining right (applied for in terms of section 22 of the MPRDA) will further the objects referred to in section 2(d) and (f) of the MPRDA (in accordance with the Charter referred to in section 100) and has granted the mining right applied for, the holder thereof is not thereafter legally obliged to restore the percentage ownership (howsoever measured, inter alia, wholly or partially by attributable units of South African production) controlled by HDSAs to the 26 percent target referred to in the Mining Charter, 2004 and the Mining Charter, 2010 , where such percentage falls below 26 percent, unless such obligation is specified in the terms and conditions of the mining right, as referred to in section 23(6) of the MPRDA;
The holder of a mining right’s failure to meet the 26 percent ownership target (either in terms of the Mining Charter, 2004 or the Mining Charter, 2010) does not amount to a material breach of the mining right for the purposes of section 47 of the MPRDA (i.e. failure to meet the 26 percent HDSA ownership target will not be a ground for suspension or cancellation of the mining right) nor does it constitute an offence in terms of section 98 of the MPRDA. This, however, does not apply where the terms and conditions of the right itself have stipulated that the 26 percent HDSA ownership must be retained;
If the 26 percent HDSA ownership participation has, for any reason, been diluted to a lesser percentage, there is no obligation to rectify such lower level once the holder of the mining right has initially achieved the 26 percent HDSA ownership participation requirement. This does not apply where the terms and conditions of the right itself have stipulated that the 26 percent HDSA ownership must be retained;
The Mining Charter, 2010 does not retrospectively deprive holders of mining rights of the benefits of credit offsets; the continuing consequences of empowerment transactions concluded after the MPRDA came into effect; and the right to off-set credits achieved in one operation against any shortfalls encountered in another operation; and
While it did not make any pronouncements on the validity of the Mining Charter, 2010, this should not be taken as a confirmation that the Mining Charter, 2010 was validly issued in terms of section 100(2) of the MPRDA or that “it is the charter contemplated in section 100” of the MPRDA.
On 19 April 2018, the DMRE filed a notice of intention to appeal the High Court judgment. Such notice was granted on 19 September 2019 entitling the DMRE to file an appeal at the Supreme Court of Appeal. Notwithstanding the repeal of the Mining Charter, 2017 by the adoption of the Mining Charter, 2018 (defined below), the findings of the High Court judgment remain relevant to mining right holders and these findings will be the subject of the pending appeal before the Supreme Court of Appeal which has not yet been progressed.
Mining Charter, 2018
On 27 September 2018, the Broad-Based Socio-Economic Empowerment Charter for the Mining and Minerals Industry, 2018 (Mining Charter, 2018)(the “2018 Mining Charter”) was published, and became effective onrepealing all prior mining charters. In September 2021, the same date. TheHigh Court of South Africa (Gauteng Division) held that the 2018 Mining Charter 2018 repeals the Mining Charter, 2004; the Mining Charter, 2010;is a policy document and the Mining Charter, 2017.does not, per se, bind holders of mining titles. The Mining Charter, 2018 stipulates that it is to be read together with implementation guidelines, gazetted on 19 December 2018. On 26 March 2019, the Minerals Council filed an application for judicial review toHigh Court also set aside certainvarious provisions of the 2018 Mining Charter, 2018. It is not clear when the matter will be heard in court.
Some of the key provisions of the Mining Charter, 2018 include:
Existing mining right holders who have achieved the 26 percent HDSA ownership target shall be recognized as compliant for the duration of the mining right. However, the “the once empowered always empowered” principle shall not be applicable on the transfer or renewal of the mining right.;
An application, which was lodged and accepted prior to the commencement of the Mining Charter, 2018 shall be processed in terms of the Mining Charter, 2010 with a minimum of 26 percent HDSA ownership. The right holder must within a period of five years from the effective date of such mining right, increase its HDSA ownership to a minimum of 30 percent;
A new mining right must have a minimum of 30 percent HDSA ownership, which shall include economic interest plus corresponding percentage of voting rights per mining right or in the mining company which holds a mining right. The 30 percent HDSA ownership must be distributed as follows:
a minimum of 5 percent non-transferable carried interest to qualifying employees;
a minimum of 5 percent non-transferable carried interest or “equity equivalent benefit” to host communities; and
a minimum of 20 percent effective ownership in the form of shares to a BEE entrepreneur, 5 percent of which must preferably be for women;
The Mining Charter, 2018 reduced the offset available for beneficiation from 11 percent to 5 percent, but on the basis that existing mining right holders, who qualified for the previous offset, would be allowed to retain it for the duration of the right. Right holders must submit a Beneficiation Equity Equivalent Plan (as outlined in implementation guidelines) to the DMRE for approval. Further, mining right holders must submit an annual progress report to the DMRE, which report must be in line with the approved Beneficiation Equity Equivalent Plan;Charter. In November
Mining companies must have Historically Disadvantaged Persons (as defined in the MPRDA) representation at various levels
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New procurement targets have been introduced. 70 percent of total mining goods procurement spend must be on South African manufactured goods. South African manufactured goods are defined as goods with a minimum of 60 percent local content during the assembly or manufacturing of the product in South Africa. The calculation of local content excludes profit mark-up, intangible value such as brand value and overheads. A minimum of 80 percent of the total spend on services must be sourced from South African companies. The transitional arrangement period for compliance with the procurement targets is five years from the publication of the Mining Charter, 2018; and
The Mining Charter, 2018 provides for the specific application of certain of the elements of the Mining Charter, 2018 to holders of licences under the Precious Metals Act, No. 37 of 2005 and the Diamonds Act, No. 56 of 1986 with variations and exemptions depending on the size of the licence holder. For example, enterprises with a turnover of less than ZAR 1 million are exempt from the Mining Charter, 2018 in its entirety. Enterprises with a turnover of more than ZAR 50 million must comply with the Mining Charter, 2018 in its entirety.
On 25 February 2019, AngloGold Ashanti received a directive from the DMRE stating that the company was not compliant with the amendment process required by the MPRDA in connection with BEE transactions entered into by the company after the conversion of the West Wits mining rights. The DMRE instructed AngloGold Ashanti to submit an application to amend the clauses of two of its West Wits mining rights which record the BEE transactions entered into and implemented by the company to reflect further details of those BEE transactions and provide certain information relating to such transactions. On 7 March 2019, AngloGold Ashanti
submitted an application for consent of the MRE Minister to amend the clauses of the two West Wits mining rights which record the BEE transactions entered into and implemented by the company accordingly and provided the requested information. The DMRE has not reverted to AngloGold Ashanti on the submitted application which remains pending. Should AngloGold Ashanti be found in breach of its obligations to comply with the MPRDA or the applicable mining charter, it may be compelled to conclude additional BEE transactions. In the event that AngloGold Ashanti applies for a new mining right, it will have to comply with the Mining Charter, 2018 ownership requirements and it will not be entitled to rely on its current BEE ownership structure.
The Code of Good Practice for the Minerals Industry
Section 100(1)(b) of the MPRDA obliged the MRE Minister to develop a code of good practice for2021, the South African minerals industry (Code) which was publishedDepartment of Mineral Resources and Energy (“DMRE”) informed the parliamentary portfolio committee on 29 April 2009. mineral resources and energy that it does not intend to appeal the outcome of the judgement, but instead will consider steps to achieve the empowerment objectives through legislative amendments to the MPRDA.
The CodeB-BBEE Act
The Broad-Based Black Economic Empowerment Act, No. 53 of 2003 (the “B-BBEE Act”) is a guiding documentlaw of general application in respect of Broad-Based Black Economic Empowerment (“B-BBEE”) and its purpose isenables the Minister of Trade and Industry to set out administrative principles to enhance implementationdrive B-BBEE across all sectors of the Mining Charter, 2004 (including later iterations thereof) and the MPRDA. The Code is to be read in combination with the Mining Charter, 2004 (including later iterations thereof) and other legislation relating to measurement of socio-economic transformation in the South African mining industry. The Code does not replace the Mining Charter, 2004 (including later iterations thereof), nor any key legislation and laws relating to the minerals and the petroleum industry, but serves as a statement of policy and principles that assists in the implementation of both the MPRDA and the Mining Charter, 2004 (including later iterations thereof).
The Housing and Living Conditions Standard
On 20 March 2019, the MRE Minister published the draft Reviewed Housing and Living Conditions Standard for the Minerals Industry, 2019 (Draft Reviewed Housing Standard) in the Government Gazette No. 42326 under GNR. 449 inviting interested and affected parties to submit written representations on the draft within 30 days of the publication of the notice. The Draft Reviewed Housing Standard proposes, among other things, that:
An existing mining right holder must within a period of 6 months from the date of publication of the Draft Reviewed Housing Standard submit a detailed Housing and Living Conditions Plan;
A new mining right holder must within a period of 12 months from the date of publication of the Draft Reviewed Housing Standard consult with organized labour, the relevant municipality and the Department of Human Settlements and enter into a housing and living conditions agreement with organized labour regarding its mine employee housing and living conditions needs;
A mining right holder will be required after consultation with other stakeholders to acquire land within close proximity of the mine operations and plan housing needs in support of compact, integrated and mixed land use environment; and
A mining right holder must offer employees a range of housing options which include, amongst other things, rental accommodation, home ownership, government led social housing and living out allowance.
Draft Mine Community Resettlement Guidelines
On 4 December 2019, the MRE Minister published the Draft Mine Community Resettlement Guidelines, 2019 (Draft Resettlement Guidelines) for public comment in the Government Gazette No. 42884 under GNR. 1566. The closing date for submission of written representations was 31 January 2020. Some of the key provisions of the Draft Guidelines include the following:
The Draft Resettlement Guidelines apply to both applicants (Applicants) and existing holders (Holders) of mining rights, prospecting rights and mining permits in terms of the MPRDA where prospecting or mining activities will have the effect of displacement or resettlement of the interested and affected parties (as defined in the Draft Resettlement Guidelines meaning any person, group of persons, or organization interested in or affected by a resettlement activity and any organ of state that may have jurisdiction over any aspect of the resettlement activity);
Applicants and Holders are required to make provision for development of a Resettlement Plan, Resettlement Action Plan and Resettlement Agreement; and
No mining activity shall commence until a Resettlement Agreement is reached on the appropriate amount of compensation as a result of the resettlement of the affected parties. An Applicant/Holder, where feasible, must provide financial assistance to affected parties. A “Party to Party dispute resolution process” must be invoked prior to embarking on the Regional Manager-led process in section 54 of the MPRDA.
The BBBEE Amendment Act
On 23 Januaryeconomy. In 2014, the President of South Africa assented to the Broad-Based Black Economic Empowerment Amendment Act, No. 46 of 2013 (BBBEE(the “B-BBEE Amendment Act). The BBBEE Amendment ActAct”) came into effect on 24 October 2014 with the object of amending the Broad-Based Black Economic Empowerment, 2003 (BBBEE Act)B-BBEE Act to provide a framework of principles, strategies and guidelines aimed at promoting the broad-based socio-economic empowerment of HDSAs across the South African economy and society in the form of ownership, management, employment equity, skills development, preferential procurement, enterprise development and socio-economic development. The BBBEE Amendment Act includes a number of changes to the framework under the BBBEE Act, including:
amending and clarifying the definition of the intended beneficiaries of such framework;
amending the definition of “Broad-Based Black Economic Empowerment” or “BBBEE”, to introduce the concept of viable BBBEE and providing standards for that preferential procurement;
expanding the scope of the BBBEE Codes of Good Practice (BBBEE Codes), and the related transformation charters, on BBBEE matters that the Minister of Trade and Industry can issue under the BBBEE Act for specific sectors of the South African economy and making it compulsory for public authorities, governmental agencies and other public entities to apply such codes (Sector Codes);
introducing into the BBBEE Act the definition of “fronting BBBEE practices” (i.e. a transaction, arrangement or other act or conduct that directly or indirectly undermines or frustrates the achievement of the objectives of the BBBEE Act or the implementation of any of its provisions), which to date has been developed outside of the BBBEE Act and has now been expanded:
to capture more sophisticated and unsuspecting fronting transactions;
making fronting a criminal offense that is punishable with imprisonment and fines under certain circumstances, reasserting in the BBBEE Act the common law remedies for misrepresentation and more generally enhancing the enforcement mechanism against fronting;
establishing a BBBEE Commission responsible for overseeing, supervising and promoting compliance with the BBBEE Act, as well as receiving and investigating BBBEE-related complaints; and
providing that the Department of Trade and Industry (DTI) may impose special requirements for specific industries.
Before the BBBEE Amendment Act came into effect, the BBBEE Act provided that in the event of a conflict between the BBBEE Act and any other law in force immediately prior to the commencement of the BBBEE Act, the BBBEE Act would prevail if the conflict specifically relates to a matter addressed in the BBBEE Act. The BBBEE Amendment Act inserted a new provision in the BBBEE Act whereby the BBBEE Act trumps the provisions of any other law in South Africa with which it conflicts, provided such conflicting law was in force immediately prior to the effective date of the BBBEE Amendment Act. The provision became effective as from 24 October 2016.
On 27 October 2015, the Minister for Trade and Industry published Government Notice 1047 of Government Gazette No. 39350, which declared an exemption in favour of the DMRE from applying the requirements contained in section 10(1) of the BBBEE Act for a period of 12 months. The exemption can be read as confirmation that the DTI sees the BBBEE Codes as “applicable” to the mining industry after the exemption is lifted on 27 October 2016.
Additionally, the revised BBBEE Codes of Good Practice (Revised BEE Codes) became effective on 1 May 2015. Both the BBBEE Amendment Act and the Revised BEE Codes expressly stipulate that where an economic sector in South Africa has a Sector Code in place for BEE purposes, companies in that sector must comply with the Sector Code. For purposes of the BBBEE Act, none of the mining charters referred to above (i.e. Mining Charter, 2004; Mining Charter, 2010; Mining Charter, 2017 or Mining Charter, 2018) are Sector Codes. It is not, at this stage, clear what the interplay between the applicable mining charter and the BBBEE Act and Revised BEE Codes is. The government could designate the applicable mining charter as a Sector Code in the future, in which case it would be under the auspices of the BBBEE Act, but it has not chosen to do so with respect to the Mining Charter, 2010 in its Government Gazette notice of 17 February 2016 which designated, for example, the tourism sector code and property sector code as applicable and valid Sector Codes. Until such determination is made, if at all, the applicable mining charter remains a stand-alone document under the auspices of the MPRDA and may become subject to the trumping provision discussed above. The resulting legal uncertainty could be addressed by a clarification from the government or by the matter receiving judicial attention.
Historically, there has been some debate as to whether the BBBEE Act and the BBBEE Codes apply to the mining industry, taking into account that the BBBEE Act requires every organ of state and public entity to give due consideration to the BBBEE Codes when issuing licenses, concession or other authorisations.
While the MPRDA and the BBBEE Act have an overlapping focus, the BBBEE Act and the Revised BEE Codes do not require the DMRE to apply the Revised BEE Codes when determining the qualification criteria for the issuing of mining rights, nor do they require that the DMRE apply the Revised BEE Codes as a requirement for the retention of existing mining rights. The Revised BEE Codes will nevertheless apply to mining companies if they wish to be scored for the purpose of contracting with organs of state.
Land Expropriation
Constitutional Amendment Bill
On 27 February 2018, the National Assembly resolved to assign the Constitutional Review Committee (CRC) to review section 25 of the Constitution of the Republic of South Africa (Constitution) and other clauses where necessary to allow the state to expropriate land in the public interest without compensation. This resolution follows the African National Congress’s (ANC) resolution at its elective conference in December 2017 to pursue expropriation of land without compensation in a manner that does not destabilise the agricultural sector, endanger food security or undermine economic growth and job creation. In its report dated 15 November 2018, which was adopted by Parliament on 4 December 2018, the CRC recommended that section 25 of the Constitution be amended to make explicit that expropriation of land without compensation is a legitimate option for land reform. As a result, the draft Constitution Eighteenth Amendment Bill, 2019 (Constitutional Amendment Bill) was published for public comment on 6 December 2019. The Constitutional Amendment Bill proposes that where land and any improvements thereon are expropriated for the purposes of land reform, nil compensation may be payable. The Constitutional Amendment Bill does not specify the circumstances in which a court may determine that the amount of compensation is nil, but states that national legislation must set out such circumstances.
Draft Expropriation Bill
Separately, the Draft Expropriation Bill, 2019 (Expropriation Bill) was published for public comment on 21 December 2018. The Expropriation Bill proposed the inclusion of a provision in the Constitution to the effect that it may be just and equitable for nil compensation to be paid where land is expropriated in the public interest. The Expropriation Bill has not been progressed.
MPRDA provisions
Section 5(3) of the MPRDA entrenches a statutory right of access for the mining right holder to the mining area for the purposes of conducting mining operations and does not require the mining right holder to own the land on which it conducts operations. Once a mining right is granted, the landowner has no right to refuse the conducting of mining operations on the property in question and is not entitled to compensation from the mining right holder for the use of the land for mining operations conducted in terms of the MPRDA. The DMRE may, in terms of section 54(3) of the MPRDA, request the parties concerned to endeavour to reach an agreement for the payment of compensation for loss or damage if the DMRE concludes that the landowner has suffered or is likely to suffer loss or damage as a result of the mining operations. Section 55 of the MPRDA further provides the MRE Minister with powers to expropriate the land in question for purposes of mining.
Tax laws relating to mining
The Royalty Act
The Mineral and Petroleum Resources Royalty Act, No. 28 of 2008 (Royalty Act) was promulgated on 24 November 2008 and came into operation on 1 March 2010. The Royalty Act imposes a royalty on refined and unrefined minerals payable to the state.
The royalty in respect of refined minerals (which include gold and silver) is calculated by dividing earnings before interest and taxes (EBIT) as determined by the Royalty Act, by the product of 12.5 times gross revenue calculated as a percentage, plus an additional 0.5 percent. EBIT refers to taxable mining income (with certain exceptions such as no deduction for interest payable and foreign exchange losses) before assessed losses but after capital expenditure. A maximum royalty of 5 percent of gross revenue has been introduced for refined minerals.
The royalty in respect of unrefined minerals (which include uranium) is calculated by dividing EBIT by the product of nine times gross revenue calculated as a percentage, plus an additional 0.5 percent. A maximum royalty of 7 percent of gross revenue was introduced for unrefined minerals. Where unrefined minerals (such as uranium) constitute less than 10 percent in value of the total composite minerals, the royalty rate in respect of refined minerals may be used for all gross revenue and a separate calculation of EBIT for each class of minerals is not required. For AngloGold Ashanti, this means that currently the company will pay a royalty based on refined minerals (as the unrefined minerals (such as uranium) for AngloGold Ashanti for 2019 constituted less than 10 percent in value of the total composite minerals). The rate of royalty tax payable for 2019 was 0.5 percent of gross revenue of the company’s South African operations.
In 2013, the President appointed the Davis Tax Committee to review the current mining tax regime. In the Second and Final Report on Hard Rock Mining released in November 2017, the Davis Tax Committee recommended an update and refinement of the schedules in the Royalty Act, suggesting it should form part of regulations made by the Minister of Finance in the Government Gazette rather than forming part of the legislation itself. The Davis Tax Committee called upon the South African Revenue Service (SARS) to issue a comprehensive interpretation notice on the Royalty Act to dispel industry uncertainty.
Some of the other preliminary recommendations of the Davis Tax Committee have included the upfront capital expenditure write-off regime being discontinued and replaced with an accelerated capital expenditure depreciation regime, which is in parity with the write-off periods provided for in respect of the manufacturing (40/20/20/20) basis. Another recommendation has been to bring the taxation of newly established gold mines into line with the tax regime applicable to non-gold mining taxpayers (in so far as possible). The Davis Tax Committee has recommended that the so called “gold formula” be retained for existing gold mines. Given the retention of the gold formula for existing gold mines, it will be necessary to retain ring-fences in mines where the gold formula subsists. With regard to the additional capital allowances available to gold mines, the Davis Tax Committee has recommended that such allowances should be phased out so as to bring the gold mining corporate income tax regime into parity with the tax system applicable to taxpayers as a whole.
Environmental laws relating to mining
National Environmental Management Act
The MPRDAA repealed the sections in the MPRDA that dealt with environmental regulation of mining and prospecting operations. This was the first step in migrating environmental regulation provisions from the MPRDA into National Environmental Management Act, No. 107 of 1998, (NEMA). NEMA was thenas amended by the National Environmental Management Amendment Act, No. 62 of2008 and then again by the National Environmental Management Laws Amendment Act, No. 25 of 2014, and now(the “NEMA”) includes provisions to deal with environmental regulation of mining and prospecting, which provisions are administered by the MRE Minister.
Pursuant to section 24N(8) of NEMA, directors of a company are jointly and severally liable for any negative impact on the environment, whether advertently or inadvertently caused by the company they represent, including damage, degradation and pollution.
See also “Item 4B: Business Overview-Mine Site Rehabilitation and Closure” and “Item 4B: Business Overview-Environmental, Health and Safety Matters”.
Financial Provision Regulations
On 20 November 2015,From an environmental perspective, given the Regulations Pertainingwide scope of the statutory duty of care in South African environmental law, erstwhile land owners may be held liable for historic contamination by the regulatory authorities. The “polluter pays” principle in South Africa enables the competent authority to seek recourse against various responsible parties based on their historical or current relationship to the Financial Provision for Prospecting, Exploration, Miningsource and receptor of degradation or Production Operations were published inpollution. The duty of care also applies retrospectively to significant pollution or degradation that occurred before the Government Gazette No. 39425 under GNR. 1147 (Financial Provision Regulations, 2015)entry into force of NEMA (i.e., and now fall under NEMA. The Financial Provision Regulations, 2015 are similar to the previous provisions under the MPRDA. However, the mining industry believes some of the significant changes introduced by the Financial Provision Regulations, 2015 include:
broader definition of “financial provision” requires the holder to make financial provisions for any adverse impacts that might arise from mining operations and is not limited to those identified in the environmental management plan (EMP)29 January 1999), as was previouslywell as significant pollution or degradation that arises or is likely to arise at a different time from the case;
requiringactual activity that caused the holder to annually assess environmental liability estimates and adjust the financial provision to the satisfaction of the MRE Minister;
requiring the holder to submitcontamination (e.g., latent or residual impact) or arises through an audit report from an independent auditor to the MRE Minister on the adequacy of the holder’s financial provision. If the MRE Minister is not satisfied with the assessment, he is entitled to appoint his own auditor;
requiring that a holder maintain and retain a financial provision following the issuanceact or activity of a closure certificate. Furthermore, the MRE Minister may retain such portion of the financial provision as may be required to rehabilitate the closed mining or prospecting operationperson that exacerbates pre-existing contamination. The authorities can also seek compensation in respect of latent, residual or any other environmental impacts, including the pumping of polluted or excess water, for a prescribed period. Thisclean-up measures that it is not only in respect of holders of rights, but also now in respect of holders of old order rights and holders of works;
before the coming into effectrequired to take on behalf of the Financial Provision Regulations, 2015, holdersresponsible parties and apportion liability amongst the responsible parties, which could make financial provision for annual rehabilitation, final rehabilitationtechnically include a historic landowner or mining company that caused the pollution. Although the purchasers of AngloGold Ashanti’s assets in South Africa have contractually assumed all environmental liability associated with its former South African operations and post-closure residual impacts and water pumping by adding up the total amount for these three types of rehabilitation and making financial provisionagreed to indemnify AngloGold Ashanti for the same, using one orthere remains a mixrisk, at least theoretically, of four methods:
depositing cash instatutory liability to the DMRE bank account;state.
keeping the amount in a rehabilitation trust in accordance with the Income Tax Act, No. 58 of 1962 (the amount in the trust can only relate to financial provision for post-closure residual impacts and water pumping and not for annual and final closure);
obtaining a financial guarantee or a bank guarantee in respect of the amount; or
using a method determined by the Director-General (uncommon in practice).
a holder’s financial provision at any given time must be equal to the sum of actual costs of implementing all three broad classes of rehabilitation for at least 10 years from such date of assessment of financial provision; and
the financial provision liability associated with annual rehabilitation, final closure and latent or residual environmental impacts may not be discounted based on value of the assets at mine closure or mine infrastructure salvage value.
Failure to align to the Financial Provision Regulations, 2015 constitutes non-compliance with section 24P of NEMA, which entitles the DMRE to issue a directive to remedy such non-compliance and failure to comply with the directive is an offence under section 49A(g) of NEMA. A person convicted of an offence under section 49A(g) of NEMA is liable to a fine not exceeding ZAR 10 million and/or to imprisonment for a period not exceeding 10 years.
The mining industry has raised concerns with the Financial Provision Regulations, 2015, in particular with respect to: confusion regarding the applicability of the Financial Provision Regulations, 2015 to applicants and to previous rights holders; duplicate funding or double provisioning; unclear methods and periods for determining financial provision; legal barriers to use of trust funds; burdensome public consultation and disclosure requirements; transitional provisions and time frames; requirements for an additional three plans; over-auditing, time and cost implications; and inclusion of care and maintenance.
On 21 September 2018, the Acting Minister of Environmental Affairs published a series of amendments to the Financial Provision Regulations, 2015 which included, among other things, the repeal of prior amendments and the extension of the deadline for compliance to 19 February 2020.
On 17 January 2020, the Minister of Environment, Forestry and Fisheries published another amendment to the Financial Provision Regulations, 2015. This amendment extended the transitional period for certain existing rights and permit holders until 19 June 2021.
Proposed Financial Provision Regulations
In May 2019, the South African Proposed Regulations Pertaining to the Financial Provision for the Rehabilitation and Remediation of Environmental Damage caused by Reconnaissance, Prospecting, Exploration, Mining or Production Operations, 2019 (Proposed Financial Provision Regulations, 2019) were released for public comment.
The Proposed Financial Provision Regulations, 2019 provide that holders of prospecting rights and mining rights or permits, who applied for the right or permit prior to 20 November 2015, will be required to comply with the new regulations no later than three months following the first financial year end of the relevant holder subsequent to 19 February 2020. Some of the key features of the Proposed Financial Provision Regulations, 2019 and the concerns raised during the commenting process by mining companies are the following:
Regulation 7(3) provides that “funds set aside for financial provision must remain in place until a closure certificate is issued, unless a withdrawal as contemplated in regulation 11 is allowed”. Regulation 11 outlines the procedure for holders to follow when seeking to withdraw financial provision and provides that the MRE Minister must approve withdrawals with the concurrence of the Minister of Human Settlements, Water and Sanitation and the Minister of Finance. The withdrawal of financial provision can only occur after the stringent requirements stipulated in regulation 11 are met and are only allowed for decommissioning and final closure and not for ongoing or concurrent rehabilitation. Since the financial provision is not accessible to the holder for use during the life of the right, the holder has to effectively make double provision (the first being financial provision and the second being actual expenditure incurred for rehabilitation). The implications of regulation 7(3), read with regulation 11, may include a rise in the amount of financial guarantees provided in connection with mining operations;
Regulation 12(2) prescribes that the determination, review and assessment of financial provision must be undertaken by a specialist which must be audited by an independent auditor as provided for in regulation 13(1)(a) and submitted for approval to the MRE Minister. This requirement places a significant administrative and cost burden on the mining industry; and
Value-added tax (VAT) is included in the financial provision calculation. This inclusion is seen as onerous by the mining industry.
AngloGold Ashanti’s rights and permits
Under South African law,Pursuant to the SA Sale Agreement, AngloGold Ashanti and Golden Core executed a mining right will be granted to a successful applicant for a period not exceeding 30 years. Thereafter,notarial deed of cession of the mining rights may be renewed for additional periods not exceeding 30 years at a time. A mining right can be cancelled if the mineralwith DMRE references GP 30/5/1/2/2/01 MR and GP 30/5/1/2/2/248 MR to which such mining right relates is not mined at the production rate undertaken by the mining right holder in the approved mining work programme. A prospecting right will be granted to a successful applicant for a period not exceeding five yearstransfer and may only be renewed once for three years. In addition, a retention period of up to three years after prospecting could be allowed under certain circumstances, which may be renewed once for up to two years, subject to certain conditions. Refining licences are granted by the South African Diamond and Precious Metals Regulator for a period not exceeding 30 years and may be renewed for an unlimited number of further periods.
AngloGold Ashanti currently holds threecede these mining rights in South Africa. These mining rights relate to operations inGolden Core (the “Deed of Cession”). On 14 June 2021, the West Wits area and have been successfully converted, executed andDeed of Cession was registered as new order mining rights at the Mineral and Petroleum Titles Registration Office (MPTRO)(the “MPTRO”). Mining
With respect to the mining right GP 30/5/1/2/2/01 MR (DMRE reference) in respect of gold, silver, nickel and uranium covers an area of approximately 6,477 hectares and expires in 2036. Mining rightheld under DMRE reference GP 30/5/1/2/2/11 MR, (DMRE reference) in respect of gold, silver, nickel and uranium covering an area of approximately 31 hectares expired in 2016 and the company is currently in the process of renewing this mining right following a timely submission of a renewal application. Mining right GP 30/5/1/2/2/248 MR (DMRE reference) in respect of sand covers an area of approximately 196 hectares and expires in 2022. AngloGold Ashanti currently does not hold any prospecting rights in South Africa.
AngloGold Ashanti also held a mining permit for the recovery of sand and clay in the West Wits area. Mining permit GP 30/5/1/2/2/174 MP (DMRE reference) in respect of sand and clay expired in 2017 and the company is currently in the process of renewing this mining permit following a timely submission of a renewal application.
AngloGold Ashanti submittedGolden Core agreed to make an application in terms of section 102 of the MPRDA in March 2017 to consolidateat the company’s three mining rights and its mining permit in South Africa into one singleDMRE after the closing date of the SA Sale Agreement requesting, among other matters, the incorporation of this mining right (GPinto the mining right with DMRE reference GP 30/5/1/2/2/01 MR) (Consolidation Application)MR (the “Harmony Consolidation Application”). The Consolidation Application requested the DMREAngloGold Ashanti also executed a notarial conditional deed of abandonment pursuant to suspend the renewal applications forwhich it conditionally abandons this mining right GP 30/5/1/2/2/11 MR and mining permit GP 30/5/1/2/2/174 MP in order to processterms of section 56(f) of the MPRDA (the “Deed of Abandonment”) on condition that ministerial consent is granted in respect of the Harmony Consolidation Application. The DMRE acknowledged theHarmony Consolidation Application, in July 2018 andwhich was submitted to the DMRE on 17 January 2022, is currently consideringstill pending. On the date of the grant of the Harmony Consolidation Application.
In addition,Application, AngloGold Ashanti holdswill cease to be a refining licence (AP06789)holder of any mining rights in South Africa. Once the transaction has been fully implemented, the general laws relating to mining outlined above will no longer be applicable to the Vaal River area expiringCompany, other than the statutory duty of care in 2039.terms of NEMA as described above.
CONTINENTAL AFRICA REGION
Democratic Republic of the Congo (DRC)
General laws relating to mining
The mining industry in the DRC is primarily regulated by lawLaw No. 007/2002 dated 11 July 2002 (2002(the “2002 DRC Code)Code”), as amended and supplemented by lawLaw No. 18/001 dated 29 January9 March 2018 (Reformed(the “Reformed DRC Mining Code)Code”) and decreeDecree No. 038/2003 dated 26 March 2003, as amended and supplemented by decreeDecree No. 18/024 dated 8 June 2018 (Reformed(the “Reformed DRC Mining Regulations)Regulations”).
As regards
With respect to the application of the Reformed DRC Mining Code and Reformed DRC Mining Regulations, Kibali Goldmines SA (Kibali)S.A. (“Kibali Goldmines”) has reserved and continues reserving its rights, including, without limitation, its stability rights under, among other legal sources,
the 2002 DRC Code. Discussions with the DRC government on these issues and the possible application of incentives that may be available under the Reformed DRC Mining Code and Reformed DRC Mining Regulations, in particular under article 220 of the Reformed DRC Mining Code which provides that the Prime Minister of the DRC may grant a number of incentives to provinces with infrastructure deficits to encourage economic development from mining resources, are ongoing.
In accordance with prior mining legislation, companiesCompanies holding mining titles issued prior to the entry into force of the Reformed DRC Mining Code and Reformed DRC Mining Regulations have claims to a 10-yearten-year stability provision.provision in accordance with prior mining legislation. Notwithstanding the adoption of the new regulatory regime, their rights with respect to such stability provision are reserved.
The Reformed DRC Mining Code grants the DRC Minister of Mines the authority to grant, refuse, suspend andor terminate mineral rights, subject to conditions set out in the Reformed DRC Mining Code. Mineral rights may be granted in the form of exploration permits for an initial period of five years renewable once for a further five-year period or in the form of miningexploitation permits which are granted for an initial period of 25 years. Anyears, renewable several times for 15-year periods until the end of the mine’s life. Prior to commencing exploration work, the holder of an exploration permit may, at any time before expiry, be transformed partially intomust submit for approval a mining permit or a small-scale mining permit. Miningmitigation and rehabilitation plan pursuant to which it must undertake to carry out certain mitigation measures of the impact of its activities on the environment, as well as rehabilitation measures. Exploitation permits are granted upon successful completion of exploration and satisfaction of certain requirements, including approval of a feasibility study, an environmental and social impact study and an environmental and social management plan.
The holder of a miningan exploitation permit is required to commence development and mine construction within three years of the awardgrant of such permit. Failure to do so may lead to forfeiture of the miningexploitation permit. A permit holder must comply with specific rules relating to, amongst other things, protection of the environment, cultural heritage, health and safety, construction and infrastructure planning. Mining and exploration activities are required to be undertaken so as to affect as little as possible the interests of lawful occupants of land and surface rights holders, including their customary rights. The exercise of mineral rights by title holders which effectively deprives or interferes with the rights of occupants and surface rights holders requires payment of fair compensation by the mineral title holder.
To protect and enforce rights acquired under an exploration or miningexploitation permit, the Reformed DRC Mining Code provides, depending on the nature of athe dispute or threat,controversy, administrative, judicial and national or international arbitral recourses.
Mining companies are required to grant a free-carried and non-contributory participation to the DRC government. The DRC government’s free participation was originally set at five percent, which was increased to ten percent in respect of exploitation permits issued after the entry into force of the Reformed DRC Mining Code. All mining companies are required to grant an additional five percent free-carried participation to the DRC government upon each renewal of their exploitation permit. Under the Reformed DRC Mining Code, a ten percent local contributory participation is also mandatory for exploitation permits issued after its entry into force.
Tax laws relating to mining
The Reformed DRC Mining Code sets out an exclusive and exhaustivecomprehensive tax and customs regime that is applicable to mining activities. Mining title holders are subject, amongst other things, to a corporate income tax of 30 percent, a windfall tax of 50 percent (subject to certain prerequisites) and are required to pay mining royalties to the DRC government. The royalty rate applicable to gold has been set at 3.5 percent. Mining title holders are also required to contribute a minimum of 0.3 percent of total turnover to community development.
The standard rate of VAT is 16 percent and is applicable to all mining companies.
Mining companies are required to grant a free-carried and non-contributory participation to In the DRC, government. The DRC government’s free participation was previously set at 5 percent but was increasedKibali Goldmines is due certain refunds of VAT which, to 10 percentdate, remain outstanding. During 2022, AngloGold Ashanti did not recover any VAT offsets and refunds from its operations in respect to mining titles issued after the entry into forceDRC. We believe that our attributable share of the Reformed DRC Mining Code. All mining companies are requirednet recoverable VAT balance (including recoverable fuel duty and after discounting provisions) owed to grant an additional 5 percent free-carried participation tous by the DRC government upon each renewalamounted to $86 million as of their exploitation permit. Under31 December 2022. While an agreement was reached with the Reformed DRC Mining Code, a 10 percent local contributory participation is also mandatorygovernment on the reimbursement of the refundable VAT in 2018, uncertainty remains regarding the timing and level of cash receipts and offsets against other taxes for mining titles issued after its entry into force.purposes of the recovery of our VAT receivables in the DRC.
Regarding exchange control rules, the Reformed DRC Mining Code requires that mining title holders repatriate onshore 60 percent of sale revenues during the investment amortization period and 100 percent once the investment amortization is completed.
The Reformed DRC Mining Code also provides for a level of fiscal stability. A stability clause stipulates that existing tax, customs and exchange control provisions applicable to mining activities are guaranteed to remain unchanged for a period of five years from the enactment of the Reformed DRC Mining Code.
Article 220 of theForeign exchange control regime
The Reformed DRC Mining Code providesimposed new exchange control rules requiring that mining title holders repatriate onshore 60 percent of sale revenues received during the Prime Minister ofinvestment amortisation period and 100 percent once the DRC may grant a number of incentives to provinces sufferinginvestment amortisation is completed.
During 2022, AngloGold Ashanti repatriated $694 million from infrastructures deficits to encourage economic development from mining resources. Discussions are currently ongoing with the DRC government with respect to incentives that could be available under article 220 of the Reformed DRC Mining Code.
On 18 July 2012, the Convention between the government of the Republic of South Africa and the government of the DRC for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income (Convention) came into effect. The Convention is applicable to (i) withholding taxes on amounts paid or credited on or after 1 January 2013; and (ii) other income taxes, levied in respect of taxable periods beginning on or after 1 January 2013. The Convention reduces the withholding tax on dividends paid by companies residentits operations in the DRC, in the form of dividends from Kibali (Jersey) Limited. Kibali (Jersey) Limited received such cash from Kibali Goldmines in the form of loan repayments (net of bank fees) (AngloGold Ashanti’s attributable share: $658 million) and dividends (net of withholding taxes) (AngloGold Ashanti’s attributable share: $36 million). Our attributable share of the outstanding cash balances awaiting repatriation from the DRC amounted to companies resident in South Africa from 20 percent$40 million as of 31 December 2022. The cash is fully available for the operational requirements of Kibali Goldmines. The cash and cash equivalents held at Kibali Goldmines are subject to 5 percentvarious steps before they can be distributed to Kibali (Jersey) Limited and on interest paid by companies residentare held across four banks in the DRC, to companies resident in South Africa from 20 percent to 10 percent. A South African company must own at least 25 percentincluding two domestic banks.
AngloGold Ashanti’s rights and permits
AngloGold Ashanti holds a significant stake in the Kibali gold mine which is located in the north-eastern part of the DRC. The Kibali gold mine is owned by Kibali Goldmines SA (Kibali) which is a joint venture between Barrick Gold Corporation (45 percent), AngloGold Ashanti (45 percent) and Société Minière de Kilo-Moto SA (SOKIMO)S.A. (“SOKIMO”) (10 percent) which represents the interest of the DRC government. AngloGold Ashanti and Barrick Gold Corporation each have a 50 percent interest in Kibali (Jersey) Limited which holds their respective 45 percent interest in Kibali Goldmines.
The Kibali gold mineproject is operated by Barrick.
KibaliBarrick Gold Corporation and comprises 10ten exploitation permits, of which seveneight expire in 2029 and threetwo in 2030. The Kibali gold project coversThose exploitation permits (11447, 11467, 11468, 11469, 11470, 11471, 11472, 5052, 5073, and 5088) cover an area of approximately 1,836 km2in the Moto goldfields.
Ghana
General laws relating to mining
Control of minerals and mining companies
The Constitution of Ghana as well as the Minerals and Mining Act, 2006 (Act 703) (GMM Act)(the “GMM Act”) provide that all minerals in Ghana in their natural state are the property of the State and title to them is vested in the President on behalf of and in trust for the people of Ghana, with rights of reconnaissance, prospecting, recovery and associated land usage being granted under licence or lease.
The grant of a mining lease by the Ghana Minister of Lands and Natural Resources (LNR Minister)(the “LNR Minister”) upon the advice of the Minerals Commission is subject to parliamentary ratification unless the mining lease falls into a class of transactions exempted by the Ghanaian Parliament.
The LNR Minister has the power to object to a person becoming or remaining a controller of a company which has been granted a mining lease if the LNR Minister believes, on reasonable grounds, that the public interest would be prejudiced by the person concerned becoming, or remaining, such a controller.
In 2019, Parliament passed the State Interests and Governance Authority Act, 2019 (Act 990) establishing the State Interests and Governance Authority (SIGA). The functions of SIGA include the oversight and administration of the State’s interests in state-owned enterprises, joint venture companies and other entities in which the State has an interest. This applies to mining companies on account of the Government’s mandatory free-carried equity interest in mining companies as provided for under the GMM Act. However, the Government of Ghana does not have a free-carried interest in any of AngloGold Ashanti’s mines in Ghana.
Stability and development agreements
The GMM Act provides for stability and development agreements. Stability agreements asguarantee for a mechanism to guaranteeperiod of 15 years certain terms and conditions mainly fiscal,(mainly fiscal) to which a company’s operations are subject for a period of 15 years. Stabilitysubject. Development agreements are subject to ratification by Parliament. A development agreement, as provided for by the GMM Act, may be made availablegranted to a mineral right holder with a proposed investment exceeding USD 500 million.that proposes to invest over $500 million in its mineral operations in Ghana. The GMM Act also provides that the terms of apermits stability provisions to be incorporated into development agreement may contain stability terms as provided for in stability agreements. AStability and development agreement isagreements are subject to parliamentary ratification.
In January 2020, the Minerals Commissionit was proposed certain amendments tothat the GMM Act including, among other measures, the abolishment ofbe amended by abolishing development agreements and shortening the shorteningmaximum term of stability agreements from a period not exceeding 15 years to a period of five years (with a possible extension of anotherfor a further five years). The Minerals Commission is currently engaging with stakeholders on If the GMM Act were amended along these proposed amendments. Following this engagement, the Minerals Commission may present the proposedlines, such amendments to the LNR Minister who can then decide to submit a draft bill to Parliament. If such bill were to be adopted by Parliament, it would not apply retroactively. As a result, the proposed amendments willretroactively and would therefore not have an impact on existing development agreements, including the Obuasi Development Agreement (as described below). Those amendments to the GMM Act have not yet been adopted.
Ghana Stability Agreement
On 18 FebruaryIn 2004, AngloGold Limited and the Government of Ghana agreed on the terms of a stability agreement (Ghana Stability Agreement) to govern certain aspects of the fiscal and regulatory framework under which AngloGold Ashanti would operate in Ghana following the implementation of the business combination between AngloGold Limited and Ashanti Goldfields Company Limited. The Ghana Stability Agreement necessitated the amendment of the Obuasi mining lease which had been ratified by Parliament.
Under the Ghana Stability Agreement,Limited, AngloGold Limited and the Government of Ghana agreed:
to extend the termsigned a stability agreement (the “Ghana Stability Agreement”) governing certain aspects of the mining lease relating tofiscal and regulatory framework within which the Obuasi mine until 2054 on terms existing prior to the business combination;
to maintain, for a period of 15 years, the royalties payable by AngloGold Ashanti with respect to its mining operationscompany would operate in Ghana at a rate of 3 percent per annum of the total revenue from minerals obtained by AngloGold Ashanti from such mining operations;
to ensure the income tax rate would be 30 percent for a period of 15 years. The agreement was amended in December 2006 to makeIn June 2018, the tax rate equal to the prevailing corporate rate for listed companies if the rate was less than 30 percent; and
to permit AngloGold Ashanti and any or all of its subsidiaries in Ghana to retain up to 80 percent of export proceeds in foreign currencies offshore, or if such foreign currency is held in Ghana, to guarantee the availability of such foreign currency.
The Ghana Stability Agreement also stipulates that a sale of AngloGold Ashanti’s or any of its subsidiaries’ assets located in Ghana remains subjectceased to the Government’s approval. Furthermore, the Government retains its special rights (Golden Share) under the provisions of the GMM Act pertaining to the control of a mining company, in respect of its assets and operations in Ghana.
The Government of Ghana further agreed that AngloGold Ashanti’s Ghanaian operations will not be adversely affected by any new enactments or orders, or by changes to the level of payments of any customs or other duties relating to mining operations, taxes, fees and other fiscal imports or laws relating to exchange control, transfer of capital and dividend remittance until April 2019, which is 15 years after the completion of the business combination.
In relationapply to the Obuasi mine AngloGold Ashanti (Ghana) Limited (AGA Ghana) negotiatedbecause of the parliamentary ratification of a new development agreement and a new tax concession agreement with the Government. These regulatory and fiscal agreements, which govern the redevelopment of the Obuasiin relation to that mine have received parliamentary approval in June 2018. As a result of the ratification of these agreements, the(as described below).
The Ghana Stability Agreement ceasedcontinued to apply to the Obuasi mine.
Notwithstanding the aforementioned, the Ghana Stability Agreement still applied to the Iduapriem mine until it expired in April 2019. Since this expirationthen, AngloGold Ashanti (Iduapriem) Limited (AGA Iduapriem) does not benefit from any peculiar tax concessions or other protections resulting(“AGA Iduapriem”) no longer benefits from the Ghana Stability Agreement anymore. Relevant engagements are currently ongoing betweenAgreement. AGA Iduapriem with the Minerals Commission to obtain a new stability agreementbenefits from certain concessions under two deeds of warranty, including exemptions from withholding taxes on dividends, interest and tax concession agreementpayments for the Iduapriem mine.foreign services, and allowable deductions.
Obuasi Development Agreement
On 21 June 2018, Parliament ratified the Development AgreementAngloGold Ashanti (Ghana) Limited (“AGA Ghana”) negotiated a new development agreement in relation to the Obuasi mine (Obuasi DA)(the “Obuasi DA”) with the Government of Ghana. On 21 June 2018, the Ghanaian Parliament ratified the Obuasi DA which contains stability terms as provided for in stability agreements.
The Obuasi DA confers the followinga number of rights and obligations on AGA Ghana with respect to the Obuasi mine:
Stabilizationmine, including, among other matters, (i) the stabilisation of the fiscal and regulatory framework (except for enactments promoting the use of Ghanaian goods and services) for a period of 10ten years with(with a potential of it being extended for five years;
Confirmation of accounting currency to be US dollars;
Rightyears); (ii) the right to hold up to 80 percent of proceeds received from exporting minerals in foreign currencies outside of Ghana in accordance with existing arrangements;
Obligation to set up a “Community Trust Fund” for Obuasi funded at $2 per ounce produced;
ObligationGhana; (iii) obligation to give preference to materials and goods made in Ghana as well as services provided by Ghanaians, entities incorporated or formed in GhanaGhanaians; and entities owned and controlled by Ghanaians;
Obligation to give preference to Ghanaian skills where they are available;
Obligation to employ high standards of safety; and
Right(iv) the right to peaceful enjoyment and protection against expropriation.
Obuasi Tax Concession Agreement
The fiscalFiscal terms, which willwould ordinarily form part of a single stabilisation document, were separated from the Obuasi DA. Hence a separate tax concession agreement in relation to the Obuasi mine (Obuasi TCA)(the “Obuasi TCA”) was signed with the Government. On 21 June 2018, the Ghanaian Parliament ratified the Obuasi TCA.
TCA with a concession period until 31 December 2027. The key termsObuasi TCA contains a number of tax concessions for AGA Ghana with respect to the Obuasi TCA are as follows:
Corporate Income Tax to bemine, including, among other matters, (i) a corporate income tax rate of 32.5 percent or such lower rates as may be fixed by law (current(instead of the current statutory rate isof 35 percent);
Unutilised capital allowances carried forward by AGA Ghana which relate to the period before the effective date of the Obuasi TCA which have not already been utilized for the purposes of calculating taxable income shall continue to be carried forward until 31 December 2020;
Existing tax losses and new tax losses as well as a special concession to carry forward capital allowances to be converted into tax losses as at the end of 2020, will apply to AGA Ghana (whoever is the owner of AGA Ghana and whether or not AGA Ghana was to enter into a joint venture in respect of the Obuasi mine);
Exemptions (ii) exemption of certain items from Import Duty;
Exemption of the following transactions from Capital Gains Tax:
an issue of shares bycapital gains tax; (iii) a publicly listed company which holds a direct or indirect interest in AGA Ghana in connection with a raising of finance, an acquisition or a reorganization or an issue of shares by a company in connection with a new listing;
transfers of shares in any publicly listed company which holds a direct or indirect interest in AGA Ghana other than a transfer of shares which results in a third party holding more than 35 percent of the shares in the listed company; and
a reorganization of a company which holds a direct or indirect interest in AGA Ghana where following the reorganization the shareholders are substantially similar to those shareholders of the ultimate parent entity immediately prior to the transaction;
Non-application of section 62(1) of the Income Tax Act, 2015 (Act 896) in relation to change in underlying ownership under the following circumstances:
a joint venture in relation to Obuasi gold mine;
an issue of shares by a publicly listed company which holds a direct or indirect interest in AGA Ghana in connection with a raising of finance, an acquisition or a reorganization or an issue of shares by a company in connection with a new listing;
transfers of shares in any publicly listed company which holds a direct or indirect interest in AGA Ghana other than a transfer of shares which results in a third party holding more than 50 percent of the shares in the listed company; and
a reorganization of a company which holds a direct or indirect interest in AGA Ghana where following the reorganization the shareholders are substantially similar to those shareholders of the ultimate parent entity immediately prior to the transaction;
Slidingsliding scale royalty rate ranging from 3three percent to 5five percent for a price ranging from $1,300$1,300 up to $2,000$2,000 and above per ounce instead(instead of the current flat rate of 5 percent;
Exemption from the payment offive percent); and (iv) certain VAT on items imported under the Import Duty List up to 31 December 2023;exemptions and
Entitlement to a refund of VAT credit at the pre-production stage notwithstanding that AGA Ghana will not meet certain conditions for qualifying for refunds.
Corporate regulation
Parliament passed the new Companies Act, 2019 (Act 992) which repeals the Companies Act, 1963 (Act 179). Act 992 introduced amendments to the regulation of companies in Ghana and establishes the Office of the Registrar of Companies. As a general matter, Act 992 maintained the provisions of Act 179. It, however, introduces stricter requirements for persons who are to be appointed as directors of a company as well as for company secretaries. Companies are also required to appoint new external auditors every six years.
A company is also not required to have bylaws or “regulations” as was the case under Act 179. Instead, a company may opt to have a registered constitution. Nevertheless, it is expected that the current regulations for AGA Ghana and AGA Iduapriem will be redrafted and filed at the Companies Registry. Further, a company is not required to have specific objects as prescribed previously. The implication of this is that a company can carry out any type of business unless otherwise specifically stated in the company’s constitution.
Government’s Golden Share
Section 60(1) of the GMM Act provides that the Government of Ghana can require a mining company to issue for no consideration to the Republic of Ghana for no consideration a special share (Golden Share) by notice in writing to such mining company. The Government of Ghana exercised this right in respect of AGA Ghana and as a result was issued with a(a “Golden Share”). A Golden Share in AGA Ghana. Under the Ghana Stability Agreement, this Golden Share was issued to apply solely to AGA Ghana’s assets and operations in Ghana. Following the expiration of the Ghana Stability Agreement in April 2019, the Government of Ghana reconfirmed and agreed in the Obuasi DA confirms that the Government’s rights with respect to its Golden Share apply only in respect of AGA Ghana’s assets and operations in Ghana.
The Golden Share may only be held by or transferred to a Minister ofconfers certain rights on the Government or any person acting on behalfin respect of such Government and authorised in writing by such Minister.
The following matters require, and will not be effective without, theAGA Ghana. For example, written consent of the holder of the Golden Share:
Share is required for, among other matters, (i) any amendment to or removal of the relevant provisions of the AGA Ghana Regulations setting out the rights and restrictions attaching toin respect of the Golden Share;
(ii) the voluntary winding-up or voluntary liquidation of AGA Ghana;
the redemption of or purchase by AGA Ghana of the Golden Share;
(iii) the disposal of any mining lease held by AGA Ghana or any subsidiary of AGA Ghana; and
any disposal by AGA Ghana (other than any disposal in (iv) the ordinary course of business of AGA Ghana) which, alone or when aggregated with any disposal or disposals forming part of, or connected with, the same or a connected transaction, constitutes a disposal of the wholeall or a material partsubstantially all of the assets of the AGA Ghana group taken as a whole. For this purpose, a part of the AGA Ghana group’s assets will be considered material if either (a) its book value (calculated by reference to the then latest audited consolidated accounts), or the total consideration to be received on its disposal, is not less than 25 percent of the book value of the net assets of the AGA Ghana group or (b) the average profits attributable to it represent at least 25 percent of the average profits of the AGA Ghana group for the last three years for which audited accounts are available (before deducting all charges, except taxation and extraordinary items).
Upon a return of assets in a winding-up or liquidation of AGA Ghana, theGhana. The holder of the Golden Share is entitled todoes not have the sum of GHS 0.10 cedis in priority to any payment to other members, but the Golden Share confers no further right to participate in the profits or assets of AGA Ghana. The Golden Share carries no right to anyGhana (by way of dividend or other capital issuances), but is entitled to attend any right to participate in any offergeneral meeting of securities to existing shareholders or in any capitalisation issue.shareholders.
The holder of the Golden Share may require AGA Ghana to redeem the Golden Share at any time in consideration of the payment to such holder of GHS 0.10 cedis.
Tax laws relating to mining
Fiscal regime
Currently, the main tax laws in Ghana include the following acts and regulations:regulations, which have been frequently amended over the years:
•Income Tax Act, 2015 (Act 896) (as amended) and Income Tax Regulations, 2016 (L.I. 2244);
•Customs Act, 2015 (Act 891) (as amended) and Customs Regulations, 2016 (L.I. 2248);
•Value Added Tax, 2013 (Act 870) (as amended) and Value Added Tax Regulations, 2016 (L.I. 2243); and
•Revenue Administration Act, 2016 (Act 915).
In 2012, the tax laws of Ghana were amended. Changes to the tax laws included:
An increase in the income tax rate applicable to mining businesses from 25 percent to 35 percent. The Obuasi TCA limits the corporate income tax rate for AGA Ghana to 32.5 percent and AGA Iduapriem was protected until April 2019 from any increase exceeding the rate provided for under the Ghana Stability Agreement. Following the expiration of the Ghana Stability Agreement, AGA Iduapriem currently pays an income tax rate of 35 percent;
Introduction of a new capital allowance regime for class 3 assets (which include mineral and petroleum exploration and production rights, buildings, structures and works of a permanent nature used in mineral and petroleum exploration and production and plant and machinery used in mining and petroleum operations) that provides for a 20 percent straight line rate for a period of five years. AGA Ghana is protected under the Obuasi TCA and AGA Iduapriem was protected until April 2019 from such change pursuant to the Ghana Stability Agreement;
Elimination of the 5 percent allowance on prior year additions. Prior to the 2012 amendment, the tax code granted an additional 5 percent of the value of assets acquired and qualified to be classified as class 3 assets for the purpose of granting capital allowances. Capital allowance is now 20 percent each year on the total value of the assets. The Obuasi TCA provides that unutilised capital allowances carried forward by AGA Ghana which relate to the period before the effective date of the Obuasi TCA which have not already been utilized for the purposes of calculating taxable income shall continue to be carried forward until 31 December 2020. From 1 January 2021, any such unutilized capital allowances shall be 20 percent each year on the total value of assets. AGA Iduapriem was protected until April 2019 from such change pursuant to the Ghana Stability Agreement; (as amended); and
A ring fencing rule to prevent mining businesses from deducting or setting off costs from one mining area with another’s income. This ring fencing rule applies to AGA Ghana under the Obuasi TCA. Pursuant to the Ghana Stability Agreement, this change did not affect AGA Iduapriem until April 2019.•Exemptions Act, 2022 (Act 1083).
Between 2018 and 2019, the following changes have been made to the fiscal regime of Ghana:
The Minerals Income Investment Fund Bill has been passed by Parliament to establish a Fund to receive mineral royalties and related income as well as establish a special purpose vehicle to vest the Ghanaian Government’s carried interest in mining companies. It will also provide for the disbursement and management of the royalties received from mineral rights holders by Ghana’s Government. This would not impose any additional burden on mining companies such as AngloGold Ashanti but would only change the legal personality holding the Ghanaian Government’s carried interest; and
The Income Tax (Amendment) Act, 2019 (Act 1007) was passed to revise the rates of tax for the chargeable income for resident individuals, and to provide for a tax holiday for automobile manufacturers and assemblers.
VAT
In 2018, the Value Added Tax (Amendment) Act, 2018 (Act 970) revised the VAT rate on taxable supplies to 12.5 percent. The National Health Insurance (Amendment) Act, 2018 (Act 971) decoupled the National Health Insurance Levy of 2.5 percent from the VAT and as a result is no longer included in the VAT. Act 971 converted the NHI Levy into a straight levy which is not subject to the input and output method of accounting for VAT. Same was done for the Ghana Education Trust Fund portion of the VAT under the Ghana Education Trust Fund (Amendment) Act, 2018 (Act 972). The implication is an increase in the total tax liability payable by the consumer. However, by virtue of the Obuasi DA and Obuasi TCA, AGA Ghana will not be affected by these revised rates. Following the expiration of the Ghana Stability Agreement, AGA Iduapriem is subject to these revised rates.
Income taxes
In November 2015, Parliament passed the Income Tax Act, 2015 (Act 896) (ITA) which repealed the Internal Revenue Act, 2000, (Act 592), as amended. The ITA became effective from 1 January 2016 for the 2016 year of assessment. The ITA ring fencesringfences and taxes income derived from mining operations at the rate of 35 percent. For the purpose of ascertaining the income of a person for taxation, each separate mineral operation is treated as independent business and taxed accordingly. The Obuasi TCA for AGA Ghana provides for a stabilised income tax rate of 32.5 percent. Pursuant to the Ghana Stability Agreement, the ITA did not apply to AGA Iduapriem until April 2019. Following its expiration, AGA Iduapriem currently pays income tax at the rate of 35 percent.
Furthermore, mining companies must pay ground rent and royalties. Ground rent is payable annually and is calculated based on the number of cadastral units of land held. Royalties are calculated as a percentage of total revenue from minerals obtained by the mining company. The Government of Ghana currently applies a five percent royalty rate to mining companies who have not agreed a different royalty rate under an agreement with the State. AGA Ghana pays royalties on a sliding scale ranging between three percent and five percent as provided for by the Obuasi TCA. AGA Iduapriem pays royalties at a rate of five percent.
The ITA provides for the carrying forwardprovision of losses for upgoods and services is liable to five yearsvalue added tax (“VAT”) at a revised rate of 15 percent. In addition, there are separate levies, including a 2.5 percent National Health Insurance Levy (“NHIL”), a 2.5 percent Ghana Education Trust Fund Levy (“GetFund Levy”) and those losses carried forward can only be used in the order in which they were generated or incurred. The ITA further prohibits the deferment of capital allowances calculated or granted for a particular year.
The ITA imposes a withholding tax on dividends paid by a person conducting mineral operations in Ghana at 8 percent. This is regardlessone percent COVID-19 Levy. By virtue of the amount of shareholding a shareholder or shareholders may have in the entity paying the dividend. However, a person holding or controlling directly or indirectly at least 25 percent of the voting power of the company paying the dividend may be allowed some tax exemptions. The ITA also introduces some variation in the rates of withholding taxes. For example, payments for the supply of services (Payments with a Source inObuasi TCA, AGA Ghana to Persons Other Than Individuals) has been increasedis exempt from 5 percent to 15 percent; the withholding tax on resident Directors’ remuneration has been increased from 10 percent to 20 percent; and withholding taxes on natural resource payments and royalties have been increased from 10 percent to 15 percent. This may have an indirect impact on AngloGold Ashanti’s operations as this rate will have a material impact on the margins of suppliers and possibly their working capital. Suppliers may therefore seek to pass this on to AngloGold Ashanti by increasing their fees and charges.
The ITA also abolishes the flat 15 percent rate of tax on capital gains. Capital gains are now included in business or investment income and taxed at the applicable income tax rate which, for persons engaged in mineral operations, is 35 percent.
Various amendments were made to the ITA over the years. For example, the Income Tax (Amendment) Act, 2017 (Act 941) provides for the exemption from tax of the gains from the realisation of securities listed on the Ghana Stock Exchange and the Tax Amnesty Act, 2017 (Act 955) granted amnesty to persons who failed to register with the Commissioner-General or file their tax returns or pay taxes as required by enactments administered by the Commissioner-General.
Ground rent (mineral concession rent)
The Fees and Charges (Amendment) Instrument, 2015 (L.I. 2208) was passed by Parliament on 23 December 2015 and fixed, among other things, the payment of ground rent by mining companies at GHS 15 cedis per acre per annum.
the NHIL and GetFund Levy. In addition, while AGA Ghana is paying $670 (GHS 3,705 cedis) per km2 per annum for alltechnically exempt from the AGA Ghana leases. Thepayment of the COVID-19 Levy (as it became operational subsequent to the effective date of the Obuasi DA protects AGA Ghana from any increase in ground rent forDA), the duration of that development agreement.Company decided to pay the COVID-19 Levy voluntarily. AGA Iduapriem is also paying $670 (GHS 3,705 cedis) per km2 per annumnot exempt from any of these levies.
The Exemptions Act, 2022 (Act 1083) (“Exemptions Act”) defines the scope of tax exemptions that may be granted under Ghanaian law, and sets out the administrative process for allobtaining a tax exemption. The Exemptions Act requires a person with the benefit of an existing tax exemption to apply to the Ghana Minister of Finance by 11 March 2023 in order to continue to benefit from that tax exemption. The requirement to apply to the Minister of Finance does not affect AGA Ghana (as, by virtue of the Obuasi DA, AGA Ghana is stabilized against the adverse effects of, or obligations imposed by, any new laws). By contrast, AGA Iduapriem leases.
Customs Common External Tariff
Followingis subject to the passageprovisions of the Customs (Amendment) Act, 2015 (Act 905) by the Ghana Revenue Authority, the ECOWAS Regional Common External Tariff (CET) came into effect on 1 February 2016 meaning that the Member States of the Economic Community of West African States (ECOWAS) will apply the same customs tariffs to third countries. The CET is one of the instruments utilised to harmonize regulation in ECOWAS Member States and strengthen its common market.Exemptions Act.
Royalties
Under the Minerals and Mining (Amendment) Act, 2015 (Act 900), the Minister will prescribe the royalty rate payable and the manner of payment by passing a Legislative Instrument or other subsidiary legislation. The current royalty rate amounts to 5 percent.
The company is required to pay ground rent to the Government of Ghana (as described above) as well as such other fees as are prescribed by legislation, including royalties on timber felled within the lease area.
Environmental laws relating to mining
In general, environmental laws and regulations in Ghana derive from the Constitution which imposes a duty on both the State and others to take appropriate measures to protect and safeguard the natural environment. Mining companies are required, under the GMM Act, Environmental Assessment Regulations, 1999 (L.I. 1652), Environmental Protection (Mining in Forest Reserves) Regulations, 2022 (L.I. 2462) and Water Use Regulations, 2001 (L.I. 1692), to obtain all necessary approvals from the Environmental Protection Agency (Ghana EPA), a regulatory body established under the Environmental Protection Agency Act, 1994 (Act 490),(the “Ghana EPA”) and, in appropriate cases, the Water Resources Commission, the Forestry Commission and/or the Ghanaian Minerals Commission before undertaking mining operations. The Minerals and Mining (Health, Safety and Technical) Regulations, 2012 (L.I. 2182) also impose further obligations to obtain the necessary permits from the Inspectorate Division of the Ghana Minerals Commission for the operation of mines. The GMM Act also requires that mining operations in Ghana comply with all laws for the protection of the environment. Compliance with the relevant laws are enforced by a regime of sanctions including imposition of fines and in some cases a term of imprisonment.
As part of the Ghanaian environmental laws and regulations, mining operations are required to undergoThis includes undergoing an environmental impact assessment process that culminates inand, following the issuance of an environmental permit prior to commencing operations. Environmental Management Plans are to be submitted to the Ghana EPA within 18 months after issuance of the environmental permit, and then every three years thereafter. The plan mustperiodically preparing environmental management plans, which include details of the likely impacts of mining operations on the environment and local communities, as well as a comprehensive plan and timetable for actions to mitigate and remediate any
adverse effects of the mining operations. Approvaloperations, for submission to the Ghana EPA. The Minerals and Mining (Health, Safety and Technical) Regulations, 2012 (L.I. 2182) also impose further obligations to obtain the necessary permits from the Inspectorate Division of the management plan resultsMinerals Commission for the operation of mines. The environmental permits of AGA Ghana (for the Obuasi redevelopment project and for the construction and operation of tailings and water infrastructure projects) are valid until June 2024. The environmental permits for AGA Iduapriem in connection with (i) gold mining and processing, (ii) the issuancere-mining of Block 5 and for the tertiary crusher installation project and (iii) the construction and operation of a tailings storage facility (“TSF”) expired in August 2021, July 2022 and January 2023, respectively. The renewal process for the AGA Iduapriem environmental permits, which was commenced in advance of the expiry of the permits, is underway.
Environmental laws in Ghana also require mining operators to rehabilitate land negatively impacted by mining operations according to an environmental certificate.
In June 2014,cost reclamation plan agreed with the Ghana EPA. The environmental cost reclamation plan includes two cost estimates, namely the cost of rehabilitating the mining area at the end of the life of the mine as well as the cost of rehabilitating the mine as at the date of the reclamation plan. These estimates are reviewed annually and updated every two years. Each mining company is typically required to secure a percentage (typically between 50 percent and 100 percent) of the estimated rehabilitation costs by posting reclamation bonds underwritten by banks and restricted cash. The terms of each reclamation bond are determined by a reclamation security agreement between that company and the Ghana EPA. Both AGA Ghana and AGA Iduapriem have bank guarantees in place for environmental reclamation liabilities as well as escrow accounts with joint signatories from the Ghana EPA. The guarantees for AGA Iduapriem expired in October 2022, whereas the guarantees for AGA Ghana expired in December 2022. Renewal of the bank guarantees (which commenced in advance of the expiry of the existing guarantees) has not yet been completed due to the continued depreciation of the Ghanaian cedi and its impact on the Bank of Ghana’s single obligor limit. AGA Ghana and AGA Iduapriem have notified the Ghana EPA and the Minerals Commission circulated draft Mining and Environmental Guidelines to all mining companies for comment. The guidelines concern environmental management, reclamation, closure requirements and the proposed
Mining Community Development Scheme and have not yet become effective. The Mining Community Development Scheme, which directly sponsors socio-economic development in communities in which mining operations take place or which are affected by mining activities, has since been established pursuant to the Minerals Development Fund Act, 2016 (Act 912).
Illegal and unsustainable mining practices
The Multilateral Mining Integrated Project (MMIP) is a 5-year project launched by the Government of Ghana in 2017 to address illegal and unsustainable mining practices in Ghana. The MMIP “combines a Legislation, Enforcement, Civil, Integrated and Technological Approach (LECITA) as a sustainable and structured yet regimented conjoint concept” to combat illegal mining. The MMIP involves (i) reviewing and enforcing the legal and regulatory regime of the small scale mining sector, (ii) reclaiming and rehabilitating degraded lands, (iii) dredging silted estuaries and waterways, (iv) implementing social interventions to facilitate livelihood creation in mining communities, (v) adapting technology to increase mining efficiency, processing, environmental protection and monitoring activities, and (vi) building the capacity of artisanal and small-scale miners and regulatory institutions.resultant delays.
In addition, other initiatives have been undertaken to combat illegal mining. For example, the Minerals and Mining (Amendment) Act, 2015 (Act 900) makes provision for the confiscation of the equipment of illegal miners and, as a result of recent illegal mining activities, the GMM Act was amended to increase penalties for illegal mining and expressly criminalize the aiding and abetting of illegal mining activities. The prescribed minimum sentence for illegal mining is now 15 years and maximum of 25 years for foreigners who engage in illegal mining.
Foreign exchange, export and other rules
Retention of foreign earnings
AngloGold Ashanti’s operations in Ghana areThe Obuasi mine is permitted to retain 80 percent of theirits foreign exchange earnings in an offshore foreign exchange account.account, whereas the Iduapriem mine is allowed to retain up to 75 percent. In addition, the companyCompany has permission from the Bank of Ghana to retain and use USU.S. dollars outside of Ghana to fulfil payment obligations to the company’sCompany’s hedge counterparties which cannot be met from the cash resources of its treasury company.
On 4 February 2014, the Bank of Ghana issued new directives as part of measures to streamline the collection and repatriation of export proceeds to Ghana. These directives included an instruction to all banks and authorised dealers to, within 5 working days of receipt of export proceeds, convert the proceeds into Ghana cedis based on the average Interbank Foreign Exchange Rate prevailing on the day of conversion with a spread not exceeding 200 percentage in points (pips). Exporters with retention accounts were to continue to operate these accounts in accordance with their retention agreements. Retention proceeds which were sold to the banks were to be converted into Ghana cedis based on the average Interbank Foreign Exchange Rate prevailing on the day of conversion with a spread not exceeding 200 pips. It further advised that offshore foreign exchange transactions by resident companies, including exporters, were strictly prohibited and exporters were to ensure that all export proceeds are repatriated in full. Failure to comply with the provisions attracts penalties including pecuniary sanctions, jail terms, suspension and revocation of the operating licence as applicable.
Following engagement with relevant stakeholders, the Bank of Ghana issued another notice clarifying that the transfer of foreign exchange to meet external payment obligations remains permissible for transactions such as:
redemptions and coupon payments on bonds held by non-residents;
investment income, technology and management transfer entitlements, expatriate emoluments, and other incentive packages and overseas commitments under provisions in various legislation and legislative instruments such as the GMM Act, and the Technology Transfer Regulations, 1992 (L.I.1547); and
other outward payments for imports of goods and services.
The notice also stated that all balances in Foreign Currency Accounts (FCAs) and Foreign Exchange Accounts (FEAs) will continue to be held in foreign currency and will not be converted into Ghana cedis. External transfers of up to $10,000 per annum without documentation from FEA and FCA are still permitted. Balances held in FEAs and FCAs continue to remain available for all legitimate external transactions.
The Bank of Ghana on 9 August 2014 further revised the rules on foreign exchange operations, effectively reversing the initial directives controlling transactions in foreign exchange. The key details are as follows:
Exporters shall continue to repatriate in full export proceeds in accordance with the terms agreed between the trading parties. Such proceeds shall be credited to their FEAs and converted on a need basis;
FEAs and FCAs will continue to be opened and operated as they were before the notices of 4 February 2014;
Except for transfers from FEA to FCA which are still prohibited, all other transfers between accounts are permitted;
FCAs shall be fed only with unrequited transfers such as transfers from abroad for investment or embassy transfers;
FEAs shall be fed with foreign exchange generated from activities in Ghana such as proceeds from exports of goods and services; and
The threshold for transfers abroad without initial documentation remains at $50,000.00.
The Bank of Ghana reiterated that the Ghana cedi remains the sole legal tender in Ghana. Therefore, pricing, advertising, invoicing, receiving, and making payments for goods and services should be done in Ghana cedis, unless otherwise authorized by the Bank of Ghana.
Existing measures that were not amended by this notice continue to remain in force. AngloGold Ashanti maintains and operates its FCA, FEA and retention accounts in compliance with the directives.
Rules regarding the export of gold and diamonds
The Bank of Ghana introduced new measures to regulate and monitor the export of gold and diamonds from Ghana in 2015. From 15 September 2015, all exports of gold and diamonds must be carried out through the Precious Minerals Marketing Company Ltd (PMMC)(“PMMC”), except where the exporter is the holder of a licence that permits it to export directly. The Ghana Revenue Authority (Customs Division) only permits gold to be exported by a licensed gold exporter who has a completed Form FEX A4 bearing Bank of Ghana’s embossment. The export measures do not apply to AngloGold Ashanti because the companyCompany holds a licence granted by the LNR Minister to sell and export its production.
The Bank of Ghana issued a notice (Notice No. BG/GOV/SEC/2016/02) which, among other things, allows mining companies to sell the portion of foreign exchange receipts from export that was earmarked for surrender to the Bank of Ghana directly to the commercial banks.Local assaying and refinement policies
In November 2016, the Ministry of Lands and Natural Resources issued a ministerial directive appointing the PMMC as designated laboratory for assaying in Ghana. The directive requests all persons holding export licenseslicences for gold to submit all gold to be exported to the PMMC for assay before export. Mining businesses, including AngloGold Ashanti, acting through the Ghana Chamber of Mines were opposed to this directive due to its potential negative impact on mining companies in the region. As a result, the Chamber initiated proceedings to reverse or modify the directive. Following discussions in respect of the mining industry’s concerns, the Chamber and Government agreed on the modalities for implementing the national assaying policy and it was introduced in February 2018 following a one-month pilot among certain mining companies. A final documentSubsequently, in June 2019, the LNR Minister released a statement reiterating the Government of Ghana’s plans to locally refine 30 percent of the gold produced in the country. Discussions between the Ghana Chamber of Mines and the Government of Ghana’s economic management team in 2019 led to the Chamber agreeing to consider the proposal and for the implementation ofparties to discuss detailed modalities to ensure that a move to locally refined gold does not become detrimental to the program will be executed once the Chambermining industry.
Local content and the PMMC address a few outstanding issues regarding assaying methodologies.
Localisationlocal participation policy
Mining companies must submit a detailed programme for the recruitment and training of Ghanaians with a view to achieving “localisation”, which is the replacement of expatriate personnel in a company’s Ghanaian operations by Ghanaian personnel. In addition, mining companies must give preference to Ghanaian products and personnel, to the maximum extent possible, consistent with safety, efficiency and economies. The Minerals and Mining (General) Regulations, 2012 (L.I. 2173) give further details on the localisation policy.
Except as otherwise provided in a specific mining lease, all immovable assets of the holder of the mining lease vest in the State upon termination, as does all moveable property that is fully depreciated for tax purposes. Moveable property that is not fully depreciated is to be offered to the State at the depreciated cost. The holder must exercise his rights subject to such limitations relating to surface rights as the Minister of Mines may prescribe.
In January 2020, the Minerals Commission circulated draft Minerals and Mining (Local Content and Local Participation) Regulations, intended to expand2020 (L.I. 2431) came into force on 22 December 2020 with the scopepurpose of local content requirementsdeveloping Ghanaian participation in the mining industry. industry value chain by imposing an obligation on mining companies to procure goods and services with Ghanaian content to the maximum extent possible.
The draft specifically seeksGovernment’s election to expandpurchase gold
In June 2021, the numberBank of Ghana launched a “Domestic Gold Purchase Programme” through which the Bank of Ghana intends to purchase refined gold from AGA Ghana, AGA Iduapriem and other large-scale mining related businesses requiredcompanies through voluntary arrangements pursuant to complythe Bank of Ghana Act, 2002 (Act 612). The LNR Minister indicated in November 2022 that the Government of Ghana intended to exercise its statutory right of pre-emption pursuant to the GMM Act to compel large-scale mining companies to sell 20 percent of their Ghana gold production and/or the resultant refined gold to the Bank of Ghana in exchange for Ghanaian cedis. Each of AGA Ghana and AGA Iduapriem executed voluntary gold purchase agreements with local content requirements.the Bank of Ghana on 29 December 2022. As at 10 March 2023, the Government of Ghana had not exercised its statutory right of pre-emption as prescribed in the GMM Act.
AngloGold Ashanti’s rights and permits
Obuasi
The currentObuasi mine originally held four contiguous mining lease forleases, namely, the Obuasi, areaBinsere 1, Binsere 2 and Binsere 3 Mining Leases. The Obuasi Mining Lease was granted by the Government of Ghana on 5 March 1994. It grants mining concessions to land with1994, covering an area of approximately 338 km2 in the Amansie East and Adansi West districts of the Ashanti region, for a term of 30 years from the date of the agreement. In addition, a mining lease overThe Binsere Mining Leases were granted on 9 April 1998, covering an adjacentarea of 140 km2was also granted, resulting, for a term of 30 years from the date of the agreement. All leases in respect of the total area underObuasi mine had been duly ratified in accordance with Ghanaian law. In March 2007, the mining lease increasing to 474 km2.
The Government of Ghana agreed to extend the term of the mining lease relating to the Obuasi mine until 2054.Mining Lease for a further term of 30 years. The mining leaseamended Obuasi Mining Lease was formallyalso ratified by Parliament on 23 October 2008.
The Obuasi Mining Lease will expire in March 2054 and the Binsere Mining Leases in April 2028. The mining leases are renewable. On 3 March 2016, the Minerals Commission approved AngloGold AshantiAGA Ghana’s application to surrender approximately 273.54 km2 of the area to the Government of Ghana, reducing the combined area under AGA Ghana’s lease areas to 201.46 km2. The remaining parcel of land that will be subject to the mining lease is situated within various villages and townships in the region but excludes the municipality of Obuasi.
On 15 January 2021, the Minerals Commission approved AGA Ghana is not requiredGhana’s application to pay annual mineral right fees assurrender a further 60.24 km2 of lease area, thereby reducing the AGA Ghana Leases were granted priortotal lease area to 141.22 km2 under three mining leases, namely, the enactment ofObuasi Mining Lease (87.48 km2), the GMM Act which imposes such fees. The GMM Act provides thatBinsere 1 Mining Lease (29.03 km2) and the Binsere 2 Mining Lease (24.71 km2). These mining leases granted under laws subsisting immediately before the coming
into force of the GMM Act shall continue to be governed by such pre-existing laws. As a result, the AGA Ghana Leases are still regulatedcovered by the MineralsObuasi DA and Mining Law, 1986 (PNDCL 153), as amended (notwithstanding the repeal of PNDCL 153 by the GMM Act).Obuasi TCA.
Iduapriem
The Iduapriem mine had been grantedoperates under four different mining leases:leases, namely, the Iduapriem Mining Lease (LVB1539/89) (36.47 km2), the Ajopa Mining Lease (LVB/WR326/09) (46.12 km2), the Teberebie Mining Lease (LVB3722H/92) (28.53 km2) and the Ajopa South West Mining Lease (LR#1109/1999) (28.10 km2). All fourOn 17 February 2020, the mining leases expired between 2018were extended for a further period of 15 years and 2019. All relevant documents were submitted to apply for the renewal of thesuch leases in September 2017. In January 2020, the Minerals Commission issued a Notice of Grant of Mining Lease for all four leases and the LNR Minister approved the grant of the mining leases. All four renewed leases will now expire in February 2025.
AGA Iduapriem is required to pay an annual mineral right fee2035. All leases in respect of $178,000 with respect to the Iduapriem Lease, $136,000mine have been duly ratified in accordance with respect to the Teberebie Lease, $134,000 with respect to the Ajopa South West Lease and $220,000 with respect to the Ajopa lease.Ghanaian law.
Guinea
General laws relating to mining
In Guinea, all mineral substances are the property of the State. Mining activities aremining industry is primarily regulated by lawLaw L/2011/006/CNT dated 9 September 2011 as amended by lawLaw L/2013/053/CNT dated 8 April 2013 and promulgated by decreeDecree D/2013/075/PRG/SGG dated 17 April 2013 (together, the Guinea“Guinea Mining Code)Code”).
The Guinea Mining Code is accompanied and implemented by various implementation decrees. To date, various decrees have been adopted,and orders, including decreeDecree D/2014/015/PRG/SGG adopting a model of mining convention, dated 17 January 2014, orderOrder A/2016/1584/MMG/SGG related to the administration’s capacities for the management of integrated mining projects (PARCA-GPI) and its steering committee, dated 6 June 2016, decreeand Decree D/2016/163/PRG/SGG on the national agency for the development of mining infrastructures (ANAIM), dated 13 June 2016, and decree D/2016/215/PRG/SRG on the appointment of executives to the Ministry of Mines and Geology, dated 8 July 2016.
In 2017, Decree D/2017/285/PRG/SGG was adopted, which sets forth the modalities regardingconditions for the constitution and management of the Local Development Fund (“Fodel”), as well as Joint Order A/2017/6326/MMG/MATD/SGG, which sets forth the conditions for the use, management and control of the Fodel. Together, these set forth the use of the mining companies’ financial contribution to the development of the local communities and the rules applying to the Local Development Fund (Fodel)Fodel, which was created under the Guinea Mining Code have been enacted through the adoption of decree D/2017/285/PRG/SGG setting the conditions for the constitution and management of the Fodel, dated 31 October 2017 and the joint orderCode. On 13 July 2018, a Joint Order A/2017/6326/2018/5212/MEF/MMG/MB/MATD/SGG setting out the conditions forwas issued, which regulates the use, management and controlmonitoring of the Fodel, dated 22 November 2017. Also, a joint order AC/2017/3228/MATD/MMG/SGG updating the act on the establishment, attribution and functioningresources allocated to local authorities pursuant to article 165 of the coordination committees in mining communities (CCLMS), dated 21 July 2017 has been issued by the Ministry of Territorial Administration and Decentralisation and the Ministry of Mines and Geology. The main purpose of the CCLMs, in which all concerned mining companies are represented, being to prevent and settle disputes that may arise in mining communities.Guinea Mining Code. In 2019, an inter-ministerial committee was created to supervise and control the Fodel through the adoption of the joint orderJoint Order AC/2019/089/MMG/MATD/SGG setting out the conditions for the constitution, powers and management of said inter-ministerial committee. On 6 September 2019, Decree D/2019/263/PRG/SGG was issued, which sets forth local content requirements in the framework of the implementation of public and private projects in Guinea. On 27 May 2021, Order A/2021/1229/MMG/SGG was issued to establish the Steering Committee for local content in the mining sector. On 21 October 2022, Law L/2022/010/CNT, dated 22 September 2022, setting up the legal framework for local content in public and private projects was enacted (the “Local Content Act”). In particular, the Local Content Act regulates local employment, procurement of goods and services, and subcontracting
requirements. As the Local Content Act does not expressly repeal the provisions of Decree D/2019/263/PRG/SGG, those provisions remain in force to the extent that they do not conflict with the Local Content Act.
On 16 June 2020, a new procedure for the export of gold by mining companies was enacted through the adoption of Decree D/2020/113/PRG/SGG, which sets out, amongst other things: (i) when the industrial production tax referred to in article 161-1 of the Guinea Mining Code shall be paid, and (ii) the process to be followed to export gold bullion.
On 27 April 2021, a Joint Order AC/2021/824/MMG/BCRG/SGG was issued establishing the fees and costs charged by the Guinean mining authorities and the Guinean Central Bank in connection with the administrative procedures for the export of gold by industrial and semi-industrial companies.
AngloGold Ashanti’s rights and permits
The right to undertake mining operations in Guinea can only be acquired by virtue of one of the following mining titles: surveying permit, small-scale mining licence, exploration licence, mining licence or mining concession.
The group’s GuineaGroup’s Guinean subsidiary, Société AngloGold Ashanti de Guinée SA (SAG)S.A. (“SAG”), has title to the Siguiri mine in the form of a mining concession, granted by virtue of Presidential decreeDecree D/97/171/PRG/SGG, dated 4 August 1997, for a period of 25 years (Mining Concession)(the “Mining Concession”). The Mining Concession covers exploration and mining for gold, silver, diamonds and associated ores, and was originally covered by a mining convention entered into with the Republic of Guinea on 11 Novemberin 1993 (Convention de Base) and amended in 2005. The Convention de Base provided for an initial duration of 25 years and would have expired in 2018.
The Guinea Mining Code, which came into force after the conclusion of the Convention de Base, confirms the validity of mining titles previously issued. The Guinea Mining Code also provides that for holders of validly signed and ratified mining conventions, the application of the Guinea Mining Code will take place by way of amendments to the relevant mining convention (in the case of SAG, the Convention de Base), which amendments are to be negotiated between the mining concession holder and the State.
On 28 June 2016, SAG and the Government of Guinea concluded a revised and consolidated mining convention (Convention de base (Revised Convention de Base)Base Révisée et Consolidée) (the “Revised Mining Convention”) which encompasses a renewal of the term of the original Convention de Basemining convention and other amendments necessary to support an expansion project proposed to extend the life of the Siguiri mine (the Expansion)“Expansion”).
In compliance with the provisions of the Guinea Mining Code, the Revised Mining Convention de Base was ratified by the Guinean National Assembly (law(Law L/2016/N°067/AN dated 30 December 2016, promulgated by decreeDecree D/2017/015/PRG/SGG dated 24 January 2017),
submitted to the Guinean Supreme Court which rendered a favourable opinion (judgment(Judgement N°AC 005 dated 16 January 2017), and ratified by the President of the Republic of Guinea (decree(Decree D/2017/021/PRG/SGG dated 24 January 2017).
As a consequence, as and from 24 January 2017, the Revised Convention de Base has cancelled and, following which it replaced the original Convention de Basemining convention and governs the operations at the Siguiri mine and under the Mining Concession.became effective on 24 January 2017.
Key elements of the Revised Mining Convention de Base include the following:
•a duration of 25 years, expiring 23 January 2042, subject to further renewal if mining operations continue at that time; and with continue;
•the term of the Mining Concession beingis aligned with the term of the Revised Mining Convention de Base such thatsince the Republic of Guinea committed to maintain the Mining Concession will be renewed as long asfor the entire duration of the Revised Convention de Base remains in force;Mining Convention;
•SAG’s operations remain governed by the 1995 Guinea Mining Code (the prior mining code) and are only subject to the provisions of the Guinea Mining Code to the extent they are expressly set out in the Revised Convention de Base;Mining Convention;
•the stability of the customs and tax regime is guaranteed for the entire initial term of the Revised Mining Convention, de Base, and subject to certain conditions being met, any renewal period(s);
•the Republic of Guinea holds a 15 percent free-carried/non-contributory interest;
•the Republic of Guinea is entitled to a royalty on gold of 5five percent based on a spot gold price as per LBMA fixing (PM) up until the date of steady state commercial production of the first phase of the Expansion, after which the royalty rate applicable to gold will vary depending on threshold prices as per LBMA fixing (PM), namely: 3three percent if the gold price is USD 1,300$1,300 or less, 5five percent, if above USD 1,300$1,300 and up to USD 2,000$2,000 and 7seven percent if above USD 2,000;$2,000;
•SAG will enjoy abenefits from 5-year income tax holiday as and from the beginning of steady state commercial production of the first phase of the Expansion, after which the income tax rate is set at 30 percent;
•a local development tax of 0.4 percent is payable on the sale price for gold and silver received by SAG up until 31 December 2027, after which it will be increased to 0.6 percent;
•salaries of expatriate employees are subject to a 10ten percent income tax;
•goods imported into Guinea for purposes related to the construction and commissioning of the first phase of the Expansion are exempt from all customs taxes and duties; and
•SAG is committed to adopting and progressively implementing a plan for the effective rehabilitation of the mining areas disturbed or affected by its operations.
The Mining Concession covers an area divided into four blocks and totalling approximately 1,495 km2. SAG has the exclusive right to explore and mine in any part of the concession area for the duration of the Revised Convention de Base.Mining Convention. The Revised Mining Convention de Base also grants SAG with the option to secure certain land rights over additional areas currently covered by exploration permits, but to which SAG may need access for purposes of establishing roads or storage of tailings. While the Mining Concession expired on 4 August 2022, a renewal request had been filed prior to its expiry in accordance with the provisions of the Revised Mining Convention on 1 February 2022. Pursuant to the Revised Mining Convention, the Mining Concession can be renewed for one or more period(s) that cannot exceed ten years each as long as the Revised Mining Convention is in force.
The Revised Mining Convention de Base is subject to early termination if the parties formally and expressly agree to it, if the last of the mining title held by SAG expires or is relinquished without any renewal application having been filed, if all project activities are voluntarily suspended for a continuous period of 12 months or are permanently abandoned by SAG,, or if SAG goes into voluntary liquidation or is placed into liquidation by a court of competent jurisdiction.
Mali
General laws relating to mining
Mining Reform
The mining industry in Mali is currently undergoing a reform as the mining code enacted on 27 February 2012 (2012 Mali Mining Code), which, until recently, was the primary regulation in the mining sector, was replacedprimarily regulated by ordinance No.2019-022/Ordinance No. 2019-022/P-RM dated 27 September 2019 containing the new mining code of the Republic of Mali (2019(the “Mali Mining Code”) and Decree No. 2020-0177/PT-RM dated 12 November 2020 implementing the Mali Mining Code). The revision process of MalianCode. On 8 December 2020, Decree No. 2020-0288/PM-RM enacted the new model mining legislation is not yet completed as the 2019convention referred to in Decree No. 2020-0177/PT-RM.
The Mali Mining Code isapplies to be supplemented by one or several decree(s) containing the conditions of implementation of the 2019 Mali Mining Code. While the 2019 Mali Mining Code has entered into force, it appears that the Malian authorities are awaiting the finalization of the various implementing decree(s) to actually enforce the 2019 Mali Mining Code.
Pending the effective enforcement of the 2019 Mali Mining Code by the Malian authorities, the mining operations previously carried out by AngloGold Ashanti entities in Mali (as further described below), benefit from the stabilisation clauses in their mining conventions, and thus remain subject to the provisions of the previous mining codes of 1970 and 1991 and are also, for residual matters, expressly subject to the provisions of the 2012 Mali Mining Code. The transitory rules of the 2012 Mali Mining Code specify that provisions in respect of certain matters such as administrative surveillance, mine police, rehabilitation and mine closure apply to mining titles issued prior to its entry into in force.
Once the 2019 Mali Mining Code is enforced by the Malian authorities, AngloGold Ashanti entities in Mali will be subject to all the provisions of the 2019 Mali Mining Code except with respect to the validity, scope and duration of their exploitation permits and the provisions on tax and customs regime contained in their mining conventions (conventions d’établissement) for their remaining duration. In this regard, the transitory
rules of the 2019 Mali Mining Code specify that mining conventions in force remain valid for their remaining term and their holders continue to benefit from the stability of the tax and customs regime set out therein.therein.
Mining regime
The mining regime deriving from the 2019 Mali Mining Code remains incomplete to date, pending the adoption of the implementing decree(s).
Exploration and prospecting activities are carried out under exploration authorizationsauthorisations (autorisation d’exploration) or exploration permits (permis de recherche). Exploration authorizations and exploration permits, which give their holder the exclusive right to carry out exploration activities over a given area. Exploration authorizationsauthorisations are granted by the Mining Administration (Administration chargée des Mines) for a non-renewable period of three years,months, while exploration permits are granted by Ministerial Order for a period of three years renewable twice for additional 3-year periods.
Applications for exploration authorizationsauthorisations and exploration permits must contain various documents attesting to the financial and technical capacity of the applicant as well as a detailed works and costs programme. Exploration authorizations are granted by the Mining Administration (Administration chargée des Mines) while exploration permits are granted by Ministerial Order.
A large scale permit exploitation permit (permis d’exploitation de grande mine) is required to mine a deposit located within the area of an exploration permit. The large scale exploitation permit and grants the holder an exclusive right to exploit the named substances and proceed with the processing and commercializationcommercialisation of the substances extracted within its perimeter. Large scale exploitation permits are granted by decree of the Head of Government for a maximum period of 12 years renewable for 10ten year-periods until depletion of the deposits. The large scale exploitation permit is granted only to the holder of an exploration permit and covers only the area governed by the exploration permit. An application must be submitted to the Mining Administration (Administration chargée des Mines).
and must contain various documents attesting to the financial and technical capacity of the applicant, a feasibility study, a detailed environmental study in respect of the impact of the project on the environment, an environmental permit, a closure and rehabilitation plan as well as a community development plan. As soon as the large scale exploitation permit is granted, the permit holder must incorporate a company under the laws of Mali. The permit holder willMali and assign the large scale exploitation permit for free to this company. The State will have a 10ten percent free-carried interest in the company. This interest will be converted into priority shares and the State’s participation will not be diluted in case of an increase in capital. In addition, the company is required to ensure that private Malian investors are offered the possibility to acquire 5five percent of their capital.
Applications for large scale exploitation permits must contain various documents attesting to the financial and technical capacity of the applicant, a feasibility study, a detailed environmental study in respect of the impact of the project on the environment, an environmental permit, a closure and rehabilitation plan as well as a community development plan. The large scale exploitation permit is granted by decree of the Head of Government.
All mining titles mentioned above (save for the exploration authorisation) require an establishmenta mining convention (convention d’établissement) to be signed by the State and the titleholder defining their rights and obligations, the duration of which is 20 years.
AngloGold Ashanti’s rights and permits
Historically, AngloGold Ashanti had interests in the Morila, Sadiola and Yatela gold mines, all of which arewere governed by establishmentmining conventions (conventions d’établissement) covering exploration, mining, treatment and marketing in a comprehensive document. These documents include general provisions regarding exploration (work programme, fiscal and customs framework) and exploitation (formation of a local limited liability mining company, State interest, fiscal and customs framework governing construction and exploitation phases, exchange controls, marketing of the product, accounting regime, training programmes for local labour, protection of the environment, reclamation, safety, hygiene and dispute settlement). AngloGold Ashanti complied with all applicable requirementsThe Morila and Sadiola gold mines were sold in November and December 2020, respectively.
In April 2017, Société d’Exploitation des Mines d’Or de Yatela S.A. (“Yatela”), the relevant permits were issued (subjectcompany operating the Yatela gold mine, began the implementation of a closure plan in order to relinquish the developments regarding the permit for Yatela, as described below).
Morila’s exploitation permit covers approximately 200 km2 and was issued on 4 August 1999. Morila has a 30-year permit which expires in 2029. Mining of ore has ceased at Morila.
On 23 Decemberproperty. In February 2019, AngloGold Ashanti announced that it, together withand its joint venture partner IAMGOLD Corporation has agreedannounced an agreement to sell each of their 40 percent interests in Société d’Exploitation des Mines d’Or de Sadiola S.A.Yatela to Allied Gold Corp. This salethe Government of Mali, which holds the remaining 20 percent interest. Completion of the transaction is subject to the fulfilment or waiver of a number of conditions precedent which are expectedand has been delayed several times since 2019 due to be fulfilled or waived by the end of April 2020. Sadiola’s prospectingpolitical instability and exploitation agreement covers approximately 303 km2 and was originally entered into on 5 April 1990. Sadiola has a 30-year permit which expiresrelated events in 2024.
On 14 February 2019, AngloGold Ashanti sold, together with its joint venture partner IAMGOLD Corporation, their holdings in Société d’Exploitation des Mines d’Or de Yatela to the Government of Mali. Certain conditions precedent currently remain outstanding. Prior to the sale, Yatela had begun the implementation of a closure plan in order to relinquish the property. In parallel, discussions had been ongoing for the Government of Mali to take over the residual operations as well as the implementation of the closure plan. In the course of these discussions, an administrative error occurred, leading to the cancellation of Yatela’s permit through decree 2017/0613/PM-RM dated 28 July 2017, notified to Yatela on 5 October 2017. This error has since then been corrected through the issuance of decree 2017-00951/PM-RM dated 28 November 2017 and decree n°2018-0368/PR-RM dated 12 April 2018, the purpose
of which was to reinstate Yatela in all of its rights under its exploitation permit.COVID-19 pandemic. Yatela’s exploitation permit covers approximately 212 km2. Yatela has a 30-year permit which expires in 2030.
Tanzania
General laws relating to mining
Tanzania Mining Act and Tanzania Mining Regulations
Mineral rights in the United Republic of Tanzania are principally governed by the Mining Act, 2010 (No. 14) (Tanzania Mining Act)Chapter 123 (R.E. 2019), as amended in 2017 by the Written Laws (Miscellaneous Amendments) Act, 2017 (No. 7) and which was revised and published by the Attorney General of Tanzania on 30 October 2018 as the(the “Tanzania Mining Act, Chapter 123 (R.E. 2018),Act”) and the Mining Regulations, 2010 (Tanzania2018 (the “Tanzania Mining Regulations), as amended in 2018, which include: Mining (Mineral Beneficiation) Regulations, 2018 as amended in 2019; Mining (Minerals and Mineral Concentrates Trading) Regulations, 2018 as amended in 2019; Mining (Radioactive Minerals) Regulations, 2018; Mining (Local Content) Regulations, 2018 as amended in 2019; Mining (Geological Survey) Regulations, 2018; and the Mining (Audit and InspectionRegulations”). The Tanzania
Table of Records) Regulations, 2018. Other regulations are: Mining (Environmental Protection For Small Scale Mining) Regulations, 2010; Mining (Safety, Occupational Health and Environmental Protection) Regulations, 2010; Mining (Mineral and Gem Houses) Regulations, 2019; Mining (Mining Shareholding and Public Offering) Regulations, 2016 as amended in 2017; Mining (Diamond Trading) Regulation, 2019; Natural Wealth and Resources (Permanent Sovereignty) Code of Conduct for Investors in Natural Resources Regulations, 2020 (Permanent Sovereignty Regulations); and The Natural Wealth Contracts (Review and Re-Negotiation of Unconscionable Terms) Regulations, 2020. The application of the Code of Conduct under the Permanent Sovereignty Regulations extends to employees, agents, suppliers and consultants and requires them to comply with other binding instruments and decisions made based on such instruments, in addition to policies, laws and regulations. The Permanent Sovereignty Regulations make it mandatory to seek the advice of an office bearer or the office of Attorney General, if the requirements of the Code, provisions of the Mining Act or other instruments relating to natural wealth and resources become ambiguous, unclear or in conflict resulting into uncertainty. Further, the Code of Conduct requires investors to conduct periodic reviews in respect of their compliance with such legislation in order to ensure that the investment does not result into unconscionable behaviours prohibited by the laws of Tanzania.Contents
The Tanzania Mining Act and the Tanzania Mining Regulations came into force in November 2010 followed by amendments to the Tanzania Mining Act in 2017 and subsequent amendments to the Tanzania Mining Regulations in 2018 and 2019.
Amendments of the Tanzania The Mining Act(Local Content) Regulations were amended and the Tanzania Mining Regulations
As mentioned above, the Tanzania Mining Act was amended in 2017 followed by an amendment of the Tanzania Mining Regulations in 2018,came into force on 23 September 2022. Those amendments, together with an Executive Order, introducing the following:
Dissolution of the Tanzania Minerals Audit Agency whose functions and powers have now been transferred to the Geological Survey of Tanzania (GST);
Dissolution of the Mining Advisory Board and introduction ofintroduced, among other matters, (i) the Tanzania Mining Commission. The functions and powers of the Mining Advisory Board have been taken over by the Mining Commission, including the functions of the Commissioner for Minerals. However, the Mining Commission has been made responsible for matters related to auditing and monitoring of mineral production in Tanzania. The Mining Commission has powers to audit quality and quantity of mineral produced and exported by mining entities, financial records of mining entities for the purposes of tax assessments, and environmental management expenditures of the mining entities for the purpose of assessment of compliance to the mine closure plan. Mineral rights holders were required to submit all geological information in their possession to the GST;
ACommission; (ii) local content requirementrequirements in employment and for procurement of goods and services: the Tanzania Mining Act requires that mining companies must give: (i) first consideration to good and services provided or manufactured in Tanzania where they meet mining industry specifications (established by the Standards Authority / internationally acceptable standards), (ii) first consideration for employment to qualified Tanzanians, andservices; (iii) adequate provision for on-the-job training of Tanzanians. Specific minimum local content thresholds are specified in Schedule 1 to the Tanzania Mining Regulations. These will be determined by the Mining Commission alongside the work programme. The relevant Minister may prescribe additional minimum local content thresholds;
To qualify for holding a Mining Licence in Tanzania, 5requirements of five percent of a licensee’slicencee’s equity mustto be held by Tanzanians, with at least 80 percent of its managerial positions to be held by Tanzanians and 100 percent of non-managerial and other positions to be held by Tanzanians, in addition to the shareholding of the Government of Tanzania pursuant to Section 10 of the Tanzania Mining Act (i.e. free-carried interest). This amount is determined,; and may be varied, by the relevant Minister;
Establishment of the Local Content Committee (LC Committee) which will oversee the implementation of the Tanzania Mining Regulations and which is composed of a member of the Mining Commission, the Director of Labour and Employment, a member of the Tanzania Private Sector Foundation, the CEO of the Geological Survey of Tanzania, the head of legal services at the Ministry for Minerals and the Executive Secretary of the Mining Commission. The LC Committee sets minimum standards for local content plans and reports to the Mining Commission;
Introduction of a statutory procedure(iv) regulations for the conductgovernment warehousing of Corporate Social Responsibility (CSR), whereby a company is requiredminerals prior to prepare annually a credible CSR plan jointly agreed with the local government authorities in consultation with the Minister for Finance and the Minister for Local Government Authorities; andexport/sale.
Cancellation of retention licences; right over such licences revert to the Government of Tanzania.
Minimum shareholding and public offering
TheIn 2016, the Mining (Minimum Shareholding and Public Offering) Regulations, 2016, came into force by Government Notice No. 286 published on 7 October 2016 and revised by amendment on 24 February 2017. On 10 January 2018, the Government of Tanzania published its new Tanzania Mining Regulations, 2018, which contain, amongst others, the implementation provisions of theas amended, Tanzania Mining Act.
was adopted. The regulations set out the requirement to sell shares to Tanzanian nationals, by way of a public offering and listing on the Dar es Salaam Stock Exchange, which will apply to companies that are carrying out large scale mining operations. The regulations also require all existing holders of a special mining licence to list a minimum of 30 percent of their shares on either the Main Investment Market or the Enterprise Growth Market Segment of the Dar es Salaam Stock Exchange within 6six months of the regulations coming into force, which was on 24 February 2017. However, we believethe Company believes the listing requirement conflicts with the mining development agreement. In September 2020, the Government of Tanzania published the Mining (Minimum Shareholding and Public Offering) (Amendment) Regulations, 2020, which exempts companies holding special mining licences from local listing requirements if such mining company has entered into an agreement with the Government of Tanzania that provides for a non-dilutable free-carried interest in such mining company and an economic benefits sharing arrangement.
Arbitration
Along with other major mining companies, AngloGold Ashanti’s subsidiaries are seeking a constructive dialogue with the Government of Tanzania to gain assurances that the Geita gold mine will not be affected by therecent legal and fiscal changes mentioned above, givenadopted by the Government in light of their mining development agreements which guarantee (i) fiscal and regulatory stability, as well asand (ii) an agreement between all parties before material legal and regulatory changes are made. As a precautionary step to safeguard its interests, AngloGold Ashanti commenced international arbitration proceedings against the Government of Tanzania in connection with the enactment of this legislation in July 2017. These arbitral proceedings are currently stayed until 13 May 2020 in order to afford the parties the opportunity to achieve an amicable resolution of the dispute.
The arbitration action against the Government of Tanzania seeks declaratoryDeclaratory relief is sought in accordance with the terms of the company’s existing mining development agreement to preserve the company’its and its shareholders’ rights and interests in the Geita gold mine, includingmine. AngloGold Ashanti is seeking confirmation from the Government of Tanzania that, the company is exempt from the listing requirement. The arbitration proceedings also seek to confirm that AngloGold Ashanti does not, as a result of its existing mining development agreement, the company does not fall within the scope of the new mining legislation under whichthat includes, among other things, (i) listing requirements; (ii) an increase in the rate of revenue royalties from four to six percent and a one percent clearance fee; and (iii) a right for the Government of Tanzania has the right to (i)(a) renegotiate existing mining agreements at its discretion, (ii)(b) receive a non-dilutable, free-carried interest of no less than 16 percent in all mining projects, and (iii)(c) acquire up to 50 percent of the shares of the mining company commensurate with the total tax expenditure incurred by the Government in favour of the mining company, and which includes an increase in the rate of revenue royalties from 4 to 6 percentand a 1 percent clearance fee.company. AngloGold Ashanti can provide no assurance that the new mining legislation, including the listing requirement,requirements, will not apply to its operations in Tanzania and the outcome of the arbitration action may have a material adverse impact on the company’s results of operations and financial condition. See also “Item“Item 8A: Legal Proceedings-Tanzania”.
MineralCategories of mineral right licences
Ownership of and control over minerals on, in or under the land vest in the President of the United Republic of Tanzania. No person is allowed to prospect for minerals or carry on mining operations except pursuant to the authority of a mineral right licence granted, or deemed to have been granted, under the Tanzania Mining Act or its predecessor acts. To enable a company to prospect or mine, the Tanzania Ministry of Minerals (MEM)Mining Commission (“MC”) initially grants an exclusive prospecting licence. Upon presentation of a feasibility study, together with certain other environmental, social and financial assurances, the MEMMC may then grant a form of licence for mining. Licensing decisions take into account the abilitiesThree categories of the company (including its mining, financial and technical capabilities), projected rehabilitation programmes, environmental compliance and the payment of royalties.
The following licences can be applied for under the Tanzania Mining Act:
licences for exploration, licences for mining, and licences for ancillary activities. Licences for Exploration:
exploration include prospecting licence;licences and
gemstone prospecting licence.
licences. Licences for Mining:
mining include special mining licencelicences (if the proposed capital investment is equal to at least USD 100$100 million);
, mining licencelicences (if the proposed capital investment is equal to between USD 100,000$100,000 and USD 100$100 million); and
primary mining licencelicences (reserved for Tanzanian citizens).
Licences for Ancillary Activities:
processing licence;
smelting licence; and
refining licence.
For purposes of AngloGold Ashanti’s Geita gold mine, only prospecting and special mining licences are relevant.
A prospecting licence grants the holder the exclusive right to prospect in the area covered by the licence for all minerals within the class of minerals applied for. The classes that can be applied for include, amongst others, metallic minerals; energy minerals; gemstones other than kimberlitic diamonds; and kimberlitic diamonds.
An application for a prospecting licence is made to the Mining Commission and the licence, once granted, is valid for an initial term of four years. After the initial term, the licence is renewable for a further period of three years, with no option for renewal thereafter. Upon renewal, 50 percent of the area covered by the licence must be relinquished. A company applying for a prospecting licence must, amongst other things, state the financial and technical resources available to it.
Holders of prospecting licences over a tenement will not automatically have first right to any mining licence granted over that tenement. However, in practice, they will be best positioned to meet the requirements to be granted a form of licence for mining.
Holder of prospecting licences have the obligations to: (i) commence prospecting operations within three months or such further period as the Mining Commission may allow from the date of the grant of the licence or the date as stated in the licence as commencement date; (ii) give notice to the Mining Commission on discovery of any mineral deposit of potential commercial value; and (iii) adhere to the prospecting programme which is attached to the licence and expend on prospecting operations not less than the amount prescribed.
A prospecting licence is not freely transferable and requires the Mining Commission to be notified of any transfer of a prospecting licence. The Mining Commission will refuse to register the transfer unless the transferee proves that it meets the financial and technical capability criteria required to apply for such licences.
Mining Licence / Special Mining Licence
Mining is mainly carried out through either a mining licence or a special mining licence, both of which confer on the holder the exclusive right to conduct mining operations in or on the area covered by the licence. A special mining licence is granted for the shorter of either the estimated life of the ore body indicated in the feasibility study report or such period as the applicant may request. It is renewable for a further period not exceeding the estimated life of the remaining ore body.
The holder of a special mining licence may apply for renewal of its licence at any time but no later than one year before the expiry of the licence. Thelicence and such renewal shall not be for a period exceeding the estimate life of the remaining ore body. The Mining Commission may reject an application for renewal if: (i) the applicant is in default; (ii) the applicant was issued with a noticeSpecial
Except in the case of a special mining licence, a mineral right may be freely transferred by its holder (in whole or in part) to another person or entity without requiring consent from the Mining Commission which is the relevant licensing authority. The grant and assignment of a special mining licence generally requires the approval of the Cabinet after the Mining Commission has forwarded the application to the Minister of Minerals for further approval. There are limited exceptions to the requirement for the licensing authority’s consent (such as transfers to an affiliate company of the licence holder or to a financial institution or bank as security for any loan or guarantee in respect of mining operations).
Special mining licences have certain fiscal and other advantages over mining licences, as the holder of a special mining licence may enter into a mining development agreement with the Government of Tanzania to guarantee the fiscal stability of a long-term mining project and make special provision for the payment of royalties, taxes, fees and other fiscal imposts and aimposts. A special mining licence holder may, in certain circumstances, unilaterally amend the programme of the mining operations agreed with the MEM.MC.
Tax laws relating to mining
Finance Act
TheCurrently, the main tax laws in Tanzania comprise the Finance Act, 2015 (No. 16), which was assented to on 28 June 2015 and came into force on 1 July 2015, contains a provision for a 30 percent capital gains tax on the sale of shares by an offshore parent company. This provision was introduced by the Finance Act, 2012 (No. 8) and in this legislation, additional changes were also made to the procedure for payment of capital gains tax by the seller of shares. Tax at the rate of 30 percent is payable by way of an initial instalment of 20 percent on the transfer, based on the notional gain that the seller would make after a further instalment of the remaining 10 percent is due.
The Finance Act, 2017 (No. 4), which came into force on 1 July 2017, and imposescurrently the Finance Act, 2022 (No. 5), which came into force on 1 July 2022. All tax laws impose and altersrevise certain taxes, duties, levies and fees. It further amends certain written laws relating to the collection and management of public revenue. Among other provisions, it has introduced inspection or clearance fees on the exportation or domestic use of minerals.minerals were introduced. Such exportation or domestic use is restricted unless
such minerals have been inspected or cleared at the mining areas, ports, airports, border or posts and the clearing fee of 1one percent of the gross value of the minerals has been paid by the exporter or any other person in possession thereof. Local government levies and environmental management fees and charges apply as well.
Value Added Tax Act
TheEffective 20 July 2017, the Value Added Tax Act, 2014 (No. 5) (VAT Act), which came into force on 1 July 2015, restricts(the “VAT Act”) was amended in order to restrict VAT relief on purchases madefor VAT input tax paid by mining companies. Thecompanies on goods and services. Prior to the enactment of this amendment to the VAT Act, is specific in that it provides that no purchase by companies is exempt or zero rated, unless specified by the law. Previously mining companies were entitled to 100 percent VAT relief.
Local Government Levies
As mentioned below, followingrelief in respect of the signaturegoods and services they purchased. The amendment prohibits refunds for VAT input tax incurred on a series of an addendumraw products, including the exportation of “raw minerals”. Subsequently, the Tanzania Revenue Authority (“TRA”) denied our applications for VAT input credit refunds, which amounted to a total of $153 million (after discounting provisions) as of 31 December 2022, covering the mining development agreement, Geitaperiod from July 2017 onwards, on the basis that all of the gold mine is required to pay local government a service levydoré that we export constitutes “raw minerals” for purposes of 0.3 percentthe VAT Act. In response, the company filed formal notices of its gross annual turnover in lineobjection with the Local Government Finances Act, 1982 (No. 9).
Environmental Management Fees and Charges
The Environmental Management (Fees and Charges) (Amendment) Regulations, 2016 (EM Regulations), which came into effect on 2 May 2016, introduced new feesTRA stating that the exportation of gold doré is, in relation to the review of the Environmental Impact Assessment on projectsits view, not covered by the National Environmental Management Council (NEMC). According torestriction since doré does not fall within the EM Regulations, the fees involved are “0.1 percentcategory of the total project costs”. However, the EM Regulations have not defined the term “project cost” nor have they provided a detailed breakdown on the determination of the project cost.
Labour laws
On 15 September 2015, the Non-Citizens (Employment Regulation) Act, 2015 (No. 1) (Non-Citizens Act) came into force. The Non-Citizens Act vests powers concerning work permits with the Labour Commissioner. Therefore, non-citizens wishing to be employed“raw minerals” as used in the country are requiredVAT Act. On 22 February 2019, the Tanzania Mining Act was amended to apply and be grantedintroduce a work permit before applyingdefinition for a residence permit. Before granting“raw minerals” which supports our interpretation that gold doré is excluded from the work permit,prohibition. On 1 July 2020, the Labour Commissioner must satisfy himself that all efforts have been exploredFinance Act, 2020 (No. 8), amended the VAT Act, without retrospective effect, in order to acquire a local expert. Further,remove the company is required to submit a succession plan which sets out a well-articulated planrestrictions on VAT input tax credits for the transferexportation of the non-citizen’s knowledge and expertise to Tanzanian citizens. Moreover, the Commissioner General of Immigration is required to take into consideration conditions of the work permit issued by the Labour Commissioner when granting a residence permit. Previously, the issuance of a residence permit was inclusive of a work permit. The resident permit covered working and living in Tanzania.
Further, the Non-Citizens Act introduced the Short-Term Permit (STP). The STP is granted to non-citizens who wish to work in the country for a period of not more than six months. Foreigners intending to work in Tanzania for more than three months are required to apply for an STP. The application for an STP is made to the Ministry of Labour and Employment.
Section 46(6) of the Social Security Laws (Amendments) Act, 2012 (No. 5) amended the National Social Security Fund Act, 1997 (No. 28) by providing that “an employer of a non-citizen shall remit contribution for such employee in accordance with the Act”. This means that from 15 June 2012 non-citizens are also required to be insured as any other person and their contributions should be channelled to the Nationals Social Security Fund.
The Workers’ Compensation Act, 2008 (No. 20) requires a company as the employer to contribute 1 percent of the employee’s salary and fixed allowance to the Workers Compensation Fund. Following the adoption of the Workers’ Compensation Regulations 2016, all employers were required to implement the requirements of the Workers’ Compensation Act by 30 June 2016.
Transparency and accountability laws
In 2015, the Tanzania Extractive Industries (Transparency and Accountability) Act, 2015 (No. 23) (TAA) came into force. The TAA establishes the Tanzania Extractive Industries (Transparency and Accountability) Committee (TAA Committee), an independent Government entity which is an oversight body for promoting and enhancing transparency and accountability in the extractive industry.
The TAA Committee has powers under the TAA to impose obligations on specified extractive industries and statutory recipients to receive information on reconciliation on payments made and revenues received by the Government of Tanzania. In addition, an extractive industry is required under the TAA to submit to the TAA Committee annual reports containing information on local content and corporate social responsibility. Further, the TAA demands all concessions, contracts and licences to be made public“raw minerals” as well as all revenue collecteda series of other raw products. This recent amendment confirms the technical basis for VAT input tax recovery for mineral exporters from July 2020 onwards. VAT claims from July 2020 onwards are subject to verification procedures by the extractive industry.TRA before any refunds will be received. In 2022, the company was able to offset $45 million of verified VAT claims (from July 2020 onwards) against its corporate tax liability in Tanzania. Discussions with the TRA are ongoing to resolve our historical claims for VAT input credit refunds for the period from July 2017 to June 2020.
Natural resources, export and other rules
Natural resources legislation
The Government ofIn Tanzania, enacted two laws in respect of natural resources that came into force in July 2017: the Natural Wealth and Resources Contracts (Review and Re-negotiation of Unconscionable Terms) Act, 2017 (No. 6) (Unconscionable(the “Unconscionable Terms Act)
Act”) and the Natural Wealth and Resources (Permanent Sovereignty) Act, 2017 (No. 5) (Permanent(the “Permanent Sovereignty ActAct” and together with the Unconscionable Terms Act, the Natural“Natural Resources laws)Laws”).
Implementing regulations were published in January 2020. The Natural Resources lawsLaws provide that Tanzania has sovereignty over its natural resources and require that all arrangements or agreements that relate to “natural wealth and resources” are subject to review by the National Assembly. Such agreements must fully secureAssembly to ensure that they are in the interests of the people of Tanzania. During a review all unconscionable terms as interpreted in accordance with the law are expunged from the agreement. The laws also require that new natural resources agreements are reviewed by the Government. The natural wealth and resources of Tanzania shall be inalienable and remain as the property of the people of Tanzania held in trust by the President.
In addition, under the laws, disputes over natural wealth and resources will not be subject to any proceedings in any foreign court or tribunal. As a result, investors are restricted from accessing international dispute resolution mechanisms. Accordingly, companies are now required to adopt Tanzanian law and local dispute resolution in all mining agreements. As such, all disputes will be handles by Tanzanian judicial bodies or any other Tanzania government body vested with powers to resolve disputes.
Moreover, every undertaking must demonstrate “guaranteed returns into the economy” from all earnings accrued or derived from such extraction, exploitation or acquisition and use. In addition, to ensure that the Government and the people of Tanzania obtain an equitable stake in the exploitation of mining resources, all project earnings must be retained in Tanzanian banks. Investors are also prevented from freely exporting raw minerals and repatriating funds.
In particular, under the Unconscionable Terms Act, a term is considered “unconscionable”, if the requirements or provisions of the agreement:
Aim at restricting the right of the state to exercise full permanent sovereignty over its wealth, natural resources and economic activity;
Are restricting the right of the state to exercise authority over foreign investment within the country and in accordance with the laws of Tanzania;
Are inequitable and onerous to the state;
Restrict periodic review of life-time arrangements or agreements;
Secure preferential treatment designed to create a separate legal regime to be applied discriminatorily for the benefit of a particular investor;
Are restricting the right of the state to regulate activities of transnational corporations within the country and to take measures to ensure that such activities comply with the laws of the land;
Are depriving the people of Tanzania of the economic benefits derived from subjecting natural wealth and resources to beneficiation in the country;
Are by nature empowering transnational corporations to intervene in the internal affairs of Tanzania;
Are subjecting the state to the jurisdiction of foreign laws and foreign courts or tribunals;
Expressly or implicitly undermine the effectiveness of state measures to protect the environment or the use of environmental friendly technology; or
Aim at doing any other act the effect of which undermines or is injurious to the welfare of the people of Tanzania or the economic prosperity of the nation.
Section 6 of the Unconscionable Terms Act specifically provides that where there is an unconscionable term, the National Assembly may pass a resolution for re-negotiation of the agreement whereupon the Government shall serve notice to the investor to re-negotiate the term or agreement. The Government and the particular investor have 90 days from the notice date to re-negotiate the term or agreement. This period can be extended if both parties consent. If both parties fail to revise the unconscionable term, the term will be deemed removed from the agreement. A term is considered “unconscionable” under the Unconscionable Terms Act if, among other grounds, the requirements or provisions of the agreement restrict the right of the state to exercise authority over foreign investment within the country and in accordance with the laws of Tanzania, are inequitable and onerous to the state, secure preferential treatment designed to create a separate legal regime to be applied discriminatorily for the benefit of a particular investor, deprive the people of Tanzania of the economic benefits derived from subjecting natural wealth and resources to beneficiation in the country, or subject the state to the jurisdiction of foreign laws and foreign courts or tribunals.
State participation
On 23 September 2022, the Mining (State Participation) Regulations, 2022 (the “SPR 2022”) came into force. The SPR 2022 required every mining licence or special mining licence holder to give notice to the MC to initiate negotiations to enable the Government of Tanzania to acquire a shareholding in the mining operation by 23 December 2022. On 9 December 2022, the company notified the MC that it had already initiated negotiations with the Government of Tanzania prior to the coming into force of the SPR 2022. The Government’s equity interest must consist of a non-dilutable free-carried interest in the mining operation ranging between 16 percent and 50 percent depending, in part, on the quantification of tax expenditures enjoyed by the mining entity during its establishment and on the extent of Government development of public infrastructure servicing the mining operation. The free-carried interest shares (the “FCI shares”) will be regarded as preferred shares and will entitle the Government to a dividend. Further, the FCI shares give the Government the right to appoint two directors (out of five) of the company engaged in the mining operation and the right to approve at least two suitable persons to the top executive management of the company engaged in the mining operation as may be agreed in the shareholders agreement. Any other management positions created by the company engaged in the mining operation shall be shared with the Government on a ratio of 3:1. The SPR 2022 also provides for the non-deductibility of royalty payments in the calculation of corporate income tax.
Local participation policy
On 15 September 2015, the Non-Citizens (Employment Regulation) Act, 2015 (No. 1) (the “Non-Citizens Act”) came into force which vests powers concerning work permits with the Labour Commissioner. Therefore, non-citizens wishing to be employed in the country are required to apply and be granted a work permit before applying for a residence permit. Before granting the work permit, the Labour Commissioner must be satisfied that all efforts have been explored to acquire a local expert. Further, the company is required to submit a succession plan to both the Labour Commissioner and the MC which sets out a well-articulated plan for the transfer of the non-citizen’s knowledge and expertise to Tanzanian citizens. Moreover, the Commissioner General of Immigration is required to take into consideration conditions of the work permit issued by the Labour Commissioner when granting a residence permit.
The Tanzania Investment Act No. 10 of 2022
On 2 December 2022, the Tanzania Investment Act, 2022 (No. 10) (the “Investment Act”) came into force. The Investment Act restores the right to international arbitration and grants foreign investors access to settle disputes with the Tanzania Investment Centre or the Government of Tanzania through arbitration. Pursuant to the Investment Act, parties to a dispute may agree to the use of a local or foreign arbitration venue.
AngloGold Ashanti’s rights and permits
The Geita gold mine is located in the Lake Victoria goldfields of the Mwanza region of Tanzania. AngloGold Ashanti has concluded a mining development agreement with the Ministry of Minerals on 24 June 1999 and was issued a special mining licence (SML45/99) covering approximately 196 km2 for a period of 25 years, which expires on 26 August 2024.
The internal renewal process for the special mining licence (SML45/99) is underway with a view to submitting an application for renewal prior to its expiry date. On 9 October 2014, an addendum to the mining development agreement was entered into ratifying, the following changes:
Anamong other matters, an increase in the royalty rate from 3three percent to 4four percent with effect from 1 May 2012;
With effect from the financial year 2015, the capital allowance applicable to the unredeemed qualifying capital expenditure (15 percent per annum) referred to in section 18(a) of the Income Tax Act, 1973 (No. 33) shall no longer apply; and
With effect from 1 July 2014, Geita Gold Mining Limited is liable to pay the Geita District Council Levy at a rate of 0.3 percent on turnover (no longer capped at USD 200,000 per annum as provided under Article 4 of the company’s mining development agreement).
2012. In March 2020, Geita Gold Mining Limited received the consent of the Minister of Minerals to change the mining method under its special mining licenselicence from open pit to underground method, subject to the requisite terms and conditions. Within the special mining licence area, there are also seven primary mining licences of approximately 0.63 km2 in total which belong to third parties. Furthermore, AngloGold Ashanti holds prospecting licences covering (i) an area of 120 km2 in the immediate vicinity of its special mining licence area, and (ii) an area of 690 km2 located in the Dodoma, Singida and Shinyanga regions, but none of these areas contain any Mineral Reserve. All licences are in good standing.
AUSTRALIA
General laws relating to mining
In Australia, with a few exceptions, all onshore minerals are owned by the Crown. The respective Minister for each state and territory is responsible for administering the relevant mining legislation enacted by the states and territories.
Native title legislation applies to certain mining tenements within Australia. Australia recognises and protects a form of native title that reflects the entitlement of Aboriginal people to their traditional lands in accordance with their traditional custom and laws. Should native title claims or determinations exist, certain native title processes and procedures will apply under the Native Title Act 1993 (Cth) (Native(the “Native Title Act)Act”) before the tenure is granted. Tenure may be granted subject to conditions relating to native title rights. In the mining context, native title matters are managed as part of the tenement grant process. If disputes arise in relation to the grant of a particular tenement, they can be referred to the National Native Title Tribunal, established under the Native Title Act, for resolution. Native title legislation also provides a framework for compensation to be paid for acts that affect native title rights and interests. Ordinarily, the relevant Commonwealth or State government is liable to pay compensation for acts attributable to it. However, underin the state of Western Australia, the Mining Act 1978 (WA) liabilityprovides that an applicant for compensation associated with native title can be passed back tothe grant of, or the holder of, a mining tenement at the time of a determination ofis responsible for native title compensation.compensation, if determined to be payable, to native title holders.
Federal, state and territory Aboriginal and non-Aboriginal heritage laws operate in parallel to the native title legislation. TheyState and territory heritage laws exist predominantly for the purposes of managing the impact of developments on sites, objects and areas of heritage significance. In Western Australia, impacts to Aboriginal cultural heritage are regulated by the Aboriginal Heritage Act 1972 (WA). However, this legislation will be repealed and replaced by the Aboriginal Cultural Heritage Act 2021 (WA) (the “ACH Act”) which was enacted in 2021. The regulations, management code and various guidelines which underpin the ACH Act are being co-designed by the State government, traditional owners, industry and other stakeholders. The ACH Act will not become fully operational until the co-design process is complete in mid-2023 at the earliest. Where an area of heritage significance is placed on the national or world heritage registers, federal approval processes may also apply. To date, there has not been any significant impact on any of AngloGold Ashanti’s tenure due to native title or heritage legislation.legislation and, at this stage, it is not possible to predict any significant impact that may result in the future from the final regulations, management code and various guidelines under the ACH Act, once adopted.
AngloGold Ashanti’s operating properties are located in the state of Western Australia where tenure is issued under, and mining operations are governed by, the Mining Act 1978 (WA). The most common forms of tenure in Western Australia are exploration and prospecting licences, mining leases, miscellaneous licences and general purpose leases. In most Australian states, if the holder of an exploration licence establishes indications of an economic mineral deposit in the area covered by the exploration licence and complies with the conditions of the grant, the holder of the exploration licence has a priority right against all others to be granted a mining lease which gives the holder exclusive mining rights with respect to minerals on the property. In Western Australia, a general purpose lease may also be granted for one or more of a number of permitted purposes. These purposes include erecting, placing and operating machinery and plants in connection with mining operations, depositing or treating minerals or tailings and using the land for any other specified purpose directly connected with mining operations.
It is possible for an individual or entity to own an area of land (including for infrastructure purposespurposes) and for another individual or entity to be granted the right to explore for or mine any minerals located on or under the surface of the same area. The maximum initial term of a mining lease in Western Australia is 21 years and the holder has the right to renew the lease for an additional 21 years. Subsequent renewals are granted at the discretion of the respective state or territory’s minister responsible for mining rights. In Western Australia, mining leases can only be assigned with the prior written consent of the minister.
Tax laws relating to mining
Government royalties are payable by the holder of mining tenure in respect of minerals obtained from the relevant area of land at the rates specified in the relevant legislation in each state or territory. The royalty on gold production in Western Australia is payable quarterly at a fixed rate of 2.5 percent of the royalty value of gold metal produced. The royalty value is calculated by multiplying the amount of gold produced during a given month by the average gold spot price for that month. In addition, the holder of a mining tenement is required to pay annual rent in respect of the tenement. In Western Australia there is a minimum annual expenditure requirement for prospecting and exploration licences and mining leases. Exemptions from the expenditure requirement can be obtained if certain conditions are satisfied.
Environmental laws relating to mining
Mining tenements will be granted with endorsements and conditions relating to protection of the environment. Exploration and mining operations may also require separate approval from the state, territory or federal environment minister, which may require completion of an environmental impact assessment (including a public consultation period) pursuant to applicable environmental protection legislation prior to commencement. Further, a works 'construction' approval and an operating licence under the relevant environmental protection legislation in the state or territory may also be required for certain mine processing or mining-related operations. In Western Australia, legislation removing the distinction between “works approvals” and “licenses” is expected to enter into force in December 2023 such that, following the effective date, only a “license” will be required for “prescribed activities”, which include relevant works and operations on a mining lease, and not a separate “works approval”. Depending on the jurisdiction, a further separate approvaladditional approvals may be required for the removal of native vegetation within the tenement.tenement, and the taking and use of water for exploration and mining operations.
AngloGold Ashanti’s rights and permits
AngloGold Ashanti has been granted 21-year term mining leases with rights of renewal to all of its mining areas in Australia, including its proportionate share of joint venture operations and accordingly it has, together with its joint venture partners where applicable, the exclusive right to mine in those areas. Both the groupGroup and its joint venture partners are fully authorised to conduct operations
in accordance with relevant laws and regulations. The mining leases and rights of renewal cover the current life-of-mine at AngloGold Ashanti’s operations in Australia.
At Sunrise Dam, one mining lease (M39/1116) covers the deposit is now situated upon two mining leases covering approximatelyand mine infrastructure (approximately 7,808 hectareshectares) and another mining lease of(M39/1117) covers the water extraction infrastructure used to supply the operation with water (approximately 1,768 hectares contains related infrastructure.hectares). Both leases are currently in good standing, with expiry dates in 2038.
The Butcher Well joint venture has security of tenure for all current exploration licences and for the contiguous mining leases that covers its Mineral Resource. There are three mining leases: mining lease (M39/165) which covers 602.35 hectares with expiry date in 2030, mining lease (M39/166) which covers 990 hectares with expiry date in 2030 and mining lease (M39/230) which covers 446.4 hectares with expiry date in 2032.
At Tropicana, the deposit is situated upon a single mining lease (M39/1096) covering approximately 27,228 hectares, which is currently in good standing, with an expiry date in 2036.
AngloGold Ashanti Australia Limited is also conducting early stage exploration activities in Queensland under the Mineral Resources Act 1989 (QLD). AngloGold Ashanti holds 1815 exploration permits covering 497,087316,851 hectares. Each permit is granted with an initial term of five years, renewable for two further periods of not more than five years. There is an entitlement to convert exploration permits to mining titles in the form of mining claims, mining leases or mineral development licences.years each.
AMERICAS
Argentina
General laws relating to mining and land ownership
Mining regime
The Argentinean Mining Code governs mining activity in the country. Special regimes exist for hydrocarbons and nuclear minerals. In the case of most minerals, the Argentinean Mining Code establishes that the owner of the land is not the owner of the mineral rights; these are held by the national or provincial governments (depending on the location of the minerals). The national or provincial government, as applicable, is required by the Argentinean Mining Code to grant whomever discovers a new mine title to the mining concession.
The Argentinean Mining Code regulates exploration permits andas well as mining concessions.concessions, or exploitation rights. Exploration permits grant their holders exclusivity rights to any mineral discoveries, including those made by a third party within the exploration area covered by the permit. Exploration permits are limited in time and as to the extent of the exploration area, are subject to the payment of a single-time fee, and also require a minimum exploration work programme and schedule to keep the permit in force.
The Argentinean Mining Code also regulates mining concessions, or exploitation rights. Priority for receiving a mining concession is given to the registered discoverer of the mine, which holds the exploration permit. Once the application for a mine has been submitted, the applicant may commence works and must submit a legal survey of the units requested for the new mine. The application and the legal survey may be opposed by third parties following specific proceedings set forth in the Argentinean Mining Code. Approval and registration of the legal survey by the provincial mining authority constitutes formal title to the mining concession.
Holders of mining concessions must comply with three main conditions: payment of an annual fee, investment of a minimum amount of capital, and the carrying out of a reasonable level of exploitation. Failure to do so could lead to forfeiture of the mining concession, which would then revert back to the Province.
In addition to the Argentinean Mining Code, between 1993 and 1995, Argentina implemented several federal laws to offer foreign companies attractive incentives for exploration and mining in Argentina, the Mining Investment Law (Law No. 24, 196), as amended (Mining(the “Mining Investment Law)Law”), and related legal provisions being the most important one. Such incentives include, amongst others,among other matters, import duty exemptions, accelerated depreciation of fixed assets, a 3three percent cap on provincial royalties set at pit-head value on the mineral extracted, value added tax refunds for exploration-related expenses incurred by companies registered under the Mining Investment Law, and, subject to the filing of a feasibility study for the relevant mining project, a 30-year stability as to the tax burden on the project and the customs and foreign exchange regimes and duties. Cerro Vanguardia S.A. (“CVSA”) obtained its tax, customs and foreign exchange stability certificate in 1996.
Glacier Law
On 30 September 2010, the National Law on Minimum Requirements for the Protection of Glaciers (Law No. 26, 639) (Glacier Law)(the “Glacier Law”) was enacted in Argentina, banning new mining exploration and exploitation activities on glaciers and “peri-glacial” areas. The Glacier Law also subjects on-going mining activities in those areas to an environmental audit. If such audit results in material impacts on glaciers and “peri-glacial” areas, the relevant authority is empowered to take action, including suspension or relocation of the activity. The Glacier Law establishes a broad definition of “peri-glacial” areas that, together with glacial areas, must be surveyed by an existing national government agency specifically appointed to this end every five years. The area where the Cerro Vanguardia project is located does not include any glaciers or peri-glacial areas according to the inventory of glaciers which was published in June 2018. The constitutionality of the Glacier Law has been challenged by some mining companies along with the
Province of San Juan (which hosts large mining projects), but the National Supreme Court of Justice of Argentina rejected these claims on 4 June 2019.
Rural Land Law
On 27 December 2011, the Argentinean National Congress passed a law on the Regime for Protection of National Domain over Ownership, Possession or Tenure of Rural Land (Law No. 26, 737) (Rural(the “Rural Land Law)Law”) which implemented a set of rules restricting the ownership of rural land by foreigners (including foreign individuals or any kind of legal entity controlled by foreign individuals or legal entities). The main restrictions are as follows: (i) foreigners cannot own in the aggregate more than 15 percent of the entire rural land of Argentina, the same cap being applicable to each Province and Municipality; (ii) foreigners will not be allowed to purchase more than 1,000 hectares in the so-called “zona núcleo”, which comprises the main agricultural areas of central Argentina or an “equivalent” surface depending on the location of the land and its productive potential; and (iii) foreigners will not be allowed to buy land that contains, or is adjacent to, relevant and permanent water bodies (such as rivers and lakes). Although exploration permits and mining concessions are not the subject matter of the restrictions placed by the Rural Land Law, certain rights granted to foreign mining companies under the Argentinean Mining Code may be restricted by this
new law. For example, the right that holders of mining concessions currently have to force the surface owner to sell the land to the holder of the mining concession might be restricted if the concession holder is a foreign individual or a legal entity controlled by foreigners.
Federal Mining Agreement
On 13 June 2017, the national government and the provinces in whose territories the main mining projects of Argentina are located, signed the New Federal Mining Agreement (FMA)(“FMA”). The purpose of the FMA is, amongst other things, to increase provincial revenues from the mining industry by creating legal entities owned by provincial governments that would work in association with private mining companies. This scheme is not new in Argentina and it has been used by some provincial governments, amongst them the Santa Cruz Province (through Fomicruz), in which the Cerro Vanguardia project is located. The FMA also contemplates other forms of revenues such as the formation of special trusts to be funded by mining companies in order to finance education, health and other programmes. Additionally, the FMA included setting forth mining royalties up to 3three percent of the gross value of commercializedcommercialised minerals, without any deductions other than VAT. As the FMA has not yet been converted into law by the National Congress, its provisions are neither binding nor enforceable.
In Argentina, the current regulatory regime of royalty payments is expected to change and several different options and payment thresholds have been discussed. In December 2012, the Santa Cruz Province changed the mining royalty from 1one percent to 3three percent calculated at pit-head value of the mineral extracted thus bringing it to the cap of the Mining Investment Law.
Foreign exchange control regimeand export rules
Foreign exchange controls
On 1 September 2019, by means of Executive Decree No. 609/2019 (Decree)(the “Export Controls Decree”), the Argentinean national government re-establishedreinstated foreign exchange and export controls. The Export Controls Decree imposes,and related regulations of the Central Bank of Argentina impose, among other measures, the obligation of Argentinean residents to transfer to Argentina and/or sell for Argentinean pesos in the Argentinean foreign exchange market (mercado libre(mercado de cambios)cambios) the countervalue (contravalor)(contravalor) from their exports of goods within 15 to 365 calendar days dependinga specified period. The export of goods is regulated by the Consolidated Text on the goods exported“Foreign Trade and the relationship with the importer. Regardless of the applicable maximum term, upon collection of the export, the proceeds thereof must be sold for Argentinean pesos in the Argentinean foreign exchange market no later than five business days from the date of collection.
The Decree also authorized the Central Bank of Argentina to establish the requirements for compliance with the measures set out therein. On the same date,Exchange” issued by the Argentinean Central Bank, as the regulatory authority in charge of administering the Argentinean foreign exchange market, issued Communication “A” 6770 establishing (as amended from time to time) which establishes the specific regulatory requirements in order to implement the measures adopted by the national government. The Argentinean Central Bank delegated the responsibility to follow up and supervise compliance with the repatriation obligation in this area. Prior approval of exporters to financial institutions. In this respect, it implemented the so-called “Follow-up regime for foreign exchange countervalue from exports of goods” (Seguimiento de las negociaciones de divisas por exportaciones de bienes or SECOEXPO). Upon the expiration of the applicable term to transfer and sell the proceeds of exports, the designated financial institution must inform the Argentinean Central Bank ifis generally required to access the exporter has compliedforeign exchange market for transactions relating to the outflow of funds, except in certain circumstances.
In October 2022, the Argentinean national government implemented the Argentinean System of Imports (Sistema de Importaciones de la República Argentina) (“SIRA”) and the Argentinean System of Imports and Foreign Payments of Services (Sistema de Importaciones de la República Argentina y Pagos de Servicios al Exterior). Importers must obtain a SIRA approval in the form of a SIRA certificate for the import of goods and to access the foreign exchange market for payments in connection with its obligations or not.the import of goods. Additionally, from 1 January 2023, Argentinean residents, such as CVSA, must comply with certain supplementary provisions in order to access the foreign exchange market without prior approval of the Argentinean Central Bank, unless an exception applies.
CVSA had a cash balance equivalent to $116 million at 31 December 2022. The cash balance is available to be paid to AngloGold Ashanti’s offshore ($105 million (equivalent)) and onshore ($15 million (equivalent)) investment holding companies in the form of declared dividends. Applications have been made to the Argentinean Central Bank to approve the purchase of U.S. dollars in order to distribute offshore dividends related to the 2019, 2020 and 2021 financial years of $105 million (equivalent) to AngloGold Ashanti. Also, under a special regime established for dividend payments, a new petition to distribute a portion of the offshore dividends applied for, in the amount of $54 million (equivalent), was submitted to the Argentinean Central Bank during the third quarter of 2022. In December 2022, the Argentinean Central Bank approved, based on the applications submitted under this special regime, the payment of $17 million (equivalent) to AngloGold Ashanti. As a result, during 2022, AngloGold Ashanti received offshore dividends from CVSA in a total amount of $17 million (net of withholding taxes) paid in U.S. dollars. While the remaining approvals are pending, the cash remains fully available for CVSA’s operational and exploration requirements.
Export duties
On 4 September 2018, export duties were imposed by Decree No. 793/2018 (Export Duties Decree) published by the Argentinean government which will be applicable until 31 December 2020. The export duty is set at 12 percent ad valorem. The Export Duties Decree, if not compensated with other tax reductions, affects the tax stability guarantee granted to Cerro Vanguardia S.A. (CVSA) in 1996 in light of the fact that at the time export duties were zero percent.
On 26 February 2019, the Argentinean tax and mining authorities published a resolution establishing a mechanism to reimburse or compensate federal taxes paid in excess of the total tax burden provided for by applicable tax stability guarantees. The resolution provides for an administrative procedure to be followed to prove that the actual tax burden is higher than the one a company should have based on its tax stability guarantee. Cerro Vanguardia S.A. initiated this procedure in order to claim reimbursement of, or compensation for, export taxes paid during 2018 in excess of the total tax burden provided for by its tax stability guarantee. The
National Mining Secretariat issued a favorable opinion regarding Cerro Vanguardia S.A.’s claim, which is currently under review by the relevant customs authorities (Customs Regional Division - Patagonia).
On 21 December 2019, the National Law on Social Solidarity and Productive Reactivation (Law No. 27, 541) (Solidarity Law)(the “Solidarity Law”) was enacted. The Solidarity Law grantsgranted the national government power until 31 December 2021 to impose export duties which may not exceed certain caps. For example, the Solidarity Law provides that export duties on mining exports cannot exceed 8%eight percent of the taxable value or official FOB price. On 2 October 2020, the national government published Decree No. 785/2020 (the “Export Duties Decree”) which sets an export duty rate of eight percent for certain goods, including doré bars and gold alloys, and revoked the provisions of Decree No. 793/2018 which had previously set the export duty at 12 percent ad valorem. While the Export Duties Decree was set to expire at the end of 2021, on 31 December 2021, the national government published Decree No. 908/2021, extending the deadline of export duties on certain goods, including doré bars and gold alloys, until 31 December 2023. It is currently unclearuncertain whether this 8% limit applies automaticallythe national government is empowered to extend such deadline beyond the date set forth in the Solidarity Law. These export duties, if not compensated with other tax reductions, affect the tax stability guarantee granted to CVSA in 1996 in light of the fact that at the time export duties were zero percent.
On 26 February 2019, the Argentinean tax and mining authorities published a resolution (RC 4428/2019) establishing an administrative procedure to be followed to obtain the reimbursement or whether it requirescompensation of federal taxes paid in excess of the issuance of a decreetotal tax burden provided for by the national government.applicable tax stability guarantee (the “2019 Procedure”). CVSA initiated the 2019 Procedure to claim compensation for the export duties it paid in 2018, 2019 and 2020 as export duties are not contemplated by its tax stability guarantee. Prior to the publication of RC 4428/2019, CVSA had already submitted to the tax authorities claims for reimbursement of the export duties it paid from 2008 to 2015.
Pursuant to the 2019 Procedure, the National Mining Secretariat issued favorable opinions regarding CVSA’s claims in respect of fiscal years 2018 and 2019, which amounted to approximately $2.0 million and $6.3 million, respectively, as of 31 December 2022. These claims are currently under review by the relevant customs authorities. On 14 July 2021, CVSA submitted its claim in respect of fiscal year 2020, which amounted to approximately $12.4 million as of 31 December 2022. The National Mining Secretary has not yet issued an opinion regarding this claim.
Furthermore, CVSA has requested the tax authorities to apply the 2019 Procedure in respect of its historical claims for fiscal years 2008 to 2015 during which the imposition of export duties also exceeded CVSA’s total tax burden under its tax stability guarantee. However, these claims, which amounted to approximately $3.1 million as of 31 December 2022, are still being reviewed under the rules to challenge export duties instead of the 2019 Procedure. CVSA has appealed the application of those rules and a decision on this issue is pending.
On 9 June 2022, the Argentinean tax and mining authorities published a resolution (RC 5205/2022) establishing a new administrative procedure to be followed to obtain the reimbursement or compensation of federal taxes paid in excess of the total tax burden provided for by the applicable tax stability guarantee (the “2022 Procedure”). This 2022 Procedure replaces the 2019 Procedure established by RC 4428/2019. On 20 September 2022, CVSA submitted its claim for compensation for the export duties in respect of fiscal year 2021, which amounted to approximately $11.2 million as of 31 December 2022, pursuant to the 2022 Procedure. This claim is currently under review by the National Mining Secretary.
In total, AngloGold Ashanti’s net export duty receivables (after discounting provisions) in Argentina amounted to $9 million as of 31 December 2022.
Environmental laws relating to mining
Any mining company wishing to commence or modify any mining-related activity, as defined by the Argentinean Mining Code, including prospecting, exploration, exploitation, development, preparation, extraction, and storage of mineral substances, as well as property abandonment or mine closure activity, is required to prepare and submit to the competent provincial environmental authority an Environmental Impact Assessment (EIA)(“EIA”) prior to commencing the work. Each EIA is required to describe the nature of the proposed work, its potential risk to the environment, and the measures that will be taken to mitigate that risk. If accepted by the competent authority, the EIA is used as the basis to create a Declaration of Environmental Impact (DEI)(“DEI”) to which the mining company is required to adhere during the mining-related activity at issue. The DEI is required to be updated at least on a biannual basis. Sanctions and penalties for non-compliance with the DEI are outlined in the Environmental Protection section of the Argentinean Mining Code, and may include warnings, fines, suspension of quality certifications, restoration ofobligations to restore the environment, temporary or permanent closure of activities, and withdrawal of authorisation to conduct mining-related activities.
AngloGold Ashanti’s rights and permits
In the caseThe mining concession holder of Cerro Vanguardia, AngloGold Ashanti’sthe Company’s operation in Argentina, the mining concession holder is AngloGold Ashanti’s partner, Fomento Minero de Santa Cruz S.E. (Fomicruz).(“Fomicruz”), which is wholly owned by the Santa Cruz Province. On 27 December 1996, Fomicruz entered into a usufruct agreement whereby Cerro Vanguardia S.A.CVSA was granted an irrevocable right to exploit the Cerro Vanguardia deposit (encompassing an area of approximately 543 km2) for a 40-year period,period. The mining licence (402642/CV/97), which covers the full Mineral Reserve, expires on 26 December 2036. Cerro Vanguardia S.A.CVSA is a corporation incorporated in Argentina indirectly controlled by AngloGold Ashanti (92.5 percent), with Fomicruz as minority shareholder.shareholder (7.5 percent). On 14 August 1996, Cerro Vanguardia S.A.CVSA obtained its tax, customs and foreign exchange stability certificate,, which expires in 2026.
Brazil
General laws relating to mining and land ownership
The Brazilian Constitution of 1934 states that, for purposes of exploration and exploitation, deposits and other Mineral Resources constitute property separate from the soil and belong to the Federal Union. Exploration and exploitation of such Mineral Resources may take place only with the Federal Union’s concession and in such a way as to protect the national interest. Federal law sets out penal and administrative sanctions for conduct and activities deemed harmful to the environment.
In Brazil, the National Mining Agency (ANM)(“ANM”) is the state body within the Mines and Energy Ministry (MME)(“MME”) that is responsible for: (i) the registration of mining titles, (ii) the grant of authorisations and concessions, (iii) the supervision of mining activities and mining titleholders, and (iv) the issuance of supplementary rules in relation to mining activity.
Under the current Brazilian Mining Code, there are two kinds of mines: (i) claimstake mines (minas manifestadas)(minas manifestadas), for which rights were acquired before 1934 and exist independently of any mining licence or authorisation from the Federal Government and for which the Mineral Resources constitute property of the landowner, and (ii) granted mines, which are those that rely on grants from the Federal Government for mineral exploration or exploitation (pursuant to the Brazilian Constitution of 1988). AngloGold Ashanti’s operations in Brazil consist of both claimstake mines and granted mines.
Mining activities in granted mines must be performed in two defined stages: (i) exploration, which entails defining and evaluating the deposit and determining the feasibility of exploitation, and (ii) exploitation, which involves coordinating operations aimed at the industrial exploitation of the mineral deposit, from the extraction of useful minerals to their processing. Exploration authorisations issued by the ANM are valid for one to threefour years. ExtensionsOne extension can be obtained if necessary,automatically as long as it is justified. For more than one extension, the extension request will have to satisfy specific legal requirements. In contrast, exploitation rights, once granted, are valid for the lifetime of the deposit, provided the mining titleholder complies with all legal requirements. Pursuant to these requirements, for example, titleholders must (i) start work on mineral exploitation within six months from the date of publication of the Exploitation Concession, (ii) continue their mining activities until the mineral deposit has been exhausted, in accordance with the Economic Exploitation Plan (Plano(Plano de Aproveitamento Econômico)mico) approved by the ANM, and (iii) refrain from suspending mining activities without prior notice to the ANM.
Tax laws relating to mining
During the exploration period, the mining titleholder has to pay an Annual Rate per Hectare (Taxa(Taxa Annual por Hectare or TAH)“TAH”), subject to a maximum value set by law. In the exploitation period, regardless of the legal regime governing the project (whether
claimstake or granted mines), the mining titleholder has to pay the Financial Compensation for Exploiting Mineral Resources (Compensaç(Compensação Financeira pela Exploração Mineral or CFEM)“CFEM”). The CFEM which is 1.5 percent for gold is currently calculated based on revenues.
At the end of 2011 and the beginning of 2012,, the states of Minas Gerais, Pará, Amapá and Mato Grosso do Sul each created a new “inspection and control” tax (duty) on research, extraction and exploration activities as well as on the use of Mineral Resource carried out in those states. This tax could range from BRL3.00 to BRL6.50 per ton of ore extracted. In the statesstate of Minas Gerais, and Goiás, however, gold ore wasand silver ore are exempted from the collection of this new duty. At the end of 2020, the state of Goiás created a new “inspection and control” tax (duty) on extraction and exploration activities carried out in this state, which currently still needs to be implemented. The constitutionality of these “inspection and control” taxes was upheld by the Supreme Court of Brazil on 1 August 2022.
Environmental laws relating to mining
Following the catastrophic failure of a tailings storage facility (TSF) operated(“TSF”) at the Córrego do Feijão iron ore mine owned by Vale at Brumadinho in the state of Minas Gerais in Brazil in January 2019, Brazilian executive, legislative and judiciary bodies, both at the federal and state levels, have generally increased scrutiny of mining operations in Brazil, and of TSFs in particular, and have been considering, and in some cases adopting,have adopted, stricter laws and regulations applicable to the approval, licensing, construction, management, closure and decommissioning of TSFs in Brazil. For example, some of the new measures under consideration or enacted include (without limitation):
A ban prohibiting construction of new upstream tailings dams;
New requirements mandating reinforcement and earlier-than-planned closure of existing upstream TSFs;
New requirements mandating removal of all tailings material from TSFs (“decharacterization”), regardless of the original design method, upon closure and prior to decommissioning and environmental rehabilitation;
New requirements mandating bi-annual (each year in March and September) TSF Stability Declarations for approved TSFs, signed by an external engineering consultancy and geotechnical senior manager as well as company directors, to be submitted to the ANM and the relevant state environmental agency;
New requirements for companies to place a surety bond in the preliminary permit phase; and
Banning permits for any new dam where there are communities within 10 km downstream or where a dam break could affect communities in less than 30 minutes (within the Self-Rescue Zone).
Furthermore, in addition to the 156 bills that were already being considered by the National Congress, another 51 bills dealing with the mining sector were presented in 2019 that may significantly impact the mining sector and the company. For example, Federal Bill No. 550/2019, if adopted, will require the company to complete the decharacterization (descaracterização) and decommissioning of its TSF at the Serra Grande mine in the state of Goiás, which was built by the upstream method, by 25 February 2022. For the company’s other TSFs in Brazil, all of which are downstream or “centreline” designs, the following options are permitted: either (i) the structure must be decharacterized and decommissioned, (ii) the population must be relocated, with reparations for loss of cultural heritage, or (iii) reinforcement works that guarantee the effective stability of the structure must be carried out, by decision of the public authorities, taking into account the previous nature of the dam in relation to the occupation and technical-financial viability of the alternatives. Even if reinforcement works are completed, the company will still be required to decharacterize and decommission the TSF at the end of the life of the mine. This bill also introduces the requirement to present a surety bond at the planning stages for the TSF. The mining sector, including the Minas Gerais Industry Association (FIEMG), the National Industry Association (CNI) and the Brazilian Mining Chamber (IBRAM), is liaising with the legislative authorities and other stakeholders in an effort to introduce amendments to this proposed bill which would mitigate some of the concerns identified by the mining industry, in particular, regarding the requirement to remove tailings material from decommissioned TSFs. As of yet, none of these new bills have been approved by the National Congress.
At the federal level, the ANM issued Resolution No. 13/19 in August 2019 (replacing its earlier Resolution No. 4/19) which adopted additional regulatory measures to ensure the stability of TSFs, in particular those built or heightened by the upstream method or by any method declared as “unknown”. Among other things, ANM Resolution No. 13/19 prohibits the upstream method for the construction or heightening of tailings dams throughout the national territory of Brazil. It further requires the deactivation ofoperators to cease all storage and disposal activities at TSFs (known as “deactivation” or “desativação”) constructed or heightened upstream or by an “unknown” method by 15 September 2021 as well as the decommissioning ofto decommission such TSFs by 15 AugustSeptember 2022 to 15 September 2027 (depending on the capacity volume). To comply with the terms of ANM Resolution No. 13/19, does not require complete removal of tailings material from TSFs. As a result, the Serra Grande minetailings dam in the state of Goiás is inmust be decommissioned by 15 September 2025. The Serra Grande mine completed the process of reinforcing the dam walls of its upstream TSF, in advance of its expected deactivationdeactivating the TSF and migrating to dry-stacking operations, each by the 15 September 2021. In addition,2021 deadline.
Furthermore, Federal Law No. 14.066/20, adopted in October 2020, also imposes requirements on companies to decommission upstream TSFs, including the companySerra Grande tailings dam, by 25 February 2022 (which date is earlier than required by ANM Resolution No. 13/19). However, Federal Law No. 14.066/20 does permit extensions of the compliance deadline, with the consent of the ANM based on the technical plan for decommissioning. Serra Grande submitted timely requests to obtain an extension of the compliance deadline until 2025 in line with the timeline set forth in ANM Resolution No. 13/19 and presented its technical plan for decommissioning. On 26 May 2022, the ANM issued a technical note allowing the extension until 2025. With respect to downstream (or “centerline”) TSFs, Federal Law No. 14.066/20 requires companies, to the extent that communities are located in the self-rescue zone of those TSFs, to implement one of the following measures for such structures: either (i) the structure must be deactivated and decommissioned, (ii) the population must be relocated, with reparations for loss of cultural heritage, or (iii) reinforcement works that guarantee the effective stability of the structure must be carried out, by decision of the public authorities, taking into account the previous nature of the dam in relation to the occupation and technical-financial viability of the alternatives. Even if reinforcement works are completed, deactivation and decommissioning of those TSFs will be required at the end of the life of the mine. All of the TSFs operated by AngloGold Ashanti in Brazil have communities located in self-rescue zones.
As of 31 December 2022, AngloGold Ashanti has begunfully transitioned to dry-stacking operations for tailings storage at each location in Brazil. Capital expenditures required in 2022 to implement this new technology amounted to approximately $83 million. Capital expenditures for work required to comply with TSF-related requirements during the period 2023-2025 are expected to be material but, based on preliminary estimates to date, AngloGold Ashanti anticipates that annual expenditures for each of these years will be less than in prior years and will decline over time. Neither ANM Resolution No. 13/19 nor Federal Law No. 14.066/20 requires removal of all tailings material in connection with the decommissioning of TSFs (a process of evaluating alternate structures for this upstream TSF,known as well as any potential increases in regulatory and cost obligations as a result of new requirements applicable to TSFs“decharacterisation” or “descaracterização”).
At the state level, the state legislator in the state of Minas Gerais adopted Law No. 23.291/19 in February 2019 which containedcontains the state’s policy on TSF safety and should be implemented in conjunction with the equivalent federal policy. Among other things, Law No. 23.291/19 determines the criteria for licensing and inspecting TSF structures, prohibits TSFs constructed or heightened using the upstream method, establishes bond requirements and holds management liable for non-compliance with its provisions. The government of Minas Gerais adopted several decrees in furtherance of this legislation.
In addition, ANM Resolution No. 95/22, which became effective on 22 February 2022, effectively consolidates prior federal resolutions on TSFs, including ANM Resolution No. 13/19, and establishes new criteria for the operational management of TSF structures, changes the criteria related to the risk classification of TSF structures and emergency levels and sets new criteria for the suspension, embargo (order to stop operations) and interdiction of TSF activities. Operators of TSFs were mandated to conduct and submit risk assessments to the ANM by December 2022 and are required to update those risk assessments every two years. Operators are also required, on an annual basis, to obtain certifications from external consultants of the geotechnical stability of TSF structures and the adequacy of emergency response plans. In late 2022, tailings deposition was required to be suspended due to embargos at five of AngloGold Ashanti’s TSFs in Brazil pending certification by external consultants of on-site emergency response plans (Declaração de Conformidade e Operacionalidade (“DCO”)) as well as, at one such TSF, certification by external consultants of geotechnical stability (Declaração de Condição de Estabilidade (“DCE”)) consistent with the new standards. In addition, at the Calcinados TSF, a risk assessment conducted in December 2022 with oversight from external consultants, as required by Brazilian regulations, concluded that additional buttressing should be completed to align the TSF’s post liquefaction factor of safety with international standards currently considered best practice. Construction at the Calcinados TSF is expected to begin later in 2023, and the timeline for completion will be determined once the engineering and geotechnical work has been completed by external consultants. Tailings deposition at the Calcinados TSF, as well as processing of gold concentrate at the Queiroz plant, which services the Cuiabá mine complex, is suspended until additional buttressing of the Calcinados TSF impoundment is complete.
On 1 December 2022, the ANM published ANM Resolution No. 122/22, which relates to administrative sanctions for non-compliance with mining and dam safety regulations and which, in addition to significantly increasing the values of applicable fines and penalties, establishes procedures and parameters for available sanctions including seizures of ore, goods and equipment, suspension of mining activities, demolition of mine infrastructure and invalidation or cancellation of title and exploration licences.
Further amendments to the regulatory requirements in Brazil governing such TSFs and related dams are expected to be adopted in 2023.
AngloGold Ashanti’s rights and permits
At AGA Mineraçao, Cuiabá has a single mining concession (No. 000.323/1973) covering a total area of 3,662 hectares,hectares. In February 2022, two additional mining concessions for Cuiabá (Nos. 830.937/1979 and 831.027/1980) were published, which cover an additional area of 816.2 hectares. Lamego is covered by three geographically contiguous concessions totallyhas a single mining concession (No. 932.710/2017) covering a total area of 1,622 hectares andhectares. Córrego do Sítíotio is hosted by five geographically contiguous mining concessions (i.e., Nos. 930.556/2000, 930.181/2008, 830.129/1982, 833.472/2003 and 830.943/1979) covering a total area of 6,017 hectares. All of these are in good standing.
At Serra Grande, the companyCompany has interests
in or agreements over 61,50025,719.94 hectares in Crixas Greentonethe Crixás greenstone belt, representing approximately 87 percent of the relevant tenements that correspond to all current exploration and mining activities. These have been held since 1987. The mining concessions include mining concession No. 002.286/1935 covering an area of 4,206.88 hectares, mining concession No. 960.658/1987 covering an area of 1,946.89 hectares, mining concession No. 860.746/2005 covering an area of 88.28 hectares, mining concession No. 862.103/1994 covering an area of 125.41 hectares and mining concession No. 804.366/1975 covering an area of 196.05 hectares.
All of the Company’s mining concessions in Brazil are currently active, in good legal and operational standing, and free of liabilities and/or major obligations. Brazilian mining concessions remain valid up to the depletion of the OreMineral Reserve and Mineral Resource pursuant to the Economic Exploitation Plan approved by the ANM and in accordance with the required environmental permits, and as a result do not have an explicit expiry date.date.
Colombia
General laws relating to mining and land ownership
General regime
The Colombian Constitution declares that the sub-soil and the non-renewable natural resources located within the Colombian territory are the property of the Colombian State. The underlying principle of Colombian mining legislation for the granting of mining concession contracts over free areas is first in time, first in law. Mining activities are regulated by the Colombian Mining Code, Act 685, 2001.
The filing of an exploration and exploitation proposal triggers a right of preference to obtain rights over the targeted area, provided it is available. Such area cannot exceed 10,000 hectares. Upon receipt of a proposal, the relevant government agency determines whether another proposal or contract already governs the area. If there are no pre-existing claims, the government agency grants the applicant a “free area”.
With respect to land ownership, a mining concession in Colombia does not grant the rights over the surface required to develop a mining project. Therefore, in order to develop a mining project,, it is required to acquire and secure access to the land (soil). This can be achieved in several ways, such as (i) purchase of the land, (ii) a transit easement, (iii) a mining easement, and (iv) the special acquisition process or expropriation.
Concession contract
As the sub-soil and the non-renewable natural resources located within the Colombian territory are property of the Colombian State, the Colombian Mining Authority (Agencia Nacional de Minería) grants the authorizationauthorisation to explore and exploit minerals through a concession contract.
Such concessions allow concessionaires to conduct the studies, works and facilities necessary to establish the existence of minerals and to organise their exploitation. Upon being awarded a mining concession, a company must take out an insurance policy to cover the costs associated with potential environmental damage as well as breaches of its mining obligations. It may then proceed with exploration activities. Once the exploration phase is complete, the concessionaire files a new plan regarding proposed works and facilities. With the award of the mining concession or tenement contract, there are specified timelines for the completion of the various phases of a mining project, e.g. exploration, construction, exploitation. The company must comply with these timelines unless performance is suspended, for example, due to force majeure or extensionsthese timelines are extended or modifications to the timelines.modified. A grant of force majeure is for one year and must be renewed on an annual basis. If the company does not comply with the specified timelines for the completion of the various phases of a mining project, the mining authority may revoke the company's concession contracts or mining licenses.licences. As a general matter, any company that wishes to obtain a renewal of its concession contract must be up to date in all its legal and contractual obligations and must present a new plan of works and facilities to be implemented after the contract is renewed.renewed.
PINES programprogramme
In 2013,, the federalnational government instituted the PINES programprogramme designed to aid promoting certain projects that are deemed to have a national interest. This designation provides for greater oversight from the national government. All of our three advanced exploration projects (La Colosa, Quebradona and Gramalote) were considered of national strategic interest. Currently, Quebradona and Gramalote remain in the PINES program,programme, but La Colosa was temporarily removed as such (until the force majeure is over).
Tax laws relating to mining
From the moment the concession contract is registered with the Mining Register, the concessionaire has several financial obligations, including the payment of (i) a surface fee during the exploration, construction and assembly stage and (ii) royalties.
Once exploration is complete and the mining infrastructure in place, the concessionaire must begin paying royalties to the Colombian government, consisting of a percentage of the primary product and sub-products being exploited. The percentage of the royalty depends on the regulation in force when the concession contract is signed.registered. In the case of the Quebradona project, the deposit mainly consists of copper followed by gold and silver. There is a 5five percent royalty for copper on the production value at the mine’s or well’s edge (i.e. when extracted from the subsoil). In case of gold and silver, a royalty of 4four percent on the production valued at the mine’s or well’s edge (i.e. when extracted from the subsoil) was established.
Furthermore, Colombian law establishes that once the environmental licenselicence is granted the concessionaire must invest 1one percent of the project’s value to benefit the basins covered by the environmental license.licence.
Environmental laws relating to mining
In order to obtain an authorization fromauthorisation to carry out a mining project, a company must prepare an Environmental Impact Study (“EIA”) for approval by the National Environmental Licensing Authority of Colombia to carry out a project, the company must prepare an Environmental Impact Study (E.I.A.(Autoridad Nacional de Licencias Ambientales or “ANLA”) for approval by this authority.
. Global environmental licenseslicences are granted for the entire life of the project and cover all phases: construction, assembly, operation, maintenance, dismantling, final restoration, abandonment and/or termination. Construction and assembly permits (Plan de Trabajos y Obras or “PTO”) are granted by the mining authority with jurisdiction over the project.
AngloGold Ashanti’s core mining concession contracts provide thatIn Colombia, the mining authority has the discretion to declare the underlying concession void if the specific company which holds the concession breaches applicable environmental laws or regulations. If the mining authority were to exercise such discretion, against it, sucha company whose concession was voided would be required to abandon its projects and all of its other existing mining concession contracts. Pending proposals for new mining concession contracts would also be cancelled and the company would be banned from doing business with the Colombian government for a period of five years. As a result, the company would be unable to conduct any mining exploration or development activities during such period. However, this would not affect other AngloGold Ashanti subsidiaries of the company operating in Colombia, which holdif those concession contracts are held singularly or in concert with joint venture partners the majority of the company’s concession contracts in Colombia.partners.
There are some areas where miningMining activity is prohibited. These areas areprohibited in national parks, regional parks, protected forest reserves, paramos (included in Act 1753, introduced in 2015) and wetlands, pursuant to the Ramsar Convention on Wetlands of International Importance.Importance. Some forest reserves are not “protected” but are set aside for active forestry purposes. Such forest reserves must be “extracted” after initial prospection, meaning thatpurposes and the concessionaire must obtain a specific permit to partially and temporarily change the use of the soil before pursuing exploration activities. In addition, Resolution 187/1987/2016, passed by the federalnational government in late 2016, identifies areas that the Ministry of the Environment has determined to be “paramos” areas, or paramos transition areas. In these areas there are limitations on industrial or commercial work being performed, including mining. The regulation also specifies a process to determine what work, if any, can be performed in a paramos-designated area.
AngloGold Ashanti’s rights and permits
The La Colosa project managed by AngloGold Ashanti Colombia S.A. (AGA Colombia)S.A.S. (“AGA Colombia”) remains in force majeure due to the delays in the granting of the environmental permits by thenational and local environmental authority,authorities, thereby preventing AGA Colombia from undertaking further exploration activities. The currentmost recent one-year grant of force majeure, during which time the specified timelines for completing the various phases of the mining project under the concession contract are suspended, will expire on 22 June 2020 and the request for an extension is pending.2023. AGA Colombia applied for a mining area integration (consolidation) of its concession contracts related to La Colosa, in respect of which AGA Colombia was not in compliance with some of the specified timelines. The application for mining area integration (consolidation) was approved in March 2017, which remedied the non-compliance of each consolidated concession and reset the specified timelines. La Colosa now has a single integrated mining concession contract (EIG-163) which covers a total area of 9,210 hectares and expires on 28 February 2037.
Minera de Cobre Quebradona S.A. (MCQ)S.A.S. B.I.C. (“MCQ”) which manages the Quebradona project, obtained the integration of concession agreement 5881 in October 2016 and registered in December 2016. As a result, MCQ was granted the exclusive right to explore, take ownership and dispose of the mineral reserves (ore) extracted from the concession area. MCQ has the right to request an extension of up to 30 years, at least two years before the expiration of the operating period. This extension is not automatic, and the request must be filed with new technical, economic, environmental and social studies that demonstrate the status of the mineral resources. Currently, concessionConcession contract 5881 initially covered a total area of 7,593 hectares, which was reduced to 4,881.89 hectares by the relevant mining authority (Secretaría de Minas de Antioquia) on 4 March 2022. It will expire in May 2037 and is currently in its thirdseventh year of the integrated exploration phasephase. In September 2021, the permits for the construction and mining operation were approved by the relevant mining authority (Secretaría de Minas de Antioquia). On 4 November 2021, ANLA officially notified AngloGold Ashanti of its decision to ‘archive’ the environmental licence application relating to the Quebradona project. ANLA has neither denied nor granted the licence, but deemed that the information provided by AngloGold Ashanti is not enough for this authority to take a substantive decision. On 18 November 2021, AngloGold Ashanti appealed the archiving decision in order to secure further details on the specific additional information ANLA requires to make a determination. ANLA denied the appeal on 29 April 2022 and the archiving decision was confirmed. AngloGold Ashanti is in the process of preparing a new Environmental Impact Assessment for the Quebradona project requestedto submit to ANLA in connection with its environmental licence application.
The Gramalote project is organised as a joint operation between AngloGold Ashanti (through AGA Colombia Holdings Limited and AngloGold Ashanti Holdings plc) and B2Gold (through B2Gold Corp. and Graminvest Ventures Limited). Gramalote Limited, a company incorporated under the Mining Authority forlaws of British Virgin Islands which is the legal vehicle operating the joint operation, established a Colombian branch, Gramalote Colombia Limited (“GCL”), to carry out activities in Colombia and obtain the mining concession contracts necessary to develop the Gramalote project. The Gramalote joint operation has been operated by B2Gold since January 2020. Pursuant to an integrated mining concession contract No. 14292, GCL was granted the exclusive right to explore, take ownership and dispose of the mineral reserves (ore) extracted from the concession area (which covers a total area of 8,720.71 hectares and includes the Gramalote and Monjas anomalies) until April 2043. GCL has the right to request an extension of 2 more years.the operating period for up to 20 years, and, if exercised, such request to extend must include new technical, economic, environmental and social studies that demonstrate the status of the mineral resources. Currently, concession contract
No. 14292 is in the phase of construction and assembly, pending resettlement of communities and the formal start of construction activities. GCL has received an environmental licence granted by ANLA and permits for the construction and mining operation which were approved by the relevant mining authority (Secretaría de Minas de Antioquia). GCL also holds an exploration concession No. 4894 (which covers a total area of 2,279.32 hectares and includes the Trinidad anomaly) which expires in 2044 and an exploration concession No. QHQ-16081 (which covers a total area of 9.78 hectares) which expires in 2052. Following the completion of the feasibility study in the second half of 2022, AngloGold Ashanti and B2Gold determined that the Gramalote project does not meet their investment thresholds for development. Following a comprehensive review of the alternatives relating to the project, both joint operation parties commenced a joint sales process for the Gramalote project, which is currently ongoing.
United States of America (Nevada)
NevadaGeneral laws relating to mining and land ownership
General regime
Mineral and surface rights in the United States are owned by private parties, state governments or the federal government. The majority of land utilised for precious metals exploration, development and mining in the western United States is owned by the federal government, and often the state government will have an ownership interest in minerals, regardless of whether the state is the surface owner.government. The right to mine on such federal land in western states is governed by the U.S. General Mining Law of 1872, as amended (General(the “General Mining Law).Law”), as well as relevant state statutes and regulations. The General Mining Law allows mining claims (for mining and mining-related activities) on certain federal lands upon the discovery of a valuable mineral deposit andafter proper compliance with claim location and maintenance requirements.
In Nevada, AngloGold Ashanti (U.S.A.) Exploration Inc. is advancing a joint venture property, the Silicon Project, on federal lands through an Earn-in Option Agreement for 277 mining claims, covering an area of approximately 5,700 acres. Additionally, a further 1,414 mining claims (29,215 acres) in the name of AngloGold Ashanti North America Inc. are also being explored. On these lands, AngloGold Ashanti (U.S.A.) Exploration Inc. is currently engaged in early-stage exploration activities that include, but are not limited to, geological and spectral mapping, surface geochemical sampling, geophysical surveying and RC and/or diamond drilling.
Mineral exploration activities in Nevada are also generally subject to applicable federal, state, and local permitting requirements, but the specific regulatory authorizationsauthorisations required for the company’s activities are based on the nature and location of the exploratory
work. AngloGold Ashanti (U.S.A.) Exploration Inc.’sMany of the company’s Nevada operations are currently conducted under what is generally referred to under federal law as a notice-level operation subject to 43 CFR § 3809.21. The3809.21, while projects that are more advanced require additional permitting, including a Plan of Operations approved by the federal Bureau of Land Management (BLM) issued a Notice(“BLM”). The State of Decision for the Silicon Project approving the proposed exploration operations on 1 November 2017. The BLM determined that the operations would not cause unnecessary or undue degradation as defined under 43 CFR § 3809.5. Three amendments to the NoticeNevada Division of Decision have been authorized by the BLM in letters dated 31 January 2018, 2 April 2018, and 4 October 2018. The Notice of Decision requires reclamation of the drill pads and roads, including the reseeding of disturbed lands. The Notice of Decision also set the financial guarantee amount for reclamation. The Notice of Decision includes a renewable 2-year term from the date of the last amendment to the Notice.
The BLM issued a Notice of Decision for the Rhyolite North Project approving the proposed exploration operations on 14 January 2020. The Rhyolite North Project, situated within the Nye County of south-western Nevada, is wholly owned by AngloGold Ashanti North America Inc. It is an early-stage exploration project managed by AngloGold Ashanti (U.S.A.) Exploration Inc. and is currently comprised of 237 unpatented mining claims.
Nevada’sEnvironmental Protection’s Bureau of Mining Regulation and Reclamation (BMRR)(“BMRR”) also regulates mining within the state. Explorationstate of Nevada. However, exploration projects of 5five acres or less on federal land, the scope of a notice-level operation under federal law, are exempt from BMRR regulation. AngloGold Ashanti’s currentCertain of the company’s early-stage exploration programsactivities fall within this exemption.
AngloGold Ashanti (U.S.A.) Exploration Inc. has initiated a subsequent permitting process for the Silicon Project to increase theThe company is currently engaged in exploration activities beyond the 5-acre notice level. This process was initiated in 2019 with the completionon certain of its unpatented claims that include, but are not limited to, geological and submission of the required environmental baseline studiesspectral mapping, surface geochemical sampling, geophysical surveying and the submission of a Plan of Operation and Reclamation Plan to the BLM and BMRR. The permitting process is expected to be completed in 2020 and decisions from the BLM and BMRR are expected to be received in the same year.RC and/or diamond drilling.
Minnesota
In Minnesota, AngloGold Ashanti Minnesota Inc. completed early-stage reconnaissance exploration activities to determine the potential for gold mineralization in the northern counties of Minnesota. Based on the achieved results, the company has decided to terminate its exploration activities in the state and it is currently in the process of closing out activities in accordance with state and company requirements.
Potential regulatory changes
Over the years, the U.S. Congress has considered a number of proposed amendments to the General Mining Law and other federal statutes relating to mining. Among the significant features contained in previously proposed legislation were a production royalty obligation, new and more stringent environmental standards and conditions, additional reclamation requirements, extensive new procedural steps which would likely result in extended permitting timelines, and granting counties and other entities the ability to petition the U.S. Secretary of the Interior to make certain areas unavailable for the location of unpatented mining claims. The U.S. Environmental Protection Agency has alsoIn June 2020, former President Trump signed an executive order directing certain federal agencies to streamline the review processes associated with permitting of infrastructure and natural resources projects. Many of those policies have subsequently been rescinded by the Biden administration. While certain other executive orders may favorably affect the timing of our permit and project approvals, the impact is yet to be determined and remains uncertain.
There are a number of bills being proposed potential revisions to financial assurancethe Nevada state legislature during the 2023 legislative session that could impact the company’s planned operations. These include proposed legislation that would alter the way water rights are administered by the state, as well as a bill that would, if enacted, impose additional requirements relating tofor environmental review of mineral development activities.projects in Nevada. At this stage, it is not possible to evaluate whether these bills will be enacted in any form by the Nevada state legislature or, if passed, what impact any might have on AGA.
AGA is currently unaware of any other new federal or state legislative or regulatory changes or rule-making that has been proposed or enacted that would adversely affect its current exploration programs.programmes. If any of the above-referenced provisionsrequirements, standards or conditions were adopted in the future that imposed additional or new obligations or costs on AGA in connection with our exploration or extraction activities in the United States, the company’s operations in Nevada could be adversely affected.
AngloGold Ashanti’s rights and permits
In Nevada, the company’s wholly-owned subsidiaries hold a significant number of unpatented mining claims on federal lands. The Silicon project consists of approximately 950 unpatented mining claims. The North Bullfrog project consists of 45 patented and approximately 1,600 unpatented mining claims (covering approximately 32,000 acres) situated in the Bullfrog mining district. There are also nine mining leases within the North Bullfrog project the majority of which continue in perpetuity so long as the company meets certain minimal requirements for use of the land. One mining lease is scheduled to expire in 2031. The Mother
Lode project consists of 13 unpatented mining claims. The North Bullfrog and Mother Lode projects are now controlled by the company as a result of its acquisition of all of the outstanding stock of Corvus Gold Inc., which closed on 18 January 2022. The southern claim block, encompassing the Sterling mine and other properties in the same general area, consists of approximately 1,900 unpatented claims (covering approximately 35,000 acres), which are now controlled by the company as a result of its acquisition of all of the outstanding stock of Coeur Sterling, Inc. (a subsidiary of Coeur Mining, Inc.), which closed on 4 November 2022. As a result of this acquisition, the company now controls a past-producing mine site in southern Nevada known as the Sterling mine, which has one applicable mining lease that expires in 2029, with the option to extend the lease for an additional ten-year period. Although the Sterling mine is currently in care and maintenance status, it remains subject to complex permitting and regulatory requirements, including compliance with relevant provisions of the U.S. Federal Mine Safety and Health Act of 1977 and oversight by the U.S. Department of Labor’s Mine Safety and Health Administration (“MSHA”).
MINE SITE REHABILITATION AND CLOSURE
Closure, an integral part of operations
All mining operations eventually cease. An integral aspect of operating AngloGold Ashanti’s mines is ongoing planning for site closure and, where feasible, implementation of concurrent rehabilitation, together with an estimate of associated liability costs and the placement of adequate financial provisions and assurances to cover these costs.
AngloGold Ashanti revised its groupintegrates mine closure planning management standardthroughout the mine life cycle as follows:
•Exploration stage: developing a plan and programme for cessation and closure of exploration activities in 2013a manner that meets local laws and all of its operations are required to comply with the standard, as well as applicable law and regulations, as theirAngloGold Ashanti's mine closure planning standard.
•Project phase: developing conceptual closure plans are reviewed and updated.cost estimates for all projects and including them in project feasibility studies, designs and evaluations.
•Operational phase: developing and periodically updating mine closure plans and cost estimates with increasing levels of detail and confidence over the operational phase as part of the business planning process. Closure planning is an activity that starts at the exploration and mine design stage and continues throughout the life of mine:
New projects include a closure plan which takes into account future closure and associated rehabilitation and other costs.
The closure plan is reviewed annually and updated every three years (annually in the final three years of a mine’s life) or whenever significant changes are made, takingupdates take into account operational conditions, planning and regulatory requirements international protocols, technological developments andas well as advances in practice.
For many oftechnology and international industry good practice (e.g., the older mines, closure planning and the evaluation of environmental liabilities is a complex process. This is particularly so in Brazil, Ghana and South Africa, where many of the mining and other operations have taken place for more than fifty years. A particular challenge is concurrentICMM Integrated Mine Closure Good Practice Guide). Concurrent rehabilitation, which is carried out while a mine is still operational. Thisoperational, is a good practice that serves to decrease the ultimate liability and reduces the final rehabilitation and closure work that must be undertaken, but has the potential to sterilise Ore Reserve, which the company might wish to exploit should conditions, suchas well as the gold price, change.ultimate liability.
•Closure period: implementing the final closure plan starting at cessation of operations through a period of decommissioning, dismantling and rehabilitation until the point in time where management of the site is largely limited to monitoring and maintenance.
The company’sCompany’s group mine closure planning standard stipulates that closure planning must be undertaken in consultation with the community.stakeholders. In the course of these consultations, different issues are raised which require site-specific solutions. Livelihood preservationEach mine closure plan includes a social transition plan which seeks to minimise social impacts and maximise opportunities for local communities, including human resource, social infrastructure, are often key requirements. Communities also require information oneconomic and financial assets with the company’s rehabilitationaim of enhancing the landscape and on any lasting environmental impacts. Long-term remediation obligations, including decommissioning and restoration liabilities relating to past operations, are based on environmental management plans and compliance with current environmental and regulatory requirements.self-sustainability of mine communities after mine closure.
Provisions for decommissioning and rehabilitationrestoration costs are made when there is a present obligation, it is probable that expenditure on decommissioning and rehabilitationrestoration work will be required and the cost can be estimated within a reasonable range of possible outcomes. These costs are based on currently available facts, technology expected to be available at the time of the clean-up,rehabilitation, laws and regulations presently or virtually certain to be enacted and previous experience in the rehabilitation of mine sites.
Decommissioning costs and restoration costs are provided at the present value of the expenditures expected to settle the obligation, using estimated cash flows based on current prices. Estimates are discounted at a pre-tax rate that reflects current market assessments of the time value of money.
ProvisionsTotal provisions for decommissioning and for environmental restoration activities (excluding joint ventures) increaseddecreased by $95 million from $637$673 million in 20182021 to $730$578 million in 2019 (including the rehabilitation obligations transferred2022. This decrease was mainly due to held for sale liabilities and associated with our pending sale of operationschanges in Mali and South Africa). This increase mainly relates to proposed requirements regarding the removal of tailings materialsestimates resulting from tailings storage facilities in Brazil upon closure and decommissioning (a process known as “decharacterization”) and changes in discount rates, based onchanges in global economic assumptions. The provisions were also impacted byassumptions, changes in mine plans resulting in a change in cash flows andas well as changes in the design of tailings storage facilitiesTSFs.
SUSTAINABILITY AND ENVIRONMENTAL, SOCIAL AND GOVERNANCE (“ESG”) MATTERS
AngloGold Ashanti’s sustainability approach is fundamental to how the Company operates its business, as well as its ability to create long-term value for its shareholders, employees and social partners through safely and responsibly exploring, mining and marketing its products. Sustainability and safety are integrated into the Company’s business and operations at all levels through various frameworks, standards and policies, and the Company measures its performance in methodology following requests from the environmental regulatory authorities.achieving its goals against its sustainability and other ESG metrics, as well as its engagement with stakeholders.
ENVIRONMENTAL, HEALTH AND SAFETY MATTERS
In additionmitigating the risks and impacts that are an inherent part of its business, AngloGold Ashanti is informed by an annual assessment of its key ESG issues. This process is aligned with guidance published by the International Integrated Reporting Council (“IIRC”), the Sustainability Accounting Standards Board (“SASB”), the Global Reporting Initiative (“GRI”) Standards and
the Accountability AA1000 Stakeholder Management Standard. This assessment is annually reviewed by AngloGold Ashanti’s senior leadership and approved by the Social, Ethics and Sustainability Committee (the “SES Committee”).
AngloGold Ashanti’s board of directors, assisted by the SES Committee, has ultimate responsibility over environmental, safety, health and ethical matters and for the integration of sustainability objectives into AngloGold Ashanti’s business. This includes oversight of the Company’s stakeholder engagement framework and structures, which apply to post-mining land rehabilitationinvestors, employees, governments, suppliers and closurecommunities, at every stage of its business from exploration to mine closure. Group Corporate Affairs and Sustainability is responsible for development of management systems and supports the Company’s general managers in the day-to-day implementation of its sustainability strategy.
AngloGold Ashanti maintains a set of policies and procedures to guide the Company in acting as a responsible corporate citizen, including the Code of Business Principles and Ethics which sets requirements for the implementation of key corporate policies and guidelines and applies to all management and employees, and to maintain compliance with applicable environmental, health and safety (“EHS”) laws. In 2022, AngloGold Ashanti continued with the implementation of the Integrated Sustainability Information Management System (“iSIMS”), in order to improve internal reporting and better integrate, manage and monitor sustainability activities with respect to its broader business. This common management and reporting application for all sustainability disciplines, from safety, health and security to community and environmental management, is expected to help provide timely information in each of these areas, and to facilitate transparency and decision-making in its processes and practices.
Significant EHS requirements and ESG risks and trends affecting the Company’s mining and processing operations are described below.
EHS Regulatory Compliance
AngloGold Ashanti is subject to extensive environmental, health and safety (EHS)EHS laws and regulations in the various jurisdictions in which the companyCompany operates. These requirements govern, among other things, extraction, use, conservation and discharge of water; air emissions (including dust control and greenhouse gases)gases (“GHGs”)); mine and dam safety, regulatory and community reporting; clean-up of contamination; land use and conservation of protected areas; rehabilitation and closure of mined land; worker health and safety and community health; and the generation, transportation, storage and disposal of solid and hazardous wastes, such as reagents, radioactive materials, and mine tailings. Environmental laws and regulations applicable to ourthe Company’s operations, including the requirements contained in environmental permits, are generally becoming more restrictive. Significant EHS requirements, risks and trends affecting our mining and processing operations are described below.
Regulatory Compliance
Capital and operating costs to comply with EHS laws and regulations have been, and are expected to continue to be, significant to AngloGold Ashanti. In addition, AngloGold Ashanti could incur fines, penalties and other sanctions, environmental clean-up costs, and third-party claims for personal injury or property or natural resources damages; suffer reputational damage; and be required to install costly pollution control equipment or to modify or suspend facilities, such as TSFs, or operations, as a result of actual or alleged violations of, or liabilities under, EHS laws and regulations. Failure to comply with applicable EHS laws and regulations may also result in the suspension or revocation of permits and, in some jurisdictions, ourthe right to mine a given concession. AngloGold Ashanti’s ability to obtain and maintain permits and other approvals and to successfully operate near particular host communities may be adversely impacted by real or perceived effects on the environment or human health and safety associated with AngloGold Ashanti’s or other mining companies’ activities. In addition, unknown environmental hazards may exist at the company’sCompany’s properties which may have been caused by previous owners or operators.
Water Management
AngloGold Ashanti’s mining and processing operations are heavily dependent upon access to substantial volumes of water required for such operations. Typically,use in the mining and extractive processes and typically are subject to water-use permits or water rights in each country impose limits on the quantity ofto extract water that can be extracted from certain natural sources that govern usage and require, among other things, that wastewater from mining operations meetmaintain certain water quality criteria if discharged to the environment.upon discharge. Water supply, quality and usage are areas of interest globally, but are particularly significant forconcern across all of the Company’s operations, including with respect to the Company’s mining operations in Brazil, Ghana and South Africa, and for explorationBrazil, its mine development projects in Colombia, where there is significant potential environmental and social impact and a high level of stakeholder scrutiny.Nevada, as well as its mine development project at Quebradona in Colombia. Any failure by the Company to secure access to suitable water supplies, or achieve and maintain compliance with theapplicable requirements of ourthe permits or licenses,licences, could result in curtailment or suspensionhalting of
production at the affected operation.operations. Incidents of water pollution or shortage can, in extremecertain cases, lead to community protest and ultimately result into the withdrawal of community and government support for AngloGold Ashanti’s operations. A failure by the company’sCompany to comply with water contamination related directives may result in further, more stringent, directives being issued against the Company, which may, in some cases, result in a temporary or partial shutdown of some of the Company’s operations.
Where feasible, the companyCompany operates a “closed loop” system which recycles the water used in its operations without discharging it to the environment. In some areas, however, such as Ghana and Brazil, high levels of rainfall and surface water runoff mean that a closed loop system is not feasible and that discharges, after water treatment where necessary, must take place.
Waste Management
Mining and mineral processing operations generate waste rock and tailings.
During open-pit mining, large volumes of soil and/or rock (overburden) are mined to expose the ore body. Similarly, waste rock is mined during drilling and developing access to underground ore bodies. Overburden and waste rock typically contain sub-economic levels of gold and are deposited as large waste rock facilities. Mine tailings are the process waste generated once grinding and extraction of gold from the ore is completed in the milling process and are typically deposited as slurry in large tailing storage facilities (“TSFs”) specifically designed for this purpose.
The impact of dust generation, breach, leak, or other failure of a waste rock facility or tailings storage facility (TSF),TSF, including any associated dam, can be significant, and the companyCompany therefore monitors such facilities closely in accordance with the company’sCompany’s internal standards, independent review, national regulatory requirements, industry standards and commitments made to local communities. The occasional well-publicised failure of a third-party tailings facilityTSF and the potential impact of such failure also mean that these facilities are generally tightly regulated. AnA safety or environmental incident at the company’sCompany’s operations could result, among other things, in enforcement, including mandatory shutdown of a TSF and related facilities, obligations to remediate environmental contamination, negative press coverage, and claims for property or natural resources damages and personal injury by adjacent communities. Incidents at other mining companies’ operations could result in governmental action to tighten regulatory requirements and restrict certain mining activities, in particular with respect to TSFs, also in respect of other mine operators in that region.
For example, following the catastrophic failure of a TSF at anthe Córrego do Feijão iron ore mine owned by Vale at Brumadinho in the state of Minas Gerais in Brazil in January 2019, tailings were discharged into the mine’s administrative area and part of the local community, reportedly resulting in deaths and injuriesdeath or injury to hundreds of people. As a result of this incident, there has been considerably increased regulatory scrutiny in Brazil and other areas on mining operations generally, and the requirements applicable to the approval, licensing, construction, management, closure and decommissioning of TSFs have generally become far more stringent. In particular,For example, in Brazil, new TSFs in the upstream design method have been prohibited by the Brazilian National Mining Agency (ANM) and decommissioninglate 2022, tailings deposition was suspended at five of all existing upstream TSFs has been ordered. As a result, we will be required to reinforce, and decommission by February 2022, the TSF at our Serra Grande mine, located in the state of Goiás. The incremental costs for reinforcing the walls of this facility and, ultimately, for decommissioning and closing the TSF in compliance with new legislation, are likely to be material. We will also be required to reinforce or decommission allAngloGold Ashanti’s TSFs in Brazil constructed basedpending certification by external consultants of on-site emergency response plans (“DCO”) and/or geotechnical stability (“DCE”) consistent with new regulatory standards enacted in early 2022. In addition, at the Calcinados TSF, a risk assessment conducted in December 2022 with oversight from external consultants, as required by Brazilian regulations, concluded that additional buttressing should be completed to align the TSF’s post liquefaction factor of safety with international standards currently considered best practice. The timeline for completion will be determined once the engineering and geotechnical work has been completed by external consultants. For further information on the downstream design method by 2025. Moreover, a bill currently pending in the National Congressregulatory framework governing TSFs in Brazil, would requiresee “Item 4B: Business Overview—The Regulatory Environment Enabling AngloGold Ashanti to Mine—Americas—Brazil”.
In addition, a new Global Industry Standard on Tailings Management (“GISTM”) was established in August 2020 by a panel comprised of industry and non-governmental organisation (“NGO”) experts. AngloGold Ashanti has committed to comply with the GISTM at all tailings materialsof its TSFs by August 2025, and the costs related to be removed from the TSF (a process known as “decharacterization”) in connection with closure and decommissioning. If passed, the additional costs associated with decharacterizationmeeting such standard are likelynot expected to be material to AngloGold Ashanti. Finally, the suspension of environmental licensing permit processes for TSFs in the state of Minas Gerais has delayed approval processes with respect to our operating permits, and may compromise our production plans in respect of our Minas Gerais operations. Further and more substantial amendments to the regulatory requirements in Brazil governing such TSFs and related dams are anticipated in 2020. See “Item 4B: Business Overview-The Regulatory Environment Enabling
In addition, AngloGold Ashanti could incur liabilities, or material costs to Mine”.manage solid and hazardous waste generated by its mining activities, including dust and residual chemicals and metals. For example, AngloGold Ashanti expects to incur approximately $25 million to $30 million in capital expenditure and operating costs during 2023-2026 in connection with treatment and disposal of a quantity of legacy arsenic trioxide waste located at the Obuasi mine.
Groundwater ImpactsSOUTH AFRICA
As part of the South African asset sale, AngloGold Ashanti Limited sold its remaining three mining rights in South Africa to Golden Core Trade and Invest (Pty) Ltd (“Golden Core”) and Harmony Gold Mining Company Limited pursuant to a sale agreement concluded on or about 12 February 2020, as amended and reinstated from time to time (the “SA Sale Agreement”). These mining rights relate to operations in the West Wits area.
General laws relating to mining
The MPRDA
The Mineral and Petroleum Resources Development Act, No. 28 of 2002 (the “MPRDA”) came into effect on 1 May 2004. The objectives of the MPRDA are, amongst other things, to allow for state sovereignty over all mineral and petroleum resources in the country, to promote economic growth and the development of these resources and to expand opportunities for the historically disadvantaged and to ensure security of tenure for the respective operations concerning prospecting, exploration, mining and production. By virtue of the provisions of the MPRDA, the state ensures that holders of mining and prospecting rights contribute to the socioeconomic development of the areas in which they operate. The Mineral and Petroleum Resources Development Amendment Act, No. 49 of 2008 (the “MPRDAA”) became effective on 7 June 2013. On 23 April 2004, the Minister of Mineral Resources and Energy (the “MRE Minister”) published, under the terms of the MPRDA, the Mineral and Petroleum Resources Development Regulations in order to implement the provisions of the MPRDA and MPRDAA. These implementation regulations were amended on 27 March 2020.
The mining charter
Since 2004, a series of mining charters have been adopted in South Africa with the main purpose of transferring part of the ownership of mining assets to black or historically disadvantaged South Africans (“HDSAs”) within a certain time period. Such mining charters also set targets for, amongst other things, the advancement of HDSAs into management positions, the employment of women, procurement of goods and services from HDSA-owned companies, training, community development and the upgrading of mine housing. In 2004, the Broad-Based Socio-Economic Empowerment Charter for the South African Mining Industry, 2004 was published and, in September 2018, the Broad-Based Socio-Economic Empowerment Charter for the Mining and Minerals Industry, 2018 (the “2018 Mining Charter”) was published, repealing all prior mining charters. In September 2021, the High Court of South Africa (Gauteng Division) held that the 2018 Mining Charter is a policy document and does not, per se, bind holders of mining titles. The High Court also set aside various provisions of the 2018 Mining Charter. In November
2021, the South African Department of Mineral Resources and Energy (“DMRE”) informed the parliamentary portfolio committee on mineral resources and energy that it does not intend to appeal the outcome of the judgement, but instead will consider steps to achieve the empowerment objectives through legislative amendments to the MPRDA.
The B-BBEE Act
The Broad-Based Black Economic Empowerment Act, No. 53 of 2003 (the “B-BBEE Act”) is a law of general application in respect of Broad-Based Black Economic Empowerment (“B-BBEE”) and enables the Minister of Trade and Industry to drive B-BBEE across all sectors of the economy. In 2014, the Broad-Based Black Economic Empowerment Amendment Act, No. 46 of 2013 (the “B-BBEE Amendment Act”) came into effect amending the B-BBEE Act to provide a framework of principles, strategies and guidelines aimed at promoting the broad-based socio-economic empowerment of HDSAs across the South African economy and society in the form of ownership, management, employment equity, skills development, preferential procurement, enterprise development and socio-economic development.
Environmental Remediationlaws relating to mining
The National Environmental Management Act, No. 107 of 1998, as amended (the “NEMA”) includes provisions to deal with environmental regulation of mining and prospecting, which provisions are administered by the MRE Minister. Pursuant to section 24N(8) of NEMA, directors of a company are jointly and severally liable for any negative impact on the environment, whether advertently or inadvertently caused by the company they represent, including damage, degradation and pollution.
From an environmental perspective, given the wide scope of the statutory duty of care in South African environmental law, erstwhile land owners may be held liable for historic contamination by the regulatory authorities. The “polluter pays” principle in South Africa enables the competent authority to seek recourse against various responsible parties based on their historical or current relationship to the source and receptor of degradation or pollution. The duty of care also applies retrospectively to significant pollution or degradation that occurred before the entry into force of NEMA (i.e., 29 January 1999), as well as significant pollution or degradation that arises or is likely to arise at a different time from the actual activity that caused the contamination (e.g., latent or residual impact) or arises through an act or activity of a person that exacerbates pre-existing contamination. The authorities can also seek compensation in respect of clean-up measures that it is required to take on behalf of the responsible parties and apportion liability amongst the responsible parties, which could technically include a historic landowner or mining company that caused the pollution. Although the purchasers of AngloGold Ashanti’s assets in South Africa have contractually assumed all environmental liability associated with its former South African operations and agreed to indemnify AngloGold Ashanti for the same, there remains a risk, at least theoretically, of statutory liability to the state.
AngloGold Ashanti’s rights and permits
Pursuant to the SA Sale Agreement, AngloGold Ashanti and Golden Core executed a notarial deed of cession of the mining rights with DMRE references GP 30/5/1/2/2/01 MR and GP 30/5/1/2/2/248 MR to transfer and cede these mining rights to Golden Core (the “Deed of Cession”). On 14 June 2021, the Deed of Cession was registered at the Mineral and Petroleum Titles Registration Office (the “MPTRO”).
With respect to the mining right held under DMRE reference GP 30/5/1/2/2/11 MR, AngloGold Ashanti and Golden Core agreed to make an application in terms of section 102 of the MPRDA at the DMRE after the closing date of the SA Sale Agreement requesting, among other matters, the incorporation of this mining right into the mining right with DMRE reference GP 30/5/1/2/2/01 MR (the “Harmony Consolidation Application”). AngloGold Ashanti also executed a notarial conditional deed of abandonment pursuant to which it conditionally abandons this mining right in terms of section 56(f) of the MPRDA (the “Deed of Abandonment”) on condition that ministerial consent is granted in respect of the Harmony Consolidation Application. The Harmony Consolidation Application, which was submitted to the DMRE on 17 January 2022, is still pending. On the date of the grant of the Harmony Consolidation Application, AngloGold Ashanti will cease to be a holder of any mining rights in South Africa. Once the transaction has been fully implemented, the general laws relating to mining outlined above will no longer be applicable to the Company, other than the statutory duty of care in terms of NEMA as described above.
AFRICA REGION
Democratic Republic of the Congo (DRC)
General laws relating to mining
The mining industry in the DRC is primarily regulated by Law No. 007/2002 dated 11 July 2002 (the “2002 DRC Code”), as amended and supplemented by Law No. 18/001 dated 9 March 2018 (the “Reformed DRC Mining Code”) and Decree No. 038/2003 dated 26 March 2003, as amended and supplemented by Decree No. 18/024 dated 8 June 2018 (the “Reformed DRC Mining Regulations”).
With respect to the application of the Reformed DRC Mining Code and Reformed DRC Mining Regulations, Kibali Goldmines S.A. (“Kibali Goldmines”) has reserved and continues reserving its rights, including, without limitation, its stability rights under, among other legal sources, the 2002 DRC Code. Discussions with the DRC government on these issues and the possible application of incentives that may be available under the Reformed DRC Mining Code and Reformed DRC Mining Regulations, in particular under article 220 of the Reformed DRC Mining Code which provides that the Prime Minister of the DRC may grant a number of incentives to provinces with infrastructure deficits to encourage economic development from mining resources, are ongoing.
Companies holding mining titles issued prior to the entry into force of the Reformed DRC Mining Code and Reformed DRC Mining Regulations have claims to a ten-year stability provision in accordance with prior mining legislation. Notwithstanding the adoption of the new regulatory regime, their rights with respect to such stability provision are reserved.
The Reformed DRC Mining Code grants the DRC Minister of Mines the authority to grant, refuse, suspend or terminate mineral rights, subject to conditions set out in the Reformed DRC Mining Code. Mineral rights may be granted in the form of exploration permits for an initial period of five years renewable once for a further five-year period or in the form of exploitation permits which are granted for an initial period of 25 years, renewable several times for 15-year periods until the end of the mine’s life. Prior to commencing exploration work, the holder of an exploration permit must submit for approval a mitigation and rehabilitation plan pursuant to which it must undertake to carry out certain mitigation measures of the impact of its activities on the environment, as well as rehabilitation measures. Exploitation permits are granted upon successful completion of exploration and satisfaction of certain requirements, including approval of a feasibility study, an environmental and social impact study and an environmental and social management plan. The holder of an exploitation permit is required to commence development and mine construction within three years of the grant of such permit. Failure to do so may lead to forfeiture of the exploitation permit. To protect and enforce rights acquired under an exploration or exploitation permit, the Reformed DRC Mining Code provides, depending on the nature of the dispute or controversy, administrative, judicial and national or international arbitral recourses.
Mining companies are required to grant a free-carried and non-contributory participation to the DRC government. The DRC government’s free participation was originally set at five percent, which was increased to ten percent in respect of exploitation permits issued after the entry into force of the Reformed DRC Mining Code. All mining companies are required to grant an additional five percent free-carried participation to the DRC government upon each renewal of their exploitation permit. Under the Reformed DRC Mining Code, a ten percent local contributory participation is also mandatory for exploitation permits issued after its entry into force.
Tax laws relating to mining
The Reformed DRC Mining Code sets out an exclusive and comprehensive tax and customs regime that is applicable to mining activities. Mining title holders are subject, amongst other things, to a corporate income tax of 30 percent, a windfall tax of 50 percent (subject to certain prerequisites) and are required to pay mining royalties to the DRC government. The royalty rate applicable to gold has been set at 3.5 percent. Mining title holders are also required to contribute a minimum of 0.3 percent of total turnover to community development.
The standard rate of VAT is 16 percent and is applicable to all mining companies. In the DRC, Kibali Goldmines is due certain refunds of VAT which, to date, remain outstanding. During 2022, AngloGold Ashanti did not recover any VAT offsets and refunds from its operations in the DRC. We believe that our attributable share of the net recoverable VAT balance (including recoverable fuel duty and after discounting provisions) owed to us by the DRC government amounted to $86 million as of 31 December 2022. While an agreement was reached with the DRC government on the reimbursement of the refundable VAT in 2018, uncertainty remains regarding the timing and level of cash receipts and offsets against other taxes for purposes of the recovery of our VAT receivables in the DRC.
The Reformed DRC Mining Code also provides for a level of fiscal stability. A stability clause stipulates that existing tax, customs and exchange control provisions applicable to mining activities are guaranteed to remain unchanged for a period of five years from the enactment of the Reformed DRC Mining Code.
Foreign exchange control regime
The Reformed DRC Mining Code imposed new exchange control rules requiring that mining title holders repatriate onshore 60 percent of sale revenues received during the investment amortisation period and 100 percent once the investment amortisation is completed.
During 2022, AngloGold Ashanti repatriated $694 million from its operations in the DRC, in the form of dividends from Kibali (Jersey) Limited. Kibali (Jersey) Limited received such cash from Kibali Goldmines in the form of loan repayments (net of bank fees) (AngloGold Ashanti’s attributable share: $658 million) and dividends (net of withholding taxes) (AngloGold Ashanti’s attributable share: $36 million). Our attributable share of the outstanding cash balances awaiting repatriation from the DRC amounted to $40 million as of 31 December 2022. The cash is fully available for the operational requirements of Kibali Goldmines. The cash and cash equivalents held at Kibali Goldmines are subject to various steps before they can be distributed to Kibali (Jersey) Limited and are held across four banks in the DRC, including two domestic banks.
AngloGold Ashanti’s rights and permits
AngloGold Ashanti holds a significant stake in the Kibali gold mine which is located in the north-eastern part of the DRC. The Kibali gold mine is owned by Kibali Goldmines which is a joint venture between Barrick Gold Corporation (45 percent), AngloGold Ashanti (45 percent) and Société Minière de Kilo-Moto S.A. (“SOKIMO”) (10 percent) which represents the interest of the DRC government. AngloGold Ashanti and Barrick Gold Corporation each have a 50 percent interest in Kibali (Jersey) Limited which holds their respective 45 percent interest in Kibali Goldmines.
The Kibali gold project is operated by Barrick Gold Corporation and comprises ten exploitation permits, of which eight expire in 2029 and two in 2030. Those exploitation permits (11447, 11467, 11468, 11469, 11470, 11471, 11472, 5052, 5073, and 5088) cover an area of approximately 1,836 km2 in the Moto goldfields.
Ghana
General laws relating to mining
Control of minerals and mining companies
The Constitution of Ghana as well as the Minerals and Mining Act, 2006 (Act 703) (the “GMM Act”) provide that all minerals in Ghana in their natural state are the property of the State and title to them is vested in the President on behalf of and in trust for the people of Ghana, with rights of reconnaissance, prospecting, recovery and associated land usage being granted under licence or lease. The grant of a mining lease by the Ghana Minister of Lands and Natural Resources (the “LNR Minister”) upon the advice of the Minerals Commission is subject to parliamentary ratification unless the mining lease falls into a class of transactions exempted by the Ghanaian Parliament. The LNR Minister has identified groundwater contamination plumesthe power to object to a person becoming or remaining a controller of a company which has been granted a mining lease if the LNR Minister believes, on reasonable grounds, that the public interest would be prejudiced by the person concerned becoming, or remaining, a controller.
Stability and development agreements
The GMM Act provides for stability and development agreements. Stability agreements guarantee for a period of 15 years certain terms and conditions (mainly fiscal) to which a company’s operations are subject. Development agreements may be granted to a mineral right holder that proposes to invest over $500 million in its mineral operations in Ghana. The GMM Act permits stability provisions to be incorporated into development agreements. Stability and development agreements are subject to parliamentary ratification. In January 2020, it was proposed that the GMM Act be amended by abolishing development agreements and shortening the maximum term of stability agreements from 15 years to five years (with a possible extension for a further five years). If the GMM Act were amended along these lines, such amendments would not apply retroactively and would therefore not have an impact on existing development agreements, including the Obuasi Development Agreement (as described below). Those amendments to the GMM Act have not yet been adopted.
Ghana Stability Agreement
In 2004, following the implementation of the business combination between AngloGold Limited and Ashanti Goldfields Company Limited, AngloGold Limited and the Government of Ghana signed a stability agreement (the “Ghana Stability Agreement”) governing certain aspects of the fiscal and regulatory framework within which the company would operate in Ghana for a period of 15 years. In June 2018, the Ghana Stability Agreement ceased to apply to the Obuasi mine because of the parliamentary ratification of a new development agreement and a new tax concession agreement in relation to that mine (as described below).
The Ghana Stability Agreement continued to apply to the Iduapriem mine until it expired in April 2019. Since then, AngloGold Ashanti (Iduapriem) Limited (“AGA Iduapriem”) no longer benefits from the Ghana Stability Agreement. AGA Iduapriem benefits from certain concessions under two deeds of warranty, including exemptions from withholding taxes on dividends, interest and payments for foreign services, and allowable deductions.
Obuasi Development Agreement
AngloGold Ashanti (Ghana) Limited (“AGA Ghana”) negotiated a new development agreement in relation to the Obuasi mine (the “Obuasi DA”) with the Government of Ghana. On 21 June 2018, the Ghanaian Parliament ratified the Obuasi DA which contains stability terms as provided for in stability agreements. The Obuasi DA confers a number of rights and obligations on AGA Ghana with respect to the Obuasi mine, including, among other matters, (i) the stabilisation of the fiscal and regulatory framework (except for enactments promoting the use of Ghanaian goods and services) for a period of ten years (with a potential of it being extended for five years); (ii) the right to hold up to 80 percent of proceeds received from exporting minerals in foreign currencies outside of Ghana; (iii) obligation to give preference to materials and goods made in Ghana as well as services provided by Ghanaians; and (iv) the right to peaceful enjoyment and protection against expropriation.
Obuasi Tax Concession Agreement
Fiscal terms, which would ordinarily form part of a single stabilisation document, were separated from the Obuasi DA. Hence a separate tax concession agreement in relation to the Obuasi mine (the “Obuasi TCA”) was signed with the Government. On 21 June 2018, the Ghanaian Parliament ratified the Obuasi TCA with a concession period until 31 December 2027. The Obuasi TCA contains a number of tax concessions for AGA Ghana with respect to the Obuasi mine, including, among other matters, (i) a corporate income tax rate of 32.5 percent or such lower rates as may be fixed by law (instead of the current statutory rate of 35 percent); (ii) exemption of certain transactions from capital gains tax; (iii) a sliding scale royalty rate ranging from three percent to five percent for a price ranging from $1,300 up to $2,000 and above per ounce (instead of the current flat rate of five percent); and (iv) certain VAT exemptions and refunds.
Government’s Golden Share
Section 60(1) of the GMM Act provides that the Government of Ghana can require a mining company to issue to the Republic of Ghana for no consideration a special share (a “Golden Share”). A Golden Share in AGA Ghana was issued to the Government of Ghana and the Obuasi DA confirms that the Government’s rights with respect to its Golden Share apply only in respect of AGA Ghana’s assets and operations in Ghana. The Golden Share confers certain rights on the Government in respect of AGA Ghana. For example, written consent of the holder of the Golden Share is required for, among other matters, (i) any amendment of the rights and restrictions in respect of the Golden Share; (ii) the voluntary winding-up or voluntary liquidation of AGA Ghana; (iii) the disposal of any mining lease held by AGA Ghana; and (iv) the disposal of all or substantially all of the assets of AGA Ghana. The holder of the Golden Share does not have the right to participate in the profits or assets of AGA Ghana (by way of dividend or other capital issuances), but is entitled to attend any general meeting of shareholders.
Tax laws relating to mining
Currently, the main tax laws in Ghana include the following acts and regulations, which have been frequently amended over the years:
•Income Tax Act, 2015 (Act 896) (as amended) and Income Tax Regulations, 2016 (L.I. 2244);
•Customs Act, 2015 (Act 891) (as amended) and Customs Regulations, 2016 (L.I. 2248);
•Value Added Tax, 2013 (Act 870) (as amended) and Value Added Tax Regulations, 2016 (L.I. 2243);
•Revenue Administration Act, 2016 (Act 915) (as amended); and
•Exemptions Act, 2022 (Act 1083).
The Income Tax Act, 2015 (Act 896) ringfences and taxes income derived from mining operations at certainthe rate of 35 percent. The Obuasi TCA for AGA Ghana provides for a stabilised income tax rate of 32.5 percent. AGA Iduapriem currently pays income tax at the rate of 35 percent.
Furthermore, mining companies must pay ground rent and royalties. Ground rent is payable annually and is calculated based on the number of cadastral units of land held. Royalties are calculated as a percentage of total revenue from minerals obtained by the mining company. The Government of Ghana currently applies a five percent royalty rate to mining companies who have not agreed a different royalty rate under an agreement with the State. AGA Ghana pays royalties on a sliding scale ranging between three percent and five percent as provided for by the Obuasi TCA. AGA Iduapriem pays royalties at a rate of five percent.
The provision of goods and services is liable to value added tax (“VAT”) at a revised rate of 15 percent. In addition, there are separate levies, including a 2.5 percent National Health Insurance Levy (“NHIL”), a 2.5 percent Ghana Education Trust Fund Levy (“GetFund Levy”) and a one percent COVID-19 Levy. By virtue of the Obuasi TCA, AGA Ghana is exempt from the payment of the NHIL and GetFund Levy. In addition, while AGA Ghana is technically exempt from the payment of the COVID-19 Levy (as it became operational subsequent to the effective date of the Obuasi DA), the Company decided to pay the COVID-19 Levy voluntarily. AGA Iduapriem is not exempt from any of these levies.
The Exemptions Act, 2022 (Act 1083) (“Exemptions Act”) defines the scope of tax exemptions that may be granted under Ghanaian law, and sets out the administrative process for obtaining a tax exemption. The Exemptions Act requires a person with the benefit of an existing tax exemption to apply to the Ghana Minister of Finance by 11 March 2023 in order to continue to benefit from that tax exemption. The requirement to apply to the Minister of Finance does not affect AGA Ghana (as, by virtue of the Obuasi DA, AGA Ghana is stabilized against the adverse effects of, or obligations imposed by, any new laws). By contrast, AGA Iduapriem is subject to the provisions of the Exemptions Act.
Environmental laws relating to mining
Mining companies are required, under the GMM Act, Environmental Assessment Regulations, 1999 (L.I. 1652), Environmental Protection (Mining in Forest Reserves) Regulations, 2022 (L.I. 2462) and Water Use Regulations, 2001 (L.I. 1692), to obtain all necessary approvals from the Environmental Protection Agency (the “Ghana EPA”) and, in appropriate cases, the Water Resources Commission, the Forestry Commission and/or the Minerals Commission before undertaking mining operations. This includes undergoing an environmental impact assessment process and, following the issuance of the environmental permit, periodically preparing environmental management plans, which include details of the likely impacts of mining operations on the environment and local communities, as well as a comprehensive plan and timetable for actions to mitigate and remediate any
adverse effects of the mining operations, for submission to the Ghana EPA. The Minerals and Mining (Health, Safety and Technical) Regulations, 2012 (L.I. 2182) also impose further obligations to obtain the necessary permits from the Inspectorate Division of the Minerals Commission for the operation of mines. The environmental permits of AGA Ghana (for the Obuasi redevelopment project and for the construction and operation of tailings and water infrastructure projects) are valid until June 2024. The environmental permits for AGA Iduapriem in connection with (i) gold mining and processing, (ii) the re-mining of Block 5 and for the tertiary crusher installation project and (iii) the construction and operation of a tailings storage facility (“TSF”) expired in August 2021, July 2022 and January 2023, respectively. The renewal process for the AGA Iduapriem environmental permits, which was commenced in advance of the expiry of the permits, is underway.
Environmental laws in Ghana also require mining operators to rehabilitate land negatively impacted by mining operations according to an environmental cost reclamation plan agreed with the Ghana EPA. The environmental cost reclamation plan includes two cost estimates, namely the cost of rehabilitating the mining area at the end of the life of the mine as well as the cost of rehabilitating the mine as at the date of the reclamation plan. These estimates are reviewed annually and updated every two years. Each mining company is typically required to secure a percentage (typically between 50 percent and 100 percent) of the estimated rehabilitation costs by posting reclamation bonds underwritten by banks and restricted cash. The terms of each reclamation bond are determined by a reclamation security agreement between that company and the Ghana EPA. Both AGA Ghana and AGA Iduapriem have bank guarantees in place for environmental reclamation liabilities as well as escrow accounts with joint signatories from the Ghana EPA. The guarantees for AGA Iduapriem expired in October 2022, whereas the guarantees for AGA Ghana expired in December 2022. Renewal of the bank guarantees (which commenced in advance of the expiry of the existing guarantees) has not yet been completed due to the continued depreciation of the Ghanaian cedi and its impact on the Bank of Ghana’s single obligor limit. AGA Ghana and AGA Iduapriem have notified the Ghana EPA of the resultant delays.
Foreign exchange, export and other rules
Retention of foreign earnings
The Obuasi mine is permitted to retain 80 percent of its operations. Numerous scientific, technicalforeign exchange earnings in an offshore foreign exchange account, whereas the Iduapriem mine is allowed to retain up to 75 percent. In addition, the Company has permission from the Bank of Ghana to retain and legal studiesuse U.S. dollars outside of Ghana to fulfil payment obligations to the Company’s hedge counterparties which cannot be met from the cash resources of its treasury company.
Rules regarding the export of gold and diamonds
The Bank of Ghana introduced new measures to regulate and monitor the export of gold and diamonds from Ghana in 2015. From September 2015, all exports of gold and diamonds must be carried out through the Precious Minerals Marketing Company Ltd (“PMMC”), except where the exporter is the holder of a licence that permits it to export directly. The Ghana Revenue Authority (Customs Division) only permits gold to be exported by a licensed gold exporter who has a completed Form FEX A4 bearing Bank of Ghana’s embossment. The export measures do not apply to AngloGold Ashanti because the Company holds a licence granted by the LNR Minister to sell and export its production.
Local assaying and refinement policies
In November 2016, the Ministry of Lands and Natural Resources issued a ministerial directive appointing the PMMC as designated laboratory for assaying in Ghana. The directive requests all persons holding export licences for gold to submit all gold to be exported to the PMMC for assay before export. Mining businesses, including AngloGold Ashanti, acting through the Ghana Chamber of Mines were opposed to this directive due to its potential negative impact on mining companies in the region. As a result, the Chamber initiated proceedings to reverse or modify the directive. Following discussions in respect of the mining industry’s concerns, the Chamber and Government agreed on the modalities for implementing the national assaying policy and it was introduced in February 2018 following a one-month pilot among certain mining companies. Subsequently, in June 2019, the LNR Minister released a statement reiterating the Government of Ghana’s plans to locally refine 30 percent of the gold produced in the country. Discussions between the Ghana Chamber of Mines and the Government of Ghana’s economic management team in 2019 led to the Chamber agreeing to consider the proposal and for the parties to discuss detailed modalities to ensure that a move to locally refined gold does not become detrimental to the mining industry.
Local content and local participation policy
Mining companies must submit a detailed programme for the recruitment and training of Ghanaians with a view to achieving “localisation”, which is the replacement of expatriate personnel in a company’s Ghanaian operations by Ghanaian personnel. In addition, mining companies must give preference to Ghanaian products and personnel, to the maximum extent possible, consistent with safety, efficiency and economies. The Minerals and Mining (General) Regulations, 2012 (L.I. 2173) give further details on the localisation policy. The Minerals and Mining (Local Content and Local Participation) Regulations, 2020 (L.I. 2431) came into force on 22 December 2020 with the purpose of developing Ghanaian participation in the mining industry value chain by imposing an obligation on mining companies to procure goods and services with Ghanaian content to the maximum extent possible.
The Government’s election to purchase gold
In June 2021, the Bank of Ghana launched a “Domestic Gold Purchase Programme” through which the Bank of Ghana intends to purchase refined gold from AGA Ghana, AGA Iduapriem and other large-scale mining companies through voluntary arrangements pursuant to the Bank of Ghana Act, 2002 (Act 612). The LNR Minister indicated in November 2022 that the Government of Ghana intended to exercise its statutory right of pre-emption pursuant to the GMM Act to compel large-scale mining companies to sell 20 percent of their Ghana gold production and/or the resultant refined gold to the Bank of Ghana in exchange for Ghanaian cedis. Each of AGA Ghana and AGA Iduapriem executed voluntary gold purchase agreements with the Bank of Ghana on 29 December 2022. As at 10 March 2023, the Government of Ghana had not exercised its statutory right of pre-emption as prescribed in the GMM Act.
AngloGold Ashanti’s rights and permits
Obuasi
The Obuasi mine originally held four contiguous mining leases, namely, the Obuasi, Binsere 1, Binsere 2 and Binsere 3 Mining Leases. The Obuasi Mining Lease was granted by the Government of Ghana on 5 March 1994, covering an area of approximately 338 km2 in the Amansie East and Adansi West districts of the Ashanti region, for a term of 30 years from the date of the agreement. The Binsere Mining Leases were granted on 9 April 1998, covering an area of 140 km2, for a term of 30 years from the date of the agreement. All leases in respect of the Obuasi mine had been duly ratified in accordance with Ghanaian law. In March 2007, the Government of Ghana agreed to extend the term of the Obuasi Mining Lease for a further term of 30 years. The amended Obuasi Mining Lease was also ratified by Parliament on 23 October 2008. The Obuasi Mining Lease will expire in March 2054 and the Binsere Mining Leases in April 2028. The mining leases are renewable. On 3 March 2016, the Minerals Commission approved AGA Ghana’s application to surrender approximately 273.54 km2 of the area to the Government of Ghana, reducing the combined area under AGA Ghana’s lease areas to 201.46 km2. The remaining parcel of land that will be subject to the mining lease is situated within various villages and townships in the region but excludes the municipality of Obuasi. On 15 January 2021, the Minerals Commission approved AGA Ghana’s application to surrender a further 60.24 km2 of lease area, thereby reducing the total lease area to 141.22 km2 under three mining leases, namely, the Obuasi Mining Lease (87.48 km2), the Binsere 1 Mining Lease (29.03 km2) and the Binsere 2 Mining Lease (24.71 km2). These mining leases are covered by the Obuasi DA and Obuasi TCA.
Iduapriem
The Iduapriem mine operates under four different mining leases, namely, the Iduapriem Mining Lease (LVB1539/89) (36.47 km2), the Ajopa Mining Lease (LVB/WR326/09) (46.12 km2), the Teberebie Mining Lease (LVB3722H/92) (28.53 km2) and the Ajopa South Mining Lease (LR#1109/1999) (28.10 km2). On 17 February 2020, the mining leases were extended for a further period of 15 years and such leases will now expire in February 2035. All leases in respect of the Iduapriem mine have been undertakenduly ratified in accordance with Ghanaian law.
Guinea
General laws relating to assistmining
In Guinea, the mining industry is primarily regulated by Law L/2011/006/CNT dated 9 September 2011 as amended by Law L/2013/053/CNT dated 8 April 2013 and promulgated by Decree D/2013/075/PRG/SGG dated 17 April 2013 (together, the “Guinea Mining Code”).
The Guinea Mining Code is implemented by various decrees and orders, including Decree D/2014/015/PRG/SGG adopting a model of mining convention, dated 17 January 2014, Order A/2016/1584/MMG/SGG related to the administration’s capacities for the management of integrated mining projects (PARCA-GPI) and its steering committee, dated 6 June 2016, and Decree D/2016/163/PRG/SGG on the national agency for the development of mining infrastructures (ANAIM), dated 13 June 2016.
In 2017, Decree D/2017/285/PRG/SGG was adopted, which sets forth the conditions for the constitution and management of the Local Development Fund (“Fodel”), as well as Joint Order A/2017/6326/MMG/MATD/SGG, which sets forth the conditions for the use, management and control of the Fodel. Together, these set forth the use of the mining companies’ financial contribution to the development of the local communities and the rules applying to the Fodel, which was created under the Guinea Mining Code. On 13 July 2018, a Joint Order A/2018/5212/MEF/MMG/MB/MATD/SGG was issued, which regulates the use, management and monitoring of the resources allocated to local authorities pursuant to article 165 of the Guinea Mining Code. In 2019, an inter-ministerial committee was created to supervise and control the Fodel through the adoption of Joint Order AC/2019/089/MMG/MATD/SGG setting out the conditions for the constitution, powers and management of said inter-ministerial committee. On 6 September 2019, Decree D/2019/263/PRG/SGG was issued, which sets forth local content requirements in determining the magnitudeframework of the implementation of public and private projects in Guinea. On 27 May 2021, Order A/2021/1229/MMG/SGG was issued to establish the Steering Committee for local content in the mining sector. On 21 October 2022, Law L/2022/010/CNT, dated 22 September 2022, setting up the legal framework for local content in public and private projects was enacted (the “Local Content Act”). In particular, the Local Content Act regulates local employment, procurement of goods and services, and subcontracting
requirements. As the Local Content Act does not expressly repeal the provisions of Decree D/2019/263/PRG/SGG, those provisions remain in force to the extent that they do not conflict with the Local Content Act.
On 16 June 2020, a new procedure for the export of gold by mining companies was enacted through the adoption of Decree D/2020/113/PRG/SGG, which sets out, amongst other things: (i) when the industrial production tax referred to in article 161-1 of the Guinea Mining Code shall be paid, and (ii) the process to be followed to export gold bullion.
On 27 April 2021, a Joint Order AC/2021/824/MMG/BCRG/SGG was issued establishing the fees and costs charged by the Guinean mining authorities and the Guinean Central Bank in connection with the administrative procedures for the export of gold by industrial and semi-industrial companies.
AngloGold Ashanti’s rights and permits
The Group’s Guinean subsidiary, Société AngloGold Ashanti de Guinée S.A. (“SAG”), has title to the Siguiri mine in the form of a mining concession, granted by virtue of Presidential Decree D/97/171/PRG/SGG, dated 4 August 1997, for a period of 25 years (the “Mining Concession”). The Mining Concession covers exploration and mining for gold, silver, diamonds and associated ores, and was originally covered by a mining convention entered into with the Republic of Guinea in 1993 and amended in 2005. On 28 June 2016, SAG and the Government of Guinea concluded a revised and consolidated mining convention (Convention de Base Révisée et Consolidée) (the “Revised Mining Convention”) which encompasses a renewal of the term of the original mining convention and other amendments necessary to support an expansion project to extend the life of the Siguiri mine (the “Expansion”). In compliance with the provisions of the Guinea Mining Code, the Revised Mining Convention was ratified by the Guinean National Assembly (Law L/2016/N°067/AN dated 30 December 2016, promulgated by Decree D/2017/015/PRG/SGG dated 24 January 2017), submitted to the Guinean Supreme Court which rendered a favourable opinion (Judgement N°AC 005 dated 16 January 2017), and ratified by the President of the Republic of Guinea (Decree D/2017/021/PRG/SGG dated 24 January 2017), following which it replaced the original mining convention and became effective on 24 January 2017.
Key elements of the Revised Mining Convention include the following:
•a duration of 25 years, expiring 23 January 2042, subject to further renewal if mining operations continue;
•the term of the Mining Concession is aligned with the term of the Revised Mining Convention since the Republic of Guinea committed to maintain the Mining Concession for the entire duration of the Revised Mining Convention;
•SAG’s operations remain governed by the 1995 Guinea Mining Code (the prior mining code) and are only subject to the provisions of the Guinea Mining Code to the extent they are expressly set out in the Revised Mining Convention;
•the stability of the customs and tax regime is guaranteed for the entire initial term of the Revised Mining Convention, and subject to certain conditions being met, any renewal period(s);
•the Republic of Guinea holds a 15 percent free-carried/non-contributory interest;
•the Republic of Guinea is entitled to a royalty on gold of five percent based on a spot gold price as per LBMA fixing (PM) up until the date of steady state commercial production of the first phase of the Expansion, after which the royalty rate applicable to gold will vary depending on threshold prices as per LBMA fixing (PM), namely: three percent if the gold price is $1,300 or less, five percent, if above $1,300 and up to $2,000 and seven percent if above $2,000;
•SAG benefits from 5-year income tax holiday from the beginning of steady state commercial production of the first phase of the Expansion, after which the income tax rate is set at 30 percent;
•a local development tax of 0.4 percent is payable on the sale price for gold and silver received by SAG up until 31 December 2027, after which it will be increased to 0.6 percent;
•salaries of expatriate employees are subject to a ten percent income tax;
•goods imported into Guinea for purposes related to the construction and commissioning of the first phase of the Expansion are exempt from all customs taxes and duties; and
•SAG is committed to adopting and progressively implementing a plan for the effective rehabilitation of the mining areas disturbed or affected by its operations.
The Mining Concession covers an area divided into four blocks totalling approximately 1,495 km2. SAG has the exclusive right to explore and mine in any part of the concession area for the duration of the Revised Mining Convention. The Revised Mining Convention also grants SAG the option to secure certain land rights over additional areas currently covered by exploration permits, but to which SAG may need access for purposes of establishing roads or storage of tailings. While the Mining Concession expired on 4 August 2022, a renewal request had been filed prior to its expiry in accordance with the provisions of the Revised Mining Convention on 1 February 2022. Pursuant to the Revised Mining Convention, the Mining Concession can be renewed for one or more period(s) that cannot exceed ten years each as long as the Revised Mining Convention is in force.
The Revised Mining Convention is subject to early termination if the parties formally and expressly agree to it, if the last of the mining title held by SAG expires or is relinquished without any renewal application having been filed, if all project activities are voluntarily suspended for a continuous period of 12 months or are permanently abandoned by SAG, or if SAG goes into voluntary liquidation or is placed into liquidation by a court of competent jurisdiction.
Mali
General laws relating to mining
The mining industry in Mali is primarily regulated by Ordinance No. 2019-022/P-RM dated 27 September 2019 containing the new mining code of the Republic of Mali (the “Mali Mining Code”) and Decree No. 2020-0177/PT-RM dated 12 November 2020 implementing the Mali Mining Code. On 8 December 2020, Decree No. 2020-0288/PM-RM enacted the new model mining convention referred to in Decree No. 2020-0177/PT-RM.
The Mali Mining Code applies to the mining operations previously carried out by AngloGold Ashanti entities in Mali (as further described below) except with respect to the validity, scope and duration of their exploitation permits and the provisions on tax and customs regime contained in their mining conventions (conventions d’établissement) for their remaining duration. In this regard, the transitory rules of the Mali Mining Code specify that mining conventions in force remain valid for their remaining term and their holders continue to benefit from the stability of the tax and customs regime set out therein.
Exploration and prospecting activities are carried out under exploration authorisations (autorisation d’exploration) or exploration permits (permis de recherche), which give their holder the exclusive right to carry out exploration activities over a given area. Exploration authorisations are granted by the Mining Administration (Administration chargée des Mines) for a non-renewable period of three months, while exploration permits are granted by Ministerial Order for a period of three years renewable twice for additional 3-year periods. Applications for exploration authorisations and exploration permits must contain various documents attesting to the financial and technical capacity of the applicant as well as a detailed works and costs programme.
A large scale permit exploitation permit (permis d’exploitation de grande mine) is required to mine a deposit located within the area of an exploration permit and grants the holder an exclusive right to exploit the named substances and proceed with the processing and commercialisation of the substances extracted within its perimeter. Large scale exploitation permits are granted by decree of the Head of Government for a maximum period of 12 years renewable for ten year-periods until depletion of the deposits. An application must be submitted to the Mining Administration (Administration chargée des Mines) and must contain various documents attesting to the financial and technical capacity of the applicant, a feasibility study, a detailed environmental study in respect of the impact of the project on the environment, an environmental permit, a closure and to find sustainable remediation solutions. Based on those studiesrehabilitation plan as well as discussion with regulators,a community development plan. As soon as the large scale exploitation permit is granted, the permit holder must incorporate a company under the laws of Mali and assign the permit for free to this company. The State will have a ten percent free-carried interest in the company. This interest will be converted into priority shares and the State’s participation will not be diluted in case of an increase in capital. In addition, the company has taken steps, including monitored natural attenuationis required to ensure that private Malian investors are offered the possibility to acquire five percent of their capital.
All mining titles mentioned above (save for the exploration authorisation) require a mining convention (convention d’établissement) to be signed by the State and phyto-technologies,the titleholder defining their rights and obligations, the duration of which is 20 years.
AngloGold Ashanti’s rights and permits
Historically, AngloGold Ashanti had interests in the Morila, Sadiola and Yatela gold mines, all of which were governed by mining conventions (conventions d’établissement) covering exploration, mining, treatment and marketing in a comprehensive document. These documents include general provisions regarding exploration (work programme, fiscal and customs framework) and exploitation (formation of a local limited liability mining company, State interest, fiscal and customs framework governing construction and exploitation phases, exchange controls, marketing of the product, accounting regime, training programmes for local labour, protection of the environment, reclamation, safety, hygiene and dispute settlement). The Morila and Sadiola gold mines were sold in November and December 2020, respectively.
In April 2017, Société d’Exploitation des Mines d’Or de Yatela S.A. (“Yatela”), the company operating the Yatela gold mine, began the implementation of a closure plan in order to address soilrelinquish the property. In February 2019, AngloGold Ashanti and groundwater contamination. Subjectits joint venture partner IAMGOLD Corporation announced an agreement to sell each of their 40 percent interests in Yatela to the completionGovernment of trialsMali, which holds the remaining 20 percent interest. Completion of the transaction is subject to the fulfilment or waiver of a number of conditions precedent and has been delayed several times since 2019 due to political instability and related events in Mali as well as the COVID-19 pandemic. Yatela’s exploitation permit covers approximately 212 km2. Yatela has a 30-year permit which expires in 2030.
Tanzania
General laws relating to mining
Tanzania Mining Act and Tanzania Mining Regulations
Mineral rights in the United Republic of Tanzania are principally governed by the Mining Act, Chapter 123 (R.E. 2019), as amended (the “Tanzania Mining Act”) and the technology beingMining Regulations, 2018 (the “Tanzania Mining Regulations”). The Tanzania
Mining Act and the Tanzania Mining Regulations came into force in November 2010 followed by amendments to the Tanzania Mining Act in 2017 and subsequent amendments to the Tanzania Mining Regulations in 2018 and 2019. The Mining (Local Content) Regulations were amended and came into force on 23 September 2022. Those amendments, together with an Executive Order, introduced, among other matters, (i) the Tanzania Mining Commission; (ii) local content requirements in employment and for procurement of goods and services; (iii) Mining Licence requirements of five percent of a proven remediation technique, no reliable estimate canlicencee’s equity to be madeheld by Tanzanians, with at this timeleast 80 percent of its managerial positions to be held by Tanzanians and 100 percent of non-managerial and other positions to be held by Tanzanians, in addition to the shareholding of the Government of Tanzania pursuant to Section 10 of the Tanzania Mining Act (i.e. free-carried interest); and (iv) regulations for the obligation. Should these obligationsgovernment warehousing of minerals prior to export/sale.
Minimum shareholding and public offering
In 2016, the Mining (Minimum Shareholding and Public Offering) Regulations, 2016, as amended, was adopted. The regulations set out the requirement to sell shares to Tanzanian nationals, by way of a public offering and listing on the Dar es Salaam Stock Exchange, which will apply to companies that are carrying out large scale mining operations. The regulations also require all existing holders of a special mining licence to list a minimum of 30 percent of their shares on either the Main Investment Market or the Enterprise Growth Market Segment of the Dar es Salaam Stock Exchange within six months of the regulations coming into force, which was on 24 February 2017. However, the Company believes the listing requirement conflicts with the mining development agreement. In September 2020, the Government of Tanzania published the Mining (Minimum Shareholding and Public Offering) (Amendment) Regulations, 2020, which exempts companies holding special mining licences from local listing requirements if such mining company has entered into an agreement with the Government of Tanzania that provides for a non-dilutable free-carried interest in such mining company and an economic benefits sharing arrangement.
Arbitration
Along with other major mining companies, AngloGold Ashanti’s subsidiaries are seeking a constructive dialogue with the Government of Tanzania to gain assurances that the Geita gold mine will not be significant,affected by recent legal and fiscal changes adopted by the Government in light of their mining development agreements which guarantee (i) fiscal and regulatory stability, and (ii) an agreement between all parties before material legal and regulatory changes are made. As a precautionary step to safeguard its interests, AngloGold Ashanti commenced international arbitration proceedings against the Government of Tanzania in connection with the enactment of this couldlegislation in July 2017. Declaratory relief is sought in accordance with the terms of the company’s existing mining development agreement to preserve its and its shareholders’ rights and interests in the Geita gold mine. AngloGold Ashanti is seeking confirmation from the Government of Tanzania that, as a result of its existing mining development agreement, the company does not fall within the scope of the new mining legislation that includes, among other things, (i) listing requirements; (ii) an increase in the rate of revenue royalties from four to six percent and a one percent clearance fee; and (iii) a right for the Government of Tanzania to (a) renegotiate existing mining agreements at its discretion, (b) receive a non-dilutable, free-carried interest of no less than 16 percent in all mining projects, and (c) acquire up to 50 percent of the shares of the mining company commensurate with the total tax expenditure incurred by the Government in favour of the mining company. AngloGold Ashanti can provide no assurance that the new mining legislation, including the listing requirements, will not apply to its operations in Tanzania and the outcome of the arbitration action may have a material adverse impact upon AngloGold Ashanti’s results and its financial condition.
As AngloGold Ashanti or its predecessors have a long history of mining operations in certain regions, issues may arise regarding historical environmental impacts on those areas, for which AGA, as the current owner/operator, may be legally responsible.
In addition, AngloGold Ashanti identified a flooding and future pollution risk to deep groundwater in the Far West Rand goldfields in South Africa, which includes AngloGold Ashanti’s operations. The premature closure of neighbouring mines owned by other mining companies in the area led to increased pumping obligations on AngloGold Ashanti to address water infiltration into AGA’s mines. In addition, in the West Wits district, after Blyvooruitzicht Gold Mining Company was placed in provisional liquidation in August 2013, AngloGold Ashanti purchased from Blyvooruitzicht the rights of access to the 4 and 6 shafts as well as the relevant infrastructure to continue pumping underground water. We subsequently transferred the assets and rights to a newly incorporated subsidiary Covalent Water Company and, in November 2014, obtained a directive from the Department of Water and Sanitation directing AngloGold Ashanti through Covalent to dewater 4 and 6 shafts and discharge the water. AGA continues to comply with the directive.
Climate Change and Greenhouse Gas Regulation
Greenhouse gases (GHGs) are emitted directly by AngloGold Ashanti’s operations, as well as by external utilities from which AngloGold Ashanti purchases electricity.
As a result of commitments made at the UN Climate Change Conference in Durban, South Africa in December 2011, certain members of the international community negotiated a treaty at the Conference of the Parties of the UN Framework Convention on Climate Change in Paris in December 2015 (Paris Agreement). The Paris Agreement, which came into force on 4 November 2016, requires developed countries to set targets for emissions reductions. Additional measures designed to limit or reduce GHG emissions, both mandatory and voluntary, may be implemented at national or international levels in various countries.
For example, in South Africa, the Carbon Tax Act, No. 15 of 2019, imposing a tax on carbon dioxide equivalent of GHG emissions, took effect on 1 June 2019. The tax will be implemented in a phased manner, taking into account South Africa’s Nationally Determined Contributions (NDCs) commitment under the Paris Agreement to reduce greenhouse gas emissions. The first phase, which runs from June 2019 to December 2022, imposed a tax of ZAR120/ton carbon dioxide equivalent (CO2-e) of direct GHG emissions, which will increase by CPI plus two percent up to 2022 and in line with inflation thereafter. As this first phase is designed to be revenue-neutral in terms of its aggregated impact, a system of rebates is in place effectively reducing the actual rate to be in a range of ZAR6/ton to ZAR48/ton.
These, or future, measures could require AngloGold Ashanti to reduce its direct GHG emissions or energy use or to incur significant costs for GHG emissions permits or taxes, including for those costs or taxes passed on by electricity utilities which supply the company’s operations. AngloGold Ashanti could also incur significant costs associated with capital equipment, GHG monitoring and reporting and other obligations to comply with applicable requirements. The most likely source of these obligations is through state-level implementation of new emissions or financial obligations pursuant to evolving climate change regulatory regimes.
For example, in 2010, Brazil launched the National Climate Change Policy, which established a voluntary reduction target of 1.2 billion tonnes of CO2 below the projected emissions in 2020. The policy required the development of sector-specific plans in order to meet the target. Amongst other plans, it is intended to reduce deforestation in the Cerrado biome, where AngloGold Ashanti operates, by 40 percent compared to the average deforestation in 1999-2008 and expand renewable energy production and energy efficiency programmes. The policy also provided for a Brazilian GHG trading scheme, which is yet to be designed. While Brazil is not yet requiring mandatory GHG emissions reporting at the national level, some state environmental agencies have requested companies to voluntarily submit GHG emissions management plans, however Goiás and Minas Gerais State (in which AngloGold Ashanti operates) do not currently require GHG emissions management plans for mining projects.
In Australia, the Commonwealth Government introduced the Safeguard Mechanism (Rule 2015) through the existing National Greenhouse and Energy Reporting (NGER) scheme, to provide a framework for Australia’s largest emitters to measure, report and manage their emissions. It does this by encouraging large facilities, whose net emissions exceed the safeguard threshold, to keep their emissions at or below emissions baselines set by the Clean Energy Regulator. The safeguard mechanism applies to facilities with Scope 1 covered emissions of more than 100,000 tonnes of CO2-e per fiscal year. The Australian mining operations (Sunrise Dam and Tropicana) had emissions baselines set in 2016 for a 3-year period (expired in 2019) which were reported annually through the NGER scheme. During the 2018/19 fiscal year, Tropicana’s emissions were within its authorised threshold and Sunrise Dam was required to purchase offsets for emissions that were 0.8% above its safeguard threshold, the cost of which was immaterial. The Australian mining operations are in the process of re-calculating their respective emissions baselines in 2020 to comply with the changes in Rule 2015 which adopt government-determined prescribed production variables.
In addition to more stringent requirements and commitments, AngloGold Ashanti’s operations are subject to a number of physical risks from climate change, such as changes in rainfall rates or patterns resulting in floods or droughts, rising sea levels, reduced water availability, higher temperatures and extreme weather events. Such events or conditions, particularly including flooding or inadequate water supplies, could disrupt mining and transport operations, mineral processing and rehabilitation efforts, create resource or energy shortages or damage the company’s property or equipment and increase health and safety risks on site.
Occupational and Community Safety and Health and Tropical Diseases
Safety is a significant sustainable development challenge facing AngloGold Ashanti. AngloGold Ashanti’s operations are subject to a variety of laws and regulations designed to protect and improve the safety and health of employees. In some of the jurisdictions in which AngloGold Ashanti operates, the government enforces compulsory shutdowns of operations to enable investigations into the cause of accidents at those operations.
Throughout the year we have continued to improve our safety performance across our global operations, which remains a top priority for AngloGold Ashanti. We pursue and continually adapt strategies in line with recognised leading practice in global safety standards and systems in working towards our 2030 goal of providing workplaces free of injury and harm for our employees and contractors. Our progress to date is the cumulative result of numerous interventions over several years, including the development of our 2015 strategy, which designed with the input of operating teams across our business as well as representatives from the Executive Committee, management and employees. To ensure that our strategy remains relevant and focused, we reassess its look at risk management, technology and innovation, leadership, people and work processes. We also adhere to global standards
and are rolling out ISO 45001:2018, which has replaced the OHSAS 18001:2007 series. All our sites are currently OHSAS 18001:2007 certified and three operations, Sunrise Dam, Siguiri and Geita, have already converted to the ISO 45001:2018 standard.
In addition, AngloGold Ashanti is subject to health and safety regulations relating to occupational disease. The primary areas of focus in respect of occupational health of employees within the company’s operations are noise-induced hearing loss (NIHL) and occupational lung diseases (OLD). OLD includes occupational tuberculosis and silicosis in individuals exposed to silica dust. Silicosis has been particularly prevalent in South Africa and has also arisen at the company’s Continental Africa and Brazilian operations, albeit to a far lesser extent. AngloGold Ashanti provides occupational health services to its employees at its occupational health centres and clinics, and continues to improve preventative occupational hygiene initiatives, such as implementing various control measures to prevent hazardous exposures, and providing employees with Personal Protective Equipment. It is believed that the costs associated with activities to prevent disease would be substantially lower than those associated with managing the consequences of occupational disease. Actual and alleged health and safety incidents or breaches of standards may also adversely impact the company’s reputation.
The South African government, by way of a cabinet resolution in 1999, proposed a possible combination and alignment of benefits of the Occupational Diseases in Mines and Works Act (ODMWA) that provides for compensation to miners who have OLD, and the Compensation for Occupational Injuries and Diseases Act (COIDA), that provides for compensation in respect of job related injuries and compensation of non-miners who have OLD. Work on amending ODMWA is underway, although it remains unclear as to what progress will be made in the short- to medium term. COIDA provides for compensation payments to workers suffering permanent disabilities which are classified as pension liabilities if the permanent disability is above a certain threshold, or a lump sum compensation payment if the permanent disability is below a certain threshold. ODMWA provides for a lump sum compensation payment to workers suffering from OLD as well as the payment of medical expenses over the claimant’s lifetime. If the proposed amendments to ODMWA were to occur, this could further increase the amount of statutory compensation that miners employed by AngloGold Ashanti could claim, which consequently could have an adverse effect on AngloGold Ashanti’s financial condition.
In 2019, the Johannesburg High Court approved the settlement of existing silicosis and tuberculosis class actions against AngloGold Ashanti and other gold mining companies in South Africa. Please refer to “Item 8A: Consolidated Financial Statements and Other Financial Information-Legal Proceedings-South Africa-Silicosis and tuberculosis litigation”.
In addition to OLD, AIDS and associated diseases remain major health care challenges faced by AngloGold Ashanti’s South African operations. AngloGold Ashanti continues to implement programmes to help those infected with HIV and prevent new infections from spreading. Since 2001, the company has offered a voluntary counselling and HIV testing programme for employees in South Africa and, since 2003, has offered anti-retroviral therapy to HIV positive employees who meet the current medical criteria and who desire this treatment. Over the past 10 years, the incidence of new infections has declined.
Malaria and other tropical diseases also pose health risks at all of the company’s operations in Central, West and East Africa where such diseases may assume epidemic proportions because of ineffective national control programmes. Malaria is a major cause of death in young children and pregnant women but also gives rise to deaths and absenteeism in adult men. All affected company operations have malaria control programmes in place.
Other conditions such as heart disease, chronic diseases and obesity are of increasing incidence and concern. Such diseases impair the health of workers and negatively affect productivity and profitability as a result of workers’ diminished focus or skill, absenteeism, treatment costs and allocated resources.
AngloGold Ashanti cannot guarantee that any current or future medical programme will be successful in preventing or reducing the injury and illness rates amongst its employees or in affecting consequent morbidity or mortality rates. AngloGold Ashanti may incur significant costs in addressing this issue in the future, which could also adversely impact the company’s results of operations and financial condition. See also “Item 8A: Legal Proceedings-Tanzania”.
Categories of mineral right licences
ANGLOGOLD ASHANTI GLOBAL OPERATIONS: 2019
Ownership of and control over minerals on, in or under the land vest in the President of the United Republic of Tanzania. No person is allowed to prospect for minerals or carry on mining operations except pursuant to the authority of a mineral right licence granted, or deemed to have been granted, under the Tanzania Mining Act or its predecessor acts. To enable a company to prospect or mine, the Tanzania Mining Commission (“MC”) initially grants an exclusive prospecting licence. Upon presentation of a feasibility study, together with certain other environmental, social and financial assurances, the MC may then grant a form of licence for mining. Three categories of licences can be applied for under the Tanzania Mining Act: licences for exploration, licences for mining, and licences for ancillary activities. Licences for exploration include prospecting licences and gemstone prospecting licences. Licences for mining include special mining licences (if the proposed capital investment is equal to at least $100 million), mining licences (if the proposed capital investment is equal to between $100,000 and $100 million) and primary mining licences (reserved for Tanzanian citizens).
A prospecting licence grants the holder the exclusive right to prospect in the area covered by the licence for all minerals within the class of minerals applied for. An application for a prospecting licence is made to the Mining Commission and the licence, once granted, is valid for an initial term of four years. After the initial term, the licence is renewable for a further period of three years, with no option for renewal thereafter. Upon renewal, 50 percent of the area covered by the licence must be relinquished.
OperationsMining is mainly carried out through either a mining licence or a special mining licence, both of which confer on the holder the exclusive right to conduct mining operations in or on the area covered by the licence. A special mining licence is granted for the shorter of either the estimated life of the ore body indicated in the feasibility study report or such period as the applicant may request. The holder of a special mining licence may apply for renewal of its licence at any time but no later than one year before the expiry of the licence and projectssuch renewal shall not be for a period exceeding the estimate life of the remaining ore body. Special
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AMERICAS | CONTINENTAL AFRICA | SOUTH AFRICA |
1 |
| Argentina | 4 |
| Guinea | 9 |
| South Africa |
| Cerro Vanguardia (92.5%)(1) | | Siguiri (85%) | | Mponeng(6) |
2 |
| Brazil | 5 |
| Mali | | Surface Operations(6) |
| Serra Grande | | Morila (40%)(5) | | |
| AGA Mineração | | Sadiola (41%)(3) | | |
3 |
| Colombia | 6 |
| Ghana | | |
| Gramalote (51%) | | Iduapriem | AUSTRALIA |
| La Colosa | | Obuasi(4) | 10 |
| Australia |
| Quebradona(2) | 7 |
| DRC | | Sunrise Dam |
| | | Kibali (45%)(5) | | Tropicana (70%) |
| 8 |
| Tanzania | | |
| | | Geita | | |
| | | | | |
mining licences have certain fiscal and other advantages over mining licences, as the holder of a special mining licence may enter into a mining development agreement with the Government of Tanzania to guarantee the fiscal stability of a long-term mining project and make special provision for the payment of royalties, taxes, fees and other fiscal imposts. A special mining licence holder may, in certain circumstances, amend the programme of the mining operations agreed with the MC.
Percentages indicateTax laws relating to mining
Currently, the ownershipmain tax laws in Tanzania comprise the Finance Act, 2015 (No. 16), which came into force on 1 July 2015, the Finance Act, 2017 (No. 4), which came into force on 1 July 2017, and currently the Finance Act, 2022 (No. 5), which came into force on 1 July 2022. All tax laws impose and revise certain taxes, duties, levies and fees. Among other provisions, inspection or clearance fees on the exportation or domestic use of minerals were introduced. Such exportation or domestic use is restricted unless such minerals have been inspected or cleared at the mining areas, ports, airports, border or posts and the clearing fee of one percent of the gross value of the minerals has been paid by the exporter or any other person in possession thereof. Local government levies and environmental management fees and charges apply as well.
Effective 20 July 2017, the Value Added Tax Act, 2014 (No. 5) (the “VAT Act”) was amended in order to restrict VAT relief for VAT input tax paid by mining companies on goods and services. Prior to the enactment of this amendment to the VAT Act, mining companies were entitled to 100 percent VAT relief in respect of the goods and services they purchased. The amendment prohibits refunds for VAT input tax incurred on a series of raw products, including the exportation of “raw minerals”. Subsequently, the Tanzania Revenue Authority (“TRA”) denied our applications for VAT input credit refunds, which amounted to a total of $153 million (after discounting provisions) as of 31 December 2022, covering the period from July 2017 onwards, on the basis that all of the gold doré that we export constitutes “raw minerals” for purposes of the VAT Act. In response, the company filed formal notices of objection with the TRA stating that the exportation of gold doré is, in its view, not covered by the restriction since doré does not fall within the category of “raw minerals” as used in the VAT Act. On 22 February 2019, the Tanzania Mining Act was amended to introduce a definition for “raw minerals” which supports our interpretation that gold doré is excluded from the prohibition. On 1 July 2020, the Finance Act, 2020 (No. 8), amended the VAT Act, without retrospective effect, in order to remove the restrictions on VAT input tax credits for the exportation of “raw minerals” as well as a series of other raw products. This recent amendment confirms the technical basis for VAT input tax recovery for mineral exporters from July 2020 onwards. VAT claims from July 2020 onwards are subject to verification procedures by the TRA before any refunds will be received. In 2022, the company was able to offset $45 million of verified VAT claims (from July 2020 onwards) against its corporate tax liability in Tanzania. Discussions with the TRA are ongoing to resolve our historical claims for VAT input credit refunds for the period from July 2017 to June 2020.
Natural resources, export and other rules
Natural resources legislation
In Tanzania, two laws in respect of natural resources came into force in July 2017: the Natural Wealth and Resources Contracts (Review and Re-negotiation of Unconscionable Terms) Act, 2017 (No. 6) (the “Unconscionable Terms Act”) and the Natural Wealth and Resources (Permanent Sovereignty) Act, 2017 (No. 5) (the “Permanent Sovereignty Act” and together with the Unconscionable Terms Act, the “Natural Resources Laws”). Implementing regulations were published in January 2020. The Natural Resources Laws provide that Tanzania has sovereignty over its natural resources and that all arrangements or agreements that relate to “natural wealth and resources” are subject to review by the National Assembly to ensure that they are in the interests of the people of Tanzania. During a review all unconscionable terms as interpreted in accordance with the law are expunged from the agreement. In addition, under the laws, disputes over natural wealth and resources will not be subject to any proceedings in any foreign court or tribunal. As a result, investors are restricted from accessing international dispute resolution mechanisms. Accordingly, companies are now required to adopt Tanzanian law and local dispute resolution in all mining agreements. As such, all disputes will be handles by Tanzanian judicial bodies or any other Tanzania government body vested with powers to resolve disputes. In addition, to ensure that the Government and the people of Tanzania obtain an equitable stake in the exploitation of mining resources, all project earnings must be retained in Tanzanian banks. Investors are also prevented from freely exporting raw minerals and repatriating funds.
Section 6 of the Unconscionable Terms Act specifically provides that where there is an unconscionable term, the National Assembly may pass a resolution for re-negotiation of the agreement whereupon the Government shall serve notice to the investor to re-negotiate the term or agreement. The Government and the particular investor have 90 days from the notice date to re-negotiate the term or agreement. If both parties fail to revise the unconscionable term, the term will be deemed removed from the agreement. A term is considered “unconscionable” under the Unconscionable Terms Act if, among other grounds, the requirements or provisions of the agreement restrict the right of the state to exercise authority over foreign investment within the country and in accordance with the laws of Tanzania, are inequitable and onerous to the state, secure preferential treatment designed to create a separate legal regime to be applied discriminatorily for the benefit of a particular investor, deprive the people of Tanzania of the economic benefits derived from subjecting natural wealth and resources to beneficiation in the country, or subject the state to the jurisdiction of foreign laws and foreign courts or tribunals.
State participation
On 23 September 2022, the Mining (State Participation) Regulations, 2022 (the “SPR 2022”) came into force. The SPR 2022 required every mining licence or special mining licence holder to give notice to the MC to initiate negotiations to enable the Government of Tanzania to acquire a shareholding in the mining operation by 23 December 2022. On 9 December 2022, the company notified the MC that it had already initiated negotiations with the Government of Tanzania prior to the coming into force of the SPR 2022. The Government’s equity interest must consist of a non-dilutable free-carried interest in the mining operation ranging between 16 percent and 50 percent depending, in part, on the quantification of tax expenditures enjoyed by the mining entity during its establishment and on the extent of Government development of public infrastructure servicing the mining operation. The free-carried interest shares (the “FCI shares”) will be regarded as preferred shares and will entitle the Government to a dividend. Further, the FCI shares give the Government the right to appoint two directors (out of five) of the company engaged in the mining operation and the right to approve at least two suitable persons to the top executive management of the company engaged in the mining operation as may be agreed in the shareholders agreement. Any other management positions created by the company engaged in the mining operation shall be shared with the Government on a ratio of 3:1. The SPR 2022 also provides for the non-deductibility of royalty payments in the calculation of corporate income tax.
Local participation policy
On 15 September 2015, the Non-Citizens (Employment Regulation) Act, 2015 (No. 1) (the “Non-Citizens Act”) came into force which vests powers concerning work permits with the Labour Commissioner. Therefore, non-citizens wishing to be employed in the country are required to apply and be granted a work permit before applying for a residence permit. Before granting the work permit, the Labour Commissioner must be satisfied that all efforts have been explored to acquire a local expert. Further, the company is required to submit a succession plan to both the Labour Commissioner and the MC which sets out a well-articulated plan for the transfer of the non-citizen’s knowledge and expertise to Tanzanian citizens. Moreover, the Commissioner General of Immigration is required to take into consideration conditions of the work permit issued by the Labour Commissioner when granting a residence permit.
The Tanzania Investment Act No. 10 of 2022
On 2 December 2022, the Tanzania Investment Act, 2022 (No. 10) (the “Investment Act”) came into force. The Investment Act restores the right to international arbitration and grants foreign investors access to settle disputes with the Tanzania Investment Centre or the Government of Tanzania through arbitration. Pursuant to the Investment Act, parties to a dispute may agree to the use of a local or foreign arbitration venue.
AngloGold Ashanti’s rights and permits
The Geita gold mine is located in the Lake Victoria goldfields of the Mwanza region of Tanzania. AngloGold Ashanti has concluded a mining development agreement with the Ministry of Minerals on 24 June 1999 and was issued a special mining licence (SML45/99) covering approximately 196 km2 for a period of 25 years, which expires on 26 August 2024. The internal renewal process for the special mining licence (SML45/99) is underway with a view to submitting an application for renewal prior to its expiry date. On 9 October 2014, an addendum to the mining development agreement was entered into ratifying, among other matters, an increase in the royalty rate from three percent to four percent with effect from 1 May 2012. In March 2020, Geita Gold Mining Limited received the consent of the Minister of Minerals to change the mining method under its special mining licence from open pit to underground method, subject to the requisite terms and conditions. Within the special mining licence area, there are also seven primary mining licences of approximately 0.63 km2 in total which belong to third parties. Furthermore, AngloGold Ashanti holds prospecting licences covering (i) an area of 120 km2 in the immediate vicinity of its special mining licence area, and (ii) an area of 690 km2 located in the Dodoma, Singida and Shinyanga regions, but none of these areas contain any Mineral Reserve. All licences are in good standing.
AUSTRALIA
General laws relating to mining
In Australia, with a few exceptions, all onshore minerals are owned by the Crown. The respective Minister for each state and territory is responsible for administering the relevant mining legislation enacted by the states and territories. Native title legislation applies to certain mining tenements within Australia. Australia recognises and protects a form of native title that reflects the entitlement of Aboriginal people to their traditional lands in accordance with their traditional custom and laws. Should native title claims or determinations exist, certain native title processes and procedures will apply under the Native Title Act 1993 (Cth) (the “Native Title Act”) before the tenure is granted. Tenure may be granted subject to conditions relating to native title rights. In the mining context, native title matters are managed as part of the tenement grant process. If disputes arise in relation to the grant of a particular tenement, they can be referred to the National Native Title Tribunal, established under the Native Title Act, for resolution. Native title legislation also provides a framework for compensation to be paid for acts that affect native title rights and interests. Ordinarily, the relevant Commonwealth or State government is liable to pay compensation for acts attributable to it. However, in the state of Western Australia, the Mining Act 1978 (WA) provides that an applicant for the grant of, or the holder of, a mining tenement is responsible for native title compensation, if determined to be payable, to native title holders.
Federal, state and territory Aboriginal and non-Aboriginal heritage laws operate in parallel to the native title legislation. State and territory heritage laws exist predominantly for the purposes of managing the impact of developments on sites, objects and areas of heritage significance. In Western Australia, impacts to Aboriginal cultural heritage are regulated by the Aboriginal Heritage Act 1972 (WA). However, this legislation will be repealed and replaced by the Aboriginal Cultural Heritage Act 2021 (WA) (the “ACH Act”) which was enacted in 2021. The regulations, management code and various guidelines which underpin the ACH Act are being co-designed by the State government, traditional owners, industry and other stakeholders. The ACH Act will not become fully operational until the co-design process is complete in mid-2023 at the earliest. Where an area of heritage significance is placed on the national or world heritage registers, federal approval processes may also apply. To date, there has not been any significant impact on any of AngloGold Ashanti. AllAshanti’s tenure due to native title or heritage legislation and, at this stage, it is not possible to predict any significant impact that may result in the future from the final regulations, management code and various guidelines under the ACH Act, once adopted.
AngloGold Ashanti’s operating properties are located in the state of Western Australia where tenure is issued under, and mining operations are 100%-owned unless otherwise indicated.
| |
(1)
| Sale process ongoing (at an advanced stage). |
| |
(2)
| In 2019, the company’s joint venture partner’s, B2Gold Corp, minority shareholding was converted to a share of profits. Likely to be a copper mine producing gold and silver as by-products. |
| |
(3)
| Agreement and sale announced December 2019. |
| |
(4)
| Obuasi's redevelopment project began in 2019. |
| |
(5)
| Kibali and Morila are managed and operated by Barrick Gold Corporation (Barrick). |
| |
(6)
| Agreement and sale announced post year end in February 2020. |
governed by, the Mining Act 1978 (WA). The most common forms of tenure in Western Australia are exploration and prospecting licences, mining leases, miscellaneous licences and general purpose leases. In most Australian states, if the holder of an exploration licence establishes indications of an economic mineral deposit in the area covered by the exploration licence and complies with the conditions of the grant, the holder of the exploration licence has a priority right against all others to be granted a mining lease which gives the holder exclusive mining rights with respect to minerals on the property.
OPERATING PERFORMANCEIt is possible for an individual or entity to own an area of land (including for infrastructure purposes) and for another individual or entity to be granted the right to explore for or mine any minerals located on or under the surface of the same area. The maximum initial term of a mining lease in Western Australia is 21 years and the holder has the right to renew the lease for an additional 21 years. Subsequent renewals are granted at the discretion of the respective state or territory’s minister responsible for mining rights. In Western Australia, mining leases can only be assigned with the prior written consent of the minister.
Group descriptionTax laws relating to mining
Government royalties are payable by the holder of mining tenure in respect of minerals obtained from the relevant area of land at the rates specified in the relevant legislation in each state or territory. The royalty on gold production in Western Australia is payable quarterly at a fixed rate of 2.5 percent of the royalty value of gold metal produced. The royalty value is calculated by multiplying the amount of gold produced during a given month by the average gold spot price for that month. In addition, the holder of a mining tenement is required to pay annual rent in respect of the tenement. In Western Australia there is a minimum annual expenditure requirement for prospecting and exploration licences and mining leases. Exemptions from the expenditure requirement can be obtained if certain conditions are satisfied.
Environmental laws relating to mining
Mining tenements will be granted with endorsements and conditions relating to protection of the environment. Exploration and mining operations may also require separate approval from the state, territory or federal environment minister, which may require completion of an environmental impact assessment (including a public consultation period) pursuant to applicable environmental protection legislation prior to commencement. Further, a works 'construction' approval and an operating licence under the relevant environmental protection legislation in the state or territory may also be required for certain mine processing or mining-related operations. In Western Australia, legislation removing the distinction between “works approvals” and “licenses” is expected to enter into force in December 2023 such that, following the effective date, only a “license” will be required for “prescribed activities”, which include relevant works and operations on a mining lease, and not a separate “works approval”. Depending on the jurisdiction, additional approvals may be required for the removal of native vegetation within the tenement, and the taking and use of water for exploration and mining operations.
AngloGold Ashanti’s rights and permits
AngloGold Ashanti has been granted 21-year term mining leases with rights of renewal to all of its mining areas in Australia, including its proportionate share of joint venture operations and accordingly it has, together with its joint venture partners where applicable, the exclusive right to mine in those areas. Both the Group and its joint venture partners are fully authorised to conduct operations in accordance with relevant laws and regulations. The mining leases and rights of renewal cover the current life-of-mine at AngloGold Ashanti’s operations in Australia.
At Sunrise Dam, one mining lease (M39/1116) covers the deposit and mine infrastructure (approximately 7,808 hectares) and another mining lease (M39/1117) covers the water extraction infrastructure used to supply the operation with water (approximately 1,768 hectares). Both leases are currently in good standing, with expiry dates in 2038.
The Butcher Well joint venture has security of tenure for all current exploration licences and for the contiguous mining leases that covers its Mineral Resource. There are three mining leases: mining lease (M39/165) which covers 602.35 hectares with expiry date in 2030, mining lease (M39/166) which covers 990 hectares with expiry date in 2030 and mining lease (M39/230) which covers 446.4 hectares with expiry date in 2032.
At Tropicana, the deposit is situated upon a single mining lease (M39/1096) covering approximately 27,228 hectares, which is currently in good standing, with an independent, globalexpiry date in 2036.
AngloGold Ashanti Australia Limited is also conducting early stage exploration activities in Queensland under the Mineral Resources Act 1989 (QLD). AngloGold Ashanti holds 15 exploration permits covering 316,851 hectares. Each permit is granted with an initial term of five years, renewable for two further periods of not more than five years each.
AMERICAS
Argentina
General laws relating to mining and land ownership
Mining regime
The Argentinean Mining Code governs mining activity in the country. Special regimes exist for hydrocarbons and nuclear minerals. In the case of most minerals, the Argentinean Mining Code establishes that the owner of the land is not the owner of the mineral rights; these are held by the national or provincial governments (depending on the location of the minerals). The national or provincial government, as applicable, is required by the Argentinean Mining Code to grant whomever discovers a new mine title to the mining concession.
The Argentinean Mining Code regulates exploration permits as well as mining concessions, or exploitation rights. Exploration permits grant their holders exclusivity rights to any mineral discoveries, including those made by a third party within the exploration area covered by the permit. Exploration permits are limited in time and as to the extent of the exploration area, are subject to the payment of a single-time fee, and also require a minimum exploration work programme and schedule to keep the permit in force. Priority for receiving a mining concession is given to the registered discoverer of the mine, which holds the exploration permit. Once the application for a mine has been submitted, the applicant may commence works and must submit a legal survey of the units requested for the new mine. The application and the legal survey may be opposed by third parties following specific proceedings set forth in the Argentinean Mining Code. Approval and registration of the legal survey by the provincial mining authority constitutes formal title to the mining concession.
Holders of mining concessions must comply with three main conditions: payment of an annual fee, investment of a minimum amount of capital, and the carrying out of a reasonable level of exploitation. Failure to do so could lead to forfeiture of the mining concession, which would then revert back to the Province.
In addition to the Argentinean Mining Code, between 1993 and 1995, Argentina implemented several federal laws to offer foreign companies attractive incentives for exploration and mining in Argentina, the Mining Investment Law (Law No. 24, 196), as amended (the “Mining Investment Law”), and related legal provisions being the most important one. Such incentives include, among other matters, import duty exemptions, accelerated depreciation of fixed assets, a three percent cap on provincial royalties set at pit-head value on the mineral extracted, value added tax refunds for exploration-related expenses incurred by companies registered under the Mining Investment Law, and, subject to the filing of a feasibility study for the relevant mining project, a 30-year stability as to the tax burden on the project and the customs and foreign exchange regimes and duties. Cerro Vanguardia S.A. (“CVSA”) obtained its tax, customs and foreign exchange stability certificate in 1996.
Glacier Law
On 30 September 2010, the National Law on Minimum Requirements for the Protection of Glaciers (Law No. 26, 639) (the “Glacier Law”) was enacted in Argentina, banning new mining exploration and exploitation activities on glaciers and “peri-glacial” areas. The Glacier Law establishes a broad definition of “peri-glacial” areas that, together with glacial areas, must be surveyed by an existing national government agency specifically appointed to this end every five years. The area where the Cerro Vanguardia project is located does not include any glaciers or peri-glacial areas according to the inventory of glaciers which was published in June 2018.
Rural Land Law
On 27 December 2011, the Argentinean National Congress passed a law on the Regime for Protection of National Domain over Ownership, Possession or Tenure of Rural Land (Law No. 26, 737) (the “Rural Land Law”) which implemented a set of rules restricting the ownership of rural land by foreigners (including foreign individuals or any kind of legal entity controlled by foreign individuals or legal entities). The main restrictions are as follows: (i) foreigners cannot own in the aggregate more than 15 percent of the entire rural land of Argentina, the same cap being applicable to each Province and Municipality; (ii) foreigners will not be allowed to purchase more than 1,000 hectares in the so-called “zona núcleo”, which comprises the main agricultural areas of central Argentina or an “equivalent” surface depending on the location of the land and its productive potential; and (iii) foreigners will not be allowed to buy land that contains, or is adjacent to, relevant and permanent water bodies (such as rivers and lakes). Although exploration permits and mining concessions are not the subject matter of the restrictions placed by the Rural Land Law, certain rights granted to foreign mining companies under the Argentinean Mining Code may be restricted by this
new law. For example, the right that holders of mining concessions currently have to force the surface owner to sell the land to the holder of the mining concession might be restricted if the concession holder is a foreign individual or a legal entity controlled by foreigners.
Federal Mining Agreement
On 13 June 2017, the national government and the provinces in whose territories the main mining projects of Argentina are located, signed the New Federal Mining Agreement (“FMA”). The purpose of the FMA is, amongst other things, to increase provincial revenues from the mining industry by creating legal entities owned by provincial governments that would work in association with private mining companies. This scheme is not new in Argentina and it has been used by some provincial governments, amongst them the Santa Cruz Province (through Fomicruz), in which the Cerro Vanguardia project is located. The FMA also contemplates other forms of revenues such as the formation of special trusts to be funded by mining companies to finance education, health and other programmes. Additionally, the FMA included setting forth mining royalties up to three percent of the gross value of commercialised minerals, without any deductions other than VAT. As the FMA has not yet been converted into law by the National Congress, its provisions are neither binding nor enforceable.
In Argentina, the current regulatory regime of royalty payments is expected to change and several different options and payment thresholds have been discussed. In December 2012, the Santa Cruz Province changed the mining royalty from one percent to three percent calculated at pit-head value of the mineral extracted thus bringing it to the cap of the Mining Investment Law.
Foreign exchange and export rules
Foreign exchange controls
On 1 September 2019, by means of Executive Decree No. 609/2019 (the “Export Controls Decree”), the Argentinean national government reinstated foreign exchange and export controls. The Export Controls Decree and related regulations of the Central Bank of Argentina impose, among other measures, the obligation of Argentinean residents to transfer to Argentina and/or sell for Argentinean pesos in the Argentinean foreign exchange market (mercado de cambios) the countervalue (contravalor) from their exports of goods within a specified period. The export of goods is regulated by the Consolidated Text on “Foreign Trade and Exchange” issued by the Argentinean Central Bank (as amended from time to time) which establishes the specific regulatory requirements to implement the measures adopted by the national government in this area. Prior approval of the Argentinean Central Bank is generally required to access the foreign exchange market for transactions relating to the outflow of funds, except in certain circumstances.
In October 2022, the Argentinean national government implemented the Argentinean System of Imports (Sistema de Importaciones de la República Argentina) (“SIRA”) and the Argentinean System of Imports and Foreign Payments of Services (Sistema de Importaciones de la República Argentina y Pagos de Servicios al Exterior). Importers must obtain a SIRA approval in the form of a SIRA certificate for the import of goods and to access the foreign exchange market for payments in connection with the import of goods. Additionally, from 1 January 2023, Argentinean residents, such as CVSA, must comply with certain supplementary provisions in order to access the foreign exchange market without prior approval of the Argentinean Central Bank, unless an exception applies.
CVSA had a cash balance equivalent to $116 million at 31 December 2022. The cash balance is available to be paid to AngloGold Ashanti’s offshore ($105 million (equivalent)) and onshore ($15 million (equivalent)) investment holding companies in the form of declared dividends. Applications have been made to the Argentinean Central Bank to approve the purchase of U.S. dollars in order to distribute offshore dividends related to the 2019, 2020 and 2021 financial years of $105 million (equivalent) to AngloGold Ashanti. Also, under a special regime established for dividend payments, a new petition to distribute a portion of the offshore dividends applied for, in the amount of $54 million (equivalent), was submitted to the Argentinean Central Bank during the third quarter of 2022. In December 2022, the Argentinean Central Bank approved, based on the applications submitted under this special regime, the payment of $17 million (equivalent) to AngloGold Ashanti. As a result, during 2022, AngloGold Ashanti received offshore dividends from CVSA in a total amount of $17 million (net of withholding taxes) paid in U.S. dollars. While the remaining approvals are pending, the cash remains fully available for CVSA’s operational and exploration requirements.
Export duties
On 21 December 2019, the National Law on Social Solidarity and Productive Reactivation (Law No. 27, 541) (the “Solidarity Law”) was enacted. The Solidarity Law granted the national government power until 31 December 2021 to impose export duties which may not exceed certain caps. For example, the Solidarity Law provides that export duties on mining exports cannot exceed eight percent of the taxable value or official FOB price. On 2 October 2020, the national government published Decree No. 785/2020 (the “Export Duties Decree”) which sets an export duty rate of eight percent for certain goods, including doré bars and gold alloys, and revoked the provisions of Decree No. 793/2018 which had previously set the export duty at 12 percent ad valorem. While the Export Duties Decree was set to expire at the end of 2021, on 31 December 2021, the national government published Decree No. 908/2021, extending the deadline of export duties on certain goods, including doré bars and gold alloys, until 31 December 2023. It is uncertain whether the national government is empowered to extend such deadline beyond the date set forth in the Solidarity Law. These export duties, if not compensated with other tax reductions, affect the tax stability guarantee granted to CVSA in 1996 in light of the fact that at the time export duties were zero percent.
On 26 February 2019, the Argentinean tax and mining authorities published a resolution (RC 4428/2019) establishing an administrative procedure to be followed to obtain the reimbursement or compensation of federal taxes paid in excess of the total tax burden provided for by the applicable tax stability guarantee (the “2019 Procedure”). CVSA initiated the 2019 Procedure to claim compensation for the export duties it paid in 2018, 2019 and 2020 as export duties are not contemplated by its tax stability guarantee. Prior to the publication of RC 4428/2019, CVSA had already submitted to the tax authorities claims for reimbursement of the export duties it paid from 2008 to 2015.
Pursuant to the 2019 Procedure, the National Mining Secretariat issued favorable opinions regarding CVSA’s claims in respect of fiscal years 2018 and 2019, which amounted to approximately $2.0 million and $6.3 million, respectively, as of 31 December 2022. These claims are currently under review by the relevant customs authorities. On 14 July 2021, CVSA submitted its claim in respect of fiscal year 2020, which amounted to approximately $12.4 million as of 31 December 2022. The National Mining Secretary has not yet issued an opinion regarding this claim.
Furthermore, CVSA has requested the tax authorities to apply the 2019 Procedure in respect of its historical claims for fiscal years 2008 to 2015 during which the imposition of export duties also exceeded CVSA’s total tax burden under its tax stability guarantee. However, these claims, which amounted to approximately $3.1 million as of 31 December 2022, are still being reviewed under the rules to challenge export duties instead of the 2019 Procedure. CVSA has appealed the application of those rules and a decision on this issue is pending.
On 9 June 2022, the Argentinean tax and mining authorities published a resolution (RC 5205/2022) establishing a new administrative procedure to be followed to obtain the reimbursement or compensation of federal taxes paid in excess of the total tax burden provided for by the applicable tax stability guarantee (the “2022 Procedure”). This 2022 Procedure replaces the 2019 Procedure established by RC 4428/2019. On 20 September 2022, CVSA submitted its claim for compensation for the export duties in respect of fiscal year 2021, which amounted to approximately $11.2 million as of 31 December 2022, pursuant to the 2022 Procedure. This claim is currently under review by the National Mining Secretary.
In total, AngloGold Ashanti’s net export duty receivables (after discounting provisions) in Argentina amounted to $9 million as of 31 December 2022.
Environmental laws relating to mining
Any mining company wishing to commence or modify any mining-related activity, as defined by the Argentinean Mining Code, including prospecting, exploration, exploitation, development, preparation, extraction, and storage of mineral substances, as well as property abandonment or mine closure activity, is required to prepare and submit to the competent provincial environmental authority an Environmental Impact Assessment (“EIA”) prior to commencing the work. Each EIA is required to describe the nature of the proposed work, its potential risk to the environment, and the measures that will be taken to mitigate that risk. If accepted by the competent authority, the EIA is used as the basis to create a Declaration of Environmental Impact (“DEI”) to which the mining company is required to adhere during the mining-related activity at issue. The DEI is required to be updated at least on a biannual basis. Sanctions and penalties for non-compliance with the DEI are outlined in the Environmental Protection section of the Argentinean Mining Code, and may include warnings, fines, suspension of quality certifications, obligations to restore the environment, temporary or permanent closure of activities, and withdrawal of authorisation to conduct mining-related activities.
AngloGold Ashanti’s rights and permits
The mining concession holder of Cerro Vanguardia, the Company’s operation in Argentina, is AngloGold Ashanti’s partner, Fomento Minero de Santa Cruz S.E. (“Fomicruz”), which is wholly owned by the Santa Cruz Province. On 27 December 1996, Fomicruz entered into a globally diverse, high-quality portfoliousufruct agreement whereby CVSA was granted an irrevocable right to exploit the Cerro Vanguardia deposit (encompassing an area of approximately 543 km2) for a 40-year period. The mining licence (402642/CV/97), which covers the full Mineral Reserve, expires on 26 December 2036. CVSA is a corporation incorporated in Argentina indirectly controlled by AngloGold Ashanti (92.5 percent), with Fomicruz as minority shareholder (7.5 percent). On 14 August 1996, CVSA obtained its tax, customs and foreign exchange stability certificate, which expires in 2026.
Brazil
General laws relating to mining and land ownership
The Brazilian Constitution of 1934 states that, for purposes of exploration and exploitation, deposits and other Mineral Resources constitute property separate from the soil and belong to the Federal Union. Exploration and exploitation of such Mineral Resources may take place only with the Federal Union’s concession and in such a way as to protect the national interest. Federal law sets out penal and administrative sanctions for conduct and activities deemed harmful to the environment.
In Brazil, the National Mining Agency (“ANM”) is the state body within the Mines and Energy Ministry (“MME”) that is responsible for: (i) the registration of mining titles, (ii) the grant of authorisations and concessions, (iii) the supervision of mining activities and mining titleholders, and (iv) the issuance of supplementary rules in relation to mining activity.
Under the current Brazilian Mining Code, there are two kinds of mines: (i) claimstake mines (minas manifestadas), for which rights were acquired before 1934 and exist independently of any mining licence or authorisation from the Federal Government and for which the Mineral Resources constitute property of the landowner, and (ii) granted mines, which are those that rely on grants from the Federal Government for mineral exploration or exploitation (pursuant to the Brazilian Constitution of 1988). AngloGold Ashanti’s operations in Brazil consist of both claimstake mines and granted mines.
Mining activities in granted mines must be performed in two defined stages: (i) exploration, which entails defining and evaluating the deposit and determining the feasibility of exploitation, and (ii) exploitation, which involves coordinating operations aimed at the industrial exploitation of the mineral deposit, from the extraction of useful minerals to their processing. Exploration authorisations issued by the ANM are valid for one to four years. One extension can be obtained automatically as long as it is justified. For more than one extension, the extension request will have to satisfy specific legal requirements. In contrast, exploitation rights, once granted, are valid for the lifetime of the deposit, provided the mining titleholder complies with all legal requirements. Pursuant to these requirements, for example, titleholders must (i) start work on mineral exploitation within six months from the date of publication of the Exploitation Concession, (ii) continue their mining activities until the mineral deposit has been exhausted, in accordance with the Economic Exploitation Plan (Plano de Aproveitamento Econômico) approved by the ANM, and (iii) refrain from suspending mining activities without prior notice to the ANM.
Tax laws relating to mining
During the exploration period, the mining titleholder has to pay an Annual Rate per Hectare (Taxa Annual por Hectare or “TAH”), subject to a maximum value set by law. In the exploitation period, regardless of the legal regime governing the project (whether claimstake or granted mines), the mining titleholder has to pay the Financial Compensation for Exploiting Mineral Resources (Compensação Financeira pela Exploração Mineral or “CFEM”). The CFEM which is 1.5 percent for gold is currently calculated based on revenues.
At the end of 2011 and the beginning of 2012, the states of Minas Gerais, Pará, Amapá and Mato Grosso do Sul each created a new “inspection and control” tax (duty) on extraction and exploration activities as well as on the use of Mineral Resource carried out in those states. In the state of Minas Gerais, gold ore and silver ore are exempted from the collection of this new duty. At the end of 2020, the state of Goiás created a new “inspection and control” tax (duty) on extraction and exploration activities carried out in this state, which currently still needs to be implemented. The constitutionality of these “inspection and control” taxes was upheld by the Supreme Court of Brazil on 1 August 2022.
Environmental laws relating to mining
Following the catastrophic failure of a tailings storage facility (“TSF”) at the Córrego do Feijão iron ore mine owned by Vale at Brumadinho in the state of Minas Gerais in Brazil in January 2019, executive, legislative and judiciary bodies, both at the federal and state levels, have generally increased scrutiny of mining operations in Brazil, and of TSFs in particular, and have been considering, and in some cases have adopted, stricter laws and regulations applicable to the approval, licensing, construction, management, closure and decommissioning of TSFs in Brazil.
At the federal level, the ANM issued Resolution No. 13/19 in August 2019 (replacing its earlier Resolution No. 4/19) which adopted additional regulatory measures to ensure the stability of TSFs, in particular those built or heightened by the upstream method or by any method declared as “unknown”. Among other things, ANM Resolution No. 13/19 prohibits the upstream method for the construction or heightening of tailings dams throughout the national territory of Brazil. It further requires operators to cease all storage and disposal activities at TSFs (known as “deactivation” or “desativação”) constructed or heightened upstream or by an “unknown” method by 15 September 2021 as well as to decommission such TSFs by 15 September 2022 to 15 September 2027 (depending on the capacity volume). To comply with the terms of ANM Resolution No. 13/19, the Serra Grande tailings dam in the state of Goiás must be decommissioned by 15 September 2025. The Serra Grande mine completed the process of reinforcing the dam walls of its upstream TSF, deactivating the TSF and migrating to dry-stacking operations, each by the 15 September 2021 deadline.
Furthermore, Federal Law No. 14.066/20, adopted in October 2020, also imposes requirements on companies to decommission upstream TSFs, including the Serra Grande tailings dam, by 25 February 2022 (which date is earlier than required by ANM Resolution No. 13/19). However, Federal Law No. 14.066/20 does permit extensions of the compliance deadline, with the consent of the ANM based on the technical plan for decommissioning. Serra Grande submitted timely requests to obtain an extension of the compliance deadline until 2025 in line with the timeline set forth in ANM Resolution No. 13/19 and presented its technical plan for decommissioning. On 26 May 2022, the ANM issued a technical note allowing the extension until 2025. With respect to downstream (or “centerline”) TSFs, Federal Law No. 14.066/20 requires companies, to the extent that communities are located in the self-rescue zone of those TSFs, to implement one of the following measures for such structures: either (i) the structure must be deactivated and decommissioned, (ii) the population must be relocated, with reparations for loss of cultural heritage, or (iii) reinforcement works that guarantee the effective stability of the structure must be carried out, by decision of the public authorities, taking into account the previous nature of the dam in relation to the occupation and technical-financial viability of the alternatives. Even if reinforcement works are completed, deactivation and decommissioning of those TSFs will be required at the end of the life of the mine. All of the TSFs operated by AngloGold Ashanti in Brazil have communities located in self-rescue zones.
As of 31 December 2022, AngloGold Ashanti has fully transitioned to dry-stacking operations for tailings storage at each location in Brazil. Capital expenditures required in 2022 to implement this new technology amounted to approximately $83 million. Capital expenditures for work required to comply with TSF-related requirements during the period 2023-2025 are expected to be material but, based on preliminary estimates to date, AngloGold Ashanti anticipates that annual expenditures for each of these years will be less than in prior years and will decline over time. Neither ANM Resolution No. 13/19 nor Federal Law No. 14.066/20 requires removal of all tailings material in connection with the decommissioning of TSFs (a process known as “decharacterisation” or “descaracterização”).
At the state level, the state legislator in the state of Minas Gerais adopted Law No. 23.291/19 in February 2019 which contains the state’s policy on TSF safety and should be implemented in conjunction with the equivalent federal policy. Among other things, Law No. 23.291/19 determines the criteria for licensing and inspecting TSF structures, prohibits TSFs constructed or heightened using the upstream method, establishes bond requirements and holds management liable for non-compliance with its provisions. The government of Minas Gerais adopted several decrees in furtherance of this legislation.
In addition, ANM Resolution No. 95/22, which became effective on 22 February 2022, effectively consolidates prior federal resolutions on TSFs, including ANM Resolution No. 13/19, and establishes new criteria for the operational management of TSF structures, changes the criteria related to the risk classification of TSF structures and emergency levels and sets new criteria for the suspension, embargo (order to stop operations) and interdiction of TSF activities. Operators of TSFs were mandated to conduct and submit risk assessments to the ANM by December 2022 and are required to update those risk assessments every two years. Operators are also required, on an annual basis, to obtain certifications from external consultants of the geotechnical stability of TSF structures and the adequacy of emergency response plans. In late 2022, tailings deposition was required to be suspended due to embargos at five of AngloGold Ashanti’s TSFs in Brazil pending certification by external consultants of on-site emergency response plans (Declaração de Conformidade e Operacionalidade (“DCO”)) as well as, at one such TSF, certification by external consultants of geotechnical stability (Declaração de Condição de Estabilidade (“DCE”)) consistent with the new standards. In addition, at the Calcinados TSF, a risk assessment conducted in December 2022 with oversight from external consultants, as required by Brazilian regulations, concluded that additional buttressing should be completed to align the TSF’s post liquefaction factor of safety with international standards currently considered best practice. Construction at the Calcinados TSF is expected to begin later in 2023, and the timeline for completion will be determined once the engineering and geotechnical work has been completed by external consultants. Tailings deposition at the Calcinados TSF, as well as processing of gold concentrate at the Queiroz plant, which services the Cuiabá mine complex, is suspended until additional buttressing of the Calcinados TSF impoundment is complete.
On 1 December 2022, the ANM published ANM Resolution No. 122/22, which relates to administrative sanctions for non-compliance with mining and dam safety regulations and which, in addition to significantly increasing the values of applicable fines and penalties, establishes procedures and parameters for available sanctions including seizures of ore, goods and equipment, suspension of mining activities, demolition of mine infrastructure and invalidation or cancellation of title and exploration licences.
Further amendments to the regulatory requirements in Brazil governing such TSFs and related dams are expected to be adopted in 2023.
AngloGold Ashanti’s rights and permits
At AGA Mineraçao, Cuiabá has a single mining concession (No. 000.323/1973) covering a total area of 3,662 hectares. In February 2022, two additional mining concessions for Cuiabá (Nos. 830.937/1979 and 831.027/1980) were published, which cover an additional area of 816.2 hectares. Lamego has a single mining concession (No. 932.710/2017) covering a total area of 1,622 hectares. Córrego do Sítio is hosted by five geographically contiguous mining concessions (i.e., Nos. 930.556/2000, 930.181/2008, 830.129/1982, 833.472/2003 and 830.943/1979) covering a total area of 6,017 hectares.
At Serra Grande, the Company has interests in or agreements over 25,719.94 hectares in the Crixás greenstone belt, representing approximately 87 percent of the relevant tenements that correspond to all current exploration and mining activities. These have been held since 1987. The mining concessions include mining concession No. 002.286/1935 covering an area of 4,206.88 hectares, mining concession No. 960.658/1987 covering an area of 1,946.89 hectares, mining concession No. 860.746/2005 covering an area of 88.28 hectares, mining concession No. 862.103/1994 covering an area of 125.41 hectares and mining concession No. 804.366/1975 covering an area of 196.05 hectares.
All of the Company’s mining concessions in Brazil are currently active, in good legal and operational standing, and free of liabilities and/or major obligations. Brazilian mining concessions remain valid up to the depletion of the Mineral Reserve and Mineral Resource pursuant to the Economic Exploitation Plan approved by the ANM and in accordance with the required environmental permits, and as a result do not have an explicit expiry date.
Colombia
General laws relating to mining and land ownership
General regime
The Colombian Constitution declares that the sub-soil and the non-renewable natural resources located within the Colombian territory are the property of the Colombian State. The underlying principle of Colombian mining legislation for the granting of mining concession contracts over free areas is first in time, first in law. Mining activities are regulated by the Colombian Mining Code, Act 685, 2001.
The filing of an exploration and exploitation proposal triggers a right of preference to obtain rights over the targeted area, provided it is available. Such area cannot exceed 10,000 hectares. Upon receipt of a proposal, the relevant government agency determines whether another proposal or contract already governs the area. If there are no pre-existing claims, the government agency grants the applicant a “free area”.
With respect to land ownership, a mining concession in Colombia does not grant the rights over the surface required to develop a mining project. Therefore, in order to develop a mining project, it is required to acquire and secure access to the land (soil). This can be achieved in several ways, such as (i) purchase of the land, (ii) a transit easement, (iii) a mining easement, and (iv) the special acquisition process or expropriation.
Concession contract
As the sub-soil and the non-renewable natural resources located within the Colombian territory are property of the Colombian State, the Colombian Mining Authority (Agencia Nacional de Minería) grants the authorisation to explore and exploit minerals through a concession contract.
Such concessions allow concessionaires to conduct the studies, works and facilities necessary to establish the existence of minerals and to organise their exploitation. Upon being awarded a mining concession, a company must take out an insurance policy to cover the costs associated with potential environmental damage as well as breaches of its mining obligations. It may then proceed with exploration activities. Once the exploration phase is complete, the concessionaire files a new plan regarding proposed works and facilities. With the award of the mining concession or tenement contract, there are specified timelines for the completion of the various phases of a mining project, e.g. exploration, construction, exploitation. The company must comply with these timelines unless performance is suspended, for example, due to force majeure or these timelines are extended or modified. A grant of force majeure is for one year and must be renewed on an annual basis. If the company does not comply with the specified timelines for the completion of the various phases of a mining project, the mining authority may revoke the company's concession contracts or mining licences. As a general matter, any company that wishes to obtain a renewal of its concession contract must be up to date in all its legal and contractual obligations and must present a new plan of works and facilities to be implemented after the contract is renewed.
PINES programme
In 2013, the national government instituted the PINES programme designed to aid promoting certain projects that are deemed to have a national interest. This designation provides for greater oversight from the national government. All of our three advanced exploration projects (La Colosa, Quebradona and Gramalote) were considered of national strategic interest. Currently, Quebradona and Gramalote remain in the PINES programme, but La Colosa was temporarily removed as such (until the force majeure is headquarteredover).
Tax laws relating to mining
From the moment the concession contract is registered with the Mining Register, the concessionaire has several financial obligations, including the payment of (i) a surface fee during the exploration, construction and assembly stage and (ii) royalties.
Once exploration is complete and the mining infrastructure in Johannesburg, South Africa. Measuredplace, the concessionaire must begin paying royalties to the Colombian government, consisting of a percentage of the primary product and sub-products being exploited. The percentage of the royalty depends on the regulation in force when the concession contract is registered. In the case of the Quebradona project, the deposit mainly consists of copper followed by gold and silver. There is a five percent royalty for copper on the production value at the mine’s or well’s edge (i.e. when extracted from the subsoil). In case of gold and silver, a royalty of four percent on the production valued at the mine’s or well’s edge (i.e. when extracted from the subsoil) was established.
Furthermore, Colombian law establishes that once the environmental licence is granted the concessionaire must invest one percent of the project’s value to benefit the basins covered by the environmental licence.
Environmental laws relating to mining
In order to obtain an authorisation to carry out a mining project, a company must prepare an Environmental Impact Study (“EIA”) for approval by the National Environmental Licensing Authority of Colombia (Autoridad Nacional de Licencias Ambientales or “ANLA”). Global environmental licences are granted for the entire life of the project and cover all phases: construction, assembly, operation, maintenance, dismantling, final restoration, abandonment and/or termination. Construction and assembly permits (Plan de Trabajos y Obras or “PTO”) are granted by the mining authority with jurisdiction over the project.
In Colombia, the mining authority has the discretion to declare the underlying concession void if the specific company which holds the concession breaches applicable environmental laws or regulations. If the mining authority were to exercise such discretion, a company whose concession was voided would be required to abandon its projects and all of its other existing mining concession contracts. Pending proposals for new mining concession contracts would also be cancelled and the company would be banned from doing business with the Colombian government for a period of five years. As a result, the company would be unable to conduct any mining exploration or development activities during such period. However, this would not affect other subsidiaries of the company operating in Colombia, if those concession contracts are held singularly or in concert with joint venture partners.
Mining activity is prohibited in national parks, regional parks, protected forest reserves, paramos (included in Act 1753, introduced in 2015) and wetlands, pursuant to the Ramsar Convention on Wetlands of International Importance. Some forest reserves are not “protected” but are set aside for active forestry purposes and the concessionaire must obtain a specific permit to partially and temporarily change the use of the soil before pursuing exploration activities. In addition, Resolution 1987/2016, passed by the national government in late 2016, identifies areas that the Ministry of the Environment has determined to be “paramos” areas, or paramos transition areas. In these areas there are limitations on industrial or commercial work being performed, including mining. The regulation also specifies a process to determine what work, if any, can be performed in a paramos-designated area.
AngloGold Ashanti’s rights and permits
The La Colosa project managed by AngloGold Ashanti Colombia S.A.S. (“AGA Colombia”) remains in force majeure due to delays in granting environmental permits by national and local environmental authorities, thereby preventing AGA Colombia from undertaking further exploration activities. The most recent one-year grant of force majeure, during which time the specified timelines for completing the various phases of the mining project under the concession contract are suspended, will expire on 22 June 2023. AGA Colombia applied for a mining area integration (consolidation) of its concession contracts related to La Colosa, in respect of which AGA Colombia was not in compliance with some of the specified timelines. The application for mining area integration (consolidation) was approved in March 2017, which remedied the non-compliance of each consolidated concession and reset the specified timelines. La Colosa now has a single integrated mining concession contract (EIG-163) which covers a total area of 9,210 hectares and expires on 28 February 2037.
Minera de Cobre Quebradona S.A.S. B.I.C. (“MCQ”) which manages the Quebradona project, obtained the integration of concession agreement 5881 in October 2016 and registered in December 2016. As a result, MCQ was granted the exclusive right to explore, take ownership and dispose of the mineral reserves (ore) extracted from the concession area. MCQ has the right to request an extension of up to 30 years, at least two years before the expiration of the operating period. This extension is not automatic, and the request must be filed with new technical, economic, environmental and social studies that demonstrate the status of the mineral resources. Concession contract 5881 initially covered a total area of 7,593 hectares, which was reduced to 4,881.89 hectares by the relevant mining authority (Secretaría de Minas de Antioquia) on 4 March 2022. It will expire in May 2037 and is currently in its seventh year of the integrated exploration phase. In September 2021, the permits for the construction and mining operation were approved by the relevant mining authority (Secretaría de Minas de Antioquia). On 4 November 2021, ANLA officially notified AngloGold Ashanti of its decision to ‘archive’ the environmental licence application relating to the Quebradona project. ANLA has neither denied nor granted the licence, but deemed that the information provided by AngloGold Ashanti is not enough for this authority to take a substantive decision. On 18 November 2021, AngloGold Ashanti appealed the third largest gold mining companyarchiving decision in order to secure further details on the specific additional information ANLA requires to make a determination. ANLA denied the appeal on 29 April 2022 and the archiving decision was confirmed. AngloGold Ashanti is in the world.process of preparing a new Environmental Impact Assessment for the Quebradona project to submit to ANLA in connection with its environmental licence application.
Our portfolioThe Gramalote project is organised as a joint operation between AngloGold Ashanti (through AGA Colombia Holdings Limited and AngloGold Ashanti Holdings plc) and B2Gold (through B2Gold Corp. and Graminvest Ventures Limited). Gramalote Limited, a company incorporated under the laws of 14British Virgin Islands which is the legal vehicle operating the joint operation, established a Colombian branch, Gramalote Colombia Limited (“GCL”), to carry out activities in Colombia and obtain the mining concession contracts necessary to develop the Gramalote project. The Gramalote joint operation has been operated by B2Gold since January 2020. Pursuant to an integrated mining concession contract No. 14292, GCL was granted the exclusive right to explore, take ownership and dispose of the mineral reserves (ore) extracted from the concession area (which covers a total area of 8,720.71 hectares and includes the Gramalote and Monjas anomalies) until April 2043. GCL has the right to request an extension of the operating period for up to 20 years, and, if exercised, such request to extend must include new technical, economic, environmental and social studies that demonstrate the status of the mineral resources. Currently, concession contract
No. 14292 is in the phase of construction and assembly, pending resettlement of communities and the formal start of construction activities. GCL has received an environmental licence granted by ANLA and permits for the construction and mining operation which were approved by the relevant mining authority (Secretaría de Minas de Antioquia). GCL also holds an exploration concession No. 4894 (which covers a total area of 2,279.32 hectares and includes the Trinidad anomaly) which expires in 2044 and an exploration concession No. QHQ-16081 (which covers a total area of 9.78 hectares) which expires in 2052. Following the completion of the feasibility study in the second half of 2022, AngloGold Ashanti and B2Gold determined that the Gramalote project does not meet their investment thresholds for development. Following a comprehensive review of the alternatives relating to the project, both joint operation parties commenced a joint sales process for the Gramalote project, which is currently ongoing.
United States of America (Nevada)
General laws relating to mining and land ownership
General regime
Mineral and surface rights in the United States are owned by private parties, state governments or the federal government. The majority of land utilised for precious metals exploration, development and mining in the western United States is owned by the federal government. The right to mine on such federal land in western states is governed by the U.S. General Mining Law of 1872, as amended (the “General Mining Law”), as well as relevant state statutes and regulations. The General Mining Law allows mining claims (for mining and mining-related activities) on certain federal lands after proper compliance with claim location and maintenance requirements.
Mineral exploration activities in Nevada are also generally subject to applicable federal, state, and local permitting requirements, but the specific regulatory authorisations required for the company’s activities are based on the nature and location of the exploratory work. Many of the company’s Nevada operations are currently conducted under what is generally referred to under federal law as a notice-level operation subject to 43 CFR § 3809.21, while projects that are more advanced require additional permitting, including a Plan of Operations approved by the federal Bureau of Land Management (“BLM”). The State of Nevada Division of Environmental Protection’s Bureau of Mining Regulation and Reclamation (“BMRR”) also regulates mining within the state of Nevada. However, exploration projects of five acres or less on federal land, the scope of a notice-level operation under federal law, are exempt from BMRR regulation. Certain of the company’s early-stage exploration activities fall within this exemption.
The company is currently engaged in exploration activities on certain of its unpatented claims that include, but are not limited to, geological and spectral mapping, surface geochemical sampling, geophysical surveying and RC and/or diamond drilling.
Potential regulatory changes
Over the years, the U.S. Congress has considered a number of proposed amendments to the General Mining Law and other federal statutes relating to mining. Among the significant features contained in previously proposed legislation were a production royalty obligation, new and more stringent environmental standards and conditions, additional reclamation requirements, extensive new procedural steps which would likely result in extended permitting timelines, and granting counties and other entities the ability to petition the U.S. Secretary of the Interior to make certain areas unavailable for the location of unpatented mining claims. In June 2020, former President Trump signed an executive order directing certain federal agencies to streamline the review processes associated with permitting of infrastructure and natural resources projects. Many of those policies have subsequently been rescinded by the Biden administration. While certain other executive orders may favorably affect the timing of our permit and project approvals, the impact is yet to be determined and remains uncertain.
There are a number of bills being proposed to the Nevada state legislature during the 2023 legislative session that could impact the company’s planned operations. These include proposed legislation that would alter the way water rights are administered by the state, as well as a bill that would, if enacted, impose additional requirements for environmental review of mineral development projects in Nevada. At this stage, it is not possible to evaluate whether these bills will be enacted in any form by the Nevada state legislature or, if passed, what impact any might have on AGA.
AGA is currently unaware of any other new federal or state legislative or regulatory changes or rule-making that has been proposed or enacted that would adversely affect its current exploration programmes. If any requirements, standards or conditions were adopted in the future that imposed additional or new obligations or costs on AGA in connection with our exploration or extraction activities in the United States, the company’s operations in Nevada could be adversely affected.
AngloGold Ashanti’s rights and permits
In Nevada, the company’s wholly-owned subsidiaries hold a significant number of unpatented mining claims on federal lands. The Silicon project consists of approximately 950 unpatented mining claims. The North Bullfrog project consists of 45 patented and approximately 1,600 unpatented mining claims (covering approximately 32,000 acres) situated in the Bullfrog mining district. There are also nine countries excluding our South African assetsmining leases within the North Bullfrog project the majority of which continue in perpetuity so long as the company meets certain minimal requirements for use of the land. One mining lease is scheduled to expire in 2031. The Mother
Lode project consists of 13 unpatented mining claims. The North Bullfrog and SadiolaMother Lode projects are now controlled by the company as a result of its acquisition of all of the outstanding stock of Corvus Gold Inc., which closed on 18 January 2022. The southern claim block, encompassing the Sterling mine and other properties in the same general area, consists of approximately 1,900 unpatented claims (covering approximately 35,000 acres), which are now controlled by the company as a result of its acquisition of all of the outstanding stock of Coeur Sterling, Inc. (a subsidiary of Coeur Mining, Inc.), which closed on 4 November 2022. As a result of this acquisition, the company now controls a past-producing mine site in southern Nevada known as the Sterling mine, which has one applicable mining lease that expires in 2029, with the option to extend the lease for an additional ten-year period. Although the Sterling mine is currently in care and maintenance status, it remains subject to complex permitting and regulatory requirements, including compliance with relevant provisions of the U.S. Federal Mine Safety and Health Act of 1977 and oversight by the U.S. Department of Labor’s Mine Safety and Health Administration (“MSHA”).
MINE SITE REHABILITATION AND CLOSURE
Closure, an integral part of operations
All mining operations eventually cease. An integral aspect of operating AngloGold Ashanti’s mines is ongoing planning for site closure and, where feasible, implementation of concurrent rehabilitation, together with an estimate of associated liability costs and the placement of adequate financial provisions and assurances to cover these costs.
AngloGold Ashanti integrates mine closure planning throughout the mine life cycle as follows:
•Exploration stage: developing a plan and programme for cessation and closure of exploration activities in a manner that meets local laws and AngloGold Ashanti's mine closure planning standard.
•Project phase: developing conceptual closure plans and cost estimates for all projects and including them in project feasibility studies, designs and evaluations.
•Operational phase: developing and periodically updating mine closure plans and cost estimates with increasing levels of detail and confidence over the operational phase as part of the business planning process. Closure plan updates take into account operational conditions, planning and regulatory requirements as well as advances in technology and international industry good practice (e.g., the ICMM Integrated Mine Closure Good Practice Guide). Concurrent rehabilitation, which is carried out while a mine is still operational, is a good practice that serves to decrease the final rehabilitation and closure work as well as the ultimate liability.
•Closure period: implementing the final closure plan starting at cessation of operations through a period of decommissioning, dismantling and rehabilitation until the point in time where management of the site is largely limited to monitoring and maintenance.
The Company’s group mine closure planning standard stipulates that closure planning must be undertaken in consultation with the stakeholders. In the course of these consultations, different issues are heldraised which require site-specific solutions. Each mine closure plan includes a social transition plan which seeks to minimise social impacts and maximise opportunities for sale, includes long-life operatinglocal communities, including human resource, social infrastructure, economic and financial assets with differing ore body types locatedthe aim of enhancing the self-sustainability of mine communities after mine closure.
Provisions for decommissioning and restoration costs are made when there is a present obligation, it is probable that expenditure on decommissioning and restoration work will be required and the cost can be estimated within a reasonable range of possible outcomes. These costs are based on currently available facts, technology expected to be available at the time of the rehabilitation, laws and regulations presently or virtually certain to be enacted and previous experience in key gold-producing regions around the world. These operating assets were supportedrehabilitation of mine sites.
Decommissioning costs and restoration costs are provided at the present value of the expenditures expected to settle the obligation, using estimated cash flows based on current prices. Estimates are discounted at a pre-tax rate that reflects current market assessments of the time value of money.
Total provisions for decommissioning and for environmental restoration activities (excluding joint ventures) decreased by three greenfields projects$95 million from $673 million in 2021 to $578 million in 2022. This decrease was mainly due to changes in estimates resulting from changes in discount rates, changes in global economic assumptions, changes in mine plans resulting in a tenth country (Colombia)change in cash flows as well as changes in the design of TSFs.
SUSTAINABILITY AND ENVIRONMENTAL, SOCIAL AND GOVERNANCE (“ESG”) MATTERS
AngloGold Ashanti’s sustainability approach is fundamental to how the Company operates its business, as well as its ability to create long-term value for its shareholders, employees and a focused global exploration programme.
Our operationssocial partners through safely and projectsresponsibly exploring, mining and marketing its products. Sustainability and safety are groupedintegrated into the following regions: Continental Africa, South Africa, AmericasCompany’s business and Australia.operations at all levels through various frameworks, standards and policies, and the Company measures its performance in achieving its goals against its sustainability and other ESG metrics, as well as its engagement with stakeholders.
The mostIn mitigating the risks and impacts that are an inherent part of its business, AngloGold Ashanti is informed by an annual assessment of its key ESG issues. This process is aligned with guidance published by the International Integrated Reporting Council (“IIRC”), the Sustainability Accounting Standards Board (“SASB”), the Global Reporting Initiative (“GRI”) Standards and
the Accountability AA1000 Stakeholder Management Standard. This assessment is annually reviewed by AngloGold Ashanti’s senior leadership and approved by the Social, Ethics and Sustainability Committee (the “SES Committee”).
AngloGold Ashanti’s board of directors, assisted by the SES Committee, has ultimate responsibility over environmental, safety, health and ethical matters and for the integration of sustainability objectives into AngloGold Ashanti’s business. This includes oversight of the Company’s stakeholder engagement framework and structures, which apply to investors, employees, governments, suppliers and communities, at every stage of its business from exploration to mine closure. Group Corporate Affairs and Sustainability is responsible for development of management systems and supports the Company’s general managers in the day-to-day implementation of its sustainability strategy.
AngloGold Ashanti maintains a set of policies and procedures to guide the Company in acting as a responsible corporate citizen, including the Code of Business Principles and Ethics which sets requirements for the implementation of key corporate policies and guidelines and applies to all management and employees, and to maintain compliance with applicable environmental, health and safety (“EHS”) laws. In 2022, AngloGold Ashanti continued with the implementation of the Integrated Sustainability Information Management System (“iSIMS”), in order to improve internal reporting and better integrate, manage and monitor sustainability activities with respect to its broader business. This common management and reporting application for all sustainability disciplines, from safety, health and security to community and environmental management, is expected to help provide timely information in each of these areas, and to facilitate transparency and decision-making in its processes and practices.
Significant EHS requirements and ESG risks and trends affecting the Company’s mining and processing operations are described below.
EHS Regulatory Compliance
AngloGold Ashanti is subject to extensive EHS laws and regulations in the various jurisdictions in which the Company operates. These requirements govern, among other things, extraction, use, conservation and discharge of water; air emissions (including dust control and greenhouse gases (“GHGs”)); mine and dam safety, regulatory and community reporting; clean-up of contamination; land use and conservation of protected areas; rehabilitation and closure of mined land; worker health and safety and community health; and the generation, transportation, storage and disposal of solid and hazardous wastes, such as reagents, radioactive materials, and mine tailings. Environmental laws and regulations applicable to the Company’s operations, including the requirements contained in environmental permits, are generally becoming more restrictive.
Capital and operating costs to comply with EHS laws and regulations have been, and are expected to continue to be, significant project milestone achieved duringto AngloGold Ashanti. In addition, AngloGold Ashanti could incur fines, penalties and other sanctions, environmental clean-up costs, and third-party claims for personal injury or property or natural resources damages; suffer reputational damage; and be required to install costly pollution control equipment or to modify or suspend facilities, such as TSFs, or operations, as a result of actual or alleged violations of, or liabilities under, EHS laws and regulations. Failure to comply with applicable EHS laws and regulations may also result in the year wassuspension or revocation of permits and, in some jurisdictions, the pouring of first goldright to mine a given concession. AngloGold Ashanti’s ability to obtain and maintain permits and other approvals and to successfully operate near host communities may be adversely impacted by real or perceived effects on the environment or human health and safety associated with AngloGold Ashanti’s or other mining companies’ activities. In addition, unknown environmental hazards may exist at the Obuasi Mine in Ghana on 18 December 2019, bringing Phase 1 of the Redevelopment Project to a conclusion on time and within budget.Company’s properties which may have been caused by previous owners or operators.
Processes to sell assets in Mali, South Africa and Argentina progressed during the year. On 23 December 2019, the Company announced that it had reached an agreement to sell its interest in the Sadiola Mine, and on 12 February 2020, the Company announced that it had reach an agreement with Harmony Gold Mining Company Limited to sell all its remaining South African producing assets and related liabilities. In Argentina, the sales process related to Cerro Vanguardia continues.Water Management
AngloGold Ashanti’s operations are heavily dependent upon access to substantial volumes of water for use in the mining and joint ventures employed, on average, 34,263 people (including contractors) in 2019 (2018: 44,249). The 23% decrease in employees is mostly dueextractive processes and typically are subject to water-use permits or rights to extract water from certain natural sources that govern usage and require, among other things, that mining operations maintain certain water quality upon discharge. Water supply, quality and usage are areas of concern across all of the Company’s operations, including with respect to the reductionCompany’s mining operations in Ghana and Brazil, its mine development projects in Nevada, as well as its mine development project at Quebradona in Colombia. Any failure by the Company to secure access to suitable water supplies, or achieve and maintain compliance with applicable requirements of employee numbersthe permits or licences, could result in curtailment or halting of production at the affected operations. Incidents of water pollution or shortage can, in certain cases, lead to community protest and ultimately to the withdrawal of community and government support for AngloGold Ashanti’s operations. A failure by the Company to comply with water contamination related directives may result in further, more stringent, directives being issued against the Company, which may, in some cases, result in a temporary or partial shutdown of some of the Company’s operations.
Where feasible, the Company operates a “closed loop” system which recycles the water used in its operations without discharging it to the environment. In some areas, however, such as Ghana and Brazil, high levels of rainfall and surface water runoff mean that a closed loop system is not feasible and that discharges, after water treatment where necessary, must take place.
Waste Management
During open-pit mining, large volumes of soil and/or rock (overburden) are mined to expose the ore body. Similarly, waste rock is mined during drilling and developing access to underground ore bodies. Overburden and waste rock typically contain sub-economic levels of gold and are deposited as large waste rock facilities. Mine tailings are the process waste generated once grinding and extraction of gold from the ore is completed in the South Africa regionmilling process and are typically deposited as slurry in large tailing storage facilities (“TSFs”) specifically designed for this purpose.
The impact of dust generation, breach, leak, or other failure of a waste rock facility or TSF, including any associated dam, can be significant, and the Company therefore monitors such facilities closely in accordance with the Company’s internal standards, independent review, national regulatory requirements, industry standards and commitments made to local communities. The occasional well-publicised failure of a third-party TSF and the potential impact of such failure also mean that these facilities are generally tightly regulated. A safety or environmental incident at the Company’s operations could result, among other things, in enforcement, including mandatory shutdown of a TSF and related facilities, obligations to remediate environmental contamination, negative press coverage, and claims for property or natural resources damages and personal injury by adjacent communities. Incidents at other mining companies’ operations could result in governmental action to tighten regulatory requirements and restrict certain mining activities, in particular with respect to TSFs, also in respect of other mine operators in that region.
For example, following the catastrophic failure of a TSF at the Córrego do Feijão iron ore mine owned by Vale at Brumadinho in the state of Minas Gerais in Brazil in January 2019, tailings were discharged into the mine’s administrative area and part of the local community, reportedly resulting in death or injury to hundreds of people. As a result of this incident, there has been considerably increased regulatory scrutiny in Brazil and other areas on mining operations generally, and the restructuringrequirements applicable to the approval, licensing, construction, management, closure and decommissioning of TSFs have generally become far more stringent. For example, in late 2022, tailings deposition was suspended at five of AngloGold Ashanti’s TSFs in Brazil pending certification by external consultants of on-site emergency response plans (“DCO”) and/or geotechnical stability (“DCE”) consistent with new regulatory standards enacted in early 2022. In addition, at the South African operationsCalcinados TSF, a risk assessment conducted in 2019.December 2022 with oversight from external consultants, as required by Brazilian regulations, concluded that additional buttressing should be completed to align the TSF’s post liquefaction factor of safety with international standards currently considered best practice. The timeline for completion will be determined once the engineering and geotechnical work has been completed by external consultants. For further information on the regulatory framework governing TSFs in Brazil, see “Item 4B: Business Overview—The Regulatory Environment Enabling AngloGold Ashanti to Mine—Americas—Brazil”.
Performance (including discontinued operations)
In 2019,addition, a new Global Industry Standard on Tailings Management (“GISTM”) was established in August 2020 by a panel comprised of industry and non-governmental organisation (“NGO”) experts. AngloGold Ashanti produced attributable 3.3 million ounces (Moz)has committed to comply with the GISTM at all of gold (2018: 3.4Moz) as well as 3.7Moz of silverits TSFs by August 2025, and 199 tonnes of sulphuric acid as by-products.the costs related to meeting such standard are not expected to be material to AngloGold Ashanti.
Production of 3.3 Moz of gold was achieved at a cost of sales of $3.1 billion and an all-in sustaining cost of $ 1,034/oz for subsidiaries and $767/oz for equity accounted joint venture operations compared to a production of 3.4Moz in 2018 at a cost of sales of $3.2 billion and all-in sustaining cost of $1,000/oz for subsidiaries and $820/oz for equity accounted joint venture operations.
Gold
TheIn addition, AngloGold Ashanti gold Ore Reserve reduced from 44.1Moz in December 2018could incur liabilities, or material costs to 43.8Moz in December 2019. This gross annual decrease of 0.3Moz includes depletion of 3.7Moz. The increase after depletions of 3.4Moz, results from additions due to explorationmanage solid and modelling changes of 3.6Moz, changes in economic assumptions of 0.4Mozhazardous waste generated by its mining activities, including dust and a change in ownership of 0.1Moz. Other factors resulted in a 0.7Moz reduction.
Copper
Theresidual chemicals and metals. For example, AngloGold Ashanti copper Ore Reserve increased from 1.26Mt (2,769Mlbs)expects to incur approximately $25 million to $30 million in December 2018 to 1.39Mt (3,068Mlbs)capital expenditure and operating costs during 2023-2026 in December 2019. This gross annual increaseconnection with treatment and disposal of 0.14Mt includes an increasea quantity of 0.07Mt due to methodology and 0.07Mt due to change in ownership from 94.876% to 100% as B2Gold’s shareholding has been converted to a share of profits.
Capital expenditure, including equity accounted joint ventures, in 2019 amounted to $814 million (2018: $721 million).
Safety
There were no fatalities across the group’s operations in 2019. The all injury frequency rate was 3.31 per million hours worked compared to 4.81 in 2018. Regrettably, there have been four fatalities across the group’s operations post year-end resulting from a seismic event as well as a tramming accidentlegacy arsenic trioxide waste located at the Mponeng mine in South Africa.
CONTINENTAL AFRICA
AngloGold Ashanti had seven mines in the region during 2019, four of which are currently in operation and two treating tailings. The redevelopment of the Obuasi mine in Ghana began in 2019 and first gold was poured in December 2019. The sale of Sadiola was announced on 23 December 2019.
|
| | | | | |
| Attributable gold production (000oz) | | Average number of employees |
|
Subsidiary operations | | | |
Ghana | | | |
Iduapriem | 275 |
| | 1,801 |
|
Obuasi | 2 |
| | 2,924 |
|
Guinea | | | |
Attr. Siguiri 85% | 213 |
| | 3,056 |
|
Tanzania | | | |
Geita | 604 |
| | 5,066 |
|
|
Joint venture operations |
Democratic Republic of the Congo | | | |
Attr. Kibali 45% | 366 |
| | 2,239 |
|
Mali | | | |
Attr. Morila 40% | 27 |
| | 354 |
|
Attr. Sadiola 41% | 51 |
| | 346 |
|
Continental Africa - Key Statistics
|
| | | | | | | | | | |
| Unit | | 2019 |
| | 2018 |
| | 2017 |
|
Subsidiary operations | | | | | | | |
Tonnes treated/milled | Mt | | 19.1 |
| | 19.5 |
| | 20.3 |
|
Pay limit | oz/t | | 0.039 |
| | 0.040 |
| | 0.038 |
|
| g/t | | 1.330 |
| | 1.372 |
| | 1.130 |
|
Recovered grade | oz/t | | 0.060 |
| | 0.049 |
| | 0.054 |
|
| g/t | | 1.77 |
| | 1.69 |
| | 1.84 |
|
Gold production (attributable) | 000oz | | 1,094 |
| | 1,060 |
| | 1,093 |
|
Cost of sales | $m | | 1,173 |
| | 1,127 |
| | 1,071 |
|
Total cash costs (1) | $/oz | | 801 |
| | 813 |
| | 686 |
|
All-in sustaining costs (1) | $/oz | | 947 |
| | 941 |
| | 909 |
|
Capital expenditure | $m | | 359 |
| | 246 |
| | 290 |
|
Safety | | | | | | | |
Number of fatalities | | | 0 |
| | 0 |
| | 0 |
|
AIFR | Per million hours worked | | 0.62 |
| | 0.51 |
| | 0.28 |
|
People | | | | | | | |
Average no of employees: Total | | | 12,847 |
| | 11,490 |
| | 10,268 |
|
Permanent employees | | | 4,939 |
| | 4,625 |
| | 4,523 |
|
Contractors | | | 7,908 |
| | 6,865 |
| | 5,745 |
|
(1) Includes Obuasi gold production in 2019, capitalised as part of the project development.
|
| | | | | | | | | | |
| Unit | | 2019 |
| | 2018 |
| | 2017 |
|
Joint venture operations | | | | | | | |
Tonnes treated/milled | Mt | | 7.5 |
| | 7.8 |
| | 7.7 |
|
Pay limit | oz/t | | 0.037 |
| | 0.041 |
| | 0.045 |
|
| g/t | | 1.255 |
| | 1.403 |
| | 1.528 |
|
Recovered grade | oz/t | | 0.060 |
| | 0.053 |
| | 0.047 |
|
| g/t | | 1.85 |
| | 1.81 |
| | 1.10 |
|
Gold production (attributable) | 000oz | | 445 |
| | 452 |
| | 360 |
|
Cost of sales | $m | | 428 |
| | 480 |
| | 441 |
|
Total cash costs (1) | $/oz | | 657 |
| | 680 |
| | 819 |
|
All-in sustaining costs (1) | $/oz | | 767 |
| | 820 |
| | 1,087 |
|
Capital expenditure | $m | | 51 |
| | 67 |
| | 119 |
|
Safety | | | | | | | |
Number of fatalities(2) | | | 0 |
| | 0 |
| | 0 |
|
AIFR (2) | Per million hours worked | | 0.65 |
| | 0.29 |
| | 1.25 |
|
People | | | | | | | |
Average no of employees: Total | | | 2,939 |
| | 3,343 |
| | 3,325 |
|
Permanent employees | | | 1,192 |
| | 1,072 |
| | 944 |
|
Contractors | | | 1,747 |
| | 2,271 |
| | 2,381 |
|
| |
(1)
| Total cash costs and all-in sustaining costs are non-GAAP measures. For further information on these non-GAAP measures, see “Item 5A: Operating Results-Non-GAAP analysis”. |
| |
(2) | Excludes Morila and Kibali which are managed by Barrick and not AngloGold Ashanti. |
Production and costs
Production from the Continental Africa region subsidiaries increased to 1.094Moz in 2019 compared to 1.060Moz in 2018. The joint venture operations decreased production to 445Moz compared to 452Moz in 2018. The increase was largely due to record production at Iduapriem, and good performance at Geita.
Gold production at Iduapriem was 8% higher at a record 275,000oz compared to 254,000oz in 2018, primarily a result of a 14% improvement in plant feed. The grade improvement was driven by better grade control and access to Cut 1 area in the Teberebie pit where stripping commenced in 2017. Production was impacted by a 5% year-on-year decline in tonnage throughput due to lower plant availability owing to an unstable power supply from the national grid in the first half of the year and mill downtime in the last quarter of the year to repair a cracked trunnion journal on Sag Mill 2. The power supply challenge has since been resolved by changing over to Volta River Authority (VRA) and Ghana Grid Company.
Geita produced 604,000oz in 2019, the highest level in 13 years, 7% higher compared to 564,000oz in 2018. The operation is transitioning to predominantly underground operations, with a 10% increase in recovered grades achieved on the back of additional flexibility in the blending strategy resulting in improved recovery rates. Record quarterly production of 208,000oz was achieved in the last quarter of the year, largely a result of the higher volumes of tonnes treated and higher-grade material from Star & Comet Cut 3.
Production at Siguiri declined 12% to 213,000oz in 2019. This compares with production of 242,000oz in 2018. The lower production was mainly due to lower plant feed grade and recovery which is related to the ROM 3 crushing plant low performance and material feed blend to the plant. This was a result of a slower ramp-up than anticipated following the completion of the carbon-in-leach (CIL) combination plant integration during the year. By year-end, quarterly production had improved as the processing challenges from the treatment of harder rock material through the plant had been addressed.
At Kibali, production increased 1% to a record of 366,000oz in 2019 (2018: 363,000oz), a result of the ramp up in underground mining, which partially offset the 9% decrease in tonnes treated due to the planned reduction in open pit mining. The mine delivered higher volumes of underground tonnes as the shaft operated in line with design specifications for the full year. Total volume of undergound ore hoisted was 15% higher year-on-year.
Sadiola continued to process the stockpile and optimise costs, producing 51,000oz in 2019. This compares to 59,000oz in 2018, a 13% decrease. The end of mining activities and the depletion of full grade ore stockpiles in 2018 led to a higher proportion of marginal grade ore from the stockpiles being fed to the plant in 2019.
Morila’s production decreased 8%, as planned, to 27,000oz in 2019 compared to 30,000oz in 2018, following the completion of satellite pit mining at the start of the first half of the year. Production was also impacted by a 16% decrease in recovered grade as the mine continued to treat tailings material. This was partially offset by a 9% increase in tonnes treated compared to the previous year. The mine is expected to continue treatment of mineralized waste ore, augmented by higher grade ore from targeted mining areas, for the next year, after which the mine will transition to full closure.
Cost of sales and all-in sustaining costs (AISC) for the subsidiary operations in the region increased to $1,173 million and $947/oz for 2019, respectively, a result of higher operating costs due to lower production at Siguiri, offset by lower costs at Geita following the transition to underground mining, as well as cost savings achieved from reagent optimisation at both Geita and Iduapriem. Cost of sales and AISC for the joint venture operations decreased due to lower operating costs at Sadiola and Morila as they wind down operations.
The drive for continuous cost improvements through the Operational Excellence programme is well entrenched across all sites and disciplines in the region. The focus remains on delivering systemic and sustainable operational improvements in the management of the region’s stay-in-business projects.
Capital expenditure
Total capital expenditure for the region increased in line with planned inward investment in growth projects, particularly at Obuasi where $246 million was spent in the redevelopment of the project. Underground Ore Reserve development projects continued at Geita, for Star & Comet and Nyankanga, and at Obuasi. These projects will provide access to ore bodies identified for future gold extraction. The balance of the capital spend was used for capitalised exploration and stay-in-business projects to improve asset reliability across our mines to ensure safe, risk-free mining and production.
Safety
There were no fatalities in the Continental Africa region in 2019, with the last fatal injury having been recorded in October 2015. The region saw a regression from the previous year, primarily due to an increased number of injuries associated with the redevelopment project currently underway at Obuasi in Ghana.
Ore Reserve
The total attributable Continental Africa Region Ore Reserve was 17.93 million ounces (2018: 16.33 million ounces). This amounts to 41 percent of the group’s Ore Reserve.
Growth and improvement
Commissioning of the Siguiri CIL combination plant was completed in 2019 with the mill achieving design throughput consistently. Optimisation of the circuit is now underway. The pre-feasibility study was completed for Block 2 Project, and it is expected that the feasibility study will be completed by end of the second quarter in 2020. Evaluation of Siguiri Block 2 and the trucking of oxide material to the existing process plant to displace marginal ore was completed. The aim is to improve the mine’s ounce profile and potentially extend its life of mine. Permits for construction of the new haul road have been received and the mining permit application is currently in progress.
At Geita, the development of Nyankanga Block 1 Portal began in December 2019 to accelerate mining in Blocks 1 and 2 following the delay in permitting for Geita Hill.
Development of Geita’s Star & Comet and Nyankanga underground operations continued during the year. Approximately 4,568m of development was completed during the year to access new areas for stope mining and further exploration. Open pit mining at Nyankanga will reach the end of its economic life during 2020. Surface exploration continued at Selous, a satellite pit 2.4km from Star & Comet, to supplement the underground operation in the near term.
At Iduapriem waste stripping for Teberebie Cut 1 was completed and ore was mined from Teberibie Cut 1, Cut 3, Ajopa and Block 3. Stripping in Cut 2 is expected to start during the first half of 2020 to deliver ore in 2021 when Cut 1 ore is depleted. Brownfields drilling continued at the Ajopa pit and open pit mining has been extended to Cut 3 to supplement ore from the larger Teberebie pit. Major brownfield exploration drilling continued at Blocks 7 and 8, Ajopa and Block 1 to improve the mine’s future ounce profile and potentially extend the life of mine.
The pre-feasibility studies for the new tailings storage facility (TSF) and return water dam (RWD) sites were completed. A related feasibility study is planned to be completed in 2020. Construction sites were identified and land access compensation and engagement with the relevant government authorities began for the permitting of the new facilities. In the second half of 2019 the mine undertook a feasibility study to consider treatment options to discharge excess water efficiently on the current greenfield tailings storage facility, the completion of which is expected in 2020.
The Obuasi Redevelopment Project has progressed well. There is a strong focus on safety. The project remains on schedule and within budget. Phase 1 of the project, which set up the plant to achieve a daily processing rate of 2,000t of ore, was completed. Phase 2, which aims to expand plant capacity to 4,000t a day, will continue through 2020. The civil engineering work is progressing well with most orders having already been placed. First blast underground, signalling the start of underground development, took place on 11 February 2019 and the first stope blast was in October 2019. This indicated the start of ore production, albeit on a limited scale, and was followed by the first pour of gold on 18 December 2019, demonstrating the successful implementation of the plan to redevelop Obuasi into a modern, mechanised mining operation, following the suspension of mining activities five years ago.
At Kibali, the Kalimva-Ikamva prefeasibility study was completed, delivering another viable opencast project. This will help balance the mine’s open cast/underground ore ratio and enhance mine plan flexibility. Drilling at Gorumbwa highlighted future underground potential and ongoing conversion drilling at KCD is delivering reserve replenishment. The mine is well placed to meet its 10-year production targets and extend them beyond this horizon.
SOUTH AFRICA
After extensive restructuringAs part of this region, at 31 December 2019, the region has two operations:
West Wits: Mponeng
Surface operations
Post-year end, on 12 February 2020, it was announced that an agreement had been reached to sell all our remaining South African producing assetsasset sale, AngloGold Ashanti Limited sold its remaining three mining rights in South Africa to Golden Core Trade and related liabilities toInvest (Pty) Ltd (“Golden Core”) and Harmony Gold Mining Company Limited. The transaction, which is subjectLimited pursuant to several conditions precedent, is expected to bea sale agreement concluded on or about 3012 February 2020, as amended and reinstated from time to time (the “SA Sale Agreement”). These mining rights relate to operations in the West Wits area.
General laws relating to mining
The MPRDA
The Mineral and Petroleum Resources Development Act, No. 28 of 2002 (the “MPRDA”) came into effect on 1 May 2004. The objectives of the MPRDA are, amongst other things, to allow for state sovereignty over all mineral and petroleum resources in the country, to promote economic growth and the development of these resources and to expand opportunities for the historically disadvantaged and to ensure security of tenure for the respective operations concerning prospecting, exploration, mining and production. By virtue of the provisions of the MPRDA, the state ensures that holders of mining and prospecting rights contribute to the socioeconomic development of the areas in which they operate. The Mineral and Petroleum Resources Development Amendment Act, No. 49 of 2008 (the “MPRDAA”) became effective on 7 June 2013. On 23 April 2004, the Minister of Mineral Resources and Energy (the “MRE Minister”) published, under the terms of the MPRDA, the Mineral and Petroleum Resources Development Regulations in order to implement the provisions of the MPRDA and MPRDAA. These implementation regulations were amended on 27 March 2020.
|
| | | | | |
| Gold production (000oz) |
| | Average number of employees |
|
Operations |
South Africa | | | |
1. West Wits | | | |
Mponeng | 244 |
| | 4,944 |
|
2. Surface operations (1) | 175 |
| | 2,031 |
|
| |
(1)
| Includes MWS for purposes of this annual report. It is operated and managed as a separate cash-generating unit. |
Since 2004, a series of mining charters have been adopted in South Africa Key Statisticswith the main purpose of transferring part of the ownership of mining assets to black or historically disadvantaged South Africans (“HDSAs”) within a certain time period. Such mining charters also set targets for, amongst other things, the advancement of HDSAs into management positions, the employment of women, procurement of goods and services from HDSA-owned companies, training, community development and the upgrading of mine housing. In 2004, the Broad-Based Socio-Economic Empowerment Charter for the South African Mining Industry, 2004 was published and, in September 2018, the Broad-Based Socio-Economic Empowerment Charter for the Mining and Minerals Industry, 2018 (the “2018 Mining Charter”) was published, repealing all prior mining charters. In September 2021, the High Court of South Africa (Gauteng Division) held that the 2018 Mining Charter is a policy document and does not, per se, bind holders of mining titles. The High Court also set aside various provisions of the 2018 Mining Charter. In November
|
| | | | | | | | | | |
| Unit | | 2019 |
| | 2018 |
| | 2017 |
|
Operation | | | | | | | |
Tonnes treated/milled | Mt | | 35.1 |
| | 34.9 |
| | 38.9 |
|
Pay limit (1) | oz/t | | 0.33 |
| | 0.44 |
| | 0.43 |
|
| g/t | | 11.90 |
| | 16.11 |
| | 15.97 |
|
Recovered grade (1) | oz/t | | 0.183 |
| | 0.219 |
| | 0.202 |
|
| g/t | | 5.69 |
| | 6.82 |
| | 6.93 |
|
Gold production (2) | 000oz | | 419 |
| | 487 |
| | 903 |
|
Cost of sales | $m | | 479 |
| | 590 |
| | 1,129 |
|
Total cash costs (3) | $/oz | | 981 |
| | 1,033 |
| | 1,085 |
|
All-in sustaining costs (3) | $/oz | | 1,132 |
| | 1,178 |
| | 1,245 |
|
Capital expenditure | $m | | 57 |
| | 73 |
| | 150 |
|
Safety | | | | | | | |
Number of fatalities | | | 0 |
| | 2 |
| | 7 |
|
AIFR | Per million hours worked | | 10.00 |
| | 10.25 |
| | 12.68 |
|
People | | | | | | | |
Average no of employees: Total | | | 6,975 |
| | 17,308 |
| | 26,245 |
|
Permanent employees | | | 6,202 |
| | 15,557 |
| | 22,738 |
|
Contractors | | | 773 |
| | 1,751 |
| | 3,507 |
|
| |
(1)
| Refers to underground operations only. |
| |
(2)
| Includes production ounces from the technology development programme in 2017. |
| |
(3)
| Total cash costs and all-in sustaining costs are non-GAAP measures. For further information on these non-GAAP measures, see “Item 5A: Operating Results-Non-GAAP analysis”. |
2021, the South African Department of Mineral Resources and Energy (“DMRE”) informed the parliamentary portfolio committee on mineral resources and energy that it does not intend to appeal the outcome of the judgement, but instead will consider steps to achieve the empowerment objectives through legislative amendments to the MPRDA.
Production and costs
The B-BBEE Act
The Broad-Based Black Economic Empowerment Act, No. 53 of 2003 (the “B-BBEE Act”) is a law of general application in respect of Broad-Based Black Economic Empowerment (“B-BBEE”) and enables the Minister of Trade and Industry to drive B-BBEE across all sectors of the economy. In 2014, the Broad-Based Black Economic Empowerment Amendment Act, No. 46 of 2013 (the “B-BBEE Amendment Act”) came into effect amending the B-BBEE Act to provide a framework of principles, strategies and guidelines aimed at promoting the broad-based socio-economic empowerment of HDSAs across the South African economy and society in the form of ownership, management, employment equity, skills development, preferential procurement, enterprise development and socio-economic development.
Environmental laws relating to mining
The National Environmental Management Act, No. 107 of 1998, as amended (the “NEMA”) includes provisions to deal with environmental regulation of mining and prospecting, which provisions are administered by the MRE Minister. Pursuant to section 24N(8) of NEMA, directors of a company are jointly and severally liable for any negative impact on the environment, whether advertently or inadvertently caused by the company they represent, including damage, degradation and pollution.
From an environmental perspective, given the wide scope of the statutory duty of care in South African environmental law, erstwhile land owners may be held liable for historic contamination by the regulatory authorities. The “polluter pays” principle in South Africa region produced 419,000oz, 14% lowerenables the competent authority to seek recourse against various responsible parties based on their historical or current relationship to the source and receptor of degradation or pollution. The duty of care also applies retrospectively to significant pollution or degradation that occurred before the entry into force of NEMA (i.e., 29 January 1999), as well as significant pollution or degradation that arises or is likely to arise at a different time from the actual activity that caused the contamination (e.g., latent or residual impact) or arises through an act or activity of a person that exacerbates pre-existing contamination. The authorities can also seek compensation in respect of clean-up measures that it is required to take on behalf of the responsible parties and apportion liability amongst the responsible parties, which could technically include a historic landowner or mining company that caused the pollution. Although the purchasers of AngloGold Ashanti’s assets in South Africa have contractually assumed all environmental liability associated with its former South African operations and agreed to indemnify AngloGold Ashanti for the same, there remains a risk, at least theoretically, of statutory liability to the state.
AngloGold Ashanti’s rights and permits
Pursuant to the SA Sale Agreement, AngloGold Ashanti and Golden Core executed a notarial deed of cession of the mining rights with DMRE references GP 30/5/1/2/2/01 MR and GP 30/5/1/2/2/248 MR to transfer and cede these mining rights to Golden Core (the “Deed of Cession”). On 14 June 2021, the Deed of Cession was registered at the Mineral and Petroleum Titles Registration Office (the “MPTRO”).
With respect to the mining right held under DMRE reference GP 30/5/1/2/2/11 MR, AngloGold Ashanti and Golden Core agreed to make an application in terms of section 102 of the MPRDA at the DMRE after the closing date of the SA Sale Agreement requesting, among other matters, the incorporation of this mining right into the mining right with DMRE reference GP 30/5/1/2/2/01 MR (the “Harmony Consolidation Application”). AngloGold Ashanti also executed a notarial conditional deed of abandonment pursuant to which it conditionally abandons this mining right in terms of section 56(f) of the MPRDA (the “Deed of Abandonment”) on condition that ministerial consent is granted in respect of the Harmony Consolidation Application. The Harmony Consolidation Application, which was submitted to the DMRE on 17 January 2022, is still pending. On the date of the grant of the Harmony Consolidation Application, AngloGold Ashanti will cease to be a holder of any mining rights in South Africa. Once the transaction has been fully implemented, the general laws relating to mining outlined above will no longer be applicable to the Company, other than the previous year,statutory duty of care in terms of NEMA as described above.
AFRICA REGION
Democratic Republic of the Congo (DRC)
General laws relating to mining
The mining industry in the DRC is primarily regulated by Law No. 007/2002 dated 11 July 2002 (the “2002 DRC Code”), as amended and supplemented by Law No. 18/001 dated 9 March 2018 (the “Reformed DRC Mining Code”) and Decree No. 038/2003 dated 26 March 2003, as amended and supplemented by Decree No. 18/024 dated 8 June 2018 (the “Reformed DRC Mining Regulations”).
With respect to the application of the Reformed DRC Mining Code and Reformed DRC Mining Regulations, Kibali Goldmines S.A. (“Kibali Goldmines”) has reserved and continues reserving its rights, including, without limitation, its stability rights under, among other legal sources, the 2002 DRC Code. Discussions with the DRC government on these issues and the possible application of incentives that may be available under the Reformed DRC Mining Code and Reformed DRC Mining Regulations, in particular under article 220 of the Reformed DRC Mining Code which provides that the Prime Minister of the DRC may grant a number of incentives to provinces with infrastructure deficits to encourage economic development from mining resources, are ongoing.
Companies holding mining titles issued prior to the entry into force of the Reformed DRC Mining Code and Reformed DRC Mining Regulations have claims to a ten-year stability provision in accordance with prior mining legislation. Notwithstanding the adoption of the new regulatory regime, their rights with respect to such stability provision are reserved.
The Reformed DRC Mining Code grants the DRC Minister of Mines the authority to grant, refuse, suspend or terminate mineral rights, subject to conditions set out in the Reformed DRC Mining Code. Mineral rights may be granted in the form of exploration permits for an initial period of five years renewable once for a further five-year period or in the form of exploitation permits which are granted for an initial period of 25 years, renewable several times for 15-year periods until the end of the mine’s life. Prior to commencing exploration work, the holder of an exploration permit must submit for approval a mitigation and rehabilitation plan pursuant to which it must undertake to carry out certain mitigation measures of the impact of its activities on the environment, as well as rehabilitation measures. Exploitation permits are granted upon successful completion of exploration and satisfaction of certain requirements, including approval of a feasibility study, an environmental and social impact study and an environmental and social management plan. The holder of an exploitation permit is required to commence development and mine construction within three years of the grant of such permit. Failure to do so may lead to forfeiture of the exploitation permit. To protect and enforce rights acquired under an exploration or exploitation permit, the Reformed DRC Mining Code provides, depending on the nature of the dispute or controversy, administrative, judicial and national or international arbitral recourses.
Mining companies are required to grant a free-carried and non-contributory participation to the DRC government. The DRC government’s free participation was originally set at five percent, which was increased to ten percent in respect of exploitation permits issued after the entry into force of the Reformed DRC Mining Code. All mining companies are required to grant an additional five percent free-carried participation to the DRC government upon each renewal of their exploitation permit. Under the Reformed DRC Mining Code, a ten percent local contributory participation is also mandatory for exploitation permits issued after its entry into force.
Tax laws relating to mining
The Reformed DRC Mining Code sets out an exclusive and comprehensive tax and customs regime that is applicable to mining activities. Mining title holders are subject, amongst other things, to a corporate income tax of 30 percent, a windfall tax of 50 percent (subject to certain prerequisites) and are required to pay mining royalties to the DRC government. The royalty rate applicable to gold has been set at 3.5 percent. Mining title holders are also required to contribute a minimum of 0.3 percent of total turnover to community development.
The standard rate of VAT is 16 percent and is applicable to all mining companies. In the DRC, Kibali Goldmines is due certain refunds of VAT which, to date, remain outstanding. During 2022, AngloGold Ashanti did not recover any VAT offsets and refunds from its operations in the DRC. We believe that our attributable share of the net recoverable VAT balance (including recoverable fuel duty and after discounting provisions) owed to us by the DRC government amounted to $86 million as of 31 December 2022. While an agreement was reached with the DRC government on the reimbursement of the refundable VAT in 2018, uncertainty remains regarding the timing and level of cash receipts and offsets against other taxes for purposes of the recovery of our VAT receivables in the DRC.
The Reformed DRC Mining Code also provides for a level of fiscal stability. A stability clause stipulates that existing tax, customs and exchange control provisions applicable to mining activities are guaranteed to remain unchanged for a period of five years from the enactment of the Reformed DRC Mining Code.
Foreign exchange control regime
The Reformed DRC Mining Code imposed new exchange control rules requiring that mining title holders repatriate onshore 60 percent of sale revenues received during the investment amortisation period and 100 percent once the investment amortisation is completed.
During 2022, AngloGold Ashanti repatriated $694 million from its operations in the DRC, in the form of dividends from Kibali (Jersey) Limited. Kibali (Jersey) Limited received such cash from Kibali Goldmines in the form of loan repayments (net of bank fees) (AngloGold Ashanti’s attributable share: $658 million) and dividends (net of withholding taxes) (AngloGold Ashanti’s attributable share: $36 million). Our attributable share of the outstanding cash balances awaiting repatriation from the DRC amounted to $40 million as of 31 December 2022. The cash is fully available for the operational requirements of Kibali Goldmines. The cash and cash equivalents held at Kibali Goldmines are subject to various steps before they can be distributed to Kibali (Jersey) Limited and are held across four banks in the DRC, including two domestic banks.
AngloGold Ashanti’s rights and permits
AngloGold Ashanti holds a significant stake in the Kibali gold mine which is located in the north-eastern part of the DRC. The Kibali gold mine is owned by Kibali Goldmines which is a joint venture between Barrick Gold Corporation (45 percent), AngloGold Ashanti (45 percent) and Société Minière de Kilo-Moto S.A. (“SOKIMO”) (10 percent) which represents the interest of the DRC government. AngloGold Ashanti and Barrick Gold Corporation each have a 50 percent interest in Kibali (Jersey) Limited which holds their respective 45 percent interest in Kibali Goldmines.
The Kibali gold project is operated by Barrick Gold Corporation and comprises ten exploitation permits, of which eight expire in 2029 and two in 2030. Those exploitation permits (11447, 11467, 11468, 11469, 11470, 11471, 11472, 5052, 5073, and 5088) cover an area of approximately 1,836 km2 in the Moto goldfields.
Ghana
General laws relating to mining
Control of minerals and mining companies
The Constitution of Ghana as well as the Minerals and Mining Act, 2006 (Act 703) (the “GMM Act”) provide that all minerals in Ghana in their natural state are the property of the State and title to them is vested in the President on behalf of and in trust for the people of Ghana, with rights of reconnaissance, prospecting, recovery and associated land usage being granted under licence or lease. The grant of a mining lease by the Ghana Minister of Lands and Natural Resources (the “LNR Minister”) upon the advice of the Minerals Commission is subject to parliamentary ratification unless the mining lease falls into a class of transactions exempted by the Ghanaian Parliament. The LNR Minister has the power to object to a person becoming or remaining a controller of a company which has been granted a mining lease if the LNR Minister believes, on reasonable grounds, that the public interest would be prejudiced by the person concerned becoming, or remaining, a controller.
Stability and development agreements
The GMM Act provides for stability and development agreements. Stability agreements guarantee for a period of 15 years certain terms and conditions (mainly fiscal) to which a company’s operations are subject. Development agreements may be granted to a mineral right holder that proposes to invest over $500 million in its mineral operations in Ghana. The GMM Act permits stability provisions to be incorporated into development agreements. Stability and development agreements are subject to parliamentary ratification. In January 2020, it was proposed that the GMM Act be amended by abolishing development agreements and shortening the maximum term of stability agreements from 15 years to five years (with a possible extension for a further five years). If the GMM Act were amended along these lines, such amendments would not apply retroactively and would therefore not have an impact on existing development agreements, including the Obuasi Development Agreement (as described below). Those amendments to the GMM Act have not yet been adopted.
Ghana Stability Agreement
In 2004, following the implementation of the business combination between AngloGold Limited and Ashanti Goldfields Company Limited, AngloGold Limited and the Government of Ghana signed a stability agreement (the “Ghana Stability Agreement”) governing certain aspects of the fiscal and regulatory framework within which the company would operate in Ghana for a period of 15 years. In June 2018, the Ghana Stability Agreement ceased to apply to the Obuasi mine because of the parliamentary ratification of a new development agreement and a new tax concession agreement in relation to that mine (as described below).
The Ghana Stability Agreement continued to apply to the Iduapriem mine until it expired in April 2019. Since then, AngloGold Ashanti (Iduapriem) Limited (“AGA Iduapriem”) no longer benefits from the Ghana Stability Agreement. AGA Iduapriem benefits from certain concessions under two deeds of warranty, including exemptions from withholding taxes on dividends, interest and payments for foreign services, and allowable deductions.
Obuasi Development Agreement
AngloGold Ashanti (Ghana) Limited (“AGA Ghana”) negotiated a new development agreement in relation to the Obuasi mine (the “Obuasi DA”) with the Government of Ghana. On 21 June 2018, the Ghanaian Parliament ratified the Obuasi DA which contains stability terms as provided for in stability agreements. The Obuasi DA confers a number of rights and obligations on AGA Ghana with respect to the Obuasi mine, including, among other matters, (i) the stabilisation of the fiscal and regulatory framework (except for enactments promoting the use of Ghanaian goods and services) for a period of ten years (with a potential of it being extended for five years); (ii) the right to hold up to 80 percent of proceeds received from exporting minerals in foreign currencies outside of Ghana; (iii) obligation to give preference to materials and goods made in Ghana as well as services provided by Ghanaians; and (iv) the right to peaceful enjoyment and protection against expropriation.
Obuasi Tax Concession Agreement
Fiscal terms, which would ordinarily form part of a single stabilisation document, were separated from the Obuasi DA. Hence a separate tax concession agreement in relation to the Obuasi mine (the “Obuasi TCA”) was signed with the Government. On 21 June 2018, the Ghanaian Parliament ratified the Obuasi TCA with a concession period until 31 December 2027. The Obuasi TCA contains a number of tax concessions for AGA Ghana with respect to the Obuasi mine, including, among other matters, (i) a corporate income tax rate of 32.5 percent or such lower rates as may be fixed by law (instead of the current statutory rate of 35 percent); (ii) exemption of certain transactions from capital gains tax; (iii) a sliding scale royalty rate ranging from three percent to five percent for a price ranging from $1,300 up to $2,000 and above per ounce (instead of the current flat rate of five percent); and (iv) certain VAT exemptions and refunds.
Government’s Golden Share
Section 60(1) of the GMM Act provides that the Government of Ghana can require a mining company to issue to the Republic of Ghana for no consideration a special share (a “Golden Share”). A Golden Share in AGA Ghana was issued to the Government of Ghana and the Obuasi DA confirms that the Government’s rights with respect to its Golden Share apply only in respect of AGA Ghana’s assets and operations in Ghana. The Golden Share confers certain rights on the Government in respect of AGA Ghana. For example, written consent of the holder of the Golden Share is required for, among other matters, (i) any amendment of the rights and restrictions in respect of the Golden Share; (ii) the voluntary winding-up or voluntary liquidation of AGA Ghana; (iii) the disposal of any mining lease held by AGA Ghana; and (iv) the disposal of all or substantially all of the assets of AGA Ghana. The holder of the Golden Share does not have the right to participate in the profits or assets of AGA Ghana (by way of dividend or other capital issuances), but is entitled to attend any general meeting of shareholders.
Tax laws relating to mining
Currently, the main tax laws in Ghana include the following acts and regulations, which have been frequently amended over the years:
•Income Tax Act, 2015 (Act 896) (as amended) and Income Tax Regulations, 2016 (L.I. 2244);
•Customs Act, 2015 (Act 891) (as amended) and Customs Regulations, 2016 (L.I. 2248);
•Value Added Tax, 2013 (Act 870) (as amended) and Value Added Tax Regulations, 2016 (L.I. 2243);
•Revenue Administration Act, 2016 (Act 915) (as amended); and
•Exemptions Act, 2022 (Act 1083).
The Income Tax Act, 2015 (Act 896) ringfences and taxes income derived from mining operations at the rate of 35 percent. The Obuasi TCA for AGA Ghana provides for a stabilised income tax rate of 32.5 percent. AGA Iduapriem currently pays income tax at the rate of 35 percent.
Furthermore, mining companies must pay ground rent and royalties. Ground rent is payable annually and is calculated based on the number of cadastral units of land held. Royalties are calculated as a percentage of total revenue from minerals obtained by the mining company. The Government of Ghana currently applies a five percent royalty rate to mining companies who have not agreed a different royalty rate under an agreement with the State. AGA Ghana pays royalties on a sliding scale ranging between three percent and five percent as provided for by the Obuasi TCA. AGA Iduapriem pays royalties at a costrate of salesfive percent.
The provision of $479 milliongoods and services is liable to value added tax (“VAT”) at a revised rate of 15 percent. In addition, there are separate levies, including a 2.5 percent National Health Insurance Levy (“NHIL”), a 2.5 percent Ghana Education Trust Fund Levy (“GetFund Levy”) and a total cash costone percent COVID-19 Levy. By virtue of $981/oz in 2019, largely duethe Obuasi TCA, AGA Ghana is exempt from the payment of the NHIL and GetFund Levy. In addition, while AGA Ghana is technically exempt from the payment of the COVID-19 Levy (as it became operational subsequent to limitations in face length availability which impacted grades following high seismicity at Mponeng. Production was also impacted by intermittent electricity duethe effective date of the Obuasi DA), the Company decided to Eskom load shedding and seismicity related safety stoppages.pay the COVID-19 Levy voluntarily. AGA Iduapriem is not exempt from any of these levies.
Mponeng mine produced 244,000oz at a cost of sales of $287 million and a total cash cost of $976/oz in 2019, an 8% decrease in production compared to 265,000oz at a cost of sales of $320 million and a total cash cost of $977/oz in 2018. The 2019 year marked the first full year in which shift arrangements at Mponeng were implemented.
The shift arrangement representsExemptions Act, 2022 (Act 1083) (“Exemptions Act”) defines the scope of tax exemptions that may be granted under Ghanaian law, and sets out the administrative process for obtaining a paradigm shifttax exemption. The Exemptions Act requires a person with the benefit of an existing tax exemption to apply to the Ghana Minister of Finance by 11 March 2023 in order to continue to benefit from that tax exemption. The requirement to apply to the evolutionMinister of Finance does not affect AGA Ghana (as, by virtue of the mine. This has resulted in significant improvements in both safety and productivity. Employees have responded positivelyObuasi DA, AGA Ghana is stabilized against the adverse effects of, or obligations imposed by, any new laws). By contrast, AGA Iduapriem is subject to the new schedule, resulting in a 36% year-on-year improved safety performance (AIFR) and a 15% uplift in productivity.
Production of 175,000oz at Surface Operations improved for the year driven by a 3% increase in production at MWS, driven by improved recoveries with the introductionprovisions of the Aachen Shear reactorExemptions Act.
Environmental laws relating to mining
Mining companies are required, under the GMM Act, Environmental Assessment Regulations, 1999 (L.I. 1652), Environmental Protection (Mining in Forest Reserves) Regulations, 2022 (L.I. 2462) and other initiatives aimed at enhancing efficiencies.
The main drivers forWater Use Regulations, 2001 (L.I. 1692), to obtain all necessary approvals from the improved delivery atEnvironmental Protection Agency (the “Ghana EPA”) and, in appropriate cases, the Surface Operations were primarily:
Improved throughput from better operational performance delivery byWater Resources Commission, the contractor; stabilised duty cycleForestry Commission and/or the Minerals Commission before undertaking mining operations. This includes undergoing an environmental impact assessment process and, following the issuance of the communication circuits
A change in strategy to process Mponeng marginal ore dumps (MOD) throughenvironmental permit, periodically preparing environmental management plans, which include details of the Savuka gold plant;
General metallurgical process efficiencies;likely impacts of mining operations on the environment and
Implementation of grid sampling and grade profiling strategy.
The impact of inclement weather remained significant during 2019. A remote reclamation project is currently underway with the aim of reducing inclement weather disruptions to production. The current situation at Eskom also remains a concern as MWS is not able to fully function on emergency power and therefore any interruptions caused by Eskom directly impacts on production activities.
Costs benefitted from operating efficiencies local communities, as well as a weaker rand/dollar exchange rate, resultingcomprehensive plan and timetable for actions to mitigate and remediate any
adverse effects of the mining operations, for submission to the Ghana EPA. The Minerals and Mining (Health, Safety and Technical) Regulations, 2012 (L.I. 2182) also impose further obligations to obtain the necessary permits from the Inspectorate Division of the Minerals Commission for the operation of mines. The environmental permits of AGA Ghana (for the Obuasi redevelopment project and for the construction and operation of tailings and water infrastructure projects) are valid until June 2024. The environmental permits for AGA Iduapriem in connection with (i) gold mining and processing, (ii) the re-mining of Block 5 and for the tertiary crusher installation project and (iii) the construction and operation of a 19% year-on-year decreasetailings storage facility (“TSF”) expired in August 2021, July 2022 and January 2023, respectively. The renewal process for the AGA Iduapriem environmental permits, which was commenced in advance of the expiry of the permits, is underway.
Environmental laws in Ghana also require mining operators to rehabilitate land negatively impacted by mining operations according to an environmental cost reclamation plan agreed with the Ghana EPA. The environmental cost reclamation plan includes two cost estimates, namely the cost of sales and a 5% year-on-year decrease in total cash cost. This was partially offset by lower gold output fromrehabilitating the region.
Cost reduction initiatives aimedmining area at calibrating both on- and off-mine cost structures progressed well through the year in line with our focus on Operational Excellence.
All-in-sustaining costs for the region were $1,132/oz (cost of sales $479 million), down 4% despite the headwinds related to production and inflationary pressures. The region successfully delivered on its targeted cost savings initiatives for 2019.
Through our Operational Excellence initiatives, cost and capital management remained a key priority as we continue to maintain asset integrity and safety performance. Project initiatives include a wide array of activities aimed at improving metallurgical recoveries and throughput and cost saving initiatives. Operational Excellence began at Mponeng in 2019 and included working to increase face length availabilities, improve recovery and mine call factors, reduce power consumption, and optimise capital spend.
Capital expenditure
Total capital expenditure for the region was $57 million, compared to $73 million in 2018. This was mainly spent on the completionend of the Phase 1 project, ore reserve development (ORD) work,life of the mine as well as the Mponeng life-of-mine extension feasibility study. Sustaining capital expenditure was spent oncost of rehabilitating the mine as at the date of the reclamation plan. These estimates are reviewed annually and updated every two years. Each mining company is typically required to secure a varietypercentage (typically between 50 percent and 100 percent) of stay-in-business projectsthe estimated rehabilitation costs by posting reclamation bonds underwritten by banks and restricted cash. The terms of each reclamation bond are determined by a reclamation security agreement between that company and the rehabilitation workGhana EPA. Both AGA Ghana and AGA Iduapriem have bank guarantees in place for environmental reclamation liabilities as well as escrow accounts with joint signatories from the Ghana EPA. The guarantees for AGA Iduapriem expired in October 2022, whereas the guarantees for AGA Ghana expired in December 2022. Renewal of the bank guarantees (which commenced in advance of the expiry of the existing guarantees) has not yet been completed due to the continued depreciation of the Ghanaian cedi and its impact on the Bank of Ghana’s single obligor limit. AGA Ghana and AGA Iduapriem have notified the Ghana EPA of the resultant delays.
Foreign exchange, export and other rules
Retention of foreign earnings
The Obuasi mine is permitted to retain 80 percent of its foreign exchange earnings in an offshore foreign exchange account, whereas the Iduapriem mine is allowed to retain up to 75 percent. In addition, the Company has permission from the Bank of Ghana to retain and use U.S. dollars outside of Ghana to fulfil payment obligations to the Company’s hedge counterparties which cannot be met from the cash resources of its treasury company.
Rules regarding the export of gold and diamonds
The Bank of Ghana introduced new measures to regulate and monitor the export of gold and diamonds from Ghana in 2015. From September 2015, all exports of gold and diamonds must be carried out through the Precious Minerals Marketing Company Ltd (“PMMC”), except where the exporter is the holder of a licence that permits it to export directly. The Ghana Revenue Authority (Customs Division) only permits gold to be exported by a licensed gold exporter who has a completed Form FEX A4 bearing Bank of Ghana’s embossment. The export measures do not apply to AngloGold Ashanti because the Company holds a licence granted by the LNR Minister to sell and export its production.
Local assaying and refinement policies
In November 2016, the Ministry of Lands and Natural Resources issued a ministerial directive appointing the PMMC as designated laboratory for assaying in Ghana. The directive requests all persons holding export licences for gold to submit all gold to be exported to the PMMC for assay before export. Mining businesses, including AngloGold Ashanti, acting through the Ghana Chamber of Mines were opposed to this directive due to its potential negative impact on mining companies in the region. As a result, the Chamber initiated proceedings to reverse or modify the directive. Following discussions in respect of the mining industry’s concerns, the Chamber and Government agreed on the modalities for implementing the national assaying policy and it was introduced in February 2018 following a one-month pilot among certain mining companies. Subsequently, in June 2019, the LNR Minister released a statement reiterating the Government of Ghana’s plans to locally refine 30 percent of the gold produced in the country. Discussions between the Ghana Chamber of Mines and the Government of Ghana’s economic management team in 2019 led to the Chamber agreeing to consider the proposal and for the parties to discuss detailed modalities to ensure that a move to locally refined gold does not become detrimental to the mining industry.
Local content and local participation policy
Mining companies must submit a detailed programme for the recruitment and training of Ghanaians with a view to achieving “localisation”, which is the replacement of expatriate personnel in a company’s Ghanaian operations by Ghanaian personnel. In addition, mining companies must give preference to Ghanaian products and personnel, to the maximum extent possible, consistent with safety, efficiency and economies. The Minerals and Mining (General) Regulations, 2012 (L.I. 2173) give further details on the localisation policy. The Minerals and Mining (Local Content and Local Participation) Regulations, 2020 (L.I. 2431) came into force on 22 December 2020 with the purpose of developing Ghanaian participation in the mining industry value chain by imposing an obligation on mining companies to procure goods and services with Ghanaian content to the maximum extent possible.
The Government’s election to purchase gold
In June 2021, the Bank of Ghana launched a “Domestic Gold Purchase Programme” through which the Bank of Ghana intends to purchase refined gold from AGA Ghana, AGA Iduapriem and other large-scale mining companies through voluntary arrangements pursuant to the Bank of Ghana Act, 2002 (Act 612). The LNR Minister indicated in November 2022 that the Government of Ghana intended to exercise its statutory right of pre-emption pursuant to the GMM Act to compel large-scale mining companies to sell 20 percent of their Ghana gold production and/or the resultant refined gold to the Bank of Ghana in exchange for Ghanaian cedis. Each of AGA Ghana and AGA Iduapriem executed voluntary gold purchase agreements with the Bank of Ghana on 29 December 2022. As at 10 March 2023, the Government of Ghana had not exercised its statutory right of pre-emption as prescribed in the GMM Act.
AngloGold Ashanti’s rights and permits
Obuasi
The Obuasi mine originally held four contiguous mining leases, namely, the Obuasi, Binsere 1, Binsere 2 and Binsere 3 Mining Leases. The Obuasi Mining Lease was granted by the Government of Ghana on 5 March 1994, covering an area of approximately 338 km2 in the Amansie East and Adansi West districts of the Ashanti region, for a term of 30 years from the date of the agreement. The Binsere Mining Leases were granted on 9 April 1998, covering an area of 140 km2, for a term of 30 years from the date of the agreement. All leases in respect of the Obuasi mine had been duly ratified in accordance with Ghanaian law. In March 2007, the Government of Ghana agreed to extend the term of the Obuasi Mining Lease for a further term of 30 years. The amended Obuasi Mining Lease was also ratified by Parliament on 23 October 2008. The Obuasi Mining Lease will expire in March 2054 and the Binsere Mining Leases in April 2028. The mining leases are renewable. On 3 March 2016, the Minerals Commission approved AGA Ghana’s application to surrender approximately 273.54 km2 of the area to the Government of Ghana, reducing the combined area under AGA Ghana’s lease areas to 201.46 km2. The remaining parcel of land that will be subject to the mining lease is situated within various villages and townships in the region but excludes the municipality of Obuasi. On 15 January 2021, the Minerals Commission approved AGA Ghana’s application to surrender a further 60.24 km2 of lease area, thereby reducing the total lease area to 141.22 km2 under three mining leases, namely, the Obuasi Mining Lease (87.48 km2), the Binsere 1 Mining Lease (29.03 km2) and the Binsere 2 Mining Lease (24.71 km2). These mining leases are covered by the Obuasi DA and Obuasi TCA.
Iduapriem
The Iduapriem mine operates under four different mining leases, namely, the Iduapriem Mining Lease (LVB1539/89) (36.47 km2), the Ajopa Mining Lease (LVB/WR326/09) (46.12 km2), the Teberebie Mining Lease (LVB3722H/92) (28.53 km2) and the Ajopa South Mining Lease (LR#1109/1999) (28.10 km2). On 17 February 2020, the mining leases were extended for a further period of 15 years and such leases will now expire in February 2035. All leases in respect of the Iduapriem mine have been duly ratified in accordance with Ghanaian law.
Guinea
General laws relating to mining
In Guinea, the mining industry is primarily regulated by Law L/2011/006/CNT dated 9 September 2011 as amended by Law L/2013/053/CNT dated 8 April 2013 and promulgated by Decree D/2013/075/PRG/SGG dated 17 April 2013 (together, the “Guinea Mining Code”).
The Guinea Mining Code is implemented by various decrees and orders, including Decree D/2014/015/PRG/SGG adopting a model of mining convention, dated 17 January 2014, Order A/2016/1584/MMG/SGG related to the Carbon Leader project.administration’s capacities for the management of integrated mining projects (PARCA-GPI) and its steering committee, dated 6 June 2016, and Decree D/2016/163/PRG/SGG on the national agency for the development of mining infrastructures (ANAIM), dated 13 June 2016.
Safety
There were no fatalitiesIn 2017, Decree D/2017/285/PRG/SGG was adopted, which sets forth the conditions for the constitution and management of the Local Development Fund (“Fodel”), as well as Joint Order A/2017/6326/MMG/MATD/SGG, which sets forth the conditions for the use, management and control of the Fodel. Together, these set forth the use of the mining companies’ financial contribution to the development of the local communities and the rules applying to the Fodel, which was created under the Guinea Mining Code. On 13 July 2018, a Joint Order A/2018/5212/MEF/MMG/MB/MATD/SGG was issued, which regulates the use, management and monitoring of the resources allocated to local authorities pursuant to article 165 of the Guinea Mining Code. In 2019, an inter-ministerial committee was created to supervise and control the Fodel through the adoption of Joint Order AC/2019/089/MMG/MATD/SGG setting out the conditions for the constitution, powers and management of said inter-ministerial committee. On 6 September 2019, Decree D/2019/263/PRG/SGG was issued, which sets forth local content requirements in the South Africa regionframework of the implementation of public and private projects in 2019,Guinea. On 27 May 2021, Order A/2021/1229/MMG/SGG was issued to establish the region’s safest year on record. The AIFR was10.00Steering Committee for local content in the mining sector. On 21 October 2022, Law L/2022/010/CNT, dated 22 September 2022, setting up the legal framework for local content in public and private projects was enacted (the “Local Content Act”). In particular, the Local Content Act regulates local employment, procurement of goods and services, and subcontracting
requirements. As the Local Content Act does not expressly repeal the provisions of Decree D/2019/263/PRG/SGG, those provisions remain in force to the extent that they do not conflict with the Local Content Act.
On 16 June 2020, a new procedure for the year, an improvement year-on-year. Safety interventions have included changesexport of gold by mining companies was enacted through the adoption of Decree D/2020/113/PRG/SGG, which sets out, amongst other things: (i) when the industrial production tax referred to in planningarticle 161-1 of the Guinea Mining Code shall be paid, and information systems,(ii) the introductionprocess to be followed to export gold bullion.
On 27 April 2021, a Joint Order AC/2021/824/MMG/BCRG/SGG was issued establishing the fees and costs charged by the Guinean mining authorities and the Guinean Central Bank in connection with the administrative procedures for the export of gold by industrial and semi-industrial companies.
AngloGold Ashanti’s rights and permits
The Group’s Guinean subsidiary, Société AngloGold Ashanti de Guinée S.A. (“SAG”), has title to the Siguiri mine in the form of a new waymining concession, granted by virtue of Presidential Decree D/97/171/PRG/SGG, dated 4 August 1997, for a period of 25 years (the “Mining Concession”). The Mining Concession covers exploration and mining for gold, silver, diamonds and associated ores, and was originally covered by a changemining convention entered into with the Republic of Guinea in shift arrangements as1993 and amended in 2005. On 28 June 2016, SAG and the Government of November 2018. Regrettably, there have been four fatalitiesGuinea concluded a revised and consolidated mining convention (Convention de Base Révisée et Consolidée) (the “Revised Mining Convention”) which encompasses a renewal of the term of the original mining convention and other amendments necessary to support an expansion project to extend the life of the Siguiri mine (the “Expansion”). In compliance with the provisions of the Guinea Mining Code, the Revised Mining Convention was ratified by the Guinean National Assembly (Law L/2016/N°067/AN dated 30 December 2016, promulgated by Decree D/2017/015/PRG/SGG dated 24 January 2017), submitted to the Guinean Supreme Court which rendered a favourable opinion (Judgement N°AC 005 dated 16 January 2017), and ratified by the President of the Republic of Guinea (Decree D/2017/021/PRG/SGG dated 24 January 2017), following which it replaced the original mining convention and became effective on 24 January 2017.
Key elements of the Revised Mining Convention include the following:
•a duration of 25 years, expiring 23 January 2042, subject to further renewal if mining operations continue;
•the term of the Mining Concession is aligned with the term of the Revised Mining Convention since the Republic of Guinea committed to maintain the Mining Concession for the entire duration of the Revised Mining Convention;
•SAG’s operations remain governed by the 1995 Guinea Mining Code (the prior mining code) and are only subject to the provisions of the Guinea Mining Code to the extent they are expressly set out in the South Africa region post year-end resultingRevised Mining Convention;
•the stability of the customs and tax regime is guaranteed for the entire initial term of the Revised Mining Convention, and subject to certain conditions being met, any renewal period(s);
•the Republic of Guinea holds a 15 percent free-carried/non-contributory interest;
•the Republic of Guinea is entitled to a royalty on gold of five percent based on a spot gold price as per LBMA fixing (PM) up until the date of steady state commercial production of the first phase of the Expansion, after which the royalty rate applicable to gold will vary depending on threshold prices as per LBMA fixing (PM), namely: three percent if the gold price is $1,300 or less, five percent, if above $1,300 and up to $2,000 and seven percent if above $2,000;
•SAG benefits from 5-year income tax holiday from the beginning of steady state commercial production of the first phase of the Expansion, after which the income tax rate is set at 30 percent;
•a seismic eventlocal development tax of 0.4 percent is payable on the sale price for gold and silver received by SAG up until 31 December 2027, after which it will be increased to 0.6 percent;
•salaries of expatriate employees are subject to a ten percent income tax;
•goods imported into Guinea for purposes related to the construction and commissioning of the first phase of the Expansion are exempt from all customs taxes and duties; and
•SAG is committed to adopting and progressively implementing a plan for the effective rehabilitation of the mining areas disturbed or affected by its operations.
The Mining Concession covers an area divided into four blocks totalling approximately 1,495 km2. SAG has the exclusive right to explore and mine in any part of the concession area for the duration of the Revised Mining Convention. The Revised Mining Convention also grants SAG the option to secure certain land rights over additional areas currently covered by exploration permits, but to which SAG may need access for purposes of establishing roads or storage of tailings. While the Mining Concession expired on 4 August 2022, a renewal request had been filed prior to its expiry in accordance with the provisions of the Revised Mining Convention on 1 February 2022. Pursuant to the Revised Mining Convention, the Mining Concession can be renewed for one or more period(s) that cannot exceed ten years each as long as the Revised Mining Convention is in force.
The Revised Mining Convention is subject to early termination if the parties formally and expressly agree to it, if the last of the mining title held by SAG expires or is relinquished without any renewal application having been filed, if all project activities are voluntarily suspended for a continuous period of 12 months or are permanently abandoned by SAG, or if SAG goes into voluntary liquidation or is placed into liquidation by a court of competent jurisdiction.
Mali
General laws relating to mining
The mining industry in Mali is primarily regulated by Ordinance No. 2019-022/P-RM dated 27 September 2019 containing the new mining code of the Republic of Mali (the “Mali Mining Code”) and Decree No. 2020-0177/PT-RM dated 12 November 2020 implementing the Mali Mining Code. On 8 December 2020, Decree No. 2020-0288/PM-RM enacted the new model mining convention referred to in Decree No. 2020-0177/PT-RM.
The Mali Mining Code applies to the mining operations previously carried out by AngloGold Ashanti entities in Mali (as further described below) except with respect to the validity, scope and duration of their exploitation permits and the provisions on tax and customs regime contained in their mining conventions (conventions d’établissement) for their remaining duration. In this regard, the transitory rules of the Mali Mining Code specify that mining conventions in force remain valid for their remaining term and their holders continue to benefit from the stability of the tax and customs regime set out therein.
Exploration and prospecting activities are carried out under exploration authorisations (autorisation d’exploration) or exploration permits (permis de recherche), which give their holder the exclusive right to carry out exploration activities over a given area. Exploration authorisations are granted by the Mining Administration (Administration chargée des Mines) for a non-renewable period of three months, while exploration permits are granted by Ministerial Order for a period of three years renewable twice for additional 3-year periods. Applications for exploration authorisations and exploration permits must contain various documents attesting to the financial and technical capacity of the applicant as well as a tramming accidentdetailed works and costs programme.
A large scale permit exploitation permit (permis d’exploitation de grande mine) is required to mine a deposit located within the area of an exploration permit and grants the holder an exclusive right to exploit the named substances and proceed with the processing and commercialisation of the substances extracted within its perimeter. Large scale exploitation permits are granted by decree of the Head of Government for a maximum period of 12 years renewable for ten year-periods until depletion of the deposits. An application must be submitted to the Mining Administration (Administration chargée des Mines) and must contain various documents attesting to the financial and technical capacity of the applicant, a feasibility study, a detailed environmental study in respect of the impact of the project on the environment, an environmental permit, a closure and rehabilitation plan as well as a community development plan. As soon as the large scale exploitation permit is granted, the permit holder must incorporate a company under the laws of Mali and assign the permit for free to this company. The State will have a ten percent free-carried interest in the company. This interest will be converted into priority shares and the State’s participation will not be diluted in case of an increase in capital. In addition, the company is required to ensure that private Malian investors are offered the possibility to acquire five percent of their capital.
All mining titles mentioned above (save for the exploration authorisation) require a mining convention (convention d’établissement) to be signed by the State and the titleholder defining their rights and obligations, the duration of which is 20 years.
AngloGold Ashanti’s rights and permits
Historically, AngloGold Ashanti had interests in the Morila, Sadiola and Yatela gold mines, all of which were governed by mining conventions (conventions d’établissement) covering exploration, mining, treatment and marketing in a comprehensive document. These documents include general provisions regarding exploration (work programme, fiscal and customs framework) and exploitation (formation of a local limited liability mining company, State interest, fiscal and customs framework governing construction and exploitation phases, exchange controls, marketing of the product, accounting regime, training programmes for local labour, protection of the environment, reclamation, safety, hygiene and dispute settlement). The Morila and Sadiola gold mines were sold in November and December 2020, respectively.
In April 2017, Société d’Exploitation des Mines d’Or de Yatela S.A. (“Yatela”), the company operating the Yatela gold mine, began the implementation of a closure plan in order to relinquish the property. In February 2019, AngloGold Ashanti and its joint venture partner IAMGOLD Corporation announced an agreement to sell each of their 40 percent interests in Yatela to the Government of Mali, which holds the remaining 20 percent interest. Completion of the transaction is subject to the fulfilment or waiver of a number of conditions precedent and has been delayed several times since 2019 due to political instability and related events in Mali as well as the COVID-19 pandemic. Yatela’s exploitation permit covers approximately 212 km2. Yatela has a 30-year permit which expires in 2030.
Tanzania
General laws relating to mining
Tanzania Mining Act and Tanzania Mining Regulations
Mineral rights in the United Republic of Tanzania are principally governed by the Mining Act, Chapter 123 (R.E. 2019), as amended (the “Tanzania Mining Act”) and the Mining Regulations, 2018 (the “Tanzania Mining Regulations”). The Tanzania
Mining Act and the Tanzania Mining Regulations came into force in November 2010 followed by amendments to the Tanzania Mining Act in 2017 and subsequent amendments to the Tanzania Mining Regulations in 2018 and 2019. The Mining (Local Content) Regulations were amended and came into force on 23 September 2022. Those amendments, together with an Executive Order, introduced, among other matters, (i) the Tanzania Mining Commission; (ii) local content requirements in employment and for procurement of goods and services; (iii) Mining Licence requirements of five percent of a licencee’s equity to be held by Tanzanians, with at least 80 percent of its managerial positions to be held by Tanzanians and 100 percent of non-managerial and other positions to be held by Tanzanians, in addition to the Mponengshareholding of the Government of Tanzania pursuant to Section 10 of the Tanzania Mining Act (i.e. free-carried interest); and (iv) regulations for the government warehousing of minerals prior to export/sale.
Minimum shareholding and public offering
In 2016, the Mining (Minimum Shareholding and Public Offering) Regulations, 2016, as amended, was adopted. The regulations set out the requirement to sell shares to Tanzanian nationals, by way of a public offering and listing on the Dar es Salaam Stock Exchange, which will apply to companies that are carrying out large scale mining operations. The regulations also require all existing holders of a special mining licence to list a minimum of 30 percent of their shares on either the Main Investment Market or the Enterprise Growth Market Segment of the Dar es Salaam Stock Exchange within six months of the regulations coming into force, which was on 24 February 2017. However, the Company believes the listing requirement conflicts with the mining development agreement. In September 2020, the Government of Tanzania published the Mining (Minimum Shareholding and Public Offering) (Amendment) Regulations, 2020, which exempts companies holding special mining licences from local listing requirements if such mining company has entered into an agreement with the Government of Tanzania that provides for a non-dilutable free-carried interest in such mining company and an economic benefits sharing arrangement.
Arbitration
Along with other major mining companies, AngloGold Ashanti’s subsidiaries are seeking a constructive dialogue with the Government of Tanzania to gain assurances that the Geita gold mine will not be affected by recent legal and fiscal changes adopted by the Government in light of their mining development agreements which guarantee (i) fiscal and regulatory stability, and (ii) an agreement between all parties before material legal and regulatory changes are made. As a precautionary step to safeguard its interests, AngloGold Ashanti commenced international arbitration proceedings against the Government of Tanzania in connection with the enactment of this legislation in July 2017. Declaratory relief is sought in accordance with the terms of the company’s existing mining development agreement to preserve its and its shareholders’ rights and interests in the Geita gold mine.
Ore Reserve
As AngloGold Ashanti is seeking confirmation from the Government of Tanzania that, as a result of its existing mining development agreement, the company does not fall within the scope of the new mining legislation that includes, among other things, (i) listing requirements; (ii) an increase in the rate of revenue royalties from four to six percent and a one percent clearance fee; and (iii) a right for the Government of Tanzania to (a) renegotiate existing mining agreements at 31 December 2019,its discretion, (b) receive a non-dilutable, free-carried interest of no less than 16 percent in all mining projects, and (c) acquire up to 50 percent of the shares of the mining company commensurate with the total Ore Reservetax expenditure incurred by the Government in favour of the mining company. AngloGold Ashanti can provide no assurance that the new mining legislation, including the listing requirements, will not apply to its operations in Tanzania and the outcome of the arbitration action may have a material adverse impact on the company’s results of operations and financial condition. See also “Item 8A: Legal Proceedings-Tanzania”.
Categories of mineral right licences
Ownership of and control over minerals on, in or under the land vest in the President of the United Republic of Tanzania. No person is allowed to prospect for minerals or carry on mining operations except pursuant to the South African region was 15.5Moz (2018: 16.8Moz). Thisauthority of a mineral right licence granted, or deemed to have been granted, under the Tanzania Mining Act or its predecessor acts. To enable a company to prospect or mine, the Tanzania Mining Commission (“MC”) initially grants an exclusive prospecting licence. Upon presentation of a feasibility study, together with certain other environmental, social and financial assurances, the MC may then grant a form of licence for mining. Three categories of licences can be applied for under the Tanzania Mining Act: licences for exploration, licences for mining, and licences for ancillary activities. Licences for exploration include prospecting licences and gemstone prospecting licences. Licences for mining include special mining licences (if the proposed capital investment is equal to 35at least $100 million), mining licences (if the proposed capital investment is equal to between $100,000 and $100 million) and primary mining licences (reserved for Tanzanian citizens).
A prospecting licence grants the holder the exclusive right to prospect in the area covered by the licence for all minerals within the class of minerals applied for. An application for a prospecting licence is made to the Mining Commission and the licence, once granted, is valid for an initial term of four years. After the initial term, the licence is renewable for a further period of three years, with no option for renewal thereafter. Upon renewal, 50 percent of the Group’s Ore Reserve.area covered by the licence must be relinquished.
THE AMERICAS
The Americas region has threeMining is mainly carried out through either a mining licence or a special mining licence, both of which confer on the holder the exclusive right to conduct mining operations featuring both open pitin or on the area covered by the licence. A special mining licence is granted for the shorter of either the estimated life of the ore body indicated in the feasibility study report or such period as the applicant may request. The holder of a special mining licence may apply for renewal of its licence at any time but no later than one year before the expiry of the licence and underground such renewal shall not be for a period exceeding the estimate life of the remaining ore body. Special
mining (onelicences have certain fiscal and other advantages over mining licences, as the holder of a special mining licence may enter into a mining development agreement with the Government of Tanzania to guarantee the fiscal stability of a long-term mining project and make special provision for the payment of royalties, taxes, fees and other fiscal imposts. A special mining licence holder may, in Argentinacertain circumstances, amend the programme of the mining operations agreed with the MC.
Tax laws relating to mining
Currently, the main tax laws in Tanzania comprise the Finance Act, 2015 (No. 16), which came into force on 1 July 2015, the Finance Act, 2017 (No. 4), which came into force on 1 July 2017, and twocurrently the Finance Act, 2022 (No. 5), which came into force on 1 July 2022. All tax laws impose and revise certain taxes, duties, levies and fees. Among other provisions, inspection or clearance fees on the exportation or domestic use of minerals were introduced. Such exportation or domestic use is restricted unless such minerals have been inspected or cleared at the mining areas, ports, airports, border or posts and the clearing fee of one percent of the gross value of the minerals has been paid by the exporter or any other person in Brazil)possession thereof. Local government levies and environmental management fees and charges apply as well.
Effective 20 July 2017, the Value Added Tax Act, 2014 (No. 5) (the “VAT Act”) was amended in order to restrict VAT relief for VAT input tax paid by mining companies on goods and services. Prior to the enactment of this amendment to the VAT Act, mining companies were entitled to 100 percent VAT relief in respect of the goods and services they purchased. The amendment prohibits refunds for VAT input tax incurred on a series of raw products, including the exportation of “raw minerals”. Subsequently, the Tanzania Revenue Authority (“TRA”) denied our applications for VAT input credit refunds, which amounted to a total of $153 million (after discounting provisions) as of 31 December 2022, covering the period from July 2017 onwards, on the basis that all of the gold doré that we export constitutes “raw minerals” for purposes of the VAT Act. In response, the company filed formal notices of objection with the TRA stating that the exportation of gold doré is, in its view, not covered by the restriction since doré does not fall within the category of “raw minerals” as used in the VAT Act. On 22 February 2019, the Tanzania Mining Act was amended to introduce a definition for “raw minerals” which supports our interpretation that gold doré is excluded from the prohibition. On 1 July 2020, the Finance Act, 2020 (No. 8), amended the VAT Act, without retrospective effect, in order to remove the restrictions on VAT input tax credits for the exportation of “raw minerals” as well as two advanced greenfields projectsa series of other raw products. This recent amendment confirms the technical basis for VAT input tax recovery for mineral exporters from July 2020 onwards. VAT claims from July 2020 onwards are subject to verification procedures by the TRA before any refunds will be received. In 2022, the company was able to offset $45 million of verified VAT claims (from July 2020 onwards) against its corporate tax liability in Colombia.
|
| | | | | |
| Attributable gold production (000oz) |
| | Average number of employees |
|
Operations | | | |
1. Argentina | | | |
Cerro Vanguardia (Attr. 92.5%) | 225 |
| | 1,698 |
|
2. Brazil | | | |
AGA Mineração | 362 |
| | 4,885 |
|
Serra Grande | 123 |
| | 1,531 |
|
Americas - Key Statistics
|
| | | | | | | | | | |
| Unit | | 2019 |
| | 2018 |
| | 2017 |
|
Operation | | | | | | | |
Tonnes treated/milled | Mt | | 7.2 |
| | 6.8 |
| | 7.5 |
|
Pay limit | oz/t | | 0.11 |
| | 0.12 |
| | 0.10 |
|
| g/t | | 3.79 |
| | 4.14 |
| | 3.58 |
|
Recovered grade | oz/t | | 0.089 |
| | 0.103 |
| | 0.102 |
|
| g/t | | 3.04 |
| | 3.55 |
| | 3.49 |
|
Gold production (Attributable) | 000oz | | 710 |
| | 776 |
| | 840 |
|
Silver (attributable) | Moz | | 3.4 |
| | 5.9 |
| | 5.8 |
|
Cost of sales | $m | | 822 |
| | 838 |
| | 987 |
|
Total cash costs (1) | $/oz | | 736 |
| | 624 |
| | 638 |
|
All-in sustaining costs (1) | $/oz | | 1,032 |
| | 855 |
| | 943 |
|
Capital expenditure (2) | $m | | 195 |
| | 176 |
| | 234 |
|
Safety | | | | | | | |
Number of fatalities | | | 0 |
| | 1 |
| | 0 |
|
AIFR | Per million hours worked | | 3.50 |
| | 3.97 |
| | 3.29 |
|
People | | | | | | | |
Average no of employees: Total | | | 8,114 |
| | 7,973 |
| | 8,511 |
|
Permanent employees | | | 5,869 |
| | 5,755 |
| | 5,888 |
|
Contractors | | | 2,245 |
| | 2,218 |
| | 2,623 |
|
| |
(1)
| Total cash costs and all-in sustaining costs are non-GAAP measures. For further information on these non-GAAP measures, see “Item 5A: Operating Results-Non-GAAP analysis”. |
| |
(2)
| 100 percent, (not attributable) and includes Colombia. |
Production and costs
Total productionTanzania. Discussions with the TRA are ongoing to resolve our historical claims for VAT input credit refunds for the Americas regionperiod from July 2017 to June 2020.
Natural resources, export and other rules
Natural resources legislation
In Tanzania, two laws in 2019 declined 8%respect of natural resources came into force in July 2017: the Natural Wealth and Resources Contracts (Review and Re-negotiation of Unconscionable Terms) Act, 2017 (No. 6) (the “Unconscionable Terms Act”) and the Natural Wealth and Resources (Permanent Sovereignty) Act, 2017 (No. 5) (the “Permanent Sovereignty Act” and together with the Unconscionable Terms Act, the “Natural Resources Laws”). Implementing regulations were published in January 2020. The Natural Resources Laws provide that Tanzania has sovereignty over its natural resources and that all arrangements or agreements that relate to 710,000oz compared“natural wealth and resources” are subject to 776,000ozreview by the National Assembly to ensure that they are in 2018,the interests of the people of Tanzania. During a review all unconscionable terms as interpreted in accordance with the law are expunged from the agreement. In addition, under the laws, disputes over natural wealth and resources will not be subject to any proceedings in any foreign court or tribunal. As a result, of production declines atinvestors are restricted from accessing international dispute resolution mechanisms. Accordingly, companies are now required to adopt Tanzanian law and local dispute resolution in all three operations.
At AGA Mineração, performance at Cuiabá was hinderedmining agreements. As such, all disputes will be handles by poor ground conditions where,Tanzanian judicial bodies or any other Tanzania government body vested with powers to resolve disputes. In addition, to ensure safe production,that the rateGovernment and the people of Tanzania obtain an equitable stake in the exploitation of mining was slowed whileresources, all project earnings must be retained in Tanzanian banks. Investors are also prevented from freely exporting raw minerals and repatriating funds.
Section 6 of the Unconscionable Terms Act specifically provides that where there is an unconscionable term, the National Assembly may pass a new surface supportresolution for re-negotiation of the agreement whereupon the Government shall serve notice to the investor to re-negotiate the term or agreement. The Government and the particular investor have 90 days from the notice date to re-negotiate the term or agreement. If both parties fail to revise the unconscionable term, the term will be deemed removed from the agreement. A term is considered “unconscionable” under the Unconscionable Terms Act if, among other grounds, the requirements or provisions of the agreement restrict the right of the state to exercise authority over foreign investment within the country and in accordance with the laws of Tanzania, are inequitable and onerous to the state, secure preferential treatment designed to create a separate legal regime and mining sequencing were explored. Leading internal and external rock engineering experts were engaged to advise and subsequently mesh surface support installed to rehabilitate accessways and new controls and mine sequencing were introduced. Early indicators show these new controls to be successfulapplied discriminatorily for the benefit of a particular investor, deprive the people of Tanzania of the economic benefits derived from subjecting natural wealth and condition monitoring will continue as mining progressesresources to beneficiation in the deeper, higher grade areas.country, or subject the state to the jurisdiction of foreign laws and foreign courts or tribunals.
At
State participation
On 23 September 2022, the Córrego do Sítio complex, geological model changes,Mining (State Participation) Regulations, 2022 (the “SPR 2022”) came into force. The SPR 2022 required every mining licence or special mining licence holder to give notice to the MC to initiate negotiations to enable the Government of Tanzania to acquire a shareholding in the mining operation by 23 December 2022. On 9 December 2022, the company notified the MC that it had already initiated negotiations with the Government of Tanzania prior to the coming into force of the SPR 2022. The Government’s equity interest must consist of a non-dilutable free-carried interest in the mining operation ranging between 16 percent and 50 percent depending, in part, on the quantification of tax expenditures enjoyed by the mining entity during its establishment and on the extent of Government development of public infrastructure servicing the mining operation. The free-carried interest shares (the “FCI shares”) will be regarded as preferred shares and will entitle the Government to a dividend. Further, the FCI shares give the Government the right to appoint two directors (out of five) of the company engaged in the mining operation and the right to approve at least two suitable persons to the top executive management of the company engaged in the mining operation as may be agreed in the shareholders agreement. Any other management positions created by the company engaged in the mining operation shall be shared with the Government on a ratio of 3:1. The SPR 2022 also provides for the non-deductibility of royalty payments in the calculation of corporate income tax.
Local participation policy
On 15 September 2015, the Non-Citizens (Employment Regulation) Act, 2015 (No. 1) (the “Non-Citizens Act”) came into force which vests powers concerning work permits with the Labour Commissioner. Therefore, non-citizens wishing to be employed in the country are required to apply and be granted a work permit before applying for a residence permit. Before granting the work permit, the Labour Commissioner must be satisfied that all efforts have been explored to acquire a local expert. Further, the company is required to submit a succession plan to both the Labour Commissioner and the MC which sets out a well-articulated plan for the transfer of the non-citizen’s knowledge and expertise to Tanzanian citizens. Moreover, the Commissioner General of Immigration is required to take into consideration conditions of the work permit issued by the Labour Commissioner when granting a residence permit.
The Tanzania Investment Act No. 10 of 2022
On 2 December 2022, the Tanzania Investment Act, 2022 (No. 10) (the “Investment Act”) came into force. The Investment Act restores the right to international arbitration and grants foreign investors access to settle disputes with the Tanzania Investment Centre or the Government of Tanzania through arbitration. Pursuant to the Investment Act, parties to a dispute may agree to the use of a local or foreign arbitration venue.
AngloGold Ashanti’s rights and permits
The Geita gold mine is located in the Lake Victoria goldfields of the Mwanza region of Tanzania. AngloGold Ashanti has concluded a mining development agreement with the Ministry of Minerals on 24 June 1999 and was issued a special mining licence (SML45/99) covering approximately 196 km2 for a period of 25 years, which expires on 26 August 2024. The internal renewal process for the special mining licence (SML45/99) is underway with a view to submitting an application for renewal prior to its expiry date. On 9 October 2014, an addendum to the mining development agreement was entered into ratifying, among other matters, an increase in the royalty rate from three percent to four percent with effect from 1 May 2012. In March 2020, Geita Gold Mining Limited received the consent of the Minister of Minerals to change the mining method under its special mining licence from open pit to underground method, subject to the requisite terms and conditions. Within the special mining licence delays for the Rosalino orebody, geotechnical issues and unexpected heavy rainsarea, there are also seven primary mining licences of approximately 0.63 km2 in total which belong to third parties. Furthermore, AngloGold Ashanti holds prospecting licences covering (i) an area of 120 km2 in the last two monthsimmediate vicinity of the year delayed developmentits special mining licence area, and mining(ii) an area of the planned open pit mining areas.
At Serra Grande, the slightly lower production level in 2019 was due to lower feed grades, particularly690 km2 located in the second halfDodoma, Singida and Shinyanga regions, but none of the year, and reduced drilling productivity and fleet availability. This was partially offset by higher tonnage treated following the Mina III pushback.these areas contain any Mineral Reserve. All licences are in good standing.
Cerro Vanguardia’s production was negatively affected in the second half of the year by the planned lower grades mined and a 42% decline year-on-year in silver production. This was partially compensated for by higher average silver price.
Cost of sales for the region for the year were $822 million in 2019 (2018: $838 million). The total cash cost for the region for the year was $736/oz in 2019 (2018: $624/oz) and AISC were $1,032/oz (2018: $855/oz). The increased costs were largely due to the decline in ounces sold, reduced silver by-product revenue from Cerro Vanguardia and inflation. The inflationary pressures which affected both Argentina and Brazil, included increases in wages, operational materials, this coupled with impact of changes in the estimation of rehabilitation provisions estimation for the Brazilian operations as required by the new legislation. This was slightly offset by weaker currencies (Argentinean peso and Brazilian real).
Capital expenditure
Total capital expenditure for the region was $195 million, compared to $176 million in 2018, with the increase largely driven by higher spend in Colombia on feasibility study work at Quebradona. Sustaining capital expenditure was spent mainly on Ore Reserve development at underground operations in Brazil and Argentina. At Cerro Vanguardia, capital expenditure for the year was spent primarily on development work and larger trucks to increase hauling and loading capacity, and to ultimately improve productivity.
Serra Grande is our only operation in Brazil with an upstream TSF. Following implementation of new legislation in Brazil, the current dam, which has a reinforced wall, will be converted to dry stacking. As this was part of the mine plan, the process will be accelerated and decommissioning is expected to begin in September 2021.
Safety
There were no fatalities in the Americas region in 2019. Safety improved overall with an AIFR of 3.84 recorded for the year.
Ore Reserve
At the end of 2019, the total attributable Ore Reserve for the Americas region was 7.2 million ounces (2018: 7.1 million ounces). This is approximately 17 percent of the group’s total Ore Reserve.
Growth and improvement
In Brazil, the strategy is to enhance mining flexibility and predictability by investing in Ore Reserve development, along with Mineral Resource and Ore Reserve conversions. More brownfields exploration is planned to increase reserves and related confidence levels. This work will be vital in the upcoming year.
During 2019, Serra Grande transitioned to full owner development and development metres achieved increased by 10% compared to 2018 levels. At Cuiabá a new international contractor in the Brazilian market was signed on in March 2019 and has to date delivered a 28% year-on-year increase in metres developed.
Cuiabá is also investigating the potential of new orebodies and a plan for deepening the mine. At Córrego do Sítio (CdS) the focus is to re-open the CdS II underground mine. Along with a focus on resource conversion and stabilising production, Córrego do Sítio will invest in looking at the potential of CdS III and the Rosalino open-pit expansion.
At Serra Grande, Palmeiras South underground mine is expected to commence delivering ounces in the first half in 2020.
In Argentina, Cerro Vanguardia, which has been in operation for over 20 years, is expected to see a reduction in grades from the open pit mines and lower contributions from silver compared to the previous years’ levels. To sustain the production plan, exploration will focus on converting new and already existing blue sky tangible and Inferred Resources into Indicated category around current pits and underground operations in the main production zone. The exploration plan includes 25,000m of diamond drilling hole campaign, channels, trenches and geophysics surveys, among others.
AUSTRALIA
General laws relating to mining |
| | | | | |
| Attributable gold production (000oz) |
| | Average number of employees |
|
Operations | | | |
Australia | | | |
1. Sunrise Dam | 254 |
| | 570 |
|
2. Tropicana 70% | 360 |
| | 570 |
|
AngloGold Ashanti’s Australian assets compriseIn Australia, with a few exceptions, all onshore minerals are owned by the wholly owned Sunrise DamCrown. The respective Minister for each state and territory is responsible for administering the 70 percent-owned Tropicana Gold mine locatedrelevant mining legislation enacted by the states and territories. Native title legislation applies to certain mining tenements within Australia. Australia recognises and protects a form of native title that reflects the entitlement of Aboriginal people to their traditional lands in accordance with their traditional custom and laws. Should native title claims or determinations exist, certain native title processes and procedures will apply under the north-eastern goldfieldsNative Title Act 1993 (Cth) (the “Native Title Act”) before the tenure is granted. Tenure may be granted subject to conditions relating to native title rights. In the mining context, native title matters are managed as part of the tenement grant process. If disputes arise in relation to the grant of a particular tenement, they can be referred to the National Native Title Tribunal, established under the Native Title Act, for resolution. Native title legislation also provides a framework for compensation to be paid for acts that affect native title rights and interests. Ordinarily, the relevant Commonwealth or State government is liable to pay compensation for acts attributable to it. However, in the state of Western Australia, the Mining Act 1978 (WA) provides that an applicant for the grant of, or the holder of, a mining tenement is responsible for native title compensation, if determined to be payable, to native title holders.
Federal, state and territory Aboriginal and non-Aboriginal heritage laws operate in parallel to the native title legislation. State and territory heritage laws exist predominantly for the purposes of managing the impact of developments on sites, objects and areas of heritage significance. In Western Australia, impacts to Aboriginal cultural heritage are regulated by the Aboriginal Heritage Act 1972 (WA). However, this legislation will be repealed and replaced by the Aboriginal Cultural Heritage Act 2021 (WA) (the “ACH Act”) which was enacted in 2021. The regulations, management code and various guidelines which underpin the ACH Act are being co-designed by the State government, traditional owners, industry and other stakeholders. The ACH Act will not become fully operational until the co-design process is complete in mid-2023 at the earliest. Where an area of heritage significance is placed on the national or world heritage registers, federal approval processes may also apply. To date, there has not been any significant impact on any of AngloGold Ashanti’s tenure due to native title or heritage legislation and, at this stage, it is not possible to predict any significant impact that may result in the future from the final regulations, management code and various guidelines under the ACH Act, once adopted.
AngloGold Ashanti’s operating properties are located in the state of Western Australia where tenure is issued under, and mining operations are governed by, the Mining Act 1978 (WA). The most common forms of tenure in Western Australia are exploration and prospecting licences, mining leases, miscellaneous licences and general purpose leases. In most Australian states, if the holder of an exploration licence establishes indications of an economic mineral deposit in the area covered by the exploration licence and complies with the conditions of the grant, the holder of the exploration licence has a priority right against all others to be granted a mining lease which gives the holder exclusive mining rights with respect to minerals on the property.
It is possible for an individual or entity to own an area of land (including for infrastructure purposes) and for another individual or entity to be granted the right to explore for or mine any minerals located on or under the surface of the same area. The maximum initial term of a mining lease in Western Australia is 21 years and the holder has the right to renew the lease for an additional 21 years. Subsequent renewals are granted at the discretion of the respective state or territory’s minister responsible for mining rights. In Western Australia, mining leases can only be assigned with the prior written consent of the minister.
Tax laws relating to mining
Government royalties are payable by the holder of mining tenure in respect of minerals obtained from the relevant area of land at the rates specified in the relevant legislation in each state or territory. The royalty on gold production in Western Australia is payable quarterly at a fixed rate of 2.5 percent of the royalty value of gold metal produced. The royalty value is calculated by multiplying the amount of gold produced during a given month by the average gold spot price for that month. In addition, the holder of a mining tenement is required to pay annual rent in respect of the tenement. In Western Australia there is a minimum annual expenditure requirement for prospecting and exploration licences and mining leases. Exemptions from the expenditure requirement can be obtained if certain conditions are satisfied.
Environmental laws relating to mining
Mining tenements will be granted with endorsements and conditions relating to protection of the environment. Exploration and mining operations may also require separate approval from the state, territory or federal environment minister, which may require completion of an environmental impact assessment (including a public consultation period) pursuant to applicable environmental protection legislation prior to commencement. Further, a works 'construction' approval and an operating licence under the relevant environmental protection legislation in the state or territory may also be required for certain mine processing or mining-related operations. In Western Australia, legislation removing the distinction between “works approvals” and “licenses” is expected to enter into force in December 2023 such that, following the effective date, only a “license” will be required for “prescribed activities”, which include relevant works and operations on a mining lease, and not a separate “works approval”. Depending on the jurisdiction, additional approvals may be required for the removal of native vegetation within the tenement, and the taking and use of water for exploration and mining operations.
AngloGold Ashanti’s rights and permits
AngloGold Ashanti has been granted 21-year term mining leases with rights of renewal to all of its mining areas in Australia, including its proportionate share of joint venture operations and accordingly it has, together with its joint venture partners where applicable, the exclusive right to mine in those areas. Both the Group and its joint venture partners are fully authorised to conduct operations in accordance with relevant laws and regulations. The mining leases and rights of renewal cover the current life-of-mine at AngloGold Ashanti’s operations in Australia.
Australia - Key Statistics
At Sunrise Dam, one mining lease (M39/1116) covers the deposit and mine infrastructure (approximately 7,808 hectares) and another mining lease (M39/1117) covers the water extraction infrastructure used to supply the operation with water (approximately 1,768 hectares). Both leases are currently in good standing, with expiry dates in 2038.
The Butcher Well joint venture has security of tenure for all current exploration licences and for the contiguous mining leases that covers its Mineral Resource. There are three mining leases: mining lease (M39/165) which covers 602.35 hectares with expiry date in 2030, mining lease (M39/166) which covers 990 hectares with expiry date in 2030 and mining lease (M39/230) which covers 446.4 hectares with expiry date in 2032.
|
| | | | | | | | | | |
| Unit | | 2019 |
| | 2018 |
| | 2017 |
|
Operation | | | | | | | |
Tonnes treated/milled | Mt | | 10.1 |
| | 9.5 |
| | 9.4 |
|
Pay limit | oz/t | | 0.06 |
| | 0.07 |
| | 0.06 |
|
| g/t | | 1.95 |
| | 2.10 |
| | 1.84 |
|
Recovered grade | oz/t | | 0.060 |
| | 0.065 |
| | 0.061 |
|
| g/t | | 1.87 |
| | 2.01 |
| | 1.89 |
|
Gold production (attributable) | 000oz | | 614 |
| | 625 |
| | 559 |
|
Cost of sales | $m | | 632 |
| | 622 |
| | 551 |
|
Total cash costs (1) | $/oz | | 730 |
| | 762 |
| | 743 |
|
All-in sustaining costs (1) | $/oz | | 990 |
| | 1,038 |
| | 1,062 |
|
Capital expenditure | $m | | 149 |
| | 156 |
| | 153 |
|
Safety | | | | | | | |
Number of fatalities | | | 0 |
| | 0 |
| | 0 |
|
AIFR | Per million hours worked | | 7.33 |
| | 9.14 |
| | 8.53 |
|
People | | | | | | | |
Average no of employees: Total | | | 1,140 |
| | 1,051 |
| | 974 |
|
Permanent employees | | | 249 |
| | 238 |
| | 226 |
|
Contractors | | | 891 |
| | 813 |
| | 748 |
|
At Tropicana, the deposit is situated upon a single mining lease (M39/1096) covering approximately 27,228 hectares, which is currently in good standing, with an expiry date in 2036.
AngloGold Ashanti Australia Limited is also conducting early stage exploration activities in Queensland under the Mineral Resources Act 1989 (QLD). AngloGold Ashanti holds 15 exploration permits covering 316,851 hectares. Each permit is granted with an initial term of five years, renewable for two further periods of not more than five years each.
AMERICAS
Argentina
General laws relating to mining and land ownership
Mining regime
The Argentinean Mining Code governs mining activity in the country. Special regimes exist for hydrocarbons and nuclear minerals. In the case of most minerals, the Argentinean Mining Code establishes that the owner of the land is not the owner of the mineral rights; these are held by the national or provincial governments (depending on the location of the minerals). The national or provincial government, as applicable, is required by the Argentinean Mining Code to grant whomever discovers a new mine title to the mining concession.
The Argentinean Mining Code regulates exploration permits as well as mining concessions, or exploitation rights. Exploration permits grant their holders exclusivity rights to any mineral discoveries, including those made by a third party within the exploration area covered by the permit. Exploration permits are limited in time and as to the extent of the exploration area, are subject to the payment of a single-time fee, and also require a minimum exploration work programme and schedule to keep the permit in force. Priority for receiving a mining concession is given to the registered discoverer of the mine, which holds the exploration permit. Once the application for a mine has been submitted, the applicant may commence works and must submit a legal survey of the units requested for the new mine. The application and the legal survey may be opposed by third parties following specific proceedings set forth in the Argentinean Mining Code. Approval and registration of the legal survey by the provincial mining authority constitutes formal title to the mining concession.
Holders of mining concessions must comply with three main conditions: payment of an annual fee, investment of a minimum amount of capital, and the carrying out of a reasonable level of exploitation. Failure to do so could lead to forfeiture of the mining concession, which would then revert back to the Province.
In addition to the Argentinean Mining Code, between 1993 and 1995, Argentina implemented several federal laws to offer foreign companies attractive incentives for exploration and mining in Argentina, the Mining Investment Law (Law No. 24, 196), as amended (the “Mining Investment Law”), and related legal provisions being the most important one. Such incentives include, among other matters, import duty exemptions, accelerated depreciation of fixed assets, a three percent cap on provincial royalties set at pit-head value on the mineral extracted, value added tax refunds for exploration-related expenses incurred by companies registered under the Mining Investment Law, and, subject to the filing of a feasibility study for the relevant mining project, a 30-year stability as to the tax burden on the project and the customs and foreign exchange regimes and duties. Cerro Vanguardia S.A. (“CVSA”) obtained its tax, customs and foreign exchange stability certificate in 1996.
Glacier Law
On 30 September 2010, the National Law on Minimum Requirements for the Protection of Glaciers (Law No. 26, 639) (the “Glacier Law”) was enacted in Argentina, banning new mining exploration and exploitation activities on glaciers and “peri-glacial” areas. The Glacier Law establishes a broad definition of “peri-glacial” areas that, together with glacial areas, must be surveyed by an existing national government agency specifically appointed to this end every five years. The area where the Cerro Vanguardia project is located does not include any glaciers or peri-glacial areas according to the inventory of glaciers which was published in June 2018.
Rural Land Law
On 27 December 2011, the Argentinean National Congress passed a law on the Regime for Protection of National Domain over Ownership, Possession or Tenure of Rural Land (Law No. 26, 737) (the “Rural Land Law”) which implemented a set of rules restricting the ownership of rural land by foreigners (including foreign individuals or any kind of legal entity controlled by foreign individuals or legal entities). The main restrictions are as follows: (i) foreigners cannot own in the aggregate more than 15 percent of the entire rural land of Argentina, the same cap being applicable to each Province and Municipality; (ii) foreigners will not be allowed to purchase more than 1,000 hectares in the so-called “zona núcleo”, which comprises the main agricultural areas of central Argentina or an “equivalent” surface depending on the location of the land and its productive potential; and (iii) foreigners will not be allowed to buy land that contains, or is adjacent to, relevant and permanent water bodies (such as rivers and lakes). Although exploration permits and mining concessions are not the subject matter of the restrictions placed by the Rural Land Law, certain rights granted to foreign mining companies under the Argentinean Mining Code may be restricted by this
new law. For example, the right that holders of mining concessions currently have to force the surface owner to sell the land to the holder of the mining concession might be restricted if the concession holder is a foreign individual or a legal entity controlled by foreigners.
Federal Mining Agreement
On 13 June 2017, the national government and the provinces in whose territories the main mining projects of Argentina are located, signed the New Federal Mining Agreement (“FMA”). The purpose of the FMA is, amongst other things, to increase provincial revenues from the mining industry by creating legal entities owned by provincial governments that would work in association with private mining companies. This scheme is not new in Argentina and it has been used by some provincial governments, amongst them the Santa Cruz Province (through Fomicruz), in which the Cerro Vanguardia project is located. The FMA also contemplates other forms of revenues such as the formation of special trusts to be funded by mining companies to finance education, health and other programmes. Additionally, the FMA included setting forth mining royalties up to three percent of the gross value of commercialised minerals, without any deductions other than VAT. As the FMA has not yet been converted into law by the National Congress, its provisions are neither binding nor enforceable.
In Argentina, the current regulatory regime of royalty payments is expected to change and several different options and payment thresholds have been discussed. In December 2012, the Santa Cruz Province changed the mining royalty from one percent to three percent calculated at pit-head value of the mineral extracted thus bringing it to the cap of the Mining Investment Law.
Foreign exchange and export rules
Foreign exchange controls
On 1 September 2019, by means of Executive Decree No. 609/2019 (the “Export Controls Decree”), the Argentinean national government reinstated foreign exchange and export controls. The Export Controls Decree and related regulations of the Central Bank of Argentina impose, among other measures, the obligation of Argentinean residents to transfer to Argentina and/or sell for Argentinean pesos in the Argentinean foreign exchange market (mercado de cambios) the countervalue (contravalor) from their exports of goods within a specified period. The export of goods is regulated by the Consolidated Text on “Foreign Trade and Exchange” issued by the Argentinean Central Bank (as amended from time to time) which establishes the specific regulatory requirements to implement the measures adopted by the national government in this area. Prior approval of the Argentinean Central Bank is generally required to access the foreign exchange market for transactions relating to the outflow of funds, except in certain circumstances.
In October 2022, the Argentinean national government implemented the Argentinean System of Imports (Sistema de Importaciones de la República Argentina) (“SIRA”) and the Argentinean System of Imports and Foreign Payments of Services (Sistema de Importaciones de la República Argentina y Pagos de Servicios al Exterior). Importers must obtain a SIRA approval in the form of a SIRA certificate for the import of goods and to access the foreign exchange market for payments in connection with the import of goods. Additionally, from 1 January 2023, Argentinean residents, such as CVSA, must comply with certain supplementary provisions in order to access the foreign exchange market without prior approval of the Argentinean Central Bank, unless an exception applies.
CVSA had a cash balance equivalent to $116 million at 31 December 2022. The cash balance is available to be paid to AngloGold Ashanti’s offshore ($105 million (equivalent)) and onshore ($15 million (equivalent)) investment holding companies in the form of declared dividends. Applications have been made to the Argentinean Central Bank to approve the purchase of U.S. dollars in order to distribute offshore dividends related to the 2019, 2020 and 2021 financial years of $105 million (equivalent) to AngloGold Ashanti. Also, under a special regime established for dividend payments, a new petition to distribute a portion of the offshore dividends applied for, in the amount of $54 million (equivalent), was submitted to the Argentinean Central Bank during the third quarter of 2022. In December 2022, the Argentinean Central Bank approved, based on the applications submitted under this special regime, the payment of $17 million (equivalent) to AngloGold Ashanti. As a result, during 2022, AngloGold Ashanti received offshore dividends from CVSA in a total amount of $17 million (net of withholding taxes) paid in U.S. dollars. While the remaining approvals are pending, the cash remains fully available for CVSA’s operational and exploration requirements.
Export duties
On 21 December 2019, the National Law on Social Solidarity and Productive Reactivation (Law No. 27, 541) (the “Solidarity Law”) was enacted. The Solidarity Law granted the national government power until 31 December 2021 to impose export duties which may not exceed certain caps. For example, the Solidarity Law provides that export duties on mining exports cannot exceed eight percent of the taxable value or official FOB price. On 2 October 2020, the national government published Decree No. 785/2020 (the “Export Duties Decree”) which sets an export duty rate of eight percent for certain goods, including doré bars and gold alloys, and revoked the provisions of Decree No. 793/2018 which had previously set the export duty at 12 percent ad valorem. While the Export Duties Decree was set to expire at the end of 2021, on 31 December 2021, the national government published Decree No. 908/2021, extending the deadline of export duties on certain goods, including doré bars and gold alloys, until 31 December 2023. It is uncertain whether the national government is empowered to extend such deadline beyond the date set forth in the Solidarity Law. These export duties, if not compensated with other tax reductions, affect the tax stability guarantee granted to CVSA in 1996 in light of the fact that at the time export duties were zero percent.
On 26 February 2019, the Argentinean tax and mining authorities published a resolution (RC 4428/2019) establishing an administrative procedure to be followed to obtain the reimbursement or compensation of federal taxes paid in excess of the total tax burden provided for by the applicable tax stability guarantee (the “2019 Procedure”). CVSA initiated the 2019 Procedure to claim compensation for the export duties it paid in 2018, 2019 and 2020 as export duties are not contemplated by its tax stability guarantee. Prior to the publication of RC 4428/2019, CVSA had already submitted to the tax authorities claims for reimbursement of the export duties it paid from 2008 to 2015.
Pursuant to the 2019 Procedure, the National Mining Secretariat issued favorable opinions regarding CVSA’s claims in respect of fiscal years 2018 and 2019, which amounted to approximately $2.0 million and $6.3 million, respectively, as of 31 December 2022. These claims are currently under review by the relevant customs authorities. On 14 July 2021, CVSA submitted its claim in respect of fiscal year 2020, which amounted to approximately $12.4 million as of 31 December 2022. The National Mining Secretary has not yet issued an opinion regarding this claim.
Furthermore, CVSA has requested the tax authorities to apply the 2019 Procedure in respect of its historical claims for fiscal years 2008 to 2015 during which the imposition of export duties also exceeded CVSA’s total tax burden under its tax stability guarantee. However, these claims, which amounted to approximately $3.1 million as of 31 December 2022, are still being reviewed under the rules to challenge export duties instead of the 2019 Procedure. CVSA has appealed the application of those rules and a decision on this issue is pending.
On 9 June 2022, the Argentinean tax and mining authorities published a resolution (RC 5205/2022) establishing a new administrative procedure to be followed to obtain the reimbursement or compensation of federal taxes paid in excess of the total tax burden provided for by the applicable tax stability guarantee (the “2022 Procedure”). This 2022 Procedure replaces the 2019 Procedure established by RC 4428/2019. On 20 September 2022, CVSA submitted its claim for compensation for the export duties in respect of fiscal year 2021, which amounted to approximately $11.2 million as of 31 December 2022, pursuant to the 2022 Procedure. This claim is currently under review by the National Mining Secretary.
In total, AngloGold Ashanti’s net export duty receivables (after discounting provisions) in Argentina amounted to $9 million as of 31 December 2022.
Environmental laws relating to mining
Any mining company wishing to commence or modify any mining-related activity, as defined by the Argentinean Mining Code, including prospecting, exploration, exploitation, development, preparation, extraction, and storage of mineral substances, as well as property abandonment or mine closure activity, is required to prepare and submit to the competent provincial environmental authority an Environmental Impact Assessment (“EIA”) prior to commencing the work. Each EIA is required to describe the nature of the proposed work, its potential risk to the environment, and the measures that will be taken to mitigate that risk. If accepted by the competent authority, the EIA is used as the basis to create a Declaration of Environmental Impact (“DEI”) to which the mining company is required to adhere during the mining-related activity at issue. The DEI is required to be updated at least on a biannual basis. Sanctions and penalties for non-compliance with the DEI are outlined in the Environmental Protection section of the Argentinean Mining Code, and may include warnings, fines, suspension of quality certifications, obligations to restore the environment, temporary or permanent closure of activities, and withdrawal of authorisation to conduct mining-related activities.
AngloGold Ashanti’s rights and permits
The mining concession holder of Cerro Vanguardia, the Company’s operation in Argentina, is AngloGold Ashanti’s partner, Fomento Minero de Santa Cruz S.E. (“Fomicruz”), which is wholly owned by the Santa Cruz Province. On 27 December 1996, Fomicruz entered into a usufruct agreement whereby CVSA was granted an irrevocable right to exploit the Cerro Vanguardia deposit (encompassing an area of approximately 543 km2) for a 40-year period. The mining licence (402642/CV/97), which covers the full Mineral Reserve, expires on 26 December 2036. CVSA is a corporation incorporated in Argentina indirectly controlled by AngloGold Ashanti (92.5 percent), with Fomicruz as minority shareholder (7.5 percent). On 14 August 1996, CVSA obtained its tax, customs and foreign exchange stability certificate, which expires in 2026.
Brazil
General laws relating to mining and land ownership
The Brazilian Constitution of 1934 states that, for purposes of exploration and exploitation, deposits and other Mineral Resources constitute property separate from the soil and belong to the Federal Union. Exploration and exploitation of such Mineral Resources may take place only with the Federal Union’s concession and in such a way as to protect the national interest. Federal law sets out penal and administrative sanctions for conduct and activities deemed harmful to the environment.
In Brazil, the National Mining Agency (“ANM”) is the state body within the Mines and Energy Ministry (“MME”) that is responsible for: (i) the registration of mining titles, (ii) the grant of authorisations and concessions, (iii) the supervision of mining activities and mining titleholders, and (iv) the issuance of supplementary rules in relation to mining activity.
Under the current Brazilian Mining Code, there are two kinds of mines: (i) claimstake mines (minas manifestadas), for which rights were acquired before 1934 and exist independently of any mining licence or authorisation from the Federal Government and for which the Mineral Resources constitute property of the landowner, and (ii) granted mines, which are those that rely on grants from the Federal Government for mineral exploration or exploitation (pursuant to the Brazilian Constitution of 1988). AngloGold Ashanti’s operations in Brazil consist of both claimstake mines and granted mines.
Mining activities in granted mines must be performed in two defined stages: (i) exploration, which entails defining and evaluating the deposit and determining the feasibility of exploitation, and (ii) exploitation, which involves coordinating operations aimed at the industrial exploitation of the mineral deposit, from the extraction of useful minerals to their processing. Exploration authorisations issued by the ANM are valid for one to four years. One extension can be obtained automatically as long as it is justified. For more than one extension, the extension request will have to satisfy specific legal requirements. In contrast, exploitation rights, once granted, are valid for the lifetime of the deposit, provided the mining titleholder complies with all legal requirements. Pursuant to these requirements, for example, titleholders must (i) start work on mineral exploitation within six months from the date of publication of the Exploitation Concession, (ii) continue their mining activities until the mineral deposit has been exhausted, in accordance with the Economic Exploitation Plan (Plano de Aproveitamento Econômico) approved by the ANM, and (iii) refrain from suspending mining activities without prior notice to the ANM.
Tax laws relating to mining
During the exploration period, the mining titleholder has to pay an Annual Rate per Hectare (Taxa Annual por Hectare or “TAH”), subject to a maximum value set by law. In the exploitation period, regardless of the legal regime governing the project (whether claimstake or granted mines), the mining titleholder has to pay the Financial Compensation for Exploiting Mineral Resources (Compensação Financeira pela Exploração Mineral or “CFEM”). The CFEM which is 1.5 percent for gold is currently calculated based on revenues.
At the end of 2011 and the beginning of 2012, the states of Minas Gerais, Pará, Amapá and Mato Grosso do Sul each created a new “inspection and control” tax (duty) on extraction and exploration activities as well as on the use of Mineral Resource carried out in those states. In the state of Minas Gerais, gold ore and silver ore are exempted from the collection of this new duty. At the end of 2020, the state of Goiás created a new “inspection and control” tax (duty) on extraction and exploration activities carried out in this state, which currently still needs to be implemented. The constitutionality of these “inspection and control” taxes was upheld by the Supreme Court of Brazil on 1 August 2022.
Environmental laws relating to mining
Following the catastrophic failure of a tailings storage facility (“TSF”) at the Córrego do Feijão iron ore mine owned by Vale at Brumadinho in the state of Minas Gerais in Brazil in January 2019, executive, legislative and judiciary bodies, both at the federal and state levels, have generally increased scrutiny of mining operations in Brazil, and of TSFs in particular, and have been considering, and in some cases have adopted, stricter laws and regulations applicable to the approval, licensing, construction, management, closure and decommissioning of TSFs in Brazil.
At the federal level, the ANM issued Resolution No. 13/19 in August 2019 (replacing its earlier Resolution No. 4/19) which adopted additional regulatory measures to ensure the stability of TSFs, in particular those built or heightened by the upstream method or by any method declared as “unknown”. Among other things, ANM Resolution No. 13/19 prohibits the upstream method for the construction or heightening of tailings dams throughout the national territory of Brazil. It further requires operators to cease all storage and disposal activities at TSFs (known as “deactivation” or “desativação”) constructed or heightened upstream or by an “unknown” method by 15 September 2021 as well as to decommission such TSFs by 15 September 2022 to 15 September 2027 (depending on the capacity volume). To comply with the terms of ANM Resolution No. 13/19, the Serra Grande tailings dam in the state of Goiás must be decommissioned by 15 September 2025. The Serra Grande mine completed the process of reinforcing the dam walls of its upstream TSF, deactivating the TSF and migrating to dry-stacking operations, each by the 15 September 2021 deadline.
Furthermore, Federal Law No. 14.066/20, adopted in October 2020, also imposes requirements on companies to decommission upstream TSFs, including the Serra Grande tailings dam, by 25 February 2022 (which date is earlier than required by ANM Resolution No. 13/19). However, Federal Law No. 14.066/20 does permit extensions of the compliance deadline, with the consent of the ANM based on the technical plan for decommissioning. Serra Grande submitted timely requests to obtain an extension of the compliance deadline until 2025 in line with the timeline set forth in ANM Resolution No. 13/19 and presented its technical plan for decommissioning. On 26 May 2022, the ANM issued a technical note allowing the extension until 2025. With respect to downstream (or “centerline”) TSFs, Federal Law No. 14.066/20 requires companies, to the extent that communities are located in the self-rescue zone of those TSFs, to implement one of the following measures for such structures: either (i) the structure must be deactivated and decommissioned, (ii) the population must be relocated, with reparations for loss of cultural heritage, or (iii) reinforcement works that guarantee the effective stability of the structure must be carried out, by decision of the public authorities, taking into account the previous nature of the dam in relation to the occupation and technical-financial viability of the alternatives. Even if reinforcement works are completed, deactivation and decommissioning of those TSFs will be required at the end of the life of the mine. All of the TSFs operated by AngloGold Ashanti in Brazil have communities located in self-rescue zones.
As of 31 December 2022, AngloGold Ashanti has fully transitioned to dry-stacking operations for tailings storage at each location in Brazil. Capital expenditures required in 2022 to implement this new technology amounted to approximately $83 million. Capital expenditures for work required to comply with TSF-related requirements during the period 2023-2025 are expected to be material but, based on preliminary estimates to date, AngloGold Ashanti anticipates that annual expenditures for each of these years will be less than in prior years and will decline over time. Neither ANM Resolution No. 13/19 nor Federal Law No. 14.066/20 requires removal of all tailings material in connection with the decommissioning of TSFs (a process known as “decharacterisation” or “descaracterização”).
At the state level, the state legislator in the state of Minas Gerais adopted Law No. 23.291/19 in February 2019 which contains the state’s policy on TSF safety and should be implemented in conjunction with the equivalent federal policy. Among other things, Law No. 23.291/19 determines the criteria for licensing and inspecting TSF structures, prohibits TSFs constructed or heightened using the upstream method, establishes bond requirements and holds management liable for non-compliance with its provisions. The government of Minas Gerais adopted several decrees in furtherance of this legislation.
In addition, ANM Resolution No. 95/22, which became effective on 22 February 2022, effectively consolidates prior federal resolutions on TSFs, including ANM Resolution No. 13/19, and establishes new criteria for the operational management of TSF structures, changes the criteria related to the risk classification of TSF structures and emergency levels and sets new criteria for the suspension, embargo (order to stop operations) and interdiction of TSF activities. Operators of TSFs were mandated to conduct and submit risk assessments to the ANM by December 2022 and are required to update those risk assessments every two years. Operators are also required, on an annual basis, to obtain certifications from external consultants of the geotechnical stability of TSF structures and the adequacy of emergency response plans. In late 2022, tailings deposition was required to be suspended due to embargos at five of AngloGold Ashanti’s TSFs in Brazil pending certification by external consultants of on-site emergency response plans (Declaração de Conformidade e Operacionalidade (“DCO”)) as well as, at one such TSF, certification by external consultants of geotechnical stability (Declaração de Condição de Estabilidade (“DCE”)) consistent with the new standards. In addition, at the Calcinados TSF, a risk assessment conducted in December 2022 with oversight from external consultants, as required by Brazilian regulations, concluded that additional buttressing should be completed to align the TSF’s post liquefaction factor of safety with international standards currently considered best practice. Construction at the Calcinados TSF is expected to begin later in 2023, and the timeline for completion will be determined once the engineering and geotechnical work has been completed by external consultants. Tailings deposition at the Calcinados TSF, as well as processing of gold concentrate at the Queiroz plant, which services the Cuiabá mine complex, is suspended until additional buttressing of the Calcinados TSF impoundment is complete.
On 1 December 2022, the ANM published ANM Resolution No. 122/22, which relates to administrative sanctions for non-compliance with mining and dam safety regulations and which, in addition to significantly increasing the values of applicable fines and penalties, establishes procedures and parameters for available sanctions including seizures of ore, goods and equipment, suspension of mining activities, demolition of mine infrastructure and invalidation or cancellation of title and exploration licences.
Further amendments to the regulatory requirements in Brazil governing such TSFs and related dams are expected to be adopted in 2023.
AngloGold Ashanti’s rights and permits
At AGA Mineraçao, Cuiabá has a single mining concession (No. 000.323/1973) covering a total area of 3,662 hectares. In February 2022, two additional mining concessions for Cuiabá (Nos. 830.937/1979 and 831.027/1980) were published, which cover an additional area of 816.2 hectares. Lamego has a single mining concession (No. 932.710/2017) covering a total area of 1,622 hectares. Córrego do Sítio is hosted by five geographically contiguous mining concessions (i.e., Nos. 930.556/2000, 930.181/2008, 830.129/1982, 833.472/2003 and 830.943/1979) covering a total area of 6,017 hectares.
At Serra Grande, the Company has interests in or agreements over 25,719.94 hectares in the Crixás greenstone belt, representing approximately 87 percent of the relevant tenements that correspond to all current exploration and mining activities. These have been held since 1987. The mining concessions include mining concession No. 002.286/1935 covering an area of 4,206.88 hectares, mining concession No. 960.658/1987 covering an area of 1,946.89 hectares, mining concession No. 860.746/2005 covering an area of 88.28 hectares, mining concession No. 862.103/1994 covering an area of 125.41 hectares and mining concession No. 804.366/1975 covering an area of 196.05 hectares.
All of the Company’s mining concessions in Brazil are currently active, in good legal and operational standing, and free of liabilities and/or major obligations. Brazilian mining concessions remain valid up to the depletion of the Mineral Reserve and Mineral Resource pursuant to the Economic Exploitation Plan approved by the ANM and in accordance with the required environmental permits, and as a result do not have an explicit expiry date.
Colombia
General laws relating to mining and land ownership
General regime
The Colombian Constitution declares that the sub-soil and the non-renewable natural resources located within the Colombian territory are the property of the Colombian State. The underlying principle of Colombian mining legislation for the granting of mining concession contracts over free areas is first in time, first in law. Mining activities are regulated by the Colombian Mining Code, Act 685, 2001.
The filing of an exploration and exploitation proposal triggers a right of preference to obtain rights over the targeted area, provided it is available. Such area cannot exceed 10,000 hectares. Upon receipt of a proposal, the relevant government agency determines whether another proposal or contract already governs the area. If there are no pre-existing claims, the government agency grants the applicant a “free area”.
With respect to land ownership, a mining concession in Colombia does not grant the rights over the surface required to develop a mining project. Therefore, in order to develop a mining project, it is required to acquire and secure access to the land (soil). This can be achieved in several ways, such as (i) purchase of the land, (ii) a transit easement, (iii) a mining easement, and (iv) the special acquisition process or expropriation.
Concession contract
As the sub-soil and the non-renewable natural resources located within the Colombian territory are property of the Colombian State, the Colombian Mining Authority (Agencia Nacional de Minería) grants the authorisation to explore and exploit minerals through a concession contract.
Such concessions allow concessionaires to conduct the studies, works and facilities necessary to establish the existence of minerals and to organise their exploitation. Upon being awarded a mining concession, a company must take out an insurance policy to cover the costs associated with potential environmental damage as well as breaches of its mining obligations. It may then proceed with exploration activities. Once the exploration phase is complete, the concessionaire files a new plan regarding proposed works and facilities. With the award of the mining concession or tenement contract, there are specified timelines for the completion of the various phases of a mining project, e.g. exploration, construction, exploitation. The company must comply with these timelines unless performance is suspended, for example, due to force majeure or these timelines are extended or modified. A grant of force majeure is for one year and must be renewed on an annual basis. If the company does not comply with the specified timelines for the completion of the various phases of a mining project, the mining authority may revoke the company's concession contracts or mining licences. As a general matter, any company that wishes to obtain a renewal of its concession contract must be up to date in all its legal and contractual obligations and must present a new plan of works and facilities to be implemented after the contract is renewed.
PINES programme
In 2013, the national government instituted the PINES programme designed to aid promoting certain projects that are deemed to have a national interest. This designation provides for greater oversight from the national government. All of our three advanced exploration projects (La Colosa, Quebradona and Gramalote) were considered of national strategic interest. Currently, Quebradona and Gramalote remain in the PINES programme, but La Colosa was temporarily removed as such (until the force majeure is over).
Tax laws relating to mining
From the moment the concession contract is registered with the Mining Register, the concessionaire has several financial obligations, including the payment of (i) a surface fee during the exploration, construction and assembly stage and (ii) royalties.
Once exploration is complete and the mining infrastructure in place, the concessionaire must begin paying royalties to the Colombian government, consisting of a percentage of the primary product and sub-products being exploited. The percentage of the royalty depends on the regulation in force when the concession contract is registered. In the case of the Quebradona project, the deposit mainly consists of copper followed by gold and silver. There is a five percent royalty for copper on the production value at the mine’s or well’s edge (i.e. when extracted from the subsoil). In case of gold and silver, a royalty of four percent on the production valued at the mine’s or well’s edge (i.e. when extracted from the subsoil) was established.
Furthermore, Colombian law establishes that once the environmental licence is granted the concessionaire must invest one percent of the project’s value to benefit the basins covered by the environmental licence.
Environmental laws relating to mining
In order to obtain an authorisation to carry out a mining project, a company must prepare an Environmental Impact Study (“EIA”) for approval by the National Environmental Licensing Authority of Colombia (Autoridad Nacional de Licencias Ambientales or “ANLA”). Global environmental licences are granted for the entire life of the project and cover all phases: construction, assembly, operation, maintenance, dismantling, final restoration, abandonment and/or termination. Construction and assembly permits (Plan de Trabajos y Obras or “PTO”) are granted by the mining authority with jurisdiction over the project.
In Colombia, the mining authority has the discretion to declare the underlying concession void if the specific company which holds the concession breaches applicable environmental laws or regulations. If the mining authority were to exercise such discretion, a company whose concession was voided would be required to abandon its projects and all of its other existing mining concession contracts. Pending proposals for new mining concession contracts would also be cancelled and the company would be banned from doing business with the Colombian government for a period of five years. As a result, the company would be unable to conduct any mining exploration or development activities during such period. However, this would not affect other subsidiaries of the company operating in Colombia, if those concession contracts are held singularly or in concert with joint venture partners.
Mining activity is prohibited in national parks, regional parks, protected forest reserves, paramos (included in Act 1753, introduced in 2015) and wetlands, pursuant to the Ramsar Convention on Wetlands of International Importance. Some forest reserves are not “protected” but are set aside for active forestry purposes and the concessionaire must obtain a specific permit to partially and temporarily change the use of the soil before pursuing exploration activities. In addition, Resolution 1987/2016, passed by the national government in late 2016, identifies areas that the Ministry of the Environment has determined to be “paramos” areas, or paramos transition areas. In these areas there are limitations on industrial or commercial work being performed, including mining. The regulation also specifies a process to determine what work, if any, can be performed in a paramos-designated area.
AngloGold Ashanti’s rights and permits
The La Colosa project managed by AngloGold Ashanti Colombia S.A.S. (“AGA Colombia”) remains in force majeure due to delays in granting environmental permits by national and local environmental authorities, thereby preventing AGA Colombia from undertaking further exploration activities. The most recent one-year grant of force majeure, during which time the specified timelines for completing the various phases of the mining project under the concession contract are suspended, will expire on 22 June 2023. AGA Colombia applied for a mining area integration (consolidation) of its concession contracts related to La Colosa, in respect of which AGA Colombia was not in compliance with some of the specified timelines. The application for mining area integration (consolidation) was approved in March 2017, which remedied the non-compliance of each consolidated concession and reset the specified timelines. La Colosa now has a single integrated mining concession contract (EIG-163) which covers a total area of 9,210 hectares and expires on 28 February 2037.
Minera de Cobre Quebradona S.A.S. B.I.C. (“MCQ”) which manages the Quebradona project, obtained the integration of concession agreement 5881 in October 2016 and registered in December 2016. As a result, MCQ was granted the exclusive right to explore, take ownership and dispose of the mineral reserves (ore) extracted from the concession area. MCQ has the right to request an extension of up to 30 years, at least two years before the expiration of the operating period. This extension is not automatic, and the request must be filed with new technical, economic, environmental and social studies that demonstrate the status of the mineral resources. Concession contract 5881 initially covered a total area of 7,593 hectares, which was reduced to 4,881.89 hectares by the relevant mining authority (Secretaría de Minas de Antioquia) on 4 March 2022. It will expire in May 2037 and is currently in its seventh year of the integrated exploration phase. In September 2021, the permits for the construction and mining operation were approved by the relevant mining authority (Secretaría de Minas de Antioquia). On 4 November 2021, ANLA officially notified AngloGold Ashanti of its decision to ‘archive’ the environmental licence application relating to the Quebradona project. ANLA has neither denied nor granted the licence, but deemed that the information provided by AngloGold Ashanti is not enough for this authority to take a substantive decision. On 18 November 2021, AngloGold Ashanti appealed the archiving decision in order to secure further details on the specific additional information ANLA requires to make a determination. ANLA denied the appeal on 29 April 2022 and the archiving decision was confirmed. AngloGold Ashanti is in the process of preparing a new Environmental Impact Assessment for the Quebradona project to submit to ANLA in connection with its environmental licence application.
The Gramalote project is organised as a joint operation between AngloGold Ashanti (through AGA Colombia Holdings Limited and AngloGold Ashanti Holdings plc) and B2Gold (through B2Gold Corp. and Graminvest Ventures Limited). Gramalote Limited, a company incorporated under the laws of British Virgin Islands which is the legal vehicle operating the joint operation, established a Colombian branch, Gramalote Colombia Limited (“GCL”), to carry out activities in Colombia and obtain the mining concession contracts necessary to develop the Gramalote project. The Gramalote joint operation has been operated by B2Gold since January 2020. Pursuant to an integrated mining concession contract No. 14292, GCL was granted the exclusive right to explore, take ownership and dispose of the mineral reserves (ore) extracted from the concession area (which covers a total area of 8,720.71 hectares and includes the Gramalote and Monjas anomalies) until April 2043. GCL has the right to request an extension of the operating period for up to 20 years, and, if exercised, such request to extend must include new technical, economic, environmental and social studies that demonstrate the status of the mineral resources. Currently, concession contract
No. 14292 is in the phase of construction and assembly, pending resettlement of communities and the formal start of construction activities. GCL has received an environmental licence granted by ANLA and permits for the construction and mining operation which were approved by the relevant mining authority (Secretaría de Minas de Antioquia). GCL also holds an exploration concession No. 4894 (which covers a total area of 2,279.32 hectares and includes the Trinidad anomaly) which expires in 2044 and an exploration concession No. QHQ-16081 (which covers a total area of 9.78 hectares) which expires in 2052. Following the completion of the feasibility study in the second half of 2022, AngloGold Ashanti and B2Gold determined that the Gramalote project does not meet their investment thresholds for development. Following a comprehensive review of the alternatives relating to the project, both joint operation parties commenced a joint sales process for the Gramalote project, which is currently ongoing.
United States of America (Nevada)
General laws relating to mining and land ownership
General regime
Mineral and surface rights in the United States are owned by private parties, state governments or the federal government. The majority of land utilised for precious metals exploration, development and mining in the western United States is owned by the federal government. The right to mine on such federal land in western states is governed by the U.S. General Mining Law of 1872, as amended (the “General Mining Law”), as well as relevant state statutes and regulations. The General Mining Law allows mining claims (for mining and mining-related activities) on certain federal lands after proper compliance with claim location and maintenance requirements.
Mineral exploration activities in Nevada are also generally subject to applicable federal, state, and local permitting requirements, but the specific regulatory authorisations required for the company’s activities are based on the nature and location of the exploratory work. Many of the company’s Nevada operations are currently conducted under what is generally referred to under federal law as a notice-level operation subject to 43 CFR § 3809.21, while projects that are more advanced require additional permitting, including a Plan of Operations approved by the federal Bureau of Land Management (“BLM”). The State of Nevada Division of Environmental Protection’s Bureau of Mining Regulation and Reclamation (“BMRR”) also regulates mining within the state of Nevada. However, exploration projects of five acres or less on federal land, the scope of a notice-level operation under federal law, are exempt from BMRR regulation. Certain of the company’s early-stage exploration activities fall within this exemption.
The company is currently engaged in exploration activities on certain of its unpatented claims that include, but are not limited to, geological and spectral mapping, surface geochemical sampling, geophysical surveying and RC and/or diamond drilling.
Potential regulatory changes
Over the years, the U.S. Congress has considered a number of proposed amendments to the General Mining Law and other federal statutes relating to mining. Among the significant features contained in previously proposed legislation were a production royalty obligation, new and more stringent environmental standards and conditions, additional reclamation requirements, extensive new procedural steps which would likely result in extended permitting timelines, and granting counties and other entities the ability to petition the U.S. Secretary of the Interior to make certain areas unavailable for the location of unpatented mining claims. In June 2020, former President Trump signed an executive order directing certain federal agencies to streamline the review processes associated with permitting of infrastructure and natural resources projects. Many of those policies have subsequently been rescinded by the Biden administration. While certain other executive orders may favorably affect the timing of our permit and project approvals, the impact is yet to be determined and remains uncertain.
There are a number of bills being proposed to the Nevada state legislature during the 2023 legislative session that could impact the company’s planned operations. These include proposed legislation that would alter the way water rights are administered by the state, as well as a bill that would, if enacted, impose additional requirements for environmental review of mineral development projects in Nevada. At this stage, it is not possible to evaluate whether these bills will be enacted in any form by the Nevada state legislature or, if passed, what impact any might have on AGA.
AGA is currently unaware of any other new federal or state legislative or regulatory changes or rule-making that has been proposed or enacted that would adversely affect its current exploration programmes. If any requirements, standards or conditions were adopted in the future that imposed additional or new obligations or costs on AGA in connection with our exploration or extraction activities in the United States, the company’s operations in Nevada could be adversely affected.
AngloGold Ashanti’s rights and permits
In Nevada, the company’s wholly-owned subsidiaries hold a significant number of unpatented mining claims on federal lands. The Silicon project consists of approximately 950 unpatented mining claims. The North Bullfrog project consists of 45 patented and approximately 1,600 unpatented mining claims (covering approximately 32,000 acres) situated in the Bullfrog mining district. There are also nine mining leases within the North Bullfrog project the majority of which continue in perpetuity so long as the company meets certain minimal requirements for use of the land. One mining lease is scheduled to expire in 2031. The Mother
Lode project consists of 13 unpatented mining claims. The North Bullfrog and Mother Lode projects are now controlled by the company as a result of its acquisition of all of the outstanding stock of Corvus Gold Inc., which closed on 18 January 2022. The southern claim block, encompassing the Sterling mine and other properties in the same general area, consists of approximately 1,900 unpatented claims (covering approximately 35,000 acres), which are now controlled by the company as a result of its acquisition of all of the outstanding stock of Coeur Sterling, Inc. (a subsidiary of Coeur Mining, Inc.), which closed on 4 November 2022. As a result of this acquisition, the company now controls a past-producing mine site in southern Nevada known as the Sterling mine, which has one applicable mining lease that expires in 2029, with the option to extend the lease for an additional ten-year period. Although the Sterling mine is currently in care and maintenance status, it remains subject to complex permitting and regulatory requirements, including compliance with relevant provisions of the U.S. Federal Mine Safety and Health Act of 1977 and oversight by the U.S. Department of Labor’s Mine Safety and Health Administration (“MSHA”).
MINE SITE REHABILITATION AND CLOSURE
Closure, an integral part of operations
All mining operations eventually cease. An integral aspect of operating AngloGold Ashanti’s mines is ongoing planning for site closure and, where feasible, implementation of concurrent rehabilitation, together with an estimate of associated liability costs and the placement of adequate financial provisions and assurances to cover these costs.
AngloGold Ashanti integrates mine closure planning throughout the mine life cycle as follows:
•Exploration stage: developing a plan and programme for cessation and closure of exploration activities in a manner that meets local laws and AngloGold Ashanti's mine closure planning standard.
•Project phase: developing conceptual closure plans and cost estimates for all projects and including them in project feasibility studies, designs and evaluations.
•Operational phase: developing and periodically updating mine closure plans and cost estimates with increasing levels of detail and confidence over the operational phase as part of the business planning process. Closure plan updates take into account operational conditions, planning and regulatory requirements as well as advances in technology and international industry good practice (e.g., the ICMM Integrated Mine Closure Good Practice Guide). Concurrent rehabilitation, which is carried out while a mine is still operational, is a good practice that serves to decrease the final rehabilitation and closure work as well as the ultimate liability.
•Closure period: implementing the final closure plan starting at cessation of operations through a period of decommissioning, dismantling and rehabilitation until the point in time where management of the site is largely limited to monitoring and maintenance.
The Company’s group mine closure planning standard stipulates that closure planning must be undertaken in consultation with the stakeholders. In the course of these consultations, different issues are raised which require site-specific solutions. Each mine closure plan includes a social transition plan which seeks to minimise social impacts and maximise opportunities for local communities, including human resource, social infrastructure, economic and financial assets with the aim of enhancing the self-sustainability of mine communities after mine closure.
Provisions for decommissioning and restoration costs are made when there is a present obligation, it is probable that expenditure on decommissioning and restoration work will be required and the cost can be estimated within a reasonable range of possible outcomes. These costs are based on currently available facts, technology expected to be available at the time of the rehabilitation, laws and regulations presently or virtually certain to be enacted and previous experience in the rehabilitation of mine sites.
Decommissioning costs and restoration costs are provided at the present value of the expenditures expected to settle the obligation, using estimated cash flows based on current prices. Estimates are discounted at a pre-tax rate that reflects current market assessments of the time value of money.
Total provisions for decommissioning and for environmental restoration activities (excluding joint ventures) decreased by $95 million from $673 million in 2021 to $578 million in 2022. This decrease was mainly due to changes in estimates resulting from changes in discount rates, changes in global economic assumptions, changes in mine plans resulting in a change in cash flows as well as changes in the design of TSFs.
SUSTAINABILITY AND ENVIRONMENTAL, SOCIAL AND GOVERNANCE (“ESG”) MATTERS
AngloGold Ashanti’s sustainability approach is fundamental to how the Company operates its business, as well as its ability to create long-term value for its shareholders, employees and social partners through safely and responsibly exploring, mining and marketing its products. Sustainability and safety are integrated into the Company’s business and operations at all levels through various frameworks, standards and policies, and the Company measures its performance in achieving its goals against its sustainability and other ESG metrics, as well as its engagement with stakeholders.
In mitigating the risks and impacts that are an inherent part of its business, AngloGold Ashanti is informed by an annual assessment of its key ESG issues. This process is aligned with guidance published by the International Integrated Reporting Council (“IIRC”), the Sustainability Accounting Standards Board (“SASB”), the Global Reporting Initiative (“GRI”) Standards and
the Accountability AA1000 Stakeholder Management Standard. This assessment is annually reviewed by AngloGold Ashanti’s senior leadership and approved by the Social, Ethics and Sustainability Committee (the “SES Committee”).
AngloGold Ashanti’s board of directors, assisted by the SES Committee, has ultimate responsibility over environmental, safety, health and ethical matters and for the integration of sustainability objectives into AngloGold Ashanti’s business. This includes oversight of the Company’s stakeholder engagement framework and structures, which apply to investors, employees, governments, suppliers and communities, at every stage of its business from exploration to mine closure. Group Corporate Affairs and Sustainability is responsible for development of management systems and supports the Company’s general managers in the day-to-day implementation of its sustainability strategy.
AngloGold Ashanti maintains a set of policies and procedures to guide the Company in acting as a responsible corporate citizen, including the Code of Business Principles and Ethics which sets requirements for the implementation of key corporate policies and guidelines and applies to all management and employees, and to maintain compliance with applicable environmental, health and safety (“EHS”) laws. In 2022, AngloGold Ashanti continued with the implementation of the Integrated Sustainability Information Management System (“iSIMS”), in order to improve internal reporting and better integrate, manage and monitor sustainability activities with respect to its broader business. This common management and reporting application for all sustainability disciplines, from safety, health and security to community and environmental management, is expected to help provide timely information in each of these areas, and to facilitate transparency and decision-making in its processes and practices.
Significant EHS requirements and ESG risks and trends affecting the Company’s mining and processing operations are described below.
EHS Regulatory Compliance
AngloGold Ashanti is subject to extensive EHS laws and regulations in the various jurisdictions in which the Company operates. These requirements govern, among other things, extraction, use, conservation and discharge of water; air emissions (including dust control and greenhouse gases (“GHGs”)); mine and dam safety, regulatory and community reporting; clean-up of contamination; land use and conservation of protected areas; rehabilitation and closure of mined land; worker health and safety and community health; and the generation, transportation, storage and disposal of solid and hazardous wastes, such as reagents, radioactive materials, and mine tailings. Environmental laws and regulations applicable to the Company’s operations, including the requirements contained in environmental permits, are generally becoming more restrictive.
Capital and operating costs to comply with EHS laws and regulations have been, and are expected to continue to be, significant to AngloGold Ashanti. In addition, AngloGold Ashanti could incur fines, penalties and other sanctions, environmental clean-up costs, and third-party claims for personal injury or property or natural resources damages; suffer reputational damage; and be required to install costly pollution control equipment or to modify or suspend facilities, such as TSFs, or operations, as a result of actual or alleged violations of, or liabilities under, EHS laws and regulations. Failure to comply with applicable EHS laws and regulations may also result in the suspension or revocation of permits and, in some jurisdictions, the right to mine a given concession. AngloGold Ashanti’s ability to obtain and maintain permits and other approvals and to successfully operate near host communities may be adversely impacted by real or perceived effects on the environment or human health and safety associated with AngloGold Ashanti’s or other mining companies’ activities. In addition, unknown environmental hazards may exist at the Company’s properties which may have been caused by previous owners or operators.
Water Management
AngloGold Ashanti’s operations are heavily dependent upon access to substantial volumes of water for use in the mining and extractive processes and typically are subject to water-use permits or rights to extract water from certain natural sources that govern usage and require, among other things, that mining operations maintain certain water quality upon discharge. Water supply, quality and usage are areas of concern across all of the Company’s operations, including with respect to the Company’s mining operations in Ghana and Brazil, its mine development projects in Nevada, as well as its mine development project at Quebradona in Colombia. Any failure by the Company to secure access to suitable water supplies, or achieve and maintain compliance with applicable requirements of the permits or licences, could result in curtailment or halting of production at the affected operations. Incidents of water pollution or shortage can, in certain cases, lead to community protest and ultimately to the withdrawal of community and government support for AngloGold Ashanti’s operations. A failure by the Company to comply with water contamination related directives may result in further, more stringent, directives being issued against the Company, which may, in some cases, result in a temporary or partial shutdown of some of the Company’s operations.
Where feasible, the Company operates a “closed loop” system which recycles the water used in its operations without discharging it to the environment. In some areas, however, such as Ghana and Brazil, high levels of rainfall and surface water runoff mean that a closed loop system is not feasible and that discharges, after water treatment where necessary, must take place.
Waste Management
During open-pit mining, large volumes of soil and/or rock (overburden) are mined to expose the ore body. Similarly, waste rock is mined during drilling and developing access to underground ore bodies. Overburden and waste rock typically contain sub-economic levels of gold and are deposited as large waste rock facilities. Mine tailings are the process waste generated once grinding and extraction of gold from the ore is completed in the milling process and are typically deposited as slurry in large tailing storage facilities (“TSFs”) specifically designed for this purpose.
The impact of dust generation, breach, leak, or other failure of a waste rock facility or TSF, including any associated dam, can be significant, and the Company therefore monitors such facilities closely in accordance with the Company’s internal standards, independent review, national regulatory requirements, industry standards and commitments made to local communities. The occasional well-publicised failure of a third-party TSF and the potential impact of such failure also mean that these facilities are generally tightly regulated. A safety or environmental incident at the Company’s operations could result, among other things, in enforcement, including mandatory shutdown of a TSF and related facilities, obligations to remediate environmental contamination, negative press coverage, and claims for property or natural resources damages and personal injury by adjacent communities. Incidents at other mining companies’ operations could result in governmental action to tighten regulatory requirements and restrict certain mining activities, in particular with respect to TSFs, also in respect of other mine operators in that region.
For example, following the catastrophic failure of a TSF at the Córrego do Feijão iron ore mine owned by Vale at Brumadinho in the state of Minas Gerais in Brazil in January 2019, tailings were discharged into the mine’s administrative area and part of the local community, reportedly resulting in death or injury to hundreds of people. As a result of this incident, there has been considerably increased regulatory scrutiny in Brazil and other areas on mining operations generally, and the requirements applicable to the approval, licensing, construction, management, closure and decommissioning of TSFs have generally become far more stringent. For example, in late 2022, tailings deposition was suspended at five of AngloGold Ashanti’s TSFs in Brazil pending certification by external consultants of on-site emergency response plans (“DCO”) and/or geotechnical stability (“DCE”) consistent with new regulatory standards enacted in early 2022. In addition, at the Calcinados TSF, a risk assessment conducted in December 2022 with oversight from external consultants, as required by Brazilian regulations, concluded that additional buttressing should be completed to align the TSF’s post liquefaction factor of safety with international standards currently considered best practice. The timeline for completion will be determined once the engineering and geotechnical work has been completed by external consultants. For further information on the regulatory framework governing TSFs in Brazil, see “Item 4B: Business Overview—The Regulatory Environment Enabling AngloGold Ashanti to Mine—Americas—Brazil”.
In addition, a new Global Industry Standard on Tailings Management (“GISTM”) was established in August 2020 by a panel comprised of industry and non-governmental organisation (“NGO”) experts. AngloGold Ashanti has committed to comply with the GISTM at all of its TSFs by August 2025, and the costs related to meeting such standard are not expected to be material to AngloGold Ashanti.
In addition, AngloGold Ashanti could incur liabilities, or material costs to manage solid and hazardous waste generated by its mining activities, including dust and residual chemicals and metals. For example, AngloGold Ashanti expects to incur approximately $25 million to $30 million in capital expenditure and operating costs during 2023-2026 in connection with treatment and disposal of a quantity of legacy arsenic trioxide waste located at the Obuasi mine.
Groundwater Impacts and Environmental Remediation
As AngloGold Ashanti or its predecessors have a long history of mining operations in certain regions, issues may arise regarding historical, as well as potential future, environmental or health impacts in those areas, for which AGA, as the current owner/operator, may be legally responsible. For example, AngloGold Ashanti has identified groundwater contamination plumes at certain of its operations. Numerous scientific, technical and legal studies have been undertaken to assist in determining the magnitude of the impact and to find sustainable remediation solutions. Based on those studies as well as discussion with regulators, the Company has taken steps, including monitored natural attenuation and phyto-technologies, to address soil and groundwater contamination, including in Tanzania, where an in-situ remediation project to address sulfate in groundwater commenced operations in 2022.
Subject to the completion of site-specific trials and potential technologies being confirmed as viable remediation techniques, no reliable estimate can be made at this time for the obligation. Should these obligations be significant, this could have a material adverse impact upon AngloGold Ashanti’s results and its financial condition.
Climate Change and GHG Regulation
At AngloGold Ashanti, climate change is a board of directors-level governance issue, overseen by the SES Committee and the Audit and Risk Committee. AngloGold Ashanti’s Climate Change Strategy, which was approved by the board of directors in November 2021, seeks to embed the management of physical, regulatory and transition climate change-related risks, as well as climate change-related opportunities, into the Company’s strategic and operational planning processes.
In 2021, AngloGold Ashanti committed to the International Council on Mining & Metals (“ICMM”) target of achieving net zero Scope 1 and Scope 2 GHG emissions by 2050. AngloGold Ashanti has also committed to achieving a 30 percent reduction in absolute Scope 1 and 2 emissions by 2030 (as compared to a 2021 baseline), and, in partnership with value chain partners, to set Scope 3 GHG reduction targets, if not by the end of 2023, as soon as possible thereafter.
In December 2015, certain members of the international community negotiated a treaty at the Conference of the Parties of the UN Framework Convention on Climate Change in Paris (the “Paris Agreement”). The Paris Agreement, which came into force on 4 November 2016, requires developed countries to set targets for emissions reductions. As a result, measures designed to limit or reduce GHG emissions, both mandatory and voluntary, have been, and are expected to be, implemented at national or regional levels in various countries.
New regulatory requirements, or changes required to effectively transition to a low-carbon economy, could require AngloGold Ashanti to reduce its direct GHG emissions or energy use, change its fuel mix or incur significant costs for GHG emissions permits or taxes, including for those costs or taxes passed on by electricity utilities which supply the Company’s operations. AngloGold Ashanti could also incur significant costs associated with capital equipment, GHG monitoring and reporting and other obligations to comply with applicable requirements. The most likely source of these obligations is through nation state-level implementation of new emissions or financial obligations pursuant to evolving climate change regulatory regimes.
For example, in 2010, Brazil launched the National Climate Change Policy, which established a voluntary national GHG reduction target of 36.1 percent to 38.9 percent below the projected emissions in 2020 for “business as usual”. The policy required the development of sector-specific plans in order to meet the target and provided for a Brazilian GHG trading scheme, which is yet to be designed. While Brazil is not yet requiring mandatory GHG emissions reporting at the national level, some state environmental agencies have requested companies to voluntarily submit GHG emissions management plans. However, the states of Goiás and Minas Gerais (in which AngloGold Ashanti operates) do not currently require GHG emissions management plans for mining projects. In 2015, Brazil announced, in connection with its commitments under the Paris Agreement, economy-wide absolute mitigation targets providing for a 37 percent reduction in GHG emissions by 2025, as compared to 2005, and a goal to reduce GHG emissions by 43 percent by 2030 compared to 2005 levels.
In addition, in Australia, the Safeguard Mechanism (Rule 2015), through the National Greenhouse and Energy Reporting (“NGER”) scheme, provides a framework for Australia’s largest emitters to measure, report and manage their emissions. The Safeguard Mechanism applies to facilities with Scope 1 covered GHG emissions of more than 100,000 tonnes of CO2e per fiscal year. During the 2018/19 fiscal year, Tropicana’s emissions were within its authorised threshold and Sunrise Dam was required to purchase offsets for emissions that were 0.8 percent above its safeguard threshold, the cost of which was immaterial. Two amendments to the Safeguard Mechanism (Rule 2015) enacted in March 2019 and May 2020 allowed for the application of transitional calculated baselines using estimated CO2-e emissions intensities. Based on the production and emissions forecasts, the Australian mining operations applied to use transitional calculated baselines in 2020 for Sunrise Dam and Tropicana, which were approved by the Clean Energy Regulator effective 1 July 2019 to 30 June 2022 for both operations. Thereafter, the Australian mining operations will be required to apply production-adjusted baselines and, if actual emissions exceed the baseline, to purchase emissions offsets for the business. In any event, the cost of such offsets, if ultimately required to be purchased, including due to a change in the operations under the business plan prior to June 2022, are not expected to be material to the Company’s business.
In addition to more stringent requirements and commitments, AngloGold Ashanti’s operations are subject to a number of physical risks from climate change, such as changes in rainfall rates or patterns resulting in floods or droughts, reduced water availability, higher temperatures and extreme weather events. Such events or conditions, particularly including flooding or inadequate water supplies, could disrupt mining and transport operations, mineral processing and rehabilitation efforts, create resource or energy shortages or damage the Company’s property or equipment and increase health and safety risks on site. In consultation with external consultants, physical climate risk assessments were undertaken for all operations using current climate models for the business and various decarbonisation scenarios and climate adaptation plans were outlined. These physical climate risks will be further reviewed and refined in 2023.
Occupational Safety and Health
AngloGold Ashanti is subject to a variety of laws and regulations in each of the jurisdictions where the Company operates that are designed to protect and improve the safety and health of employees. In some of the jurisdictions in which AngloGold Ashanti operates, the government enforces compulsory shutdowns of operations to enable investigations into the cause of accidents and introduce corrective measures at those operations.
Safety remains a priority for AngloGold Ashanti and a focus of AngloGold Ashanti’s long-term sustainability approach, as well as the Company’s continuing efforts to manage the risks inherent to its operations, to model critical controls and to strengthen safety protocols and preventative measures. AngloGold Ashanti has made significant strides in improving safety. In 2022, there was a 41 percent reduction in year-on-year total recordable injury frequency rate, and no fatalities at any of the mines operated by AngloGold Ashanti.
AngloGold Ashanti’s Group Safety Strategy, which is updated every three years, seeks to integrate operational risk management and key performance indicators at all levels of the organisation and maintain alignment with global safety standards. The SES
Committee oversees the implementation of the Group Safety Strategy. All operations, have been certified to ISO 45001:2018, which has replaced the OHSAS 18001:2007 series.
Community Health and Tropical Diseases
AngloGold Ashanti is also subject to health and safety regulations relating to occupational disease. The primary areas of focus in respect of occupational health of employees within the Company’s operations are noise-induced hearing loss (“NIHL”) and occupational lung diseases (“OLD”). OLD includes occupational tuberculosis and silicosis in individuals exposed to silica dust. Silicosis has been particularly prevalent in South Africa and has also arisen at the Company’s Africa region and Brazilian operations, albeit to a far lesser extent. AngloGold Ashanti provides occupational health services to its employees at its occupational health centres, clinics, and through outsourced service centres. The Company continues to expand preventative occupational hygiene initiatives, such as implementing various control measures to prevent hazardous exposures, and providing employees with Personal Protective Equipment.
In 2019, the Johannesburg High Court approved the settlement of existing silicosis and tuberculosis class actions against AngloGold Ashanti and other gold mining companies in South Africa. The recent sale of the Company’s South African operating assets and liabilities did not include the silicosis or tuberculosis settlement obligations relating to South African employees, which were retained by AngloGold Ashanti. For further information, see “Item 18: Financial Statements—Note 1.2—Statement of Compliance—Significant Accounting Judgements and Estimates—Provision for silicosis”.
In addition to OLD, HIV and AIDS and associated diseases remain major health care challenges faced by AngloGold Ashanti’s Africa region operations. AngloGold Ashanti continues to implement programmes to help those infected with HIV and prevent new infections from spreading.
Malaria and other tropical diseases also pose health risks at all of the Company’s operations in Central, West and East Africa where such diseases may assume epidemic proportions because of ineffective national control programmes. Malaria is a major cause of death in young children and pregnant women and also gives rise to deaths and absenteeism in adults. All affected Company operations in Africa have malaria control programmes in place. The Ghana Obuasi malaria control programme activities have been completed in 16 districts of Ghana as planned for 2022 and a new cycle of indoor residual spraying will commence in 2023; in partnership with the Global Fund and the Ghana Department of Health.
In 2022, the COVID-19 pandemic subsided significantly with decreases in reporting of severe disease or deaths. Nevertheless, AngloGold Ashanti continued to direct resources for close surveillance and maintenance of controls within the company with a view to ensure continuity of its operations and avoid any potential disruption in the event of a re-emergence of the pandemic. Universal access to safe and effective vaccines provided an additional layer of protection, especially against severe forms of disease, hospitalisation and death. The company endeavoured to continue to provide prompt access to approved and available vaccines for all workers, especially employees considered to be at high risk as well as employees with critical skills.
The emergence of COVID-19 however also assisted to better integrate broad health risk management beyond occupational health into the overall business strategy, to contribute to productivity as well as the social licence to operate and to improve various prevention and risk management protocols in place to address the potential risk of an epidemic or pandemic, particularly after the company’s experience with Ebola in Guinea in 2014 and 2015.
The company focused on optimising mental wellbeing, minimising non-communicable diseases associated with lifestyle as well as the need for systematic contribution to health system strengthening, local skill development and overall community development in the jurisdictions in which it operates. Such risks impair the health of workers and negatively affect productivity and profitability as a result of workers’ diminished focus or skill, absenteeism, treatment costs and allocated resources. As part of AngloGold Ashanti’s continuing efforts, the company recently approved the newly updated health, hygiene and wellbeing standards based on identified major health hazards or risks which include gender, cultural and other applicable diversity considerations for risk management and controls.
Diversity and Inclusion (“D&I”)
With more than 30,000 employees (including contractor employees) on four continents, AngloGold Ashanti believes that having a diverse and inclusive workforce is important to continuing to attract talent in order to maintain competitiveness and the long-term sustainability of its business. In addition, the Company strives to have a workforce that represents the societies in which AngloGold Ashanti operates in connection with maintaining its social licence to operate.
AngloGold Ashanti’s D&I approach is aligned to the United Nation Sustainable Development Goals (“UNSDGs”) (SDG 5, 8 and 10) and the United Nations Global Compact (“UNGC”). The Company has developed a Diversity & Inclusion Framework, which aims to foster the empowerment of all staff, irrespective of race, gender, ethnicity, religion and sexual orientation and has established specific priorities and actions for the next two to five years to foster the inclusion of D&I objectives in its processes. Leadership teams are responsible for meeting defined diversity targets. In 2022, AngloGold Ashanti conducted an analysis of global gender data across job level, function and country. The analysis was carried out to inform AngloGold Ashanti’s D&I strategy.
Human Rights and Indigenous Peoples
In its commitment to respecting and promoting human rights, AngloGold Ashanti supports the United Nations Guiding Principles for Business and Human Rights (“UNGP”) and other international initiatives, including the UNGC and the Voluntary Principles on Security and Human Rights (“VPSHR”). The VPSHR, which seeks to balance safety and security needs against respect for human rights and fundamental freedoms, were developed through multi-stakeholder participation between governments, extractive industry members and NGOs. Community and security related matters, including with respect to illegal and artisanal and small-scale mining and related intrusions into the Company’s operational areas, are addressed at board of directors-level by the SES Committee. AngloGold Ashanti’s internal Human Rights Framework includes numerous policies, management standards and guidance documents which apply to all of its employees, contractors and suppliers and require reporting of, and redress for, human rights violations and related allegations.
The Company is aligned with the ICMM Position Statement on Indigenous Peoples and the International Finance Corporation’s Performance Standard 7 on Indigenous Peoples and other international standards and treaties in the area of Indigenous Peoples’ rights.
ANGLOGOLD ASHANTI GLOBAL FOOTPRINT: 2022
Operations and projects
Notes
(1) Gramalote is managed by B2Gold Corp ("B2Gold").
(2) AngloGold Ashanti acquired North Bullfrog and Mother Lode as part of the Corvus Gold Inc. ("Corvus Gold") acquisition in January 2022.
(3) AngloGold Ashanti acquired Sterling through the Coeur Sterling, Inc. ("Coeur Sterling") acquisition in November 2022.
(4) Kibali is operated by Barrick Gold Corporation ("Barrick").
OPERATING PERFORMANCE
Group description
AngloGold Ashanti is an independent global gold mining company with a diverse high-quality portfolio of operations, projects and exploration activities and is headquartered in Johannesburg, South Africa.
In 2022, our portfolio of ten operations in seven countries includes long-life operating assets with differing ore body types located in key gold-producing regions around the world. These operating assets were supported by greenfields projects in Colombia and a focused global exploration programme, including exploration in the United States.
Our operations and projects are grouped into the following regions: Africa, Americas and Australia.
On 12 February 2020, the Company announced that it had reached an agreement with Harmony to sell all its remaining South African producing assets and related liabilities. The sale closed on 30 September 2020. On 10 November 2020, the Company announced that it had completed the sale of its interest in the Morila mine in Mali and on 30 December 2020, the Company announced that it had completed the sale of its interest in the Sadiola Mine in Mali.
AngloGold Ashanti’s operations and joint arrangements employed, on average, 32,594 people (including contractors) in 2022 (2021: 30,561).
Performance
In 2022, AngloGold Ashanti produced attributable 2.742 million ounces of gold (2021: 2.472 million ounces), as well as 3.2 million ounces of silver and 352 tonnes of sulphuric acid as by-products.
Production of 2.742 million ounces of gold was achieved in 2022 at a cost of sales of $3.4 billion for subsidiaries and $342 million for equity-accounted joint venture operations, and an all-in sustaining cost of $1,439 per ounce for subsidiaries and $979 per ounce for equity-accounted joint venture operations, compared to a production of 2.472 million ounces in 2021 at a cost of sales of $2.9 billion for subsidiaries and $350 million for equity-accounted joint venture operations, and an all-in sustaining cost of $1,441 per ounce for subsidiaries and $856 per ounce for equity-accounted joint venture operations.
Gold
The AngloGold Ashanti gold Mineral Reserve increased from 28.1 million ounces as at 31 December 2021 to 28.8 million ounces as at 31 December 2022. This excludes Gramalote as the JV partner has decided not to publish the Mineral Reserve. This annual net increase of 0.7 million ounces includes additions due to exploration and modelling changes of 2.9 million ounces and changes in economic assumptions of 1.0 million ounces. This increase was partially offset by depletion of 2.9 million ounces and reductions due to other factors of 0.3 million ounces. The Mineral Reserve was estimated using a gold price of $1,400 per ounce, unless otherwise stated (2021: $1,200 per ounce). See “Item 4D Property, Plants and Equipment—Mineral Resource and Mineral Reserve”.
Copper
The AngloGold Ashanti copper Mineral Reserveremained unchanged at 1.47Mt (3,250Mlb) as at 31 December 2022 as a feasibility study optimisation is still ongoing and no additional exploration has been completed at Quebradona. The Mineral Reserve was estimated at a copper price of $2.90/lb, unless otherwise stated (2021: $2.90/lb). See “Item 4D Property, Plants and Equipment—Mineral Resource and Mineral Reserve”.
Capital expenditure, including equity-accounted joint ventures, in 2022 amounted to $1,118 million (2021: $1,100 million).
Safety
No fatal occupational safety incidents at any of the mines operated by the Company were recorded for 2022. The TRIFR was 1.26 per million hours worked in 2022 compared to 2.14 per million hours worked in 2021.
Full Asset Potential Review Programme
The Full Asset Potential (“FP”) programme aims to achieve a step-change in AngloGold Ashanti’s operating and cost performance by the year 2024. This programme includes a comprehensive three-month assessment of each of the Company’s mine sites, which covers every aspect of an operation. The outcome is intended to enhance the Company’s understanding of the relative potential of each asset and includes developing a plan and implementation schedule to achieve the targeted performance over the next six to 24 months. These assessments have now been completed at six operations of the Company (Sunrise Dam, Siguiri, Cuiabá, Tropicana, Serra Grande and Geita), where the relevant site leadership teams have taken full accountability for the delivery on these initiatives.
Operational Excellence
Operational Excellence is the continued efforts to maximise value from our assets.
New Operating Model
Our new Operating Model, designed and introduced to employees towards the end of 2021, aims to improve efficiency and support better operating outcomes by focusing only on work required to deliver the strategy, clarifying the mandates of corporate functions, properly resourcing our revenue-generating assets to deliver on their plans, and removing duplicate structures and activities. The implementation of the new Operating Model was completed during 2022.
AFRICA REGION
| | |
(1) |
Total cash costs and all-in sustaining costs are non-GAAP measures. For further information on these non-GAAP measures, see “Item 5A: Operating Results-Non-GAAP analysis”. |
Africa is currently home to five of our operations, with one – Kibali – managed by Barrick Gold Corporation. These operations, which contributed 60 percent or 1.6 million ounces to total annual group production in 2022, are in Ghana (Iduapriem and Obuasi), Guinea (Siguiri), Tanzania (Geita) and the DRC (Kibali).
| | | | | | | | | | | |
| Attributable gold production (000oz) | | Average number of employees |
Subsidiary operations | | | |
Ghana | | | |
Iduapriem | 248 | | | 2,186 | |
Obuasi | 250 | | | 4,403 | |
Guinea | | | |
Attr. Siguiri 85% | 279 | | | 4,052 | |
Tanzania | | | |
Geita | 521 | | | 6,435 | |
|
Joint venture operations |
Democratic Republic of the Congo | | | |
Attr. Kibali 45% | 337 | | | 2,731 | |
| | | |
| | | |
| | | |
Africa Region - Key Statistics | | | | | | | | | | | | | | | | | | | | | | | |
| Unit | | 2022 | | 2021 | | 2020 |
| | | | | | | Restated |
Subsidiary operations | | | | | | | |
Tonnes treated/milled | Mt | | 21.6 | | | 21.2 | | | 20.5 | |
Pay limit | oz/t | | 0.044 | | | 0.035 | | | 0.034 | |
| g/t | | 1.516 | | | 1.193 | | | 1.160 | |
Recovered grade | oz/t | | 0.054 | | | 0.045 | | | 0.052 | |
| g/t | | 1.86 | | | 1.54 | | | 1.77 | |
Gold production (a) (attributable) | 000oz | | 1,298 | | | 1,054 | | | 1,239 | |
Cost of sales | $m | | 1,662 | | | 1,300 | | | 1,362 | |
Total cash costs per ounce (1) | $/oz | | 1,023 | | | 991 | | | 841 | |
All-in sustaining costs per ounce(1) | $/oz | | 1,291 | | | 1,264 | | | 1,002 | |
Capital expenditure | $m | | 486 | | | 434 | | | 383 | |
Safety | | | | | | | |
Number of fatalities | | | 0 | | 1 | | 2 |
TRIFR | Per million hours worked | | 0.33 | | | 0.61 | | | 0.55 | |
People | | | | | | | |
Average no of employees: Total | | | 17,076 | | | 14,806 | | | 14,496 | |
Permanent employees | | | 5,780 | | | 5,619 | | | 5,433 | |
Contractors | | | 11,296 | | | 9,187 | | | 9,063 | |
(a) Includes Obuasi gold production in 2020, capitalised as part of the project development.
| | | | | | | | | | | | | | | | | | | | | | | |
| Unit | | 2022 | | 2021 | | 2020 |
Joint venture operations | | | | | | | |
Tonnes treated/milled | Mt | | 3.5 | | | 3.5 | | | 3.4 | |
Pay limit | oz/t | | 0.054 | | | 0.048 | | | 0.048 | |
| g/t | | 1.850 | | | 1.652 | | | 1.640 | |
Recovered grade | oz/t | | 0.087 | | | 0.095 | | | 0.096 | |
| g/t | | 2.98 | | | 3.25 | | | 3.29 | |
Gold production (attributable) | 000oz | | 337 | | | 365 | | | 364 | |
Cost of sales | $m | | 342 | | | 350 | | | 340 | |
Total cash costs per ounce (1) | $/oz | | 725 | | | 647 | | | 629 | |
All-in sustaining costs per ounce(1) | $/oz | | 979 | | | 856 | | | 810 | |
Capital expenditure | $m | | 90 | | | 72 | | | 52 | |
People | | | | | | | |
Average no of employees: Total | | | 2,731 | | | 2,454 | | | 2,333 | |
Permanent employees | | | 957 | | | 860 | | | 824 | |
Contractors | | | 1,774 | | | 1,594 | | | 1,509 | |
(1)“Total cash costs per ounce” and “all-in sustaining costs per ounce” are non-GAAP measures. For further information on these non-GAAP measures, see “Item 5A: Operating Results—Non-GAAP analysis”.
Performance summary
Production for the Africa region was up 15 percent for the year ended 31 December 2022 at 1.635 million ounces compared to 1.419 million ounces for the year ended 31 December 2021.
Safety performance improved – there were no occupational fatalities at any of the mines operated by the Company and costsa TRIFR of 0.33 per million hours worked was recorded (2021: 0.61 per million hours worked).
Regional community investment totalled $10.19 million (2021: $10.5 million).
With Obuasi having received its ISO 45001 (health and safety) certification, all our Africa operations are now certified in terms of ISO 45001, ISO 14001 (environmental management) and the International Cyanide Management Code.
We continued integration of the new Operating Model, the existing Operational Excellence programme, and the Full Asset Potential (FP) review programme launched during 2021.
In the second half of 2022, Geita was part of the FP review programme designed to enhance understanding of the relative potential of each asset and includes developing a plan and implementation schedule to achieve the targeted performance over the next six to 24 months.
Siguiri was the first of the African operations to be involved in the FP review programme with the leadership team focusing on increasing the volume of high-grade oxide ore from Block 2. This increase was successful and is reflected in the year-on-year increase in production. We are starting to see the benefits of the FP review programme at Siguiri and a second contractor was hired to deliver higher volumes of higher-grade oxide ore from Block 2.
For more information regarding production performance in the Africa region, refer to “Item 5A: Operating Results—Key factors affecting results—Production in 2022”.
For more information regarding operating performance in the Africa region, refer to “Item 5A: Operating Results—Comparison of operating performance on a segment basis in 2022 with 2021”
For more information regarding capital expenditure in the Africa region, refer to “Item 5A: Operating Results—Comparison of capital expenditure in 2022, 2021 and 2020—Comparison of capital expenditure in 2022 with 2021”
Obuasi update
Phase 3 of the Obuasi redevelopment project, which relates principally to capital expenditure to refurbish existing infrastructure around the KMS Shaft, as well as to service the mine in deeper production areas, continues to progress.
In 2022, the project achieved the following milestones: hoisting via the KMS rock shaft in November 2022; pumping to drop the water level below 50 level; commissioning of the material handling system from 44 level to surface; completing the new ventilation shaft pilot hole and progressing the KMS shaft down to 44 level.
The AustraliaObuasi mine continues on the ramp-up path to its full production run-rate in excess of 400,000 ounces.
The Americas hosts three of our operations – one in Argentina and two in Brazil – as well as greenfields projects in Colombia and a significant new greenfields development in Nevada in the United States. | | | | | | | | | | | |
| Attributable gold production (000oz) | | Average number of employees |
Operations | | | |
1. Argentina | | | |
Cerro Vanguardia (Attr. 92.5%) | 170 | | | 1,819 | |
2. Brazil | | | |
AGA Mineração | 311 | | | 5,702 | |
Serra Grande | 88 | | | 1,977 | |
Americas - Key Statistics | | | | | | | | | | | | | | | | | | | | | | | |
| Unit | | 2022 | | 2021 | | 2020 |
Operation | | | | | | | |
Tonnes treated/milled | Mt | | 7.1 | | | 7.8 | | | 7.5 | |
Pay limit | oz/t | | 0.10 | | | 0.10 | | | 0.07 | |
| g/t | | 3.52 | | | 3.49 | | | 2.46 | |
Recovered grade | oz/t | | 0.070 | | | 0.066 | | | 0.081 | |
| g/t | | 2.40 | | | 2.27 | | | 2.77 | |
Gold production (attributable) | 000oz | | 569 | | | 559 | | | 649 | |
Silver production (attributable) | Moz | | 3.2 | | | 3.4 | | | 3.3 | |
Cost of sales | $m | | 913 | | | 822 | | | 764 | |
Total cash costs per ounce (1) | $/oz | | 1,078 | | | 921 | | | 721 | |
All-in sustaining costs per ounce (1) | $/oz | | 1,718 | | | 1,587 | | | 1,003 | |
Capital expenditure (2) | $m | | 339 | | | 398 | | | 216 | |
Safety | | | | | | | |
Number of fatalities | | | 0 | | 1 | | 0 |
TRIFR | Per million hours worked | | 2.33 | | | 3.55 | | | 3.68 | |
People | | | | | | | |
Average no of employees: Total | | | 9,498 | | | 9,972 | | | 8,789 | |
Permanent employees | | | 6,093 | | | 6,452 | | | 6,158 | |
Contractors | | | 3,405 | | | 3,520 | | | 2,631 | |
(1)“Total cash costs per ounce” and “all-in sustaining costs per ounce” are non-GAAP measures. For further information on these non-GAAP measures, see “Item 5A: Operating Results—Non-GAAP analysis”.
(2)100 percent (not attributable) and includes Projects.
Performance summary
Production for the Americas region produced 614,000oz in 2019was up two percent for the year ended 31 December 2022 at 569,000 ounces compared to 625,000oz 2018. The 2% drop in year-on-year production was largely559,000 ounces for the result of lower underground mined volumesyear ended 31 December 2021.
Safety – no occupational fatalities and grades at Sunrise Dam. Sunrise Dam experienced operational challengesthe TRIFR improved to 2.33 per million hours worked (2021: 3.55 per million hours worked).
Community investment amounted to $6.4 million (2021: $5.8 million).
All operations in the middleAmericas maintained their certification in terms of International Cyanide Management Code, ISO 45000 (health and safety) and ISO 14001 (environmental management).
During the second half of 2022, Cuiabá and Serra Grande completed assessments to identify performance improvement initiatives as part of the yearFP review programme. The FP programme initiatives implemented at Cuiabá have seen ore tonnes consistently above full potential target. At Serra Grande, the FP team identified several enhancement opportunities and it is following implementation plans with limited stope flexibilitytimelines for delivery.
In December 2022, the company suspended filtered tailings deposition on the Calcinados TSF and paste fill delays,processing of gold concentrate at the Queiroz plant (both of which resultedservice the Cuiabá mine complex). For further information, refer to “Item 4B: Business Overview—The Regulatory Environment Enabling AngloGold Ashanti to Mine—Americas—Brazil” and “Item 3D: Risk Factors—Compliance with tailings management requirements and standards, and potential liabilities in lower underground volumesthe event of a failure to timely comply with these requirements or an incident involving a tailings storage facility, could adversely impact AngloGold Ashanti's financial condition, results of operations and grades. However,reputation”.
For more information regarding production performance in the Americas region, refer to “Item 5A: Operating Results—Key factors affecting results—Production in 2022”.
For more information regarding operating performance in the Americas region, refer to “Item 5A: Operating Results—Comparison of operating performance on a segment basis in 2022 with 2021”.
For more information regarding capital expenditure in the Americas region, refer to “Item 5A: Operating Results—Comparison of capital expenditure in 2022, 2021 and 2020—Comparison of capital expenditure in 2022 with 2021”.
Nevada strategy
In Nevada, during 2022, AngloGold Ashanti’s project team integrated the Corvus Gold assets and project data into the AngloGold Ashanti evaluation framework. The Company completed planning for feasibility study work at North Bullfrog and also commenced a pre-feasibility study at Silicon along with further drilling at the Merlin deposit. Following the acquisition of Coeur Sterling’s mining flexibility improvedproperties in the fourth quarter of 2019 as larger stopes came online, resulting2022, AngloGold Ashanti’s project team commenced integrating these assets into the broader evaluation studies.
AUSTRALIA
| | | | | | | | | | | |
| Attributable gold production (000oz) | | Average number of employees |
Operations | | | |
Australia | | | |
1. Sunrise Dam | 232 | | | 725 | |
2. Tropicana 70% | 306 | | | 807 | |
The two AngloGold Ashanti operations in a record production from underground for the fourth quarter. A substantial exploration programme is underway to increase Mineral Resource confidence, grow the underground Ore ReserveAustralia are Sunrise Dam and support developmentTropicana, both of additional mining areaswhich are in the long term. Critical for success atnorth-eastern goldfields in the state of Western Australia. Sunrise Dam is increasing flexibility to ensure consistently high underground tonnages are available to displace lower-grade surface stockpiles. Strategic drill platformswholly owned. We have been established to facilitate systematic explorationa 70 percent holding in, and manage, Tropicana. Regis Resources Ltd, our partner in Tropicana, holds the balance. Sunrise Dam includes the Butcher Well project (70 percent).
At Tropicana, production at 360,000oz for the year, was 7% higher year-on-year. Higher mill throughput, which set new records in December 2019, offset lower feed grades in the second half of the year and contributed to the increase in gold production. Annual tonnes mined also broke site records in 2019. The Tropicana open pit was completed during the year and mining continued in the Havana South, Havana and Boston Shaker pits. It is planned that open pit mining will be focused on the Havana pit in 2020.Australia - Key Statistics | | | | | | | | | | | | | | | | | | | | | | | |
| Unit | | 2022 | | 2021 | | 2020 |
Operation | | | | | | | |
Tonnes treated/milled | Mt | | 10.7 | | | 10.5 | | | 10.2 | |
Pay limit | oz/t | | 0.05 | | | 0.06 | | | 0.06 | |
| g/t | | 1.69 | | | 1.89 | | | 1.95 | |
Recovered grade | oz/t | | 0.050 | | | 0.047 | | | 0.054 | |
| g/t | | 1.56 | | | 1.47 | | | 1.68 | |
Gold production (attributable) | 000oz | | 538 | | | 494 | | | 554 | |
Cost of sales | $m | | 783 | | | 740 | | | 705 | |
Total cash costs per ounce (1) | $/oz | | 1,157 | | | 1,196 | | | 968 | |
All-in sustaining costs per ounce(1) | $/oz | | 1,345 | | | 1,500 | | | 1,225 | |
Capital expenditure | $m | | 202 | | | 185 | | | 142 | |
Safety | | | | | | | |
Number of fatalities | | | 0 | | 0 | | 0 |
TRIFR | Per million hours worked | | 3.82 | | | 6.59 | | | 3.74 | |
People | | | | | | | |
Average no of employees: Total | | | 1,532 | | | 1,332 | | | 1,230 | |
Permanent employees | | | 314 | | | 288 | | | 259 | |
Contractors | | | 1,218 | | | 1,044 | | | 971 | |
The region’s cost of sales and AISC were $632 million and $990/oz in 2019, respectively, compared to $622 million and $1,038/oz for 2018, respectively. Despite the 2% lower production delivered in the region for the year, a strong focus on operational excellence coupled with a weaker exchange rate contributed to a 4% drop in total(1)“Total cash costs per ounce” and a 5% drop in AISC compared to 2018. Tropicana’s total cash“all-in sustaining costs declined due to higher volumes, and improved efficiencies partially offset by unfavourable grades, royalties and inflation while total cash costs at Sunrise Dam were negatively impacted by lower efficiencies, lower grade and inflation. Operational excellence work included a successful trial of autonomous open-pit blast hole drilling, which indicated significant productivity gains could be achieved by converting all six drill rigs to autonomous operation. Autonomous operation can improve drill use by enabling their continued operation within the exclusion zone during blasting, so extending drill bit life and reducing the number of operators needed.per ounce” are non-GAAP measures. For further information on these non-GAAP measures, see “Item 5A: Operating Results—Non-GAAP analysis”.
Capital expenditurePerformance summary
Total capital expenditure for the region was $149 million in 2019 compared to $156 million in 2018. Capital expenditure at Tropicana increased by $29 million predominately due to the start of the Boston Shaker underground growth project ($21 million). An increase in waste stripping capital expenditure due to the scheduling of open pit cutbacks was partially offset by a reduction in stay-in-business capital. Capital expenditure at Sunrise Dam reduced by $35 million due to lower Ore Reserve development and stay-in-business capital expenditure. Several key infrastructure projects, such as the expansion of the tailings storage facility and the upgrade to the ventilation system were completed in 2018 resulting in a $25 million year-on-year reduction in stay-in-business capital expenditure when compared to 2019.
Safety
Safety performance improved for the Australia region in 2019, continuing a positive trend since the commissioning of Tropicana in 2013. At Tropicana, the site ended the year with a record safety performance in terms of the AIFR and the lost-time injury frequency rate (LTIFR), achieving 14 months without a lost-time injury. At Sunrise Dam, the AIFR and LTIFR both increased marginally from 2018, although the severity of injuries was minor.
Ore Reserve
At the end of 2019, the total attributable Ore ReserveProduction for the Australia region was 3.2up nine percent for the year ended 31 December 2022 at 538,000 ounces compared to 494,000 ounces for the year ended 31 December 2021.
Safety performance improved – there were no occupational fatalities and a TRIFR of 3.82 per million ounces (2018: 3.8hours worked was recorded (2021: 6.59 per million ounces)hours worked). This is approximately seven percent
Regional community investment amounted to $0.99 million (2021: $1.01 million).
Sunrise Dam and Tropicana are certified under the Cyanide Code, ISO 45000 (health and safety) and ISO 14001 (environmental management).
The first site to complete an assessment as part of the group’s total Ore Reserve.
Growth and improvement
AtFP review programme was Sunrise Dam, where the biggest opportunity is to increase productivity in development and achieve a step-change in underground exploration programme initiatedproduction. The proposed improvements include an underground workshop to lift jumbo utilisation and improvements to planning and scheduling which, together are expected to support an increase in underground volumes. During the second half of 2019 is expected2022, Tropicana also completed an assessment to take two years. The programme is designed to increase Mineral Resource confidence, growidentify performance improvement initiatives as part of the underground Ore Reserve and support development of additional mining areasFP review programme.
For more information regarding production performance in the long term. ByAustralia region, refer to “Item 5A: Operating Results—Key factors affecting results—Production in 2022”.
For more information regarding operating performance in the endAustralia region, refer to “Item 5A: Operating Results—Comparison of operating performance on a segment basis in 2022 with 2021”.
For more information regarding capital expenditure in the Australia region, refer to “Item 5A: Operating Results—Comparison of capital expenditure in 2022, 2021 and 2020—Comparison of capital expenditure in 2022 with 2021”.
SOUTH AFRICA
The sale of the year six underground diamond drill rigs wereSouth African assets to Harmony closed on 30 September 2020. As a result, the figures in operation testing various targets including the southern strike extensions of the Midway Shear Steeps (MSS) and Elle and areas this section relate
to the southnine months ended on 30 September 2020, unless the context indicates otherwise.
South Africa Key Statistics | | | | | | | | | | | | | | | | | | | | | | | |
| Unit | | 2022 | | 2021 | | 2020 |
Operation | | | | | | | |
Tonnes treated/milled | Mt | | | | | | 0.4 | |
Pay limit (1) | oz/t | | | | | | 0.40 | |
| g/t | | | | | | 14.60 | |
Recovered grade (1) | oz/t | | | | | | 0.120 | |
| g/t | | | | | | 3.75 | |
Gold production | 000oz | | | | | | 241 | |
Cost of sales | $m | | | | | | 287 | |
Total cash costs per ounce (2) | $/oz | | | | | | 1,149 | |
All-in sustaining costs per ounce(2) | $/oz | | | | | | 1,296 | |
Capital expenditure | $m | | | | | | 35 | |
Safety | | | | | | | |
Number of fatalities | | | | | | | 4 |
TRIFR | Per million hours worked | | | | | | 6.12 | |
People | | | | | | | |
Average no of employees: Total | | | | | | | 8,297 | |
Permanent employees | | | | | | | 7,012 | |
Contractors | | | | | | | 1,285 | |
(1)Refers to underground operations only.
(2)“Total cash costs per ounce” and “all-in sustaining costs per ounce” are non-GAAP measures. For further information on these non-GAAP measures, see “Item 5A: Operating Results—Non-GAAP analysis”.
Drilling results returned in 2019 identified extensions of Vogue mineralisation over an approximate 180m strike length; southern extensions to the Midway Shear (MWS) Steeps ore domains, approximately 190m south of the current Indicated Resource; and potential repetition of the MWS Steeps ore domains, approximately 100m east of the current Indicated Resource. Drilling also intersected mineralisation 500m to the south down plunge of the Mineral Resource, suggesting the continuation of the Vogue orebody.
Development of the Boston Shaker underground mine at Tropicana began in May 2019 and at year-end the project was on track to deliver high-grade ore in mid-2020 as planned. The decision to go ahead with the project was announced in March 2019 following board approval and after a feasibility study confirmed that underground mining was technically and financially viable, demonstrating robust economics with an anticipated internal rate of return of 39% for a capital investment of $79.3 million.
Boston Shaker is expected to contribute higher-grade mill feed, resulting in an improved gold production profile and enhanced cash flow, during 2021-2023 when the mine plan includes periods of higher waste stripping in the Havana open pit.
The feasibility study was based on the mining of 6.58 million tonnes, grading 3.84g/t, assuming the systematic conversion of Mineral Resources to Ore Reserves over the life of the mine. The average underground mining rate will be approximately 1.1Mtpa (including development) over an eight-year mine life to 2026 to produce a total of 732,000oz. Mining methods will comprise conventional mechanised mining and underhand sublevel open stoping.
The two raised bore holes required for ventilation and emergency egress were tracking ahead of schedule by year end, and underground development of 1,640m was ahead of plan. Underground reverse circulation grade control drilling began in October. Recruitment of the underground workforce is progressing as planned and the underground operation remains on track to deliver first gold in the second half of 2020. Operational excellence work is focused on remote bogging, the mechanical operator-controlled digging of ore from surface, and on optimising level spacing and extraction ratios.
EXPLORATION REVIEW
Our greenfields exploration is focused on two of our strategic focus areas: creating value by providing long-term optionality and improving portfolio quality. Our exploration programme covers greenfields and brownfields exploration.
These strategic objectivesprogrammes are met by:
Greenfields exploration which aimsdesigned to discover large, high-valuenew Mineral Resource whichthat will eventuallyultimately lead to the development of new, stand-alone gold mines;mines and
support the sustainability of our business.
BrownfieldsIn 2022, the Silicon and Merlin prospects in Nevada were handed over to our Beatty project team, following which the greenfields exploration which focuses team refocused its efforts on delivering value through accretive additionsthe discovery of the next significant project to add to the Ore Reserve at existing mines as well as new discoveries in defined areas around operations. BrownfieldsAngloGold Ashanti portfolio.
Greenfields exploration actively drives the creation of value by growing our Mineral Resource and Ore Reserve, our major assets. The brownfields exploration programme is based on innovation in geological modelling and mine planning, and continual optimisation of our asset portfolio.
In 2019, $622022, $29 million was spent on greenfields exploration. Our greenfields exploration and $95 million on brownfields exploration.
Greenfields exploration
5,500kmtenements cover over 9,500km2 of highly prospective ground was explored in twosix countries – Australia, Argentina, Brazil, Guinea, Tanzania, and the United States – along with licence applications and other ground positions in Argentina,Brazil and Tanzania. In total, more than 71km of diamond, reverse circulation (RC) and aircore (AC) drilling was completed in 2019.States.
In Australia, in the Laverton district, AngloGold Ashanti completed the 70% earn-in at the Butcher Well and Lake Carey JV. The Butcher Well scoping study was updated by integrating the drilling results from the second half of 2018. Elsewhere in Laverton, a total of 49,200m of aircore drilling and 4,486m of diamond drilling was completed on several joint venture and non- joint venture projects.Americas
Diamond drilling programmes were also completed at the Mt Clark prospect in North Queensland (nine holes for 2,748m) and the Glandore prospect, located 60km east of Kalgoorlie in Western Australia (six holes for 1,846m), with no positive results derived.
In the United States, atfollowing the handover of the Silicon project in Nevada, 8,008m of RC and 3,300m of diamond drilling were completed in 2019. The programme followed up on and further developed understanding ofdiscovery to the alteration system intersected in earlier drilling as well as testing other favourable litho-structural targets within the Silicon-Thompson structural corridor. An induced polarization (IP) survey was also completed along with ground magnetic and gravity surveys. The second-year anniversary payment was made to Renaissance Gold during the period to maintain the option earn-in agreement into the third and final year in 2020.
AlsoBeatty Project team in the United States,first quarter of 2022, the greenfields exploration function shifted its focus to seven, 100 percent-owned, earlier-stage greenfields projects located elsewhere in Minnesota, roto-sonic drilling wasthe Great Basin of Nevada. Work completed over several target areas with 54 holes completed for a total of 1,619m. Since the results from the programme were not encouraging, work has stopped. AngloGold Ashanti returned all the mineral leases to the state of Minnesota.
In Argentina and Tanzania, exploration properties are on care and maintenance. Target generation activities were completed in Brazil and West Africa.
Brownfields exploration
Brownfields exploration was carried out in nine countries in and around AngloGold Ashanti operations. A total of 877,630m of Diamond and RC drilling was completed during the year.
South Africa: Exploration continued with one-hole drilled at Mponeng’s Western Ultra Deep Levels targeting the Ventersdorp Contact Reef. Drilling was stopped due to capital constraints and the final site clearance/closure certificate signed off in June.
Argentina: At Cerro Vanguardia, due to budget constraints, exploration was focused onthese various projects included prospect mapping, surface sampling and ground geophysical surveys. Diamond drilling is planned for the Midnight Star and CR projects during 2023.
In Brazil,:At AGA Mineração, 1,330 stream sediments, 1,200 soil samples and 1,060 rock chip samples were collected. From the SBB terrane in the Iron Quadrangle, a totalstate of 263,345mMinas Gerais, four districts have been identified by stream sediment sampling. Infill sampling is in progress to define projects in these districts. At the WBC terrane, which is located in the state of Matto Grosso do Sul to the south-west of Minas Gerais, one project has been advanced and will be considered for drilling in 2023.
In Argentina, an option agreement was drilled.signed with Latin Metals for the Organullo project in Salta Province. Work completed since June 2022 included soil sampling, mapping, acquisition of various spectral data sets and community engagement. At Cuiabá, the underground100 percent-held El Cori project, four drilling programme focused on Fonte Grandetargets were identified from surface exploration.
Africa
In Guinea, we received six reconnaissance permits for the Shira district in the Siguiri Basin of Guinea. Community engagement work has started and Serrotinho (upright limb), Balancãofield exploration is scheduled for the first quarter of 2023.
In Tanzania, target generation activities continued.
Australia
In Australia, we carried out exploration work in the Laverton District and, Galinheiro (overturned limb). A long-inclined borehole drilling project was successfully completed. Positive results with significant intercepts were reported for secondary targets including the quartz vein project (VQZ) and Viana.
Regionally, drilling at the Descoberto target is ongoing and has produced encouraging observations. Land access was granted in October 2019 to allow the Matarelli target drill programme to commence. A trial unmanned aerial vehicle (UAV) magnetic survey was successfully completed at Matarelli and a more comprehensive survey covering the Matarelli and Tinguá targets is planned. A detailed geological map and associated cross sections were produced over the Tinguá target area ahead of a geochemical soil
programme planned for early 2020.
At Lamego, drilling focused on confirming the continuity of Carruagem in a south-westerly direction (both limbs) from levels 1 to 5. Drilling alsoQueensland, greenfields exploration took place at Cabeça de Pedra (hinge zone), which reported high gradesthe Chillagoe and indicated thatGeorgetown projects.
Brownfields exploration
In the orebody remains open.
DrillingBeatty District, brownfields exploration continued at Córrego do Sítio (CdS) testedNorth Bullfrog, and successfully defined and expanded the Rosalino open pit. At CdS I, underground drilling in LaranjeirasSilicon and Carvoaria confirmedMerlin targets. Elsewhere across our operations, exploration continued, on one hand to add confidence to the mine plans by upgrading the Mineral Resource and indicate good prospectivityon the other to search for high grades in Carvoaria. In the ‘Gold Quadrangle’ area of Candeias-Cristina, Mutuca, Cachorro Bravo and Pneu, drilling supportednew Mineral Resource additionswith a high likelihood for conversion to Mineral Reserve.
In 2022, our brownfields exploration teams across the globe completed 799km of capital and 358km of expensed drilling at a cost of $79 million and $67 million, respectively. The drilled metre achievement was ten percent below the 2022 budget of 1,281km with the gap closing each quarter after slow start ups at a few operations. Total expenditure of $146 million was 12 percent below budget.
Brownfields exploration activities resulting in the area.most notable economic intercepts, by operation, for 2022 are listed below by region.
At CdS II,Africa
•Geita: The key area drilled was Geita Hill which is split into six blocks. The drilling was conducted from both surface and underground and was designed to upgrade the underground project and to prepare for mining. Other significant intercepts were drilled at Star and Comet underground at Cut 3 and Ridge 8, extending the potential of the underground complex at Star and Comet. Drilling at the Nyamulilima open pit expanded and further defined the mineralisation.
•Obuasi: Drilling at Block 8, Block 10 and Sansu continued to define the limits of mineralisation and prepare these areas for mining. Late in the shallow north-east portion of São Bento confirmedyear drilling started at Cote D’Or examining the continuity of the mineralised structure in that direction.potential to open a second mining area.
•Siguiri: The Remaining Ounces project identified potential areas for high-grade ore within old mining areas. At CdS III, a sterilization drilling campaign is underway and one positive intercept suggests the extension of the Anomalia and Jambeiro target trends.
A total of 128,888m was drilled at Serra Grande. Exploration drilling at Pitanga, Palmeiras South, Mangaba, Corpo IV, V and Limoeiro resulted in the addition of Mineral Resource. The mine acquired the Palmeiras South area in late 2018 which contains the southern extension of all mineralised trends; subsequent drilling during 2019 returned positive results along Structure 3.5.
The Pitanga orebody was discovered along Structure III close to Mina Nova mine. The reinterpretation of existing orebodies at Corpo IV, Corpo V and Limoeiro supported exploration drilling and led to new ounce generation. Target generation focused on assessing shallow opportunities and using interpreted S2 stacking behaviour to identify new potential areas to test in 2020.
Colombia:Limitedkey exploration activities were completed at Gramalote. RCKounkoun (Block 3) where infill and definition drilling started at Trinidad in October 2019 and diamond drilling at Gramalote in November with no results reported to date. The La Colosa project continued on care and maintenance following the cessation of all field activities in April 2017.
At Quebradona, a total of 10,494m was drilled, focusing on geotechnical programmes for site infrastructure, the tunnel trace, the mine subsidence area and the crusher chamber. Geological and structural models were updated for infrastructure sites, the tunnel and mine area.
Tanzania: At Geita, a total of 96,407m of drilling was completed in 2019.
The overall results for Star & Comet Cut 2 Mineral Resource drilling were positive. While exploratory drilling results identified no economic intersections, interpretation and review are ongoing. The Star & Comet Cut 3 Mineral Resource drilling results confirmed the down-dip continuity. Extension drilling at Star & Comet Cut 2 and Cut 3 confirmed the presence of open-ended high-grade mineralisation along the hanging wall and footwall sidescontinue as part of the intrusive, suggesting thatoverall assessment of Block 3 as a future mining area. Drilling to extend and define the Cut 2 and Cut 3 orebodies might join and become one.
Mineral Resource development drilling programmes for Nyankanga underground were carried out at Blocks 3, 4 and 5 as well asknown mineralisation in the gap area between Block 2 and 3. All results were positive.
Three of eight holes in the surface drilling programme at the Star & Comet North Extension returned lower grades than previous data. Results from surface drilling completed at Selous confirmed the orebody extensions inside and outside the pit margins. While exploratory surface drilling at Mabe delineated localised orezones of medium to high grade.
At Geita Hill, underground Blocks 1 and 2 was conducted.
•Kibali: Two notable drilling results defined low-grade mineralised zones.intercepts, at Mengu Hill and Oere, were recorded during the year.
Americas
•Cerro Vanguardia: Numerous veins were drilled and later in the year emphasis moved to the northwest of the property and onto the Condor ground.
•AGA Mineração, CdS: Drilling initiatedof underground opportunities at both CdS I and II delivered significant intercepts at Sangue De Boi, Mutuca, Rosalino, Pinta Bem and Pneu.
•AGA Mineração, Cuiabá: Drilling to extend the Roberts deposit confirmeddepth extents of Fonte Grande Sul below 21 level continued while at a shallower depth drilling to define the presence and potential of economicsatellite ore zones within and outside the optimised pit.bodies continued to deliver.
Guinea: At Siguiri, a total of 74,939m•Serra Grande: One significant intercept, at Angicão, was drilled during the year.
•Beatty: Definition and infill drilling continued at Silicon and Merlin in Nevada. Drilling at North Bullfrog started to deliver later in the year.
Kami
Australia
•Sunrise Dam: The key areas delivering significant intercepts were at Frankie and Vogue as part of programmes designed to define and extend mineralisation in these areas. As is typical of the Sunrise Dam mineralisation, most drilling has shownprogrammes drilled significant intercepts which reflect the nuggety nature of the mineralisation.
•Tropicana: Successful drilling was aimed at the three underground projects, namely, Boston Shaker, Havana and Tropicana.
While many of the significant economic intersections are for unmined underground opportunities, Nevada is delivering significant intersections that will most likely be excavated through open pit mining.
PROJECTS
Quebradona
Following the decision of Colombia’s national environmental agency (ANLA) in November 2021 to archive the Company’s environmental licence application for the Quebradona project, AngloGold Ashanti filed an appeal seeking to secure further details on the specific additional information required for ANLA to make a decision on AngloGold Ashanti’s licence submission. On 29 April 2022, ANLA dismissed the appeal and confirmed its decision to archive the Company’s application. AngloGold Ashanti continues to review and analyse the additional information identified as part of ANLA’s decision. The objective is to prepare, submit and process a new environmental licence request for Quebradona following completion of a new environmental impact assessment.
Gramalote
Following completion of the feasibility study on the Gramalote gold project, a joint operation with B2Gold, both partners have determined that the mineralisation extends into the fresh rockGramalote project does not meet their investment thresholds for development. The project continues to benefit from federal and into oxide in Kami East saddle. Bidini drilling has shown that the mineralisation extends to the east of the pit in oxide. Silakoro West drilling was completed and confirmed the mineralisation.
Silakoro North drilling intersected mineralisation associated with disseminated sulphides. Foulata East drilling results show unmineralised albitite, while the main Foulata drillholes indicate the potential extension of mineralisation at depth and along the trend. Advanced grade control (AGC) drilling at Foulata confirmed the model.
At Saraya, drilling confirmed the extension of shallow mineralisation to the north and deeper along the plunge. The Saraya AGC drilling confirmed the model despite defining thicker internal waste intervals. At Seguelen PB2 drilling confirmed the extension of the mineralisation in the fresh rock.
The Sanu Tinti infill drilling crossed potentially mineralised breccioconglomerates layers. At Niono, reconnaissance drilling showed weak potential for oxide mineralisation. The Doko, Block 4, reconnaissance drill programme is now 48% complete with some economic intersection.
At Balato North, Saraya West EL and Setiguiya West reconnaissance drilling showed negative results. Field visits and reviews confirmed the potential of the Carbonate Hills (East and Central) targets.
Ghana: At Iduapriem, a total of 21,279m of drilling was completed in 2019. Exploration focused on Mineral Resource conversion drilling at Block 1, Ajopa, Efuanta and Block 4S. Regional mapping of the hydrothermal targets commenced during the yearlocal government support as well as auger drilling at Mile 8 and Mile 5W targets.continuing support from local communities.
At Obuasi, drilling started on 27 May 2019 with capital drilling on 41 level, grade control drilling on 17 and 22 levels, and expensed exploratory drilling in the GCS top area.
The 41-level drill programme completed 7,921m of combined RC and diamond drilling. Two multi-purpose RC/diamond rigs are being used to accelerate data acquisition and reduce costs. The grade control programme drilled 3,480m and showed continuity of the Obuasi fissure in terms of grade and structure. The 5,475m of exploratory drilling indicated potential in the footwall splays.
Democratic Republic of the Congo: A total of 25,210m was drilled at Kibali during the year.
The drilling results at Gorumbwa-Sessenge gap support the continuity of the mineralisation from Gorumbwa into the gap.
At Ikamva, drilling observations support the model while at Ikamva-East, the drilling programme was completed, and the results returned support the consistency of the two lenses. Two holes were drilled into the Kalimva-Ikamva Hinge zone with results supporting the model of a potential link between the two structures.
Results also suggest the presence of other shoots pertaining to the Kalimva system.
The orientation drilling programme along the Zakitoko-Birindi trend was completed and indicate an extension down dip and along strike. A data review of the Aindi area was conducted leading to identification of four zones of interest.
In the Oere-Kalimva Gap, the drilling programme is complete and indicates no mineralisation within the gap. While in the Mofu-Oere gap, a trenching programme showed weak results from surface that increase down dip and plunge.
Eight trenches were excavated in the Mandungu-Memekazi-Renzi trend with overall results supporting the model and the trenching programme at Memekazi Northeast, returning results that support the potential of the area.
At Sayi, the results support the model and continuity of the interpreted mineralisation. While drilling in the Sayi-Mengu gap returned narrow intercepts. Results from the Renzi trenching programme support the model, though they are relatively low grade, while the Oere drilling results support the presence of highgrade domains within the mineralisation envelope.
A soil sampling programme in the KZ South area returned results supporting potential for a mineralised system. At Pakaka, drilling results from the hole furthest southeast support a consistently thin high-grade mineralisation along the sheared contact observed in the pit.
Mali: No drilling was completed in 2019.
Australia:At Sunrise Dam, six underground rigs were in use during the period, with most drilling taking place at Vogue, Midway Shear (MWS) Steeps and Elle, as well as at Stella (Target 18) and Steeps below Sunrise Shear Zone (Target 01). Commissioning of a seventh underground rig took place during November and an eighth rig was commissioned in December 2019.
One surface rig was in operation, targeting the southern extensions of the deposit from surface, 520m and 360m south of the current Ore Reserve from the Cleo waste dump.
At Tropicana, mine drilling consisted of infill drilling at Havana to upgrade the Mineral Resource confidence and assist in the mining option studies. Significant results were returned from the infill drilling at Havana, as well as encouraging results from drilling at Havana South down-dip.
Regional drilling was concentrated at Iceberg, Tumbleweed, New Zebra, Angel Eyes Voodoo Child, Wild Thing, Electra, Mojito and Monsoon. Regional drilling produced an important result from RC drilling at Voodoo Child that indicates mineralisation is present ca. 500m along strike from the defined prospect.
Projects
Colombia: The greenfields projects in Colombia make a significant contribution to AngloGold Ashanti’s Mineral Resource with La Colosa, Quebradona and Gramalote collectively contributing 38.5Moz. Quebradona and Gramalote contribute 4.3Moz to the gold Ore Reserve. Quebradona also has a copper Ore Reserve of 3,068Mlbs. Both Quebradona and Gramalote are at various stages of feasibility study while the La Colosa project is currently under force majeure, pending the necessary environmental permits.
The Gramalote project, a joint venture between AngloGold Ashanti and B2Gold Corp (B2Gold) in Colombia, lies on the eastern flankhave completed a comprehensive review of the Cordillera Central, near the towns of Providenciaalternatives and San Jose del Nusconsider that it would be in the municipalitybest interest of San Roque, in the north-west of the Antioquia Department. It is approximately 230km north-west of Bogota and about 120km north-east of Medellin.
In September 2019, AngloGold Ashanti announced that an agreement had been reached with B2Gold, under which B2Gold would fund an investment and exploration programme in 2020all stakeholders for a new party to the value of $13.9 million, in order to earn back to a 50:50 partnership and assume management of the project effective 1 January 2020. Completion of the feasibility study for Gramalote is targeted for the end of 2020. The project has several key infrastructure advantages including reliable water supply, its close proximity to key infrastructure and a technically capable workforce in country.
As per the agreement, B2Gold assumed management of the Gramalote joint venture on 1 January 2020. On 21 January 2020, B2Gold announced positive results from the updated preliminary economic assessment (PEA) for the Gramalote Ridge deposit, a part ofown the Gramalote project. The PEA updates and enhances previous studies onpartners appointed a corporate advisor in the Gramalote project in several areas.
B2Gold is currently completing approximately 42,500mfourth quarter of infill drilling at Gramalote Ridge2022 to convertassist with the existing Inferred Mineral Resource to the Indicated category, and 7,645m geotechnical drilling for site infrastructure.
The Gramalote joint venture will continue to advance community resettlement programmes, establish coexistence programmes for small artisanal miners, to work on health, safety and environmental projects and to continue to work with government and local communities on social programmes.
B2Gold, as manager, plans to continue to complete and submit the feasibility work by 31 December 2020. The main work programme for feasibility is infill drilling to confirm and upgrade the Inferred Mineral Resource to the Indicated category.
The Environmental Impact Study and Project Implementation Plansale process for the Gramalote project, have been fully approved by the National Authoritywhich is currently ongoing.
The Quebradona deposit is located approximately 104km south-west from Medellin, Antioquia Department and is a porphyry-related, copper-gold mineralised stock work system, located within the Western Cordillera of Colombia. Until 2019, the project was a joint venture with B2Gold (5.7% and diluting) and AngloGold Ashanti (94.3% and operator). During 2019, the 5% dilution threshold was reached and the parties entered into a royalty agreement in which B2Gold transferred the minority interest in the joint venture to AngloGold Ashanti in exchange for a royalty fee during production.4C. ORGANISATIONAL STRUCTURE
During the year, AngloGold Ashanti continued with the exploration programme, with the key aim of developing the feasibility study, completing and submitting the environmental and construction licence requests (filled in November 2019), and securing the land required for project implementation. The Quebradona project is an attractive business case of ca. 8.7Moz gold equivalent, with required capital investment estimated at around ca. US$1billion and an internal rate of return at approval stage of 15% (meeting our required hurdle rate). 2020 will be a critical year for the project, with an estimated investment of approximately $64 million, targeted at the following key milestones:
Complete the feasibility study and present it to the board for approval in November 2020;
Obtain the environmental and construction licence by November 2020; and
Complete the process of securing the land for project implementation.
The La Colosa project is located approximately 150km west of Bogota in the Tolima Department. It is a very large porphyrystyle gold deposit discovered by the Colombia greenfields exploration team in 2006. The project is 100% owned by AngloGold Ashanti. The project comprises a singular large deposit likely in excess of 28.45Moz of mineral resources and endowment. The project’s pre-feasibility study began in 2010 and was formally put on care and maintenance in April 2017. A second-time force majeure was granted pending the approval of environmental permits. The force majeure is expected to be renewed in June 2020 if the conditions associated with the environmental licence permits remain.
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4C. | ORGANISATIONAL STRUCTURE |
GROUP STRUCTURE
AngloGold Ashanti’s operations are divided into the following regions:
South
•Africa – West Wits and surface operations;
Continental Africa –— operations in Ghana, Guinea and Tanzania and a joint venture operationsoperation in the DRC and Mali;DRC;
•Australia –— operations in Australia; and
•Americas –— operations in Argentina and Brazil, and exploration projects in the United States and Colombia.
The above four regions also correspond to AngloGold Ashanti’s four business segments. The South Africa region is recognised for financial statement purposes as discontinued operations as we sold our remaining South African producing assets and related liabilities in 2020. In addition, a new segment, Projects has been introduced from the implementation of the new Operating Model (previously reported under the America’s segment). The Projects segment comprises all the major non-sustaining capital projects with the potential to be developed into operating entities.
Day-to-day management of the groupGroup is entrusted to AngloGold Ashanti’s executive management team, chaired by the Chief Executive Officer. See “Item“Item 6: Directors, Senior Management and Employees”.
Support is provided to the executive management team in managing AngloGold Ashanti’s corporate activities at both the central and local levels.
SUBSIDIARIES
AngloGold Ashanti Limited has investments in principal subsidiaries and joint venture interests, see “Item“Item 19: Exhibits – to Form 20-F—Exhibit 19.8 Principal subsidiariesList of AngloGold Ashanti Limited subsidiaries” for details.
On 16 March 2023, AngloGold Ashanti and operating entities at 31 December 2019” for details.Gold Fields announced that they have agreed the key terms of a proposed joint venture in Ghana between Gold Fields' Tarkwa and AngloGold Ashanti's neighbouring Iduapriem Mines (the “Proposed Joint Venture”). There can be no certainty that the parties will enter into a definitive agreement with respect to the Proposed Joint Venture or about the timing, terms and conditions of any such definitive agreement. Implementation of the Proposed Joint Venture is subject to, among other matters, reaching agreement with the Government of Ghana regarding the Proposed Joint Venture, conclusion of confirmatory due diligence and securing all requisite regulatory approvals. For further information, refer to “Item 18: Financial Statements—Note 35—Subsequent Events”.
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4D. | PROPERTY, PLANTS AND EQUIPMENT |
For more information about
94
Locations of properties
Notes:
(1) Gramalote is managed by B2Gold Corp ("B2Gold").
(2) AngloGold Ashanti acquired North Bullfrog and Mother Lode as part of the Corvus Gold Inc.("Corvus Gold") acquisition in January 2022.
(3) AngloGold Ashanti acquired Sterling (which includes the Crown Block deposits of SNA, Secret Pass and Daisy) through the Coeur Sterling, Inc. ("Coeur Sterling") acquisition in November 2022.
(4) Kibali is operated by Barrick Gold Corporation ("Barrick").
The locations of AngloGold Ashanti’s mines, including as to the company’s mining rights and licences refer to “Item 4B: Business Overview—The Regulatory Environment Enabling AngloGold Ashanti to Mine”.
Mine, operation and business unitproperties are used interchangeably.shown above. Percentages indicate the ownership interest held by AngloGold Ashanti. All operations are 100 percent ownedwholly-owned unless otherwise indicated.
Overview of mining properties and operations
The overview for each mining property is disclosed below and includes information on the following items:
•Location of the properties;
•For each material property, locality maps showing the location of such properties as well as infrastructure and licences;
•Type and amount of ownership interests;
•Identity of the operator or operators;
•Titles, mineral rights, leases or options and acreage involved;
•Stages of the properties (exploration, development or production);
•Key permit conditions;
•Mine types and mineralisation styles; and
•Processing plants and other available facilities.
Please refer to “Item 5A: Operating Results—Key factors affecting results—Production in 2022” for the aggregate annual production for each of the Company's mining properties during each of the fiscal years ended 31 December 2022, 2021 and 2020. For more information about AngloGold Ashanti’s mines, including a summary of the Company’s titles, mining rights, leases and licences with acreage, please refer to “Item 4B: Business Overview—The Regulatory Environment Enabling AngloGold Ashanti to Mine”.
In its annual report on Form 20-F for the fiscal year ended 31 December 2021, AngloGold Ashanti complied for the first time with the new mining property disclosure requirements for mining registrants set forth in Subpart 1300 of Regulation S-K (17 CFR § 229.1300) (“Regulation S-K 1300”) and reported on, and filed Technical Report Summaries for, all of its mining properties. During 2022, AngloGold Ashanti developed a process to determine which properties are material to its business or financial condition for purposes of the individual property disclosure requirements of Item 1304 of Regulation S-K (17 CFR § 229.1304). The key considerations taken into account by AngloGold Ashanti in its materiality assessment include (i) certain quantitative factors such as contribution to the Mineral Resource and Mineral Reserve, actual and planned production and Net Present Value, as well as (ii) certain qualitative factors, which are assessed in the context of the Company’s overall business and financial condition. The materiality assessment covers all of the Company’s mining properties (regardless of the stage of the mining property) and all of its mining and related activities from exploration through extraction, and will be reviewed by the Company on an annual basis. Based on these considerations, AngloGold Ashanti has determined that its material properties for purposes of Regulation S-K 1300 are Geita, Kibali and Obuasi. With respect to Geita, an updated Technical Report Summary (effective date: 31 December 2022) has been prepared by the relevant Qualified Persons, and is filed as Exhibit 19.15.4 hereto. With respect to Kibali and Obuasi, AngloGold Ashanti has determined that (i) there are no material changes to the Mineral Reserve or Mineral Resource reported in the Technical Report Summaries for these properties (effective date: 31 December 2021) which were filed as exhibits to AngloGold Ashanti’s annual report on Form 20-F for the fiscal year ended 31 December 2021, and (ii) all material assumptions and information pertaining to the disclosure of the Mineral Resource and Mineral Reserve for Kibali and Obuasi remain current in all material respects as of 31 December 2022, based on all facts and circumstances, both quantitative and qualitative. As a result, the Technical Report Summaries for Kibali and Obuasi (effective date: 31 December 2021), which were initially filed as exhibits to AngloGold Ashanti’s annual report on Form 20-F for the fiscal year ended 31 December 2021, are filed as Exhibits 19.15.7 and 19.15.5, respectively, hereto.
AngloGold Ashanti’s operating mines are all accessible by road.road, although for some, personnel access is better achieved by air.
CONTINENTAL AFRICAAngloGold Ashanti’s exploration programmes are based on consistent standards and processes across its portfolio and are guided by peer review. Part of AngloGold Ashanti's investment strategy is focused on exploration drilling and Mineral Reserve development to grow the Mineral Resource and by converting these, the Company allows for expansion of the Mineral Reserve. The process involves identifying the best group of drill targets and prioritising those that have the highest potential for success to be advanced first. Greenfields exploration aims to discover large, high-value Mineral Resource, which will eventually lead to the development of new gold mines. Brownfields exploration focuses on delivering value through accretive additions to the Mineral Reserve at existing mines as well as new discoveries in defined areas around operations.
This annual report on Form 20-F is not being submitted in support of the disclosure of exploration results and therefore no disclosure of drilling or sample results is provided. AngloGold Ashanti has elected not to provide drilling results for its operating mines as drilling at its brownfields operations is generally intended to provide incremental additions, or conversions to already reported Mineral Resource and therefore they are not seen as material. While drilling at the Company’s brownfields operations increases confidence in its Mineral Resource as well as adds LOM extensions, the incremental additions that occur on a yearly basis are not material to that operation or the Company as a whole. In cases where the drilling projects are supporting a non-sustaining addition, these projects are commented on. In the Company’s major greenfields projects, if any single drill result is considered material and may change the reported Mineral Resource significantly then it is reported. Refer to “Item 4B: Business Overview—Exploration review”.
AFRICA
AngloGold Ashanti has sevenfive mining operations within the Continental Africa region. region:
•Kibali Gold Mine in the Democratic Republic of the Congo ("DRC"), a joint venture (“JV”) between AngloGold Ashanti (45%), Barrick Gold Corporation (“Barrick”) (following its merger with Randgold Resources Limited (“Randgold”)) (45%), and Société Minière de Kilo-Moto S.A. (“SOKIMO”), a state-owned gold mining company (10%);
•Iduapriem Gold Mine ("Iduapriem") and Obuasi Gold Mine ("Obuasi") in Ghana;
•Siguiri Gold Mine (“Siguiri”) in Guinea, co-owned by AngloGold Ashanti (85%) and the government of Guinea (15%); and
•Geita Gold Mine ("GGM" or "Geita") in Tanzania.
Mining is from both open pit and underground, with Obuasi being an underground mine, in a redevelopment phase, Iduapriem Siguiri, Morila and SadiolaSiguiri being open pit mines, and Kibali and Geita being a combination of open pit and underground mines.
DEMOCRATIC REPUBLIC OF THE CONGO (DRC)DRC
Description
KIBALI
For additional information, please refer to the Technical Report Summary for Kibali (effective date: 31 December 2021) filed as Exhibit 19.15.7 hereto.
Property description
Kibali is a joint venture co-owned by AngloGold Ashanti (45%), Barrick (45%), and SOKIMO (10%). SOKIMO is wholly-owned by the DRC government. The consolidated lease is made up of ten exploitation permits. The metallurgical plant comprises a twin-circuit sulphide and oxide plant with conventional carbon-in-leach ("CIL"), including gravity recovery as well as a float and ultra-fine grind circuit. Barrick operates the mine, which comprises both open pit and underground operations.
Kibali Gold Mine,is a gold mining, processing and exploration project. Operations currently focus on open pit and underground mining. The mine was originally developed and operated by Randgold. Following the completion of the merger of Randgold and Barrick in 2019, Barrick became the operator at Kibali for both exploration and mining. Kibali is currently a production stage property.
Location
Kibali is located in the north-easternnortheastern part of the DRC near the international borders with Uganda and South Sudan,is the sole operation in the DRC.
DRC - Kibali
Description
The Kibali Gold Mine is a joint venture (JV) between AngloGold Ashanti (45 percent), Barrick Gold Corporation (45 percent) and Société Miniere de Kilo-Moto SA UNISARL (SOKIMO), a state-owned gold company owning the balance. Kibali is operated by Barrick Gold Corporation.Sudan. The mine is located adjacent to the village of Doko, which is located into the west of the projectlease area. Kibali is approximately 210 kilometres210km by road from Arua on the Ugandan border and immediately north of the district capital of Watsa.
The operational area falls within the administrative territory of Watsa in Haut UéHaut-Uélé province.
Mineralisation style
Gold deposits of the Kibali district are classified as Archaean orogenic gold deposits. At Kibali, the gold deposits are largely hosted in siliciclastic rocks, banded iron formations (“BIFs”) and chert that were deformed, altered and transposed during several events. This occurred at or near greenschist metamorphic conditions. Ore-forming H2O-CO2-rich fluids migrated along a linked network of gently northeast-dipping shears and north-northeast plunging fold axes that are commonly referred to as the KZ Trend. The auriferous KZ Trend is a complexly deformed fault system specifically developed along the boundary between the younger sedimentary basin in the west of the belt that juxtaposes the older rocks to the east. Mineralisation occurred during the later stages of subsequent regional deformation which resulted in inversion of the basin and the development of reverse faults and folds. Ongoing deformation during hydrothermal activity resulted in the development of lodes in a variety of related structural settings within the KZ Trend.
History
On 15 October 2009, AngloGold Ashanti acquired a 50 percent indirect interest in Moto Goldmines Limited through a JV with Randgold, with Moto holding a 70 percent stake in Kibali and the DRC parastatal SOKIMO holding the remaining 30 percent stake. On 21 December 2009, Randgold and AngloGold Ashanti increased their JV interest in Kibali to 90 percent, while SOKIMO retained a 10 percent holding. On 2 January 2019, Randgold merged with Barrick, and the JV is now held by the combined company, trading as Barrick.
Legal aspects and tenure
Refer to “Item 4B: Business Overview—The Regulatory Environment Enabling AngloGold Ashanti to Mine—Africa Region—Democratic Republic of the Congo (DRC)—AngloGold Ashanti’s rights and permits”.
Mining method
The operation comprises both open pit and underground mining. FirstOpen pit mining is carried out using conventional drill, blast, load and haul surface mining methods. From 2022 onwards, open pit production will come from the Sessenge, Aerodrome, Pamao, Gorumbwa, Megi-Marakeke-Sayi, Kalimva-Ikamva, Oere, Pakaka, and Karagba, Chauffeur and Durba (“KCD”) deposits. Open pit mining is conducted by contractor Kibali Mining Services, a local subsidiary of DTP Terrassement, using either free-dig or conventional drill, blast, load and haul methods.
For the underground operation, longitudinal and transverse longitudinal stoping methods with paste backfill are the nominated mining methods. The Kibali KCD underground mine is designed to extract the KCD deposit directly beneath the KCD open pit. A 50m crown pillar separates the pit bottom from the top of the underground mine. The first gold was poured in September 2013 from the open pit operations. Developmentoperations and development of the underground mine commenced in 2013. The first underground development ore was mined in 2013 and stopingthe same year. Stoping commenced in 2015.Initial2015 and ore production has ramped up to 3.8Mt in 2022. Initial production was viatruck hauled by a twin decline fromto surface. In 2017, the haulage shaft (740m deep) and materials handling system was commissioned. From 2018 onwards, the majority ofunderground ore washas predominantly been hoisted up the shaft. The decline to surface iswill continue to be used to haul some of the shallower zones and to supplement shaft haulage.
Processing plants and other available facilities
Infrastructure in the DRC is generally poor as a result of limited investment in maintenance, upgrades and extensions of the road networks established during colonial times. The mine site is located within 160km of the border with Uganda and all transport links take place through Uganda to Kenya or Tanzania. Access by air to Kibali involves a commercial flight to Entebbe in Uganda followed by a charter flight to Doko airport, situated on the mine property. The Doko airstrip was upgraded by Kibali and is equipped with runway lights and precision approach path indicator lights. For the number of persons employed at the mine, refer to “Item 4B: Business Overview—Operating Performance—Africa Region”.
Kibali is a large-scale gold mining operation, with a number of sources of ore, that has been in operation since 2013. The physical condition of the equipment, facilities, and infrastructure at Kibali is in good working order, with the mine investing heavily in maintaining and upgrading its assets to ensure that they remain reliable and efficient. Surface infrastructure associated with the overall Kibali operation includes a processing plant, tailings storage facility ("TSF"), camp, airstrip, underground shaft, workshops and offices. Power to the mine is self-generated by a combination of hydroelectric and diesel generators. The underground mine has both a ramp and shaft system,also been extensively developed, with the construction of both shaft reachingand portal and strategically placed development drives that access and further explore the gold-bearing ore.
The “Property, Plant, and Equipment” as of 31 December 2022, including lease assets, buildings and mine infrastructure, mining assets, mineral rights and dumps, decommissioning assets, capitalised exploration costs and deferred stripping, had a depthcarrying value of 740 metres. Kibali has a$983 million (reported as attributable; 45% owned by AngloGold Ashanti).
Mineral processing plant capable of producing an average of 600koz of gold per annum by treating 7.2Mtpa.
The current processing plant can treat both oxide and fresh sulphide material and is configured foruses flotation andwith ultra-fine grind of the flotation concentrate, a treatment that is required for the sulphide ore type before leaching. PowerKibali has a processing operation capable of producing an average of 730kozpa of gold for 10 years treating at least 7.2Mtpa throughput. The ore is blended using both KCD underground ore plus ore sourced from satellite open pits at Kibali.
Mineral Resource
Refer to the mine is self generated bybelow table, prepared in accordance with Table 1 to Paragraph (D)(1) of Item 1304 of Regulation S-K, which summarises the gold Mineral Resource (exclusive of Mineral Reserve) for Kibali at the end of the fiscal year ended 31 December 2022, based on a combinationgold price estimate of hydroelectric$1,700/oz. Refer to “—Material Assumptions for the Mineral Resource—Key Parameters (Open Pit and diesel generators.Underground)” for additional information on cut-off grades and metallurgical recovery.
| | | | | | | | | | | | | | | | | |
Mineral Resource | Category | Tonnes | Grade | Contained Gold |
as at 31 December 2022 | million | g/t | tonnes | Moz |
Kibali (45 percent) | Measured | 7.22 | | 3.18 | | 22.97 | | 0.74 | |
Indicated | 22.15 | | 2.64 | | 58.44 | | 1.88 | |
Measured & Indicated | 29.37 | | 2.77 | | 81.41 | | 2.62 | |
Inferred | 13.16 | | 2.61 | | 34.43 | | 1.11 | |
Notes:
Rounding of numbers may result in computational discrepancies in the Mineral Resource tabulations. The Mineral Resource and Ore Reserve are coveredestimates with respect to our material properties have been prepared by exploitation permits (11447, 11467, 11468, 11469, 11470, 11471, 11472, 5052, 5073 and 5088) totalling 1,836km2the Qualified Persons (employed by AngloGold Ashanti unless stated otherwise). The Kibali Gold Mine was grantednet difference between the 10 exploitation permits underMineral Resource at the applicable DRC mining code, seven of which are valid until 2029 and three of which are valid until 2030.
Geology
The Kibali Gold Mine is located within the Moto Greenstone Belt, which consists of Archean Kibalian volcano-sedimentary rocks and ironstone-chert horizons that have been metamorphosed to greenschist facies.
The combined Karagba, Chauffeur and Durba (KCD) deposit is host to the majorityend of the currently definedlast completed fiscal year and the preceding fiscal year is detailed in the table below. To
reflect that figures are not precise calculations and that there is uncertainty in their estimation, AngloGold Ashanti reports tonnage, grade and content for gold to two decimals. All ounces are Troy ounces. “Moz” refers to million ounces.
1.All disclosure of Mineral Resource is exclusive of Mineral Reserve. The Mineral Resource exclusive of Mineral Reserve (“Exclusive Mineral Resource”) is defined as the inclusive Mineral Resource less the Mineral Reserve before dilution and Ore Reserve,other factors are applied.
2.Mineral Resource attributable to AngloGold Ashanti’s percentage interest shown.
3.“Tonnes” refers to a metric tonne which is equivalent to 1,000 kilograms.
4.Operated by Barrick. AngloGold Ashanti has recognised that in preparing this annual report, the Qualified Persons have relied on information provided by Barrick. Based on a gold price of $1,700/oz.
5.Property currently in a production stage.
6.Refer to “—Material Assumptions for the Mineral Resource—Key Parameters (Open Pit and Underground)” for additional information on cut-off grades and metallurgical recovery.
Year on year changes in Mineral Resource - Moz
| | | | | | | | | | | | | | |
as at 31 December 2022 | Kibali |
Category | Measured | Indicated | Measured and Indicated total | Inferred |
Previous Year | 0.78 | | 1.76 | | 2.54 | | 0.89 | |
Depletion | (0.01) | | — | | (0.01) | | — | |
Exploration | 0.01 | | — | | 0.01 | | 0.10 | |
Methodology | — | | — | | — | | — | |
Price | 0.03 | | 0.16 | | 0.19 | | 0.13 | |
Cost | (0.01) | | (0.02) | | (0.03) | | (0.02) | |
Geotechnical | (0.07) | | (0.02) | | (0.09) | | — | |
Metallurgical | — | | 0.01 | | 0.01 | | 0.01 | |
Acquisition / Disposal | — | | — | | — | | — | |
Other | — | | — | | — | | — | |
Current Year | 0.74 | | 1.88 | | 2.62 | | 1.11 | |
Net Difference | (0.04) | | 0.12 | | 0.08 | | 0.22 | |
% Difference | (5) | | 7 | | 3 | | 24 | |
Notes:
All figures are expressed on an attributable basis unless otherwise indicated. AngloGold Ashanti has recognised that in preparing this annual report, the Qualified Persons have relied on information provided by Barrick.
Changes were driven both by exploration and an increase in the Mineral Resource gold price from $1,500/oz as at 31 December 2021 to $1,700/oz as at 31 December 2022, with gains seen from the open pits, specifically Ikamva, Oere and Gorumbwa, as well as from continued definition of the 11000 lode in the KCD underground. A maiden underground Inferred Mineral Resource at Gorumbwa was also reported.
Material Assumptions for the Mineral Resource
Key Parameters (Open Pit and Underground)
| | | | | | | | |
Kibali | Unit | Open Pit |
Costs | | |
Waste cost | $/tonne mined | 2.92-3.09(1) |
Extra Ore Cost – Grade Control + Ore – Rehandle + Overhaul | $/tonne mined | 1.27 | |
Grade Control cost | $/tonne mined | 0.75 | |
Dilution | % | 10 |
Ore Loss | % | 3 |
Processing cost | $/tonne milled | 15.04-17.85(1) |
G&A | $/tonne milled | 8.47 | |
Other Parameters | | |
Gold Royalties (4.7%) | $/oz | 70.50 | |
Metallurgical Recovery Factor | %MetRF | 86.1-90.1(1) |
Mineral Resource cut-off grade | g/t | 0.6-0.7(1) |
| | | | | | | | |
Kibali | Unit | Open Pit |
Mineral Resource price | $/oz | 1,700 (2) |
Notes: AngloGold Ashanti has recognised that in preparing this annual report, the Qualified Persons have relied on information provided by Barrick. (1) Vary according to rock type. (2) AngloGold Ashanti has determined that there is no material change to the Mineral Resource reported in the 2021 Technical Report Summary for Kibali (effective date: 31 December 2021) filed as Exhibit 19.15.7 hereto if this updated gold price is used (instead of $1,500, the gold price used to estimate the Mineral Resource in 2021). |
| | | | | | | | |
Kibali | Unit | Underground |
Costs | | |
Mine Production | $/tonne ore mined | 36.17 | |
Capital | $/tonne ore mined | 3.97 |
G&A | $/tonne ore milled | 8.47 |
Processing cost | $/tonne ore milled | 17.85 |
Other Parameters | | |
Gold Royalties (4.7%) | $/oz | 70.50 |
Mining cut-off grade | g/t | 1.62 |
Mineral Resource price | $/oz | 1,700 (1) |
Metallurgical Recovery Factor | %MetRF | 90 | |
Notes: AngloGold Ashanti has recognised that in preparing this report, the Qualified Persons have relied on information provided by Barrick. (1) AngloGold Ashanti has determined that there is no material change to the Mineral Resource reported in the 2021 Technical Report Summary for Kibali (effective date: 31 December 2021) filed as Exhibit 19.15.7 hereto if this updated gold price is used (instead of $1,500, the gold price used to estimate the Mineral Resource in 2021).
|
Estimation
Mineral Resource estimation is undertaken by Barrick in-house technical experts or by approved external consultants. The results of both diamond drilling ("DD") and reverse circulation ("RC") drilling are used in the estimation process. 3D mineralised envelopes are established using grade and geology, and these are then statistically verified to confirm their validity for use in grade estimation. Appropriate domaining of homogeneous zones is conducted whereby high-grade central core areas are modelled separately from the lower-grade surrounding halos. Volumes are filled with block model cells and interpolated for density, rock type and grade – the latter using ordinary kriging.
Grade top cuts and restricted searches are applied to drill hole data to prevent the spread of high-grades during the estimation process. Drill hole spacing is used to guide the Mineral Resource classification. The open pit Mineral Resource is quoted within a limiting shell. The underground Mineral Resource is constrained by the application of optimised mineable Mineral Resource shapes, which applies reasonable mineability constraints including a minimum mining width, a reasonable distance from current or planned development, and a measure of assumed profitability at the related Mineral Resource cut-off grade.
Mineral Reserve
Refer to the below table, prepared in accordance with Table 2 to Paragraph (D)(1) of Item 1304 of Regulation S-K, which summarises the gold Mineral Reserve for Kibali at the end of the fiscal year ended 31 December 2022, based on a gold price estimate of $1,300/oz. Refer to “—Material Assumptions for the Mineral Reserve—Modifying factors and price estimates” for additional information on cut-off grades and metallurgical recovery.
| | | | | | | | | | | | | | | | | |
Mineral Reserve | Category | Tonnes | Grade | Contained Gold |
as at 31 December 2022 | million | g/t | tonnes | Moz |
Kibali (45 percent) | Proven | 14.49 | | 3.47 | | 50.33 | | 1.62 | |
Probable | 29.17 | | 3.15 | | 91.86 | | 2.95 | |
Total | 43.67 | | 3.26 | | 142.19 | | 4.57 | |
Notes:
1.Rounding of numbers may result in computational discrepancies in the Mineral Reserve tabulations. The Mineral Reserve estimates with respect to our material properties have been prepared by the Qualified Persons (employed by AngloGold Ashanti unless stated otherwise). The net difference between the Mineral Reserve at the end of the last completed fiscal year and the preceding fiscal year is detailed in the table below. To reflect that figures are not precise calculations and that there is uncertainty in their estimation, AngloGold Ashanti reports tonnage, grade and content for gold to two decimals. All ounces are Troy ounces. “Moz” refers to million ounces.
2.Mineral Reserve attributable to AngloGold Ashanti’s percentage interest shown.
3.“Tonnes” refers to a metric tonne which is equivalent to 1,000 kilograms.
4.Operated by Barrick. AngloGold Ashanti has recognised that in preparing this annual report, the Qualified Persons have relied on information provided by Barrick. Open Pits and underground were based on a gold price of $1,300/oz, with the exception of the Pamoa Main pit (based on a gold price of $1,400/oz) and the Pamoa South pit (based on a gold price of $1,500/oz).
5.Property currently in a production stage.
6.Refer to “—Material Assumptions for the Mineral Reserve—Modifying factors and price estimates” for additional information on cut-off grades and metallurgical recovery.
Year on year changes in Mineral Reserve - Moz
| | | | | | | | | | | |
as at 31 December 2022 | Kibali |
Category | Proven | Probable | Total |
Previous Year | 1.74 | | 2.59 | | 4.33 | |
Depletion | (0.28) | | (0.12) | | (0.40) | |
Exploration | 0.11 | | 0.42 | | 0.53 | |
Methodology | — | | — | | — | |
Price | 0.03 | | 0.12 | | 0.15 | |
Cost | (0.01) | | (0.03) | | (0.04) | |
Geotechnical | — | | — | | — | |
Metallurgical | — | | — | | — | |
Operational | 0.03 | | — | | 0.03 | |
Other | — | | (0.03) | | (0.03) | |
Acquisition / Disposal | — | | — | | — | |
Current Year | 1.62 | | 2.95 | | 4.57 | |
Net Difference | (0.12) | | 0.36 | | 0.24 | |
% Difference | (7) | | 14 | | 6 | |
Notes:
All figures are expressed on an attributable basis unless otherwise indicated. AngloGold Ashanti has recognised that in preparing this annual report, the Qualified Persons have relied on information provided by Barrick.
The increase in Mineral Reserve was primarily as a result of the conversion of the 11000 lode in the KCD underground, and growth in the Ikamva and Oere pits due to exploration successes. The gold price used for pit optimisation changed from $1,200/oz as at 31 December 2021 to $1,300/oz as at 31 December 2022 which also contributed to the increase seen.
Material Assumptions for the Mineral Reserve
Modifying factors and price estimates
| | | | | | | | |
as at 31 December 2022 | Kibali |
Primary Commodity Price | $/oz | 1,300(1)(6) |
| | |
| | |
| | |
Cut-off grade | g/t | 1.50(3)(5); 1.96(4) |
| | |
Stoping width | cm | 2990(4) |
Dilution | % | 2.0-12.5(4); 10(5) |
| | |
| | |
| | |
Mining Recovery Factor | MRF based on tonnes (%) | 91.6(4); 97(5) |
| | |
Mine Call Factor | MCF (%) | 97 |
Metallurgical Recovery Factor | MetRF (%) | 89-90(2) |
Notes: AngloGold Ashanti has recognised that in preparing this annual report, the Qualified Persons have, relied on information provided by Barrick. (1) AngloGold Ashanti has determined that there is no material change to the Mineral Reserve reported in the 2021 Technical Report Summary for Kibali (effective date: 31 December 2021) filed as Exhibit 19.15.7 hereto if this updated gold price is used (instead of $1,200, the gold price used to estimate the Mineral Reserve in 2021). (2) Vary according to rock type. (3) Stockpile. (4) Underground. (5) Open pit. (6) Open Pits and underground were based on a gold price of $1,300/oz, with the exception of the Pamoa Main pit (based on a gold price of $1,400/oz) and the Pamoa South pit (based on a gold price of $1,500/oz). |
Estimation
The open pit Mineral Reserve shell optimisations were run on the Mineral Resource models. The process incorporated the mining layout, operating factors, stripping ratio, relevant cut-off grades and modifying factors for
reporting the Mineral Reserve. An open pit underground interface was set at 5,685 metres relative level (“mRL") between the KCD open pit and underground mine.
A cut-off grade analysis of $1,300/oz was used to determine a cut-off grade of 1.96g/t for the underground mine. Longitudinal and transverse longhole open stoping methods with paste backfill are the current preferred mining operations. KCDmethods. Underground stope designs were updated from the previously reported Mineral Reserve using the latest Mineral Resource models. Modifying factors for planned and unplanned rock dilution, backfill dilution and ore loss were applied to obtain the reported Mineral Reserve.
Metallurgical, environmental, social, legal, marketing and economic factors were adequately considered in the Kibali feasibility study and have been updated as the project has developed.
Map showing Kibali planned infrastructure and licences
Below is hosted within a mineralised corridormap that also hostsshows Kibali infrastructure and licences, with the Sessenge, Gorumbwa and Pakaka deposits and a number of exploration prospects.
total mining lease area insert shown in the top right corner. The known depositscoordinates of the Kibali project are hosted along a reactivated thrust plane that creates plunging lodes of mineralisationmine, as exemplifiedrepresented by the KCD deposit. The majority of gold mineralisation identified to date is disseminated style, hosted within a sequence of coarse volcaniclasticplant, are depicted on the map and sedimentary rocks. The mineralisation is generally stratigraphically bound and associated with carbonate-silica-albite alteration with minor sulphide.are in the geographic coordinate system.
GHANA
Description
AngloGold Ashanti has two mines in Ghana:Ghana. Obuasi currently in a redevelopment phase,and Iduapriem are both wholly-owned and operated by AngloGold Ashanti.
Obuasi is an underground mine andoperating at depths of up to 1,500m with a continuous history of mining dating back to the 1890s. Iduapriem is an open pit mine.
Obuasi is located in the Ashanti region of southern Ghana, – Iduapriemapproximately 60km south of Kumasi. Mining was temporarily suspended at the end of 2014 while a series of economic studies progressed. Obuasi underground development restarted in the first half of 2019, with the first gold produced in December 2019. The ramp-up of the redevelopment project was delayed by the temporary stoppage of underground activities after a fall of ground incident in May 2021. Production remained suspended for several months to allow for reviews and investigations, but slowly resumed in the latter part of 2021.
Description
Iduapriem wholly ownedis located in western Ghana, some 85km from the coast and south of Obuasi, near the town of Tarkwa.
OBUASI
For additional information, refer to the Technical Report Summary for Obuasi (effective date: 31 December 2021) filed as Exhibit 19.15.5 hereto.
Property description
Obuasi is wholly-owned by AngloGold Ashanti and is a production stage property. All required mineral rights to the property are held by the Company. The mine is an underground operation, and it has been in operation since 1897 (more than 120 years). It has been operated by AngloGold Ashanti since 2004.
Location
The mine is in the municipality of Obuasi, in the Ashanti region of Ghana, about 240km northwest of the capital, Accra, and 60km south of Kumasi.
Mineralisation style
Geologically, Obuasi is in the Ashanti belt on the eastern margin of the Pre-Cambrian West African craton. This craton consists of Lower Proterozoic volcanic and flysch sediments which make up the Birimian system, overlain in part by the molasse sediments of the Middle Proterozoic Tarkwaian. The Ashanti belt is the most prominent of the five Birimian Supergroup gold belts found in Ghana.
Gold mineralisation is associated with shear zones and pervasive silica, carbonate and sulphide hydrothermal alteration which occur in tightly folded Lower Birimian schists, phyllites, meta-greywackes, and tuffs, along the eastern limb of the Kumasi anticlinorium. They are found near the contact with harder metamorphosed and metasomatically altered intermediate to basic upper Birimian volcanics. There are two broad styles of gold mineralisation including free milling quartz vein gold and sulphide-rich, disseminated and refractory gold which form alteration haloes around the quartz vein lodes. Sulphide mineralisation is dominated by arsenopyrite and quartz mineralisation, which is associated with spatially variable, but exceptionally high-grade visible gold in quartz veins.
History
Obuasi has a long mining history dating back to 1897. It has been owned and operated by various operators during this time. The current operator became involved in 2004 following the merger of former AngloGold Limited of South Africa and the Ashanti Goldfields Company Limited of Ghana. However, for several years leading up to 2014, the mine began to struggle due to ailing infrastructure and outdated methodologies. The company realised that significant rationalisation and/or replacement of current infrastructure would be necessary to enable the delivery of better utilisation and productivity metrics.
In 2014, a feasibility study commenced that considered the optimum mining methodology and schedules for the underground mine, based on modern mechanised mining methods and refurbishment of underground, surface and process plant infrastructure. During this time, Obuasi operated in a limited operating phase with underground activities essentially restricted to the continued development of the Obuasi deeps decline and underground infill drilling. The limited operating phase was brought to a halt after an incursion by illegal miners on Obuasi's concession in February 2016, at which point the mine was placed under care and maintenance. However, the study continued and in 2017, a favourable feasibility study was completed and indicated a strong technical and economic case with an anticipated 20-year life of mine ("LOM"). In 2018, approval was received from the AngloGold Ashanti board and the government of Ghana to proceed with the project.
The redevelopment project began in late 2018 and first gold was poured during the fourth quarter of 2019. Phase 1 of the redevelopment project was completed by the end of September 2007,2020, and the mine began commercial production on 1 October 2020. Phase 2 of the redevelopment project, which focused on construction and mine development, was completed in 2021. Phase 3 of the redevelopment project is situatedcurrently underway to develop the infrastructure necessary to support the planned ramp-up in production.
Legal aspects and tenure
Refer to “Item 4B: Business Overview—The Regulatory Environment Enabling AngloGold Ashanti to Mine—Africa Region—Ghana—AngloGold Ashanti’s rights and permits”.
Mining method
Obuasi is an underground operation, utilising both vertical shafts and declines as main access routes to the underground workings. The mine has seen extensive historical mining activities with varying applications of different mining methods to date. The current LOM design employs mostly the Long Hole Open Stoping ("LHOS") mining method for ore extraction. LHOS is a highly selective and productive method of mining that can be employed for orebodies of varying thicknesses and dips. The main distinct variations of the LHOS used at Obuasi are longitudinal retreat stoping (“LRS”), and transverse open stoping (“TOS”). The blind upper stoping is a form of LRS or TOS used for partial sill pillar recovery.
Processing plants and other available facilities
All significant surface activities, including ore processing, environmental management and community engagement are carried out by Obuasi staff. Existing infrastructure includes a recently refurbished and upgraded 2.2Mtpa processing plant with flotation and bacterial oxidation ("BIOX"), extensive underground development, hoisting shafts and associated infrastructure, mine ventilation and refrigeration facilities, emergency standby power and water reticulation, office complexes, workshops, and company housing estates. Power is supplied to the mine by the Volta River Authority and Ghana Grid Company Limited (“GRIDCo”). There is a focus mine development plan supported by the existing infrastructure, and ongoing upgrades of critical underground infrastructure to sustain the operations. The mine can be accessed by paved road network from Kumasi and by road or chartered air transport from the capital, Accra. For the number of persons employed at the mine, refer to “Item 4B: Business Overview—Operating Performance—Africa Region”.
The “Property, Plant, and Equipment” as of 31 December 2022, including buildings and mine infrastructure, mining assets, decommissioning assets and assets under construction, had a carrying value of $1,009 million.
Mineral processing
The plant is configured for both conventional and flash flotation and BIOX treatment which is required for the refractory sulphide ore. The gravity gold recovery system is also integrated with Knelson concentrators and inline leach reactors.
Mineral Resource
Refer to the below table, prepared in accordance with Table 1 to Paragraph (D)(1) of Item 1304 of Regulation S-K, which summarises the gold Mineral Resource (exclusive of Mineral Reserve) for Obuasi at the end of the fiscal year ended 31 December 2022, based on a gold price estimate of $1,750/oz for underground and $1,600 for open pit Mineral Resource. Refer to “—Material Assumptions for the Mineral Resource—Key Parameters” for additional information on cut-off grades and metallurgical recovery.
| | | | | | | | | | | | | | | | | |
Mineral Resource | Category | Tonnes | Grade | Contained Gold |
as at 31 December 2022 | million | g/t | tonnes | Moz |
Obuasi | Measured | 1.96 | | 8.44 | | 16.59 | | 0.53 | |
Indicated | 27.66 | | 6.06 | | 167.59 | | 5.39 | |
Measured & Indicated | 29.63 | | 6.22 | | 184.18 | | 5.92 | |
Inferred | 39.80 | | 8.50 | | 338.17 | | 10.87 | |
Notes:
Rounding of numbers may result in computational discrepancies in the Mineral Resource tabulations. The Mineral Resource estimates with respect to our material properties have been prepared by the Qualified Persons (employed by AngloGold Ashanti unless stated otherwise). The net difference between the Mineral Resource at the end of the last completed fiscal year and the preceding fiscal year is detailed in the table below. To reflect that figures are not precise calculations and that there is uncertainty in their estimation, AngloGold Ashanti reports tonnage, grade and content for gold to two decimals. All ounces are Troy ounces. “Moz” refers to million ounces.
1.All disclosure of Mineral Resource is exclusive of Mineral Reserve. The Mineral Resource exclusive of Mineral Reserve (“Exclusive Mineral Resource”) is defined as the inclusive Mineral Resource less the Mineral Reserve before dilution and other factors are applied.
2.“Tonnes” refers to a metric tonne which is equivalent to 1,000 kilograms.
3.Property currently in a production stage.
4.Refer to “—Material Assumptions for the Mineral Resource—Key Parameters” for additional information on cut-off grades and metallurgical recovery.
5.Open pit based on a gold price of $1,600/oz, underground based on a gold price of $1,750/oz.
Year on year changes in Mineral Resource - Moz
| | | | | | | | | | | | | | |
as at 31 December 2022 | Obuasi |
Category | Measured | Indicated | Measured and Indicated total | Inferred |
Previous Year | 0.66 | | 5.84 | | 6.50 | | 12.05 | |
Depletion | — | | — | | — | | — | |
Exploration | — | | — | | — | | (0.06) | |
Methodology | 0.02 | | 0.28 | | 0.30 | | (0.53) | |
Price | 0.02 | | 0.58 | | 0.60 | | 1.11 | |
Cost | (0.17) | | (0.97) | | (1.14) | | (1.31) | |
Geotechnical | — | | — | | — | | — | |
Metallurgical | — | | — | | — | | — | |
Acquisition / Disposal | — | | — | | — | | — | |
Other | — | | (0.33) | | (0.33) | | (0.37) | |
Current Year | 0.53 | | 5.39 | | 5.92 | | 10.87 | |
Net Difference | (0.12) | | (0.45) | | (0.57) | | (1.17) | |
% Difference | (19) | | (8) | | (9) | | (10) | |
Notes:
All figures are expressed on an attributable basis unless otherwise indicated.
The decrease in Mineral Resource is mainly due to depletion attributed to mining from Sansu, and Blocks 8 and 10 and an increase in costs which resulted in higher cut-off grades as well as the sterilisation of stopes in the depletion process. The decrease was partially offset by model changes primarily from the inclusion of new drilling data from ongoing operational drilling activities and the increase in Mineral Resource price.
Material Assumptions for the Mineral Resource
Key Parameters
| | | | | | | | |
Obuasi | Unit | Underground |
Costs | | |
Mining cost | $/tonne mined | 64.26-79.44(1) |
Processing cost | $/tonne treated | 42.57 |
G&A | $/tonne treated | 21.96 |
Other Parameters | | |
Royalties | % | 3.0 |
MSO(2) optimising cut-off | g/t | 3.43-3.75(1) |
Mineral Resource cut-off grade | g/t | 3.43-3.75(1) |
Mineral Resource price | $/oz | 1,600-1,750(3)(4) |
Metallurgical Recovery Factor | %MetRF | 87 |
Notes: (1) Vary according to area. (2) Datamine Mineable Shape Optimiser ("MSO"). (3) Open pit based on a gold price of $1,600/oz, Underground based on a gold price of $1,750/oz. (4) AngloGold Ashanti has determined that there is no material change to the Mineral Resource reported in the 2021 Technical Report Summary for Obuasi (effective date: 31 December 2021) filed as Exhibit 19.15.5 hereto if this updated gold price is used (instead of $1,500, the gold price used to estimate the Mineral Resource in 2021). |
Estimation
The estimation technique is ordinary kriging and the primary estimation unit size is 20m x 5m x 15m. This estimation unit size is representative of the underground mining units and is considered appropriate given the style of mineralisation and mining methods. Compositing by length is employed and the influence of extreme grades is restricted by grade capping. Sample spacing is highly variable across the deposit and ranges from 10m x 10m (for grade control areas) up to 200m x 200m (for exploration targets). However, for the Mineral Resource, the maximum extrapolation from data points is 100m. Any areas beyond this are not classified and are considered to be upside potential rather than Mineral Resource.
Mineral Reserve
Refer to the below table, prepared in accordance with Table 2 to Paragraph D(1) of Item 1304 ofRegulation S-K, which summarises the gold Mineral Reserve for Obuasi at the end of the fiscal year ended 31 December 2022, based on a gold price estimate of $1,400/oz. Refer to “—Material Assumptions for the Mineral Reserve—Modifying factors and price estimates” for additional information on cut-off grades and metallurgical recovery.
| | | | | | | | | | | | | | | | | |
Mineral Reserve | Category | Tonnes | Grade | Contained Gold |
as at 31 December 2022 | million | g/t | tonnes | Moz |
Obuasi | Proven | 4.47 | | 9.55 | | 42.73 | | 1.37 | |
Probable | 21.25 | | 9.26 | | 196.67 | | 6.32 | |
Total | 25.72 | | 9.31 | | 239.40 | | 7.70 | |
Notes:
1.Rounding of numbers may result in computational discrepancies in the Mineral Reserve tabulations. The Mineral Reserve estimates with respect to our material properties have been prepared by the Qualified Persons (employed by AngloGold Ashanti unless stated otherwise). The net difference between the Mineral Reserve at the end of the last completed fiscal year and the preceding fiscal year is detailed in the table below. To reflect that figures are not precise calculations and that there is uncertainty in their estimation, AngloGold Ashanti reports tonnage, grade and content for gold to two decimals. All ounces are Troy ounces. “Moz” refers to million ounces.
2.“Tonnes” refers to a metric tonne which is equivalent to 1,000 kilograms.
3.Property currently in a production stage.
4.Refer to “—Material Assumptions for the Mineral Reserve—Modifying factors and price estimates” for additional information on cut-off grades and metallurgical recovery.
5.Based on a gold price of $1,400/oz.
Year on year changes in Mineral Reserve - Moz
| | | | | | | | | | | |
as at 31 December 2022 | Obuasi |
Category | Proven | Probable | Total |
Previous Year | 1.19 | | 7.08 | | 8.26 | |
Depletion | (0.23) | | — | | (0.23) | |
Exploration | — | | (0.77) | | (0.77) | |
Methodology | 0.54 | | — | | 0.54 | |
Price | 0.11 | | 1.49 | | 1.60 | |
Cost | (0.23) | | (1.48) | | (1.71) | |
Geotechnical | — | | — | | — | |
Metallurgical | — | | — | | — | |
Operational | — | | — | | — | |
Other | — | | — | | — | |
Acquisition / Disposal | — | | — | | — | |
Current Year | 1.37 | | 6.32 | | 7.70 | |
Net Difference | 0.19 | | (0.75) | | (0.57) | |
% Difference | 16 | | (11) | | (7) | |
Notes:
All figures are expressed on an attributable basis unless otherwise indicated.
The key changes were primarily associated with depletion, exploration, block model changes, and economic parameters. Depletion was mainly due to mining, while exploration changes were as a result of Mineral Resource drilling. This was offset by changes in the block model methodology involving estimation parameters, interpretations, classification and density. The economic factors that also influenced the changes to the Obuasi Mineral Reserve included an increased gold price assumption which was partially offset by an increase in mining cost and sustaining capital.
Material Assumptions for the Mineral Reserve
Modifying factors and price estimates
| | | | | | | | |
as at 31 December 2022 | Obuasi |
Primary Commodity Price | $/oz | 1400(1) |
| | |
| | |
| | |
Cut-off grade | g/t | 4.29-4.69(2) |
| | |
| | |
| | | | | | | | |
as at 31 December 2022 | Obuasi |
Dilution | % | 12-17(2) |
| | |
| | |
| | |
Mining Recovery Factor | %MRF based on tonnes | 95-98(2) |
Mining Recovery Factor | %MRF based on g/t | 100 |
Mine Call Factor | %MCF | 100 |
Metallurgical Recovery Factor | %MetRF | 87 |
Notes: (1) AngloGold Ashanti has determined that there is no material change to the Mineral Reserve reported in the 2021 Technical Report Summary for Obuasi (effective date: 31 December 2021) filed as Exhibit 19.15.5 hereto if this updated gold price is used (instead of $1,200, the gold price used to estimate the Mineral Reserve in 2021). (2) Vary according to area. |
Estimation
The Mineral Reserve estimation considers mining criteria for the economic cut-off grade and minimum mining width for the anticipated mining method. All design and scheduling work is undertaken to an applicable level of detail by mine planning engineers in consultation with other technical specialists using Datamine Studio UGTM and Enhanced Production SchedulerTM ("EPS") software.
The cut-off grade parameters used include projected mining, processing, and general and administrative costs. A Mineral Reserve gold price of $1,400/oz was used. The cut-off grade also considers the metallurgical recovery factor (87 percent applied for all blocks), mining dilution and recovery, tonne-kilometre haulage cost from all blocks, as well as the backfill type.
Stopes are designed using the Datamine Mineable Shape Optimiser ("MSO") Software where the outputs are further optimised by manual edits. The stope shapes are generated at section intervals of 15m to 20m based on geotechnical guidance for each block. The MSO allows the class field to be assigned to each stope generated. The mine design is reviewed taking into consideration the updated stope shapes, existing development and future infrastructure need. A LOM plan is generated which considers fleet and infrastructure capacities. All mining blocks are designed for the LHOS mining method. The Mineral Reserve is reported from the LOM plan and only includes Measured and Indicated Mineral Resource.
Map showing Obuasi planned infrastructure and licences
Below is a map that shows the location, infrastructure and mining licence area for Obuasi. The coordinates of the mine, as represented by the plant, are depicted on the map and are in the geographic coordinate system.
IDUAPRIEM
Property description
Iduapriem mine is wholly-owned and operated by AngloGold Ashanti and a production stage property. The mine is a multiple open pit operation that currently sources ore from the Block 3W, Block 5, Ajopa, and Blocks 7 and 8 pits.
Location
The mine is located in the western region of Ghana, some 70km north of the coastal city of Takoradi and approximately 10km southwest of the town of Tarkwa. The Iduapriem mine is bordered to the north by Gold Fields Ghana Limited (Tarkwa Mine) and to the east by the Ghana Manganese Company Limited (a manganese mine in existence since the 1920s).
IduapriemMineralisation style
There are four recognised conglomerate reefs namely A, B, C and D, which are equivalent to the Tarkwaian Sub-basal, Basal (or Main), Middle (or West), and Breccia Reefs, respectively. The B and C Reefs are oligomictic and consist of well-sorted conglomerates and have been mined underground in some areas more than a century ago. The A and D Reefs have a lower gold tenor and are polymictic, containing both well-rounded and angular fragments. Gold is found within the matrix that binds the pebbles together. The gold content is a multiple open pitfunction of the size and amount (packing) of quartz pebbles present within a conglomeratic unit. The gold is fine-grained, particulate and free-milling.
Legal aspects and tenure
Refer to “Item 4B: Business Overview—The Regulatory Environment Enabling AngloGold Ashanti to Mine—Africa Region—Ghana—AngloGold Ashanti’s rights and permits”.
Processing plants and other available facilities
Surface infrastructure associated with Iduapriem’s operation that currently sources ore fromincludes a primary crusher, overland conveyor, CIL processing plant next to the Ajopamain office building, a TSF and Block 7four camp areas for contractors and 8 pits. The Iduapriem treatment plant has two semi-autogenous grinding mills and two ball mills which run in two parallel circuits, each with a semi-autogenous grinding mill and a ball mill. The carbon-in-pulp plant has a capacity of 5.1Mtpa.company employees. Tarkwa town is also adjacent to the tenement. Power is supplied to the mine by the Volta River Authority (VRA) and GridCo.GRIDCo.
Mineral processing
The current processing plant treats free-milling material from open pit mining, by a conventional crush with a semi-autogenous ball milling circuit and cyanide leach. Iduapriem comprisesoperates a two-stage crushing circuit consisting of a Metso Superior MKIII primary gyratory crusher and two GP550 gyratory crushers for secondary crushing. The Iduapriem treatment plant has two semi-autogenous grinding mills ("SAG mills") and two ball mills which run in two parallel circuits,each with a SAG mill and a ball mill. The second ball mill, a new thickener, a cluster of cyclones and a Knelson concentrator were commissioned in March 2009. In July 2017, three of the Iduapriem, Ajopa Northfour leach tanks were converted into CIL tanks by introducing carbon into the each of the tanks with the installation of inter-tank screens and South and Teberebie mining leases on a 139.77km2 concession. Applications have been submittedcarbon recovery screens. Carbon for elution is harvested from one of the leach tanks to the minerals authority foracid wash column, and the renewal of the mining permits which, according to Ghanaian law, allows for the continuation of mining on the expired leases while the renewal processcarbon recovery screen underflow is in progress. The environmental certificate for the project expired in October 2017. However, the 2017- 2020 Environmental Management Plan (EMP), which is required for to renew the certificate, was submitted on 6 April 2017. Comments were received by the mine from the Environmental Protection Agency (EPA) in June 2017 together with invoices for payment of the permit fees for the certificate. AAIL submitted the revised EMP (with the EPA’s comments addressed)pumped back to the EPA on 10 August 2018 and made the required payments. The certificateleach tanks.
GUINEA
SIGUIRI
Property description
Siguiri is still pending at the time of writing this annual report. The Ghanaian Chamber of Mines is currently engaging with the environmental authorities (EPA) on behalf of the company and other sister mines whose certificates and other permits are outstanding. There is a reasonable basis to conclude that all permits required for the project will be obtained.
Geology
The Iduapriem and Teberebie properties are located along the southern end of the Tarkwa basin. The mineralisation is containedAngloGold Ashanti’s only operation in the Banket SeriesRepublic of quartz pebble conglomerates, breccia conglomerates and metasediments within the Proterozoic Tarkwaian System.Guinea. The outcropping Banket Series of rocks in the mine area form prominent, arcuate ridges extending southwards from Tarkwa, westwards through Iduapriem and northwards towards Teberebie. The gold is hosted within the conglomerates.
Ghana - Obuasi
Description
Obuasi, wholly ownedco-owned by AngloGold Ashanti since 2004, is located in the Ashanti Region of Ghana, some 260 kilometres north-west of the capital Accra(85 percent) and approximately 60 kilometres south of Kumasi.
Mining operations are primarily underground, to a depth of 1.5 kilometres. Obuasi started production in 1897, was placed on limited operations towards the end of 2014, and on care and maintenance from 2016. Some aspects of the mine continued under limited operational conditions, including the development of the underground decline. A favourable feasibility study was completed in 2017 and indicated a strong technical and economical case with an anticipated 20-year mine life. In 2018, approval was received from the AngloGold Ashanti board to proceed with the project. The redevelopment project, to establish Obuasi as a modern, efficient, mechanised, underground operation, commenced in late 2018 and the first gold was poured late in 2019.
Phase 1 of the project, which set up the plant to achieve a daily processing rate of 2,000t of ore, was completed. Phase 2, which aims to expand plant capacity to 4,000t a day will continue through 2020. Existing infrastructure includes a 2.4Mtpa processing plant with flotation and bacterial oxidation (BIOX), underground development, hoisting shafts and associated infrastructure, power and water reticulation, office complexes, workshops and company housing estates. Power is supplied to the mine by the Volta River Authority (VRA) and GridCo.
The Mineral Resource and Ore Reserve are covered by the Obuasi Concession comprising 152.6km2 and the Binsere Concession parts 1, 2 and 3 comprising 48.86km2. The mining concessions, which expire on 5 March 2054, are covered by a Development Agreement and Tax Concession Agreement with the government of Ghana.
Geology
Guinea (15 percent). The gold deposits at Obuasi are part ofmine is a prominent gold belt of Proterozoic (Birimian) volcano-sedimentary and igneous formations which extend for a distance of approximately 300 kilometres in a north-east/south-west trend in south‑western Ghana. Obuasi mineralisation is shear-zone related and there are three main structural trends hosting gold mineralisation: the Obuasi trend, the Gyabunsu trend and the Binsere trend.
Two main ore types are mined:
quartz veins which consist mainly of quartz with free gold in association with lesser amounts of various metal sulphides of iron, zinc, lead and copper. The gold particles are generally coarse-grained and occasionally visible to the naked eye. This ore type is generally non-refractory; and
sulphide ore which is characterised by the inclusion of goldconventional open pit operation situated in the crystal structureSiguiri district in the northeast of a sulphide material. The gold in these ores is fine-grained and often locked in arsenopyrite. Higher gold grades tend to be associated with finer grained arsenopyrite crystals. Other prominent minerals include quartz, chlorite and sericite. Sulphide ore is generally refractory.Guinea.
REPUBLIC OF GUINEA (GUINEA)
Description
Siguiri Gold Mine is AngloGold Ashanti’s sole operation in Guinea.
Guinea - Siguiri
Description
Siguiri Gold Mine is 85 percent owned anda production stage property, operated by AngloGold AshantiAshanti. Gold-bearing ore is mined from several pits (generally three pits at any one time). Mining occurs primarily in Kami and 15 percent byBidini pits in Block 1, as well as Saraya pit in Block 2. The pre-feasibility study level of work on the government of Guinea. geotechnical design for Sanutinti pit is ongoing.
Location
Siguiri is located approximately 850 kilometres850km north-northeast of Conakry, 25 kilometres25km northwest of the town of Siguiri and 220 kilometres220km southeast of the Malian capital Bamako, near the Malian border.
Mineralisation style
Siguiri is currently a multi-pit oxide gold mining operation, operated by a contract miner. Processingsituated in the northern part of the Siguiri Basin of Guinea, and is underlain by Lower Proterozoic rocks of the Birimian metasedimentary and volcano-sedimentary formations. Primary gold mineralisation occurs in all three lithostratigraphic units of the Siguiri region, although most of the known mineralisation is found in the central and more competent Fatoya Formation. In some deposits, the mineralisation shows strong lithological control and is preferentially developed in coarser-grained units with higher fracture or vein densities than fine-grained rocks. Mineralised veins are more intensely developed along major structural trends, with quartz-carbonate-sulphide veining developed along structures. Some of these structures have developed as incipient faults and are represented by discrete stockworks of mineralised quartz-carbonate veins occurring along a trend instead of clearly defined continuous structures.
Legal aspects and tenure
Refer to “Item 4B: Business Overview—The Regulatory Environment Enabling AngloGold Ashanti to Mine—Africa Region—Guinea—AngloGold Ashanti’s rights and permits”.
Processing plants and other available facilities
Siguiri includes a processing plant, a TSF, and other infrastructure such as a mine village, a water supply system, roads, power supply by on-site generators and communications systems. Additional infrastructure includes on-site offices, accommodation and workshops to support remote mining. Power to the mine is self-generated using heavy fuel oil.
The town of Siguiri can be accessed via a small airfield and a well-paved road that connects Siguiri to Bamako in the north and Kouroussa in the south. Access to the mine via roads and to Siguiri is easily passable through most of the year, although some secondary roads are seasonal with limited access during the wet season. While Siguiri encounters encroachment of villages onto, and artisanal and small-scale mining invasion in, its mining areas as well as increasing community demands and expectations, mitigation plans are in place to significantly reduce the impact of these issues.
Mineral processing
The mined ore is done byprocessed using a hybrid carbon-in-leach (CIL)CIL circuit processing plant converted from carbon-in-pulp (CIP) in 2018. The plant is capable of treating 50%and can treat 50 percent hard ore post the commissioningpost-commissioning of a new ball mill and 3 stagethree-stage crushing plant in Q12019. Unit operations include comminution, leaching, carbon adsorption and desorption, smelting and tailings disposal. Further modification of 2019.three leach tanks to CIL tanks was carried out in the fourth quarter of 2020, giving a total of seven tanks in the hybrid circuit. The original processing facility was designedcombination plant treats up to process50 percent fresh rock and 50 percent soft ore, only and was successfully optimised to reach an averagewith a total throughput of 11.8Mtpa. Power11.4Mt per annum. The recovery of Bidini, which has been impacted by the presence of carbonaceous ore and the performance of the combination plant to achieve the required mill throughput and recovery, could have an impact on the economic extraction of the estimated Mineral Resource and Mineral Reserve until the plant stabilises. There are mitigation plans in place to address any TSF capacity issues and the mine is self-generated.also doing further optimisation work.
Siguiri is mined under licence from the government of Guinea. The Mineral Resource and Ore Reserve are covered by SAG mining concession D/97/171/PRG/SGG, totalling 1,494.5km2. The original SAG concession was granted under the Convention de Base between the République de Guinée and SAG signed on 4 August 1997. The concession is to be explored and mined exclusively for gold, silver and diamonds by SAG for 25 years from the date of the agreement, until 4 August 2022. An updated concession was negotiated with the government in 2016. The Convention de Base will guide the renewal of the mining concession in 2022. The SAG concession was granted under a new amended Convention de Base between the République de Guinée and SAG signed on 28 June 2016 and ratified by the Guinean parliament on 13 December 2016. The Convention de Base was ratified by the constitutional court and published in the Journal Officiel of the Republic of Guinea on 24 January 2017. Dependent on the submission of the necessary renewal documentation on, or before, 4 March 2022, the concession is to be explored and mined exclusively for gold, silver and diamonds by SAG for 25 years from the date of agreement to 13 December 2041.
Geology
The concession is dominated by Proterozoic Birimian rocks which consist of turbidite facies sedimentary sequences. The two main types of gold deposits which occur in the Siguiri basin and are mined are:
laterite mineralisation (CAP) which occurs as surficial aprons of colluvium or as palaeo‑channels of alluvial lateritic gravel adjacent to, and immediately above in-situ deposits; and
in-situ quartz-vein related mineralisation hosted in meta-sediments with the better mineralisation associated with vein stockworks that occurs preferentially in the coarser, brittle siltstones and sandstones.
The mineralised rocks have been deeply weathered to below 100 metres in places to form saprolite mineralisation (oxide). With the percentage of available oxide ore decreasing, a feasibility study to investigate the exploitation of fresh rock material was completed in December 2015. The CIL combination plant conversion project began in 2017. The plant conversion will allow the mine to treat six million tonnes of sulphate ore and six million tonnes of oxide ore. Construction was completed in March 2019 and commissioning of different sections of the plant is underway.
MALI
Description
AngloGold Ashanti has interests in two operations in Mali, namely, Sadiola and Morila. It operates one of these two operations, Sadiola. AngloGold Ashanti previously had interests in Yatela, but entered into a sales agreement in February 2019 with the state of Mali, subject to several conditions precedent being fulfilled. Morila is in the final phase of closure and the Mineral Resource and Ore Reserve have been written off.
Mali - Morila
Description
AngloGold Ashanti has an effective 40 percent stake in Morila, as does Barrick Gold Corporation (operator). The state of Mali owns the remaining 20 percent.
The Morila mine has operated since 2001 and is situated 280 kilometres southeast of Bamako, the capital of Mali. When mining concluded in 2009 with the depletion of the orebody, operations at Morila transitioned to stockpile and tailings retreatment. The plant treats 4.3Mtpa and incorporates a conventional CIL process with an upfront gravity section to extract the free gold. Power is supplied by a subcontractor.
Geology
The Morila deposit is hosted in a flat lying fold structure which rises sharply to surface in the south and west. The deposit occurs within a sequence Birimian metal-arkoses of amphibolite metamorphic grade. Mineralisation is characterised by silica-feldspar alteration and sulphide mineralisation consists of arsenopyrite, pyrrhotite, pyrite and chalcopyrite.
Mali - Sadiola
Description
The mine is a joint venture between AngloGold Ashanti (41 percent) and IAMGOLD (41 percent) and the government of Mali (18 percent).and an agreement for the sale of Sadiola was announced in December 2019. The transaction is subject to the fulfilment, or waiver, of a number of conditions precedent, including the receipt of certain approvals and releases from the Government of Mali.
The Sadiola mine is situated in western Mali, 77 kilometres to the south of the regional capital of Kayes and about 440 kilometres north-west of the capital city of Bamako. The property lies within the Galam Bambouk gold area, which straddles the Mali-Senegal border close to the border with Guinea.
The Sadiola gold deposit has been mined by the Société d’Exploitation des Mines d’Or de Sadiola S.A. (SEMOS) since 1996. Mining reduced considerably due to the 2014 gold price decrease but continued predominantly in various satellite pits. On-site surface infrastructure includes a 5.0Mta CIP gold plant, where the gold is eluted and smelted. Power to the Sadiola mine is self-generated.
From 1996 until 2010, oxide and transitional ore from the Sadiola Hill pit was the primary ore source for the mine while being increasingly supplemented from the outlying satellite pits during the latter years. From 2011 the satellite pits became the dominant source of oxide and transitional ore. Sadiola ceased mining during 2018 and transitioned to a stockpile treatment plan. A feasibility study for the Sadiola Sulphide Project (SSP), which looked at mining and processing the sulphide ore, was completed in 2016. However, a decision to proceed remains on hold while awaiting the conclusion of negotiations with the government. The oxide mining activities were completed in early 2018. While awaiting the decision, the operation continues to process stockpiled oxide material.
SEMOS is bound by the original prospecting and exploitation agreement (including its subsequent legal modifications) entered into on 5 April 1990 between AGEM Limited (AGEM) and the state of Mali, valid for the original mineral commodities until 5 April 2020. The identity number of the current exploitation area, DECRET No 00-080/PM-RM DU 06 MARS 2000 is a modification of all previous exploitation areas. Sadiola is operated under the license DECRET No 00-080/PM-RM DU 06 MARS 2000 valid from 1 August 1994 to 1 August 2024 covering a total area of 303km2. The SSP project will extend operations beyond 2024. Dialogue with the government of Mali has been ongoing throughout the project study phase and, as such, there are no foreseeable reasons why the amended environmental and social impact assessment (ESIA) and associated approvals should not be approved.
Geology
The Sadiola deposit occurs within an inlier of greenschist facies metamorphosed Birimian rocks known as the Kenieba Window. The specific rocks which host the mineralisation are marbles and greywackes which have been intensely weathered to a maximum depth of 200 metres. As a result of an east-west regional compression event, deformation occurs along a north-south striking marble-greywacke contact, increasing the porosity of this zone. North-east striking structures which intersect the north-south contact have introduced mineralisation, mainly with the marble where the porosity was greatest. The Sadiola Hill deposit generally consists of two zones, an upper oxidised cap and an underlying sulphide zone.
TANZANIA
Description
GEITA
For additional information, see the Technical Report Summary for Geita Gold Mine is wholly owned by(effective date: 31 December 2022) filed as Exhibit 19.15.4 hereto.
Property description
Geita (“GGM”), one of AngloGold Ashanti and is AngloGold Ashanti's sole operation in Tanzania.
Tanzania - Geita
Description
The Geita Gold MineAshanti’s flagship mines, is located in northwestern Tanzania, in the Lake Victoria goldfields of the Mwanza region, of Tanzania, about 120 kilometres120km from Mwanza and 4km west of Mwanza, four kilometres away from the town of Geita. The Geita gold deposits are mined as a multiple open pit and 910kmunderground operation, with ore production from Star and Comet, Nyankanga and Geita Hill underground mines, and from Nyamulilima open pit. The mine is currently serviced by a CIL processing plant with an annual capacity of 5.2Mt.
GGM is wholly-owned and operated by AngloGold Ashanti. GGM currently has three underground mines (Star and Comet, Nyankanga and Geita Hill) and one open pit (Nyamulilima Cuts 1, 2 and 3) which is in production since 2021. The property is currently in a production stage.
Location
GGM is located approximately 1,200km from the main Tanzanian capital citybusiness centre of Dar es Salaam. It has beenfalls within the Lake Zone of northwestern Tanzania, approximately 120km west of Mwanza and 4km west of the town of Geita. The mining lease area falls within the Archaean Sukumaland Greenstone Belt of the Lake Victoria goldfields.
Mineralisation style
Geita is hosted in the Geita Greenstone Belt, which is a northern segment of the Sukumaland Greenstone Belt, located in the north-western part of the Tanzania Craton and south of Lake Victoria. Gold mineralisation occurred late in the tectonic history of the greenstone belt, synchronous with the development of brittle-ductile shear zones. Mineralisation is dominantly sulfide replacement of magnetite-rich layers in ironstone, with local replacement of ferromagnesian phases and magnetite in the diorite intrusions. Primary gold mineralisation is associated with the intersection of the brittle-ductile shear zones and pre-existing fold hinges, with higher grade concentrations associated with banded iron formation lithologies and with diorite dyke and sill contacts.
History
Gold mineralisation is reported to be first discovered in the Geita district in 1898 by a German prospector. A regional survey by a Kenyan company, Saragura Prospecting Syndicate, followed in 1930. The first mine was developed in 1934, and between 1936 and 1966, Geita was the largest gold mine in East Africa, producing 1Moz of gold from underground operations.
In 1996, Ashanti Goldfields Company Limited acquired the Geita tenure through the acquisition of Cluff Resources, and acquired the Kukuluma and Matandani in 1998 from Samax Resources Limited. In December 2000, Ashanti Goldfields Company Limited reached an agreement to sell a 50 percent interest in Geita to AngloGold Limited for $324 million. AngloGold Limited added its neighbouring Nyamulilima Hill deposits into the JV company. In 2004, the merger of AngloGold Limited and Ashanti Goldfields Company Limited resulted in the operation since 1996.being wholly run by the combined company AngloGold Ashanti.
GGM commenced open pit mining in 1999, with open pit mining at Nyankanga between 1999 and 2020, at Geita Hill between 2001 and 2019, at Kukuluma and Matandani between 2002 and 2007, and at Star and Comet between 2007 and 2014. In 2015, a decision was taken to go underground at Star and Comet, and the underground development started in 2016. In 2017, the Nyankanga underground operation commenced and in 2020 the Geita Hill underground commenced and is scheduled to ramp up to full production by the end of 2023.
The Nyankanga open pit, the only remaining operating pit at the time, was mined to completion in September 2020. In April 2021, the Nyamulilima open pit commenced operations.
Legal aspects and tenure
Refer to “Item 4B: Business Overview—The Regulatory Environment Enabling AngloGold Ashanti to Mine—Africa Region—Tanzania—AngloGold Ashanti’s rights and permits”.
Mining method
Mining at Geita is byuses both open pit and underground mining methods. Historically, other pits such as Star and Comet, Matandani and Kukuluma have contributed to the ore feed. Current sources of ore are from the NyankangaThe Nyamulilima open pit minecommenced production in April 2021 and Starreached full production during 2022. Open pit mining is by conventional truck and Cometshovel methods, where production mining equipment is operated by GGM with Capital Mining Services Tanzania Limited providing production and Nyankanga underground mines. In 2016, undergroundgrade control drilling services, and Orica providing blasting and explosives services. Underground mining commenced at Star and Comet in 2016 and subsequently at Nyankanga in 2017, and most recently Geita Hill in 2020. Star and Comet underground has successfully transitioned to provide oreowner mining and the mining contractor African Underground Mining Services is used at Nyankanga and Geita Hill for underground development and stoping. The underground mining method is a combination of LOS and TOS. Cemented aggregate fill backfill is used at Nyankanga to fill the primary stopes and allows for the mining of secondary stopes. Ore is hauled from the Nyamulilima open pit (22km) and from Star and Comet (17km), Nyankanga (4km) and Geita Hill (2km) underground operations to the processing plant. This was joined in 2017central run-of-mine ("ROM") pad by the Nyankanga underground operations. The Geita Gold Mine is currently serviced bysurface mining fleet.
Processing plants and other available facilities
Surface infrastructure associated with the overall Geita operation includes a 5.2Mtpa CIL processing plant.plant, a TSF, a camp, an airstrip, open pit and underground workshops and offices, contractor yards, backfill plants and explosives suppliers. Power to the mine is self-generated at Geita's 40MW power plant using diesel generators, however, there is planned construction of a 33kV hydropower station by Tanzania Electric Supply Company Limited ("TANESCO"). The physical condition of the equipment, facilities, and infrastructure at GGM is generally considered to be in good working order. The mine has invested heavily in maintaining and upgrading its assets to ensure they remain reliable and efficient. The underground development of the mine has also been extensively developed, with the construction of a number of portals, declines and strategically placed development drives that access and further explore the gold-bearing ore. Overall, the GGM is a well-established operation implementing fit-for-purpose technologies once proven in the market. For the number of persons employed at the mine, refer to “Item 4B: Business Overview—Operating Performance—Africa Region”.
The “Property, Plant, and Equipment” as of 31 December 2022, including lease assets, buildings and mine infrastructure, mining assets, capitalised exploration costs, decommissioning assets, assets under construction and deferred stripping, had a carrying value of $418m.
Mineral processing
Geita’s ore processing method is a conventional CIL process with a throughput capacity of 5.2Mtpa. The circuit contains a primary gyratory crusher, secondary and tertiary crushers, a semi-autogenousSAG mill, a ball mill and 12 leach tanks. This is coupled with a gravity circuit using two knelsonKnelson concentrators. In planning
the plant feed blend material, hardness grade, oxide and sulphide content are considered in order to optimise throughput and recovery. Power
Mineral Resource
The below table, prepared in accordance with Table 1 to Paragraph (D)(1) of Item 1304 of Regulation S-K, summarises the minegold Mineral Resource (exclusive of Mineral Reserve) for Geita at the end of the fiscal year ended 31 December 2022, based on a gold price estimate of $1,750/oz. Refer to “—Material Assumptions for the Mineral Resource—Key Parameters” for additional information on cut-off grades and metallurgical recovery.
| | | | | | | | | | | | | | | | | |
Mineral Resource | Category | Tonnes | Grade | Contained Gold |
as at 31 December 2022 | million | g/t | tonnes | Moz |
Geita | Measured | 1.80 | | 4.15 | | 7.50 | | 0.24 | |
Indicated | 40.32 | | 2.03 | | 81.96 | | 2.63 | |
Measured & Indicated | 42.12 | | 2.12 | | 89.45 | | 2.88 | |
Inferred | 36.21 | | 2.64 | | 95.71 | | 3.08 | |
Notes:
Rounding of numbers may result in computational discrepancies in the Mineral Resource tabulations. The Mineral Resource estimates with respect to our material properties have been prepared by the Qualified Persons (employed by AngloGold Ashanti unless stated otherwise). The net difference between the Mineral Resource at the end of the last completed fiscal year and the preceding fiscal year is self-generated.detailed in the table below. To reflect that figures are not precise calculations and that there is uncertainty in their estimation, AngloGold Ashanti reports tonnage, grade and content for gold to two decimals. All ounces are Troy ounces. “Moz” refers to million ounces.
1.All disclosure of Mineral Resource is exclusive of Mineral Reserve. The Mineral Resource exclusive of Mineral Reserve (“Exclusive Mineral Resource”) is defined as the inclusive Mineral Resource less the Mineral Reserve before dilution and other factors are applied.
2.“Tonnes” refers to a metric tonne which is equivalent to 1,000 kilograms.
3.Property currently in a production stage.
4.Refer to “—Material Assumptions for the Mineral Resource—Key Parameters” for additional information on cut-off grades and metallurgical recovery.
5.Based on a gold price of $1,750/oz.
Year on year changes in Mineral Resource - Moz
| | | | | | | | | | | | | | |
as at 31 December 2022 | Geita |
Category | Measured | Indicated | Measured and Indicated total | Inferred |
Previous Year | 0.21 | | 1.87 | | 2.08 | | 3.26 | |
Depletion | — | | — | | — | | — | |
Exploration | 0.02 | | 0.09 | | 0.11 | | 0.12 | |
Methodology | 0.03 | | 0.49 | | 0.52 | | (0.57) | |
Price | 0.01 | | 0.17 | | 0.18 | | 0.19 | |
Cost | (0.03) | | 0.19 | | 0.16 | | 0.07 | |
Geotechnical | — | | — | | — | | — | |
Metallurgical | — | | 0.02 | | 0.02 | | 0.02 | |
Acquisition / Disposal | — | | — | | — | | — | |
Other | — | | (0.20) | | (0.20) | | — | |
Current Year | 0.24 | | 2.63 | | 2.88 | | 3.08 | |
Net Difference | 0.03 | | 0.77 | | 0.80 | | (0.18) | |
% Difference | 16 | | 41 | | 38 | | (6) | |
Notes:
All figures are expressed on an attributable basis unless otherwise indicated.
The special mining licence (SML45/99) covers approximately 196.17km2increase is largely as a result of exploration success due to accelerated drilling activities because of the planned reinvestment, and expires on 26 August 2024. There arechanges in methodology were as a further 120km2result of prospecting licencesrevised estimation parameters, and refined ore wireframes. The increase in the immediate vicinityMineral Resource price and favourable cost reductions in open pit haulage, general
and administrative expenses and new underground contract rates led to lower cut-off grades resulting in additional Mineral Resource, which was partially offset by depletion.
Material Assumptions for the special mining licenceMineral Resource
Key Parameters
| | | | | | | | |
Geita | Unit | Open Pit |
Costs | | |
Ore mining cost | $/tonne mined | 3.3 |
Waste mining cost | $/tonne mined | 3.3 |
Material handling | $/tonne mined | 2.03 |
Processing cost | $/tonne treated | 18.63 |
G&A | $/tonne treated | 8.43 |
Other Parameters | | |
Metallurgical Recovery Factor | %MetRF | 89 |
Slope angles | degree | 55 |
Mineral Resource cut-off grade | g/t | 0.65 |
Mineral Resource price | $/oz | 1,750 | |
Royalties | % | 7.3 | |
| | | | | | | | |
Geita | Unit | Underground |
Costs | | |
Production (Mining cost) | $/tonne ore mined | 47.68-82.88(1) |
Mine Services | $/tonne ore mined | 21.97-25.78(1) |
Processing cost | $/tonne treated | 18.46-19.11(2) |
Other Parameters | | |
Mineral Resource cut-off grade | g/t | 1.86-3.01(2) |
Mineral Resource price | $/oz | 1,750 | |
Metallurgical Recovery Factor | %MetRF | 70.4-91.4(1) |
Royalties | % | 7.3 | |
Notes: (1) Mining cost includes backfilling at Nyankanga, and material handling costs. (2) Variable according to area. (3) %MetRF: Ridge 8, 70.4%, Star and Comet Cut 5, 80.4%, Star and Comet Cut 2, 88.3%, Star and Comet Cut 3, 88.4%, Geita Hill 87.2%, Nyankanga Block 5, 89.8%, Nyankanga Block 1, 2, 3 and 4, 91.4%. (4) Datamine Mineable Shape Optimiser ("MSO"). |
Estimation
For the open pits, mineralisation boundaries for the individual deposits are defined from detailed logging of all geological drill holes. This information is validated and then geological wireframes are interpreted to create a 3D geological model. The geological model is subsequently used in conjunction with an appropriately dimensioned block model. Ordinary kriging is used to interpolate values into block models, and uniform conditioning ("UC") and localised uniform conditioning ("LUC") methods are used to generate a recoverable Mineral Resource block model, which do not contain any Ore Reserve.estimates the proportion of ore that occurs above the Mineral Resource cut-off grade assuming a specified SMU. The open pit Mineral Resource is reported within a $1,750/oz optimised pit shell and above the calculated mineralised waste cut-off grade per pit.
For the underground Mineral Resource, the geological model is generated in the same way as for the open pits. However, a high-grade wireframe is delineated within the broader, lower-grade mineralised envelope. In March 2020,this instance, all geological controls are adhered to when determining this domain. Ordinary kriging models are then constructed within the low- and high-grade domains, and numerous validation exercises are completed to ensure robust estimates are achieved. The underground Mineral Resource is reported inside a MSO volume generated using a unique underground cut-off grade for each deposit.
The ultimate open pit designs are used as the limiting boundaries between the open pits and underground during model compilation. The underground stopes and development are evaluated using the ordinary kriging block models and the open pit designs are evaluated using the LUC block models.
Stockpiled material above mineralised waste cut-off grade is included in the Mineral Resource.
Mineral Reserve
The below table, prepared in accordance with Table 2 to Paragraph (D)(1) of Item 1304 of Regulation S-K, summarises the gold Mineral Reserve for Geita Gold Mining Limited receivedat the consentend of the Ministerfiscal year ended 31 December 2022, based on a gold price estimate of Minerals$1,400/oz. Refer to change“—Material Assumptions for the Mineral Reserve—Modifying factors and price estimates” for additional information on cut-off grades and metallurgical recovery.
| | | | | | | | | | | | | | | | | |
Mineral Reserve | Category | Tonnes | Grade | Contained Gold |
as at 31 December 2022 | million | g/t | tonnes | Moz |
Geita | Proven | 9.54 | | 1.02 | | 9.70 | | 0.31 | |
Probable | 38.95 | | 2.60 | | 101.19 | | 3.25 | |
Total | 48.49 | | 2.29 | | 110.89 | | 3.57 | |
Notes:
1.Rounding of numbers may result in computational discrepancies in the Mineral Reserve tabulations. The Mineral Reserve estimates with respect to our material properties have been prepared by the Qualified Persons (employed by AngloGold Ashanti unless stated otherwise). The net difference between the Mineral Reserve at the end of the last completed fiscal year and the preceding fiscal year is detailed in the table below. To reflect that figures are not precise calculations and that there is uncertainty in their estimation, AngloGold Ashanti reports tonnage, grade and content for gold to two decimals. All ounces are Troy ounces. “Moz” refers to million ounces.
2.“Tonnes” refers to a metric tonne which is equivalent to 1,000 kilograms.
3.Property currently in a production stage.
4.Refer to “—Material Assumptions for the Mineral Reserve—Modifying factors and price estimates” for additional information on cut-off grades and metallurgical recovery.
5.Based on a gold price of $1,400/oz.
Year on year changes in Mineral Reserve - Moz
| | | | | | | | | | | |
as at 31 December 2022 | Geita |
Category | Proven | Probable | Total |
Previous Year | 0.09 | | 2.55 | | 2.65 | |
Depletion | (0.06) | | (0.49) | | (0.55) | |
Exploration | — | | 0.87 | | 0.87 | |
Methodology | — | | — | | — | |
Price | — | | 0.40 | | 0.40 | |
Cost | 0.18 | | 0.06 | | 0.25 | |
Geotechnical | — | | — | | — | |
Metallurgical | — | | — | | — | |
Operational | 0.04 | | (0.10) | | (0.06) | |
Other | 0.06 | | (0.04) | | 0.02 | |
Acquisition / Disposal | — | | — | | — | |
Current Year | 0.31 | | 3.25 | | 3.57 | |
Net Difference | 0.22 | | 0.70 | | 0.92 | |
% Difference | 241 | | 27 | | 35 | |
Notes:
All figures are expressed on an attributable basis unless otherwise indicated.
The increase is mainly due to ongoing exploration drilling success resulting in larger pit designs at Nyamulilima and in the first-time reporting of the Geita Hill underground Mineral Reserve based on a feasibility study currently being completed. An increase in the Mineral Reserve price and reduced costs mostly by reductions in hauling cost on surface and contractor rates is partially offset by depletion and operational changes.
Material Assumptions for the Mineral Reserve
Modifying factors and price estimates
| | | | | | | | |
as at 31 December 2022 | Geita |
Primary Commodity Price | $/oz | 1,400 | |
| | |
| | |
| | |
Cut-off grade | g/t | 0.70(2)-4.20(3) |
| | |
Stoping width | cm | 450-2,500(3) |
Dilution | % | 11.6(2);10-17(3) |
| | |
Resource Modification Factor | %RMF based on tonnes | 99.5(2)-100(3) |
Resource Modification Factor | %RMF based on g/t | 93(2)-100(3) |
Mining Recovery Factor | %MRF based on tonnes | 86-100(1) |
Mining Recovery Factor | %MRF based on g/t | 86-100(1) |
Mine Call Factor | %MCF | 100 |
Metallurgical Recovery Factor | %MetRF | 80.4-91.4(1) |
Notes: (1) Vary according to rock type / area. (2) Open pit. (3) Underground. |
Estimation
The Mineral Resource models are used as the basis for Mineral Reserve estimation. Input parameters for estimating the Mineral Reserve include gold price, mining method under its specialdilution and recovery, geotechnical information, stay-in-business capital, operating costs, metallurgical recovery, processing capacity and mining license fromequipment capacities.
Appropriate Mineral Reserve cut-off grades are applied and optimised pit shells are generated for the open pit sources. Pit designs are then done on selected shells and signed off by all relevant parties to underground method, subjectensure compliance to specifications. Underground designs are completed and evaluated. These designs are incorporated into the requisite termsproduction and conditions.treatment scheduling stages to yield ore tonnes and grades. Financial evaluations are completed for production and treatment schedules to check the cash flow analysis from the estimated Mineral Reserve.
Geology
The terrain is Archaean in ageMineral Reserve for Geita's operating and generally characterised by greenschist metamorphism, although amphibolitic metamorphism occurs in places. Ore zones are usually associated with Banded Iron Formation (BIF) or other iron rich rocks and typically when they are in contact with intrusive rocks such as diorites. These contacts have been deformed and act as fluid pathways for the mineralising fluids. Gold mineralisation is associated with alteration that includes sulphides such as pyrite and arsenopyrite, whilst other minerals such as hematite, magnetite, quartz, calcite, dolomite, biotite and chlorite also occur.
SOUTH AFRICA
Description
The South Africa operations comprise one deep level underground mine, the Mponeng mine, and three surface processing operations, collectively referred to as Surface Operations. The Surface Operations include the Vaal River Surface, Mine Waste Solutions (MWS) and the West Wits Surface processing operations. The surface operations rework and retreat the low grade stockpiles and tailings storage facilities (TSFs) which result from mining and processing of the primary and secondary reef horizons. Both Mponeng and the Surface Operations are wholly owned by AngloGold Ashanti. An agreement and sale was announced in February 2020 for Mponeng and the Surface Operations in South Africa. Operations in South Africa are powered by electricity from Eskom Holdings SOC Ltd which supplies 95 percent of the electricity used in South Africa.
South Africa - Mponeng
Description
Mponeng is situated to the south of the town of Carletonville and is approximately 65 kilometres west of Johannesburg. Mponeng is a deep level gold mine operating between 3,160 metres and 3,740 metres below mine datum (BMD*) and is currently the deepest mine in the world with development at 3,841 metres BMD. Future mining is planned to deepen the shaft bottom to 4,227 metres BMD. All production is currently from Ventersdorp Contact Reef (VCR) with future expansion on both VCR and the Carbon Leader Reef (CLR) horizons. Mponeng comprises a twin-shaft system housing two surface shafts and two sub-shafts. For the exploitation of the ever-deepening Mineral Resource and the need for flexibility on a mine of this nature, the sequential grid mining method was adopted. This has been proven as the best method suited to safe, deep level gold mining often associated with seismicity. Mponeng has its own processing plant situated adjacent to the mine. Ore is treated and smelted at the mine’s gold plant which also processes low grade ore from the stockpile adjacent to the shaft. The ore is initially ground down by means of semi-autogenous milling, after which a conventional gold leach process incorporating liquid oxygen injection is applied. The gold is then extracted by means of CIP technology. The plant conducts electro-winning and smelting using induction furnaces. The plant has a monthly capacity of 160,000 tonnes and operated at 111,000 tonnes for 2019.
AngloGold Ashanti holds a number of mining rights in the Mponeng area which have been successfully converted, executed and registered as new order mining rights at the Mineral and Petroleum Resources Titles Office (MPRTO). An S102 application was submitted in March 2017 to consolidate the three licences into a single mining right (GP30/5/1/2/2(01)MR).
Geology
The VCR is the main reef horizon mined at Mponeng Mine. The VCR forms the base of the Ventersdorp Supergroup, which caps the Witwatersrand Supergroup through an angular unconformity. The overlying Ventersdorp Lavas halted the deposition of the VCR, preserving it in its current state. The VCR consists of a quartz pebble conglomerate, which can be up to 3 metres thick in places. The footwall stratigraphy, following periods of uplift and erosion, controlled the development and preservation of the VCR, which is characterised by a series of channel terraces preserved at different relative elevations, and the highest gold values are preserved in these terrace deposits. The different channel terraces are divided by zones of thinner slope reef, which are of lower value and become more prevalent on the higher terraces and on the harder footwall units. CLR is the other gold bearing reef horizon exploited at Mponeng and lies 800 metres beneath the VCR. The CLR and VCR at Mponeng Mine are separated by shales and quartzites. The CLR has historically been mined extensively at Savuka and TauTona mines and the remaining portions thereof have now been transferred to Mponeng Mine.
* 0m BMD is 1,828.8 metres Above Mean Sea Level. Mponeng’s collar elevation (surface) is 275.8m BMD.
South Africa - Surface Operations
Description
Surface Operations comprise Vaal River Surface, MWS and West Wits Surface. The operations produce gold by processing surface material such as low grade stockpiles and the re-treatment of TSFs.
The Vaal River surface operations are located immediately to the north and south of the Vaal River, close to the town of Orkney in the North West province. These operations extract gold from the low grade stockpile material emanating as a by-product of the reef mining activities within the mines of the Vaal River area. The MWS operations are located approximately 8 kilometres from the town of Klerksdorp near Stilfontein, within 20 kilometres of the Vaal River Surface operations. The MWS feed sources (TSFs) are scattered over an area that stretches approximately 13.5 kilometres north to south and 14 kilometres east to west. The West Wits Surface operations are located on the West Wits Line, near the town of Carletonville, straddling the border between the North West and Gauteng provinces.
MWS’s license to mine is covered by the environmental authorisation under the National Environmental Management Act, No. 107 of 1998. In terms of the current legislation, the Mineral and Petroleum Resources Development Act, No. 28 of 2002 (the MPRDA), a mining right is not required to reclaim TSFs. MWS can prove ownership and tenure of the operations. The current mining rights for the West Wits operations cover both underground and surface horizons. The TSFs falling outside the mining right area are accommodated in the approved EMP and financial provision for rehabilitation for the West Wits mining rights,prospective pits, as well as under historic surface rights permitsunderground mine areas is estimated using updated economic factors, latest Mineral Resource models, geological, geotechnical, mining engineering and metallurgical parameters. Environmental, sociopolitical, legal and regulatory factors are also considered.
Map showing Geita planned infrastructure and licences
Below is a map that shows the location, infrastructure and mining license area for West Wits, whichGeita. The coordinates of the mine, as represented by the plant, are still valid.
Low grade stockpilesdepicted on the map and are in the Vaal River area are processed through the Kopanang Gold Plant which is a dedicated surface sources metallurgical plant with a capacity of 361,200 tonnes per month, while all AGA owned tailings material in the Vaal River and MWS areas is processed through the three metallurgical streams at the MWS metallurgical operations with a monthly capacity of 2.26 million tonnes. At West Wits Surface Operations, the Savuka Gold Plant is dedicated to processing tailings material, while low grade stockpile material is processed through both the Savuka and Mponeng Gold Plants, with the latter the low grade stockpile material is used to fill the processing gap.geographic coordinate system.
Low grade stockpiles
The low grade stockpiles consist of waste rock mined from underground workings, hoisted, transported and deposited via conveyor belts. The gold contained within these dumps was sourced from three areas namely:
Minor reef intersected while accessing the primary reef;116
Gold-bearing reef that was contained within small fault blocks that were exposed by off-reef development; andCross-tramming of gold-bearing reef material to the waste tips.
Tailings Storage Facilities
The TSFs consist of tailings material which originated from the processing of underground ore from the various AGA operations in the Vaal River area and the Buffelsfontein, Hartebeestfontein and Stilfontein gold mines as well as, various operations in the West Wits area. These gold mines are deep level gold mines, which predominantly extract the tabular, conglomeratic Vaal Reef (VR), CLR and VCR. The VR has been predominantly mined for gold in the past although the reef also contains uranium oxide. The same is true, but to a lesser extent, with the CLR and VCR. The material contained in the TSFs is fine in nature. The footprints of the MWS TSFs and Vaal River Surface operations TSFs cover an area of approximately 1,100ha.
117
THE AMERICAS
The Americas region includes the mining operations in two countries,jurisdictions Brazil and Argentina, and advanced greenfields projects in Colombia. Mining is from both open pit and underground, with AGA Mineração Cuiabá and Lamego being underground mines andwhich AngloGold Ashanti has three operations. In Argentina, the Company has one mining operation: the Cerro Vanguardia Serra GrandeMine, co-owned by AngloGold Ashanti (92.5%) and AGA MineraçãoFomento Minero de Santa Cruz Sociedad del Estado (“Fomicruz SE”) (7.5%). In Brazil, the Company has two mining operations: (i) the AngloGold Ashanti Córrego do Sítio being a combination of open pitMineração operations (“AGA Mineração”) which include the Cuiabá, Lamego and underground mines.Córrego do Sítio (“CdS”) mines, and (ii) Mineração Serra Grande (“Serra Grande”).
ARGENTINA
Description
CERRO VANGUARDIA
Property description
Cerro Vanguardia, in which AngloGold Ashanti has a 92.5 percent stake,production stage gold-silver operation, is ourthe Company’s sole operation in Argentina. Fomicruz, a state company, owns the remaining 7.5 percent. The operationmine is operated by AngloGold Ashanti.
Argentina - Cerro Vanguardia
Description
Cerro Vanguardia S.A. ("CVSA"), which is located approximately 110 kilometres north-northwest of the coastal town of Puerto San Juliana company formed by AngloGold Ashanti (92.5%) and Fomicruz SE, a state-owned company operating in the province of Santa Cruz.Cruz (7.5%). The climate is semi-arid and although snow does occur, winter is mild and exploration activities are normally possible all year round. Cerro Vanguardia is a gold-silver mine withoperates multiple small open pits with high stripping ratios and multiple narrow-vein underground mines located at different parts ofwithin the property butand mined simultaneously. The mineCerro Vanguardia has been operated by AngloGold Ashanti since 1998.in operation for more than 20 years. Silver is produced as a by-product.
Location
Cerro Vanguardia commencedis located in the Santa Cruz province, southern Patagonia, Argentina, approximately 110km north-northwest of the coastal town of Puerto San Julián. Access to the area is by aircraft from Buenos Aires to Comodoro Rivadavia (380km) or Rio Gallegos (510km) and then by road to the mine site.
Mineralisation style
Cerro Vanguardia is in the core of the 60,000km2 Deseado Massif, one of the most extensive volcanic complexes in southern Patagonia. The Deseado Massif is deposited over Paleozoic low-grade metamorphic basement rocks. The mineralisation is concentrated in steeply-dipping quartz veins that cut the flat-lying ignimbrites and volcanoclastic rocks. The Cerro Vanguardia district contains more than 100 gold and silver-bearing epithermal veins for a cumulative exposed vein strike extension of more than 240km, of which 55 veins are currently known to contain economic gold and silver mineralisation. The veins at Cerro Vanguardia consist mainly of quartz and adularia and contain minor electrum, native gold, silver sulphides and native silver as an open pit operation in 1998fine-grained disseminations.
Legal aspects and this was supplemented in 2010 with the start of shallow underground miningtenure
Refer to access high-grade material. To complement the already existing gold plant, a heap leach operation was started in 2012. “Item 4B: Business Overview—The mine has been operated byRegulatory Environment Enabling AngloGold Ashanti since 1998. The orebodies compriseto Mine—Americas—Argentina—AngloGold Ashanti’s rights and permits”.
Processing plants and other available facilities
Infrastructure for Cerro Vanguardia is mostly located on-site. It includes a series of epithermal vein deposits containing gold and large quantities of silver, which is mined as a by-product. The metallurgical plant hascamp site with a capacity of 1.3Mtpa1,300 people, a Merrill Crowe plant, heap leaching facilities, cyanide recycling plant, mine laboratory, maintenance facilities, warehouses and includes a cyanide recovery facility. Production capacity of the heap leach facility, which was commissioned in 2012 and processes lower-grade material, is around 1.6Mtpa at gold and silver grades of around 0.65g/t and 17g/t respectively.sewage processing plant. Four natural gas power generators, fed by a 40 kilometre40km long pipeline, provide electricity to the operation. Natural gas is also used for heating. Mine office facilities are located in the main mining area.
Dewatering supplies water for use both as processing water and camp consumption. Due to the particular features of the mine, and in order to optimise hauling, all pits have local, single or multiple waste dumps. The mining lease encompasses an areaTSF is located in and is contained by a natural depression.
Mineral processing
The metallurgical plant has a daily capacity estimated at 3,500tpd (1.2Mtpa), with gold and silver grade of approximately 543km2around 4.25g/t and 120g/t, respectively. The plant comprises the following stages: crushing, milling, conventional leaching in tanks, counter current decant system in thickeners (“CCD circuit”), a CIL process, acid wash, elution, conventional Merrill Crowe process to recover gold and silver with metallic zinc, and a cyanide recovery plant ("Cyanisorb"). The licence 402642/CV/97 coverstailings go directly to a conventional TSF, where there is also a reclaim water system for the full Ore Reserve, was issued on 27 December 1996plant.
In addition to the processing plant there is a heap leach pad, with an annual capacity of 1.5Mtpa, and expires on 26 December 2036.
Geology
The oldest rocks in this part of Patagonia are metamorphics of the Precambrian-Cambrian age. These are overlain by Permian and Triassic continental clastic rocks which have been faulted into a series of horsts and grabens and are associated with both limited basaltic sills and dykes and with calc-alkaline granite and granodiorite intrusions. Thick andesite flows of Lower Jurassic age occur above these sedimentary units. A large volume of rhyolitic ignimbrites was emplaced during the Middle and Upper Jurassic age over an area of approximately 100,000 square kilometres. These volcanic rocks include the Chon Aike formation ignimbrite units that host the gold bearing veins at Cerro Vanguardia. Post-mineral units include Cretaceous and Tertiary rocks of both marine and continental origin, the Quaternary La Avenida formation, the Patagonia gravel and the overlying La Angelita basalt flows. These flows do not cover the area of the Cerro Vanguardia veins.
Gold and silver mineralisation at Cerro Vanguardia occurs within a vertical rangegrades of about 150 metresaround 0.7g/t and 20g/t, respectively. The pregnant solution from this process goes directly to 200 metres in a series of narrow, banded quartz veins that occupy structures within the Chon Aike ignimbrites. These veins form a typical structural pattern related to major north-south (Concepcion) and east-west (Vanguardia) shears. Two sets of veins have formed in response to this shearing.
The veins are typical of epithermal, low-temperature, adularia-sericite character and consist primarily of quartz in several forms: massive quartz, banded chalcedonic quartz, and quartz-cemented breccias. Dark bandsCCD circuit in the quartz are dueprocess plant and to finely disseminated pyrite, now oxidised to limonite. The veins show sharp contacts with the surrounding ignimbrite which hosts narrow stockwork zones that are weakly mineralisedMerrill Crowe process for gold and appear to have been cut by a sequence of north-east-trending faults that have southerly movement with no appreciable lateral displacement.silver recovery.
BRAZIL
Description
AngloGold Ashanti’s operations in Brazil comprise AngloGold Ashanti Córrego do SítioAGA Mineração (AGA Mineração) in the Quadrilátero Ferrífero, Minas Gerais state and Mineração Serra Grande (MSG) in the Goiás state. All operations are wholly owned by AngloGold Ashanti. Anglogold Ashanti generates part of the power for its operations in Brazil at the Rio de Peixe hydroelectric plants and through its stake in the Igarapava consortium. The balance is purchased on the open market in long term contracts to secure supply.
Brazil - AngloGold Ashanti Córrego do SítioAGA Mineração S.A.
Description
AngloGold Ashanti Córrego do Sítio Mineração S.A. (AGA Mineração), consists of several mining operations, namely Cuiabá, Lamego, and Córrego do Sítio.CdS.
The Cuiabá complex includesOre from the Cuiabá and Lamego mines and the Cuiabá and Queiroz plants. The Cuiabá and Lamego mines are located near Sabará, southeast and east respectively of the city of Belo Horizonte, the capital of Minas Gerais state, in the southeast of Brazil. The Cuiabá mine is a mix of cut-and-fill and long hole stopes accessed by ramps and a shaft. Lamego is a nearby mine developed to mine underground sulphide ore. The first stage of the processing of the ore from Cuiabá and Lamego mines is in the gold plantprocessed at the Cuiabá complex, wheregold plant. The concentrate produced is produced. The material is then transported 15 kilometres by aerial ropeway to the Queiroz plant where the concentrate is roasted, and the calcine proceeds to a carbon circuit for further refining. Sulphur gas is captured for processing through the acid plant. Approximately 230ktpa ofand refining. The Queiroz hydrometallurgical plant also produces sulphuric acid is produced as a by-product. Capacity
CdS consists of open pit and underground mines. The oxide ore mined is treated by heap leach and a pressure leaching plant treats sulphide ore. The distance from the main underground mine to the metallurgical plant is around 15km.
Serra Grande comprises three mechanised underground mines, Mina III, Mina Nova and Mina Palmeiras, and an open pit as well as a dedicated metallurgical plant.
AGA MINERAÇÃO
AGA Mineração encompasses mining operations at Cuiabá, Lamego and CdS. The AGA Mineração mining complex is located in southeastern Brazil in the state of Minas Gerais. Operations are 30km from the capital of the complete circuitstate (Belo Horizonte) in the case of Cuiabá and Lamego, and approximately 100km in the case of CdS.
AGA MINERAÇÃO - CÓRREGO DO SÍTIO
Property description
CdS is 2.1Mtpa.wholly-owned by AngloGold Ashanti. It has been in operation since 1989 and consists of multiple open pit (conventional bench mining) and underground mines (mainly using sub-level stoping). The Cuiabá mine became operationalproperty is currently in 1988a production stage and the Lamego mine in 2009.operated by AGA Mineração.
Córrego do Sítio (CdS)Location
The CdS complex is located in the municipalitesmunicipalities of Santa Bárbara and Barão de Cocais, 90 kilometresthat are located 100km east of the city of Belo Horizonte in the state of Minas Gerais, state, in the southeast of Brazil. These operations are included in an important mining district referred to as the Quadrilátero Ferrífero (Iron Quadrangle), the second biggest Brazilian area for the production of iron, gold and manganese.
Mineralisation style
The CdS gold complex has beendeposit is located in operation since 1989the eastern part of the lower to middle greenschist facies of the Rio das Velhas Archaean, in the Iron Quadrangle region, on the southern margin of the São Francisco Craton in Brazil. CdS is an orogenic gold deposit hosted in intensely deformed clastic, volcanoclastic, carbonaceous schists and metagreywackes in an approximately 30km northeast-southwest striking shear zone. Hydrothermal alteration phases associated with the mineralisation are dominated by sericite and carbonate.
The CdS I, II and III, gold deposits and associated targets are located in a gold trend that extends for approximately 14km in a north-easterly direction, from Grota Funda (CdS I) in the south to Anomalia (CdS III) in the north, which developed in a compressional tectonic regime. Gold is associated with quartz and fine grained acicular arsenopyrite. The main gold targets and deposits are distributed over three trends, namely the CdS Trend and the Cristina Trend hosted in metasedimentary rocks, and the Donana Trend hosted in BIF.
Legal aspects and tenure
Refer to “Item 4B: Business Overview—The Regulatory Environment Enabling AngloGold Ashanti to Mine—Americas—Brazil—AngloGold Ashanti’s rights and permits”.
Processing plants and other available facilities
CdS infrastructure consists of two operations:the sulphide plant at CdS II (used to process refractory sulphide material), and the heap leach plant at CdS I (for oxide ore mined by open pit). The site also has an ore sorting plant, a TSF for the sulphide plant, a neutralised tailings deposit for the oxide material and numerous waste dumps for the open pit mines at CdS I. For further information on the regulatory framework governing TSFs in Brazil, see “Item 4B: Business Overview—The Regulatory Environment Enabling AngloGold Ashanti to Mine—Americas—Brazil”.
Ancillary facilities comprise a water treatment facility, effluent treatment facilities, equipment workshops, laboratory, warehouses, explosives and accessories magazines, fuel stations, electric substations as well as offices, medical
clinic, mess rooms, dressing rooms, bathrooms, storerooms, garage, fuel stations, a centre of environmental studies, nursery and other facilities required to operate the mine.
Water is primarily sourced from recycling the underground mine water and two sulphide underground mines known as CdS Isupplementary water catchment wells. The power for the operations is supplied and CdSII. purchased on the open market. Good communication infrastructure is available in the area.
Mineral processing
There are two metallurgical plants inat CdS: the heap leach plant for oxide ore and the sulphide plant. The sulphide process consists of crushing, grinding and gravity concentration, flotation, thickening, acidulation, pressure oxidation (POX autoclave), CIL extraction, elution, neutralisation, electro-winningelectrowinning and tailings disposal.dry stack tailings. The sulphide plant and POX circuit have a capacity of 600ktpa.900ktpa. The heap-leachingheap leaching process consists of crushing, agglomeration, stacking, leaching, adsorption, elution and electro-winningelectrowinning, with a total capacity of 650ktpa. Total capacity of the complete circuit is 1.5Mtpa.860ktpa.
AGA MINERAÇÃO - CUIABÁ
Property description
Cuiabá is coveredan underground operation (mainly using sub-level long hole open stoping), wholly-owned by a single concession granted byAngloGold Ashanti, within one of the Brazilian National Mining Agency (ANM), namely 000.323/1973 held by AGA Mineração, covering a total area of 3,662ha. Lamego is covered by three geographically contiguous ANM concessions granted to AGA Mineração, namely concession 830.720/1981, 831.554/1983 and 832.238/2003 covering a total area of 1,622.68ha. CdS is covered by four ANM concessions, namely 930.556/2000; 930.181/2008; 830.129/1982 and 833.472/2003 covering a total of 5,461.07ha. According to Brazilian mining laws, expiry of claims, licenses, and other tenure rights coincide with the depletion of Ore Reserves, cessation of mining operations and legally required post-operations activities (e.g. mine closure), provided all annual reports have been approved by the ANM.
Geology
The areamost important metallogenetic provinces in which AGA Mineração is located isBrazil known as the Iron Quadrangle andQuadrangle. This region is host to historic and current gold mining operations, as well as a numberan important producer of open-pit limestone and iron ore, operations.manganese and gold in Brazil. The geologyproperty is currently in a production stage and operated by AGA Mineração.
Location
Cuiabá is located 30km to the east of Belo Horizonte in the state of Minas Gerais, in the southeast of Brazil.
Mineralisation style
Cuiabá mine is located in the Iron Quadrangle, which is a geotectonic unit on the southern edge of the São Francisco Craton, comprising Archaean and Proterozoic terrains, and bordered by Neoproterozoic mobile belts. From a regional viewpoint, Cuiabá mine is located in the eastern extension of the Serra do Curral inverted homocline, located on the northeastern edge of the Iron QuadrangleQuadrangle. The mine lithostratigraphy consists of an intermediate metavolcanic sedimentary sequence of the greenstone belt type and is composed of Proterozoic and Archaean volcano‑sedimentary sequences and Pre‑Cambrian granitic complexes. The host tohosted in the gold mineralisation is the volcano-sedimentary Nova Lima Group (NLG) that occurs at the basebottom of the Rio das Velhas Supergroup (RDVS). The upper sequence of the RDVSSupergroup.
Gold mineralisation is the meta-sedimentary Maquiné Group. Cuiabá mine, located at Sabara Municipality, has gold mineralisation associated with sulphides and quartz veins in Banded Ironstone Formation (BIF)BIF and volcanic sequences. At this mine, structuralStructural control and fluidsfluid flow are the most important factors for gold mineralisation with a common association withbetween large-scale shear zones and their associated structures. Where BIF is mineralised, the ore appears strongly stratiform due to the selective sulphidation of the iron richiron-rich layers. Steeply plunging shear zones tend to control the ore shoots, which commonly plunge parallel to intersections between the shears and other structures. Mineralisation is hosted in the limbs of a fold system.
Legal aspects and tenure
Refer to “Item 4B: Business Overview—The Regulatory Environment Enabling AngloGold Ashanti to Mine—Americas—Brazil—AngloGold Ashanti’s rights and permits”.
Processing plants and other available facilities
The metallurgical plants (Cuiabá gold plant and Queiroz plant) are connected by an aerial ropeway and power to the mine is provided by a set of small hydropower plants (Rio de Peixe hydroelectric complex). Cuiabá mine has a shaft system (846m deep) for production and personnel transport, the current nominal airflow capacity for which is 1,035m3/s, of which 320m3/s are refrigerated. Tailings deposition is at one of four sites located at Cuiabá, Calcinados, Rapaunha and Cocuruto. Refer to “Item 4B: Business Overview—The Regulatory Environment Enabling AngloGold Ashanti to Mine—Americas—Brazil” for further information on the Company’s TSFs in Brazil. The Rio de Peixe hydroelectric complex is a set of seven small hydropower plants that generate energy from three dams (Ingleses, Miguelo and Codorna), and are directly connected to the Queiroz plant.
Mineral processing
Cuiabá and Lamego mines feed the Cuiabá gold (crushing, milling and flotation) and Queiroz (roaster, carbon circuit and refinery) plants, currently at 1.9Mtpa with a metallurgical recovery of 91.8 percent for the combined feed. At the Cuiabá gold plant, ore is crushed and milled followed by flotation and filtration to produce a concentrate (32 percent sulphur), which is transported by an aerial ropeway to Queiroz for further treatment. Approximately 30 percent of gold is recovered through a gravity circuit at the Cuiabá gold plant. The concentrate, transported by aerial ropeway, is received at the Queiroz plant which is located in Nova Lima and comprises the refractory ore circuit (from Cuiabá or
Lamego) with facilities for pyrometallurgy and hydrometallurgy. The concentrate is roasted and the calcine proceeds to a carbon-in-pulp ("CIP") with Merrill Crowe circuits for further refining. The sulphide gas is captured for processing at the acid plant. Sulphuric acid is produced as a by-product.
AGA MINERAÇÃO - LAMEGO
Property description
Lamego is an underground operation (mainly using long hole stoping) that is wholly-owned by AngloGold Ashanti, within one of the most important metallogenetic provinces in Brazil, known as the Iron Quadrangle. This region is an important producer of iron, manganese and gold in Brazil. The property is currently in a production stage and operated by AGA Mineração.
Location
Lamego is located 30km to the east of Belo Horizonte in the state of Minas Gerais, in the southeast of Brazil.
Mineralisation style
The controlling mineralisation structures areLamego mine is located in the apparent intersectionIron Quadrangle, which is a geotectonic unit at the southern edge of thrust faults with tight isoclinal folds inthe São Francisco Craton, comprising Archaean and Proterozoic terrains, and bordered by Neoproterozoic mobile belts. From a ductile environment. The host rocks at Cuiabá are BIF, Lapa Seca and mafic volcanics (principally basaltic). Mineralisation is due toregional viewpoint, the interaction of low salinity carbon dioxide rich fluids with the high-iron BIF, basalts and carbonaceous graphitic schists. Sulphide mineralisation consists of pyrrhotite and pyrite with subordinate arsenopyrite and chalcopyrite; the latter tends to occur as a late-stage fracture fill and is not associated with gold mineralisation. Wall rock alteration is typically carbonate, potassic and silicic.
CdSLamego mine is located in the eastern partextension of the lowerSerra do Curral inverted homocline, located on the northern edge of the Iron Quadrangle.
Gold mineralisation is characterised by orebodies associated with two horizons of chemical sedimentary rocks: BIF and metachert, with shear zones containing abundant quartz veinlets. The proportions of these lithotypes vary substantially from one deposit to middle greenschist facies archean Rio das Velhas greenstone belt. The CdS I, II and IIIanother. In the BIF, sulphide mineralisation is associated with gold, deposits and associated targets are located in a gold trend that extends for about 14 kilometres in a north-easterly direction, from Grota Funda (CdS I)while in the south to Jambeiro (CdS III) in the north. CdSII is the north portion of the Corrego do Sítio gold trend. The main gold targets and deposits are distributed over three trends, namely the CdS trend, the Donana Trend and the Cristina Trend. At CdSI, the main orebodies are Rosalino, Cachorro Bravo, Laranjeiras and Carvoaria, which are currently producing and are the most relevant deposits at Mine I. At CdSII, the main orebodies are São Bento, Pinta Bem (both BIF hosted) and Sangue de Boi (metapellitic hosted). At CdSIII, Anomalia I and II represent the best informed orebodies with the highest potential (for formal declaration purposes, CdSIII deposits are incorporated as CdSII). CdS mineralisation occurs in a greenstone belt geological environment, where goldmetachert it is associated with quartz veins. The gold occurs either as native gold or in sulphides. Lamego has a similar rock assemblage to Cuiabá, but with higher structural complexity. The mineralised BIF is more structurally deformed and sulphides (mainly very fine arsenopyrite acicular crystals)contains more silica when compared to Cuiabá, which reacted less with the hydrothermal fluid.
Legal aspects and tenure
Refer to “Item 4B: Business Overview—The Regulatory Environment Enabling AngloGold Ashanti to Mine—Americas—Brazil—AngloGold Ashanti’s rights and permits”.
Processing plants and other available facilities
Lamego operates as a satellite mine to the Cuiabá mine. Ore is transported to surface via ramps where it is crushed, stockpiled and transported daily to the Cuiabá gold plant, where it is blended with Cuiabá ore on the ROM pad.
The two plants (Cuiabá gold plant and Queiroz plant) are connected by an aerial ropeway. Power to the mine is provided by a set of small hydropower plants (Rio de Peixe hydroelectric complex) and supplied by Cemig, a state-owned company. The Rio de Peixe hydroelectric complex is a set of seven small hydropower plants that generate energy from three dams (Ingleses, Miguelo and Codorna), and are directly connected to the Queiroz plant. Tailings deposition is at one of four sites located at Cuiabá, Calcinados, Rapaunha and Cocuruto. Refer to “Item 4B: Business Overview—The Regulatory Environment Enabling AngloGold Ashanti to Mine—Americas—Brazil” for further information on the Company’s TSFs in Brazil.
Lamego has a structurally controlled corridornatural water supply system and a plant for water and sewage treatment.
Mineral processing
Cuiabá and Lamego mines feed the Cuiabá gold (crushing, milling and flotation) and Queiroz (roaster, carbon circuit and refinery) plants, currently at 1.9Mtpa with a metallurgical recovery of approximately 16 - 20 kilometres on strike91.8 percent for the combined feed. At the Cuiabá gold plant, ore is crushed and about 500 metres vertical extent, developedmilled followed by flotation and filtration to produce a concentrate (32 percent sulphur), which is transported by an aerial ropeway to Queiroz for further treatment. Approximately 30 percent of gold is recovered through a gravity circuit at the Cuiabá gold plant. The concentrate, transported by aerial ropeway, is received at the Queiroz plant which is located in Nova Lima and comprises the refractory ore circuit (from Cuiabá or Lamego) with facilities for pyrometallurgy and hydrometallurgy. The concentrate is roasted and the calcine proceeds to a compressional tectonic setting.CIP with Merrill Crowe circuits for further refining. The sulphide gas is captured for processing at the acid plant. Sulphuric acid is produced as a by-product.
Brazil - SERRA GRANDE
Property description
Mineração Serra Grande (S.A.)
Description
Mineração Serra Grande (MSG("MSG" or Serra Grande)"Serra Grande") is wholly-owned and operated by AngloGold Ashanti and is located in central Brazil, inthe northwest of the state of Goiás, about five kilometres fromin central Brazil. It operates three underground mines (using sub-level
stoping (bottom-up and top-down), cut-and-fill and room-and-pillar mining methods) and two open pit mines. The property is currently in a production stage.
Location
Serra Grande is located 5km south of the citytown of Crixás, and 420km from the Brazilian capital, Brasilia. ItBrasília and approximately 350km from the state capital of Goiás, Goiánia. The employment of 1,120 persons in this largely rural area makes mining the principal economic activity in the region.
Mineralisation style
The Serra Grande gold deposit is an orogenic mesothermal deposit, associated with the development of shear zones that belong to the Upper Archaean Crixás Group. Gold mineralisation is associated with metasediments and metavolcanics from the Ribeirão das Antas and Rio Vermelho Formations respectively. The Crixás Greenstone Belt is surrounded by granitic gneiss terrains from the Ribeirão das Antas and Caiamar complexes and metasedimentary rocks from the Santa Terezinha Group, which is part of the Goiás magmatic arc. Mineralisation at Serra Grande is associated with quartz veins and massive to disseminated sulphides in metasedimentary, metavolcanoclastic and metabasalt rocks, with variable degrees of hydrothermal alteration developed over orogenic stacked thrust layers (duplexes).
Legal aspects and tenure
Refer to “Item 4B: Business Overview—The Regulatory Environment Enabling AngloGold Ashanti to Mine—Americas—Brazil—AngloGold Ashanti’s rights and permits”.
Processing plants and other available facilities
Serra Grande operates threea single TSF, which will support the LOM production and has government environmental licensing in place. The water used in metallurgical processing comes from the underground mines. The state road GO-337 passes close to the operation providing access for logistics. The power for the mine is supplied and twopurchased in the open pit mines. Three mining methods used underground are: sub-level stoping (bottom-upmarket (grid electricity) and top-down), room and pillar. diesel self-generation. Refer to “Item 4B: Business Overview—The Regulatory Environment Enabling AngloGold Ashanti to Mine—Americas—Brazil” for further information on the Company’s TSFs in Brazil.
Mineral processing
The metallurgical plant has the capacity ofto process 1.5Mtpa, and combinescombining CIL and gravimetric circuits. The ore is blended to feed the crushing circuit, withwhich has a capacity of 3,800tpd.4,500tpd. There are two mills in operation, and 20 leachingleach tanks with a capacity of 4,800m34,800m3 divided between prelimingpre-liming and cyanidation stages. About 58% freeApproximately 45 percent of gold is captured in the parallel gravity circuit. The tailings are filtered and stacked in piles. The rest of the gold is recovered by the CIL process to form the bulliondoré that is sent to the Nova Lima refinery.for refining. The mine became operational in 1989total gold recovery is approximately 93.4 percent.
AUSTRALIA
AngloGold Ashanti operates two mines and has beenone new project in Western Australia.
Sunrise Dam, wholly-owned by AngloGold Ashanti, is located 205km north-northeast of Kalgoorlie and 55km south of Laverton.
Tropicana is a joint operation between AngloGold Ashanti (70 percent and the operator), and AFB Resources Pty Limited (30 percent), a subsidiary of Regis Resources Limited. Tropicana is located 200km east of Laverton and 330km east-northeast of Kalgoorlie in Western Australia.
The Butcher Well project is a joint venture between AngloGold Ashanti (70 percent) and Northern Star Resources Limited (“Northern Star Resources”) (30 percent). The project is managed by AngloGold Ashanti. Butcher Well is located 20km southwest of the Sunrise Dam mine and is considered to be a potential satellite operation.
SUNRISE DAM
Property description
Sunrise Dam is a production stage property with an active underground (using sub-level open stoping methods and narrow open-stoping methods) and open pit mine that is wholly-owned and operated by AngloGold Ashanti. AngloGold Ashanti since 1999.conducts all brownfield exploration activities on the site and all tenements and permits are in good standing.
Location
Sunrise Dam is covered by five ANM concessions, namely 002.286/1935, 960.658/1987, 860.746/2005, 862.103/1994approximately 205km north-northeast of Kalgoorlie and 804.366/1975 covering55km south of Laverton in Western Australia.
Mineralisation style
Sunrise Dam is a total area of 6,563.51ha. According to Brazilian mining law expiry of claims, licenses, and other tenure rights coincide with the depletion of Ore Reserves, cessation of mining operations and legally required post-operations activities (eg mine closure), provided all annual reports have been approved by the ANM.
Geology
The deposits aremesothermal gold deposit located in the Rio VermelhoArchaean greenstone belts of Western Australia. The deposit is complex and Ribeirão das Antas Formationsstructurally controlled with multiple ore zones displaying differing characteristics, from ductile shear zones to brittle stockwork complexes to intrusive hosted mineralisation. Mineralisation is typically hosted within quartz-carbonate veins with varying quantities of pyrite and arsenopyrite. Strong alteration of the Archaean Pilar de Goia’s Groupcountry host rock is common proximal to controlling structures.
Legal aspects and tenure
Refer to “Item 4B: Business Overview—The Regulatory Environment Enabling AngloGold Ashanti to Mine—Australia—AngloGold Ashanti’s rights and permits”.
Processing plants and other available facilities
All required infrastructure is in place including a fully functional camp, process plant, tailings facility, gas pipeline, power plant and electrical reticulation, offices, airstrip and road system. The underground infrastructure caters for all ventilation and dewatering needs with provisions made in the budget for extensions and upgrades.
Mineral processing
Processing at Sunrise Dam is via a conventional three-stage crushing / two-stage milling, CIL circuit, with a pyrite flotation and ultrafine grinding circuit commissioned in 2018. The gravity circuit recovers approximately 30 percent of the gold, with the CIL circuit, AcaciaTM reactor and Anglo American Research Laboratories ("AARL") elution used to recover the remainder. Electrowinning recovers gold from the Acacia reactor and is eluted to produce gold doré. Plant throughput at Sunrise Dam is approximately 4.1Mtpa.
BUTCHER WELL
Property description
Butcher Well is a joint venture between AngloGold Ashanti (70 percent) and Northern Star Resources (30 percent). Butcher Well encompasses two tenement packages, Butcher Well and Lake Carey, covering approximately 339.56km2. AngloGold Ashanti also holds a significant tenement package adjacent to the Northern Star joint venture properties.
The project is in the exploration stage in the early stages of study, with no Mineral Reserve declared. An Inferred Mineral Resource is stated, which account together forhas been the focus of a conceptual study. As the project is still in a concept study phase, no mining has taken place. Both open pit and underground mining options (using transverse longhole open stoping) are being explored.
Location
The Butcher Well project is located in the Laverton district of Western Australia, 20km southwest of AngloGold Ashanti's Sunrise Dam mine and 180km northeast of Kalgoorlie. Butcher Well is considered as a potential satellite operation to Sunrise Dam.
The Sunrise Dam airstrip is approximately 70km by road from the project, with a travel time of approximately 90 minutes on the road on the circumference of the southern part of Lake Carey. Lake Carey is a large proportionsalt lake that covers a part of the Crixás Greenstone Belt in central Brazil.western project area,with Sunrise Dam located to the east of the lake and the Butcher Well project located on the western shore.
Mineralisation style
The stratigraphyButcher Well Mineral Resource is an orogenic-style gold system hosted within the Laverton Greenstone Belt. The mineralisation is hosted within a basalt and is spatially associated with syenite dykes. Gold mineralisation within fresh rock principally occurs within steeply dipping north-south trending panels. Supergene gold dispersion and enrichment broadens the mineralised envelope within the near-surface saprolitic material. Much of this material has been previously exploited in shallow open pits.
Legal aspects and tenure
Refer to “Item 4B: Business Overview—The Regulatory Environment Enabling AngloGold Ashanti to Mine—Australia—AngloGold Ashanti’s rights and permits”.
Processing plants and other available facilities
Power is likely to be generated on-site via diesel generators. Water can be sourced from the existing flooded pits or bores. Ore material will be trucked to Sunrise Dam via existing secondary roads.
Mineral processing
Ore from Butcher Well will be processed at AngloGold Ashanti's Sunrise Dam processing plant. Processing at Sunrise Dam is via a conventional three-stage crushing, two-stage milling CIL circuit, with a pyrite flotation and ultrafine grinding circuit commissioned in 2018. The gravity circuit recovers approximately 30 percent of the beltgold, with the CIL circuit and AARL elution used to recover the remainder. Electrowinning recovers gold from the Acacia reactor and eluate to produce gold doré. Plant throughput at Sunrise Dam is dominated by basics4.1Mtpa, and ultrabasicsButcher Well ore will supplement ore production from the Sunrise Dam underground mine to maintain the mill throughput.
TROPICANA
Property description
Tropicana mine is a currently operating gold mine, and is a production stage property. It produces gold bearing ore from a number of open pits named from north to south: Boston Shaker, Tropicana, Havana and Havana South, and from an underground mine beneath the lower sequences with volcano sedimentary units forming the upper successions.Boston Shaker and Tropicana open pits. The project is a joint operationbetween AngloGold Ashanti (70 percent), as operator, and AFB Resources Pty Limited, a subsidiary of Regis Resources Limited (30 percent).
Location
Tropicana is located 330km northeast of Kalgoorlie and 200km east of Laverton, Western Australia.
Mineralisation style
The deposits areTropicana deposit is hosted in an Archaen quartz-feldspathic gneiss within a sequence of schists, meta volcanicsmajor tectonic suture zone between the Yilgarn Craton and dolomites occurring in a typical greenstone belt structural setting. Gold mineralisationthe Albany-Fraser Orogen. Mineralisation is associated with massive sulphidesa strong hydrothermal alteration assemblege of biotite-sericite-pyrite, which post-dates peak graulite facies metamorphism. Gold is found within the pyrite.
Legal aspects and vein quartz material associatedtenure
Refer to “Item 4B: Business Overview—The Regulatory Environment Enabling AngloGold Ashanti to Mine—Australia—AngloGold Ashanti’s rights and permits”.
Processing plants and other available facilities
All surface infrastructure facilities are in place and operational. The processing plant and TSF are operating well, consistent with carbonaceousdesign specifications. The infrastructure includes, but is not limited to water supply, processing plant, mine, dewatering infrastructure, TSF, workshops, camp facilities and sericitic schists and dolomites. The oreshoots plungeairstrips. Power is supplied to the north-west with dipping between 6mine by on-site gas and 35 degrees. The stratigraphydiesel power stations, and natural gas is supplied via an APA Operations (Pty) Limited pipeline. Underground development and production is ongoing.
is overturned and thrusted towards the east, with recognised shear and thrust structures that are stacked. These control the mineralisation and behave as frontal and lateral ramps and horses.
Mineral processing
The greenstone belt lithologies are surrounded byprocessing plant has a capacity of 9.3Mtpa. The crushing circuit consists of a primary gyratory crusher, feeding a set of secondary cone crushers and tertiary rolls crushers. A 14MW and 6MW ball mill in parallel completes the TTG suitegrinding circuit. A CIL circuit is used to extract the gold from the ore, and a standard AARL elution and recovery systems is used to form gold doré bars.
The power provider, Kalgoorlie Power Systems, has built a dedicated power station consisting of Archaean tonalitic gneissesa combination of diesel and granodiorites. gas powered generators with a capacity of 48.5MW.
PROJECTS
The metamorphic sediments are primarily composedprojects in Colombia form a significant contribution to AngloGold Ashanti’s Mineral Resource with the three projects: La Colosa, Minera de Cobre Quebradona ("Quebradona") and Gramalote, the latter of quartz, chlorite, sericite, carbonaceous materialwhich is a joint operationbetween AngloGold Ashanti (50 percent) and garnet bearing schists. The carbonates have been metamorphosed to ferroan dolomite marble with development of siderite and ankerite veiningB2Gold Corp. (“B2 Gold”) (50 percent). Mineral Reserve was declared for the first time at Quebradona in 2018.
During 2022, the Company's project team in the surrounding wallrock, usually associated with quartz veins. The basalts are relatively unaltered but do show pronounced stretching with elongationUnited States integrated the Mineral Resource resulting from AngloGold Ashanti's acquisitions of pillow structures being evident.Corvus Gold Inc. (“Corvus Gold”) and Coeur Sterling, Inc. (“Coeur Sterling”) using the Company’s evaluation framework. AngloGold Ashanti acquired North Bullfrog and Mother Lode as part of the Corvus Gold acquisition in January 2022 and Sterling (which includes the Crown Block deposits of SNA, Secret Pass and Daisy) through the acquisition of Coeur Sterling in November 2022.
The Crixás greenstone belt comprises a series of Archaean to Palaeoproterozoic metavolcanics, metasediments and basement granitoids stacked within a series of north to north-east transported thrust sheet. Thrusting (D1) was accompanied by significant F1 folding/foliation development and progressive alteration in a brittle-ductile regime. D1 thrusting developed irregular thrust ramp geometry, in part controlled by concealed early basin faults. The main Crixás orebodies are adjacent to a major north‑northwest structural corridor juxtaposed to the main fault ramp/corner and become dispersed to the east and north in zones of foreland thrust flats. Alteration diminishes to the west away from the main fault corner. A series of concealed east-west to northwest‑southeast basement block faults may have provided secondary fluid migration, and development of early anti‑formal warps in the thrust sheets; these structures probably define the quasi‑regular spacing of significant mineralisation within the belt. The D1 thrust stack was gently folded by non‑cylindrical folds. Gold mineralising fluids probably migrated during this event, with similar south‑south‑west to north‑north‑east migration, and focusing on bedding slip during folding. Gold mineralisation decreases and disperses to the north and east along the formal thrust flat zone. Concentrations of gold within the quartz vein may be due to the damming of fluids migrating upward along layering.
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COLOMBIA
Description
AngloGold Ashanti Colombia has three advanced greenfields projects,projects: Gramalote, La Colosa Quebradona and Gramalote of which Quebradona and Gramalote have an Ore Reserve.Quebradona.
Colombia - Gramalote
Description
The Gramalote project is a joint ventureoperation between AngloGold Ashanti (50 percent) and B2Gold Corp (B2Gold)(50 percent). Since the beginning of 2020, B2GoldThe project is responsible for the management of the Gramalote JV and AngloGold Ashanti and B2Gold now each hold 50 percent of the attributable sharesmanaged by B2Gold. It is situated in the Gramalote JV.
The property is located near the town of Providencia and San Jose del Nus within the municipality of San Roque in the, northwest Department of Antioquia, Colombia. It is approximately 230 kilometres northwest of the Colombian capital of Bogota and 124 kilometres124km northeast of Medellin whichMedellín.
The La Colosa project is the regional capital of the Antioquia Department. The region encompassing Gramalote has a long history of artisanal gold mining. Gramalote itself has had small scale artisanal mining for several decades prior to exploration workwholly-owned and mineral discoverymanaged by AngloGold Ashanti.
Development of the Gramalote project commenced with a scoping study in 2009. A number of studies followed, leading to submission of a prefeasibility study in late 2013, which did not meet investment hurdles. From 2014 to 2017 intensive work was undertaken by all technical disciplines to identify ways to improve the project economics. The main changes were an improved orebody model, grade streaming to increase the feed grade in the early years and early treatment of the oxide ore that overlies the main sulphide resource. An enhanced prefeasibility study was completed in September 2017, which supported the reporting of a maiden Ore Reserve. In 2019, further geological refinement improved the project economics. The project has progressed to a feasibility study. Power is expected to be supplied to the Gramalote project from the national power grid.
Gramalote comprises one integrated exploitation concession and one exploration concession which was granted in June 2019. The first, the 14292 concession totalling 8,720.71ha, expires on 3 April 2043 and contains the Gramalote and Monjas deposits. The second is the 4894 concession which covers 2,292.81ha and hosts the Trinidad deposit. This concession expires in June 2021 but can be extended by 11 years if required. In 2016, the project received its environmental and construction permits to operate for the LOM. According to Colombian mining law the exploration phase begins as soon as the concession contract is registered in the National Mining Registry. The total period for the concession contract (exploration, installation and construction, and exploitation) is 30 years, which may be renewed for an additional 20-year period. Under Colombian mining law, producing mines are subject to a federal royalty of 4 percent on 80 percent of the value of gold and silver production. Thus the Gramalote net royalty is 3.2 percent on gold and silver production.
Geology
The Gramalote deposit It is located in the northern portionDepartment of Tolima, 150km west of Bogotá, and 30km west of the Central Cordilleramajor town of Colombia. The terrain is mainly composed of a metamorphic basement complex and the Antioquia Batholith. The terrane of the Cajamarca-Valdivia basement consists of metamorphic rocks, volcanic rocks, oceanic ophiolites and intrusive rocks. The Antioquia Batholith, which is of Upper Cretaceous age, covers an area of 7221 km2 and constitutes the core of the Central Cordillera. About 92 percent of this intrusive corresponds to tonalite and granodiorite and eight percent to two subordinate types of rocks - granodiorite to quartz-monzonite and gabbro. From a structural point of view, the Antioquia Batholith has a history of uplift. Major lineaments affect the batholith,Ibagué.
especially in its eastern sector where they trend west northwest varying to northwest, where they show rotation and sinistral shear movement. Westward dextral transpression dominates along the Romeral Fault System.
Gramalote is an intrusive-hosted structurally controlled stockwork gold and silver deposit. Mineralisation is controlled by north-east/south-west trending shear zones and north-northwest/ south-southeast trending shear extensional zones affecting the tonalites and granodiorites of the Antioquia Batholith. Gold mineralisation is associated with three overprinting and texture destructive alteration assemblages namely: potassic, quartz-sericite and sericite carbonate. Within these alteration zones, anomalous gold mineralisation is associated with three types of quartz vein stockworks. These include quartz veinlets with fine-grained pyrite, quartz-carbonate veinlets and quartz veinlets with granular pyrite.
Colombia - Quebradona
Description
The Quebradona project is a JV betweenwholly-owned and managed by AngloGold Ashanti and B2Gold and has completedcomprises the Nuevo Chaquiro deposit, a conceptual study (2016) as well as a prefeasibility study (2018), which supported reporting of a maiden Ore Reserve. The project has progressed to a feasibility study. During 2019 B2Gold participation dropped below 5 percent which resulted in AngloGold Ashanti becoming the 100 percent owner.significant copper-gold porphyry. The Quebradona project is situated in the Middle Cauca region of Colombia, in the Department of Antioquia, 60 kilometres south-west60km southwest of Medellin.Medellín.
GRAMALOTE
Property description
Gramalote is a joint operation between AngloGold Ashanti (50 percent) and B2Gold (50 percent), with B2Gold being the manager. The property is currently an exploration stage project, with no Mineral Reserve declared. Gramalote is a semi-massive, superficial low-grade gold deposit suitable to be mined as a conventional open pit truck and shovel operation.
Following the completion of a feasibility study optimised work in the second half of 2022, both joint operation partners determined that the Gramalote project does not meet their investment thresholds for development. Following a comprehensive review of the alternatives relating to the project, both parties have commenced a joint sales process for the project, which is currently ongoing.
Location
The Gramalote property is located near the towns of Providencia and San José del Nus within the municipality of San Roque in the Department of Antioquia in the northwest of Colombia. It is approximately 230km northwest of Bogotá and 124km northeast of Medellín, which is the capital of the Antioquia Department.
Mineralisation style
Gramalote is a pluton-related, mesothermal gold deposit genetically related to the host intrusion. The alteration and mineralisation are structurally controlled, restricted to small halos along veins, sheeted veins and stockwork arrays with sulphide content being less than five percent. There are three distinct mineral deposits: Gramalote Central, Monjas West (also referred to as Monjas) and Trinidad. These all have similar mineralisation and alteration styles, with vertical to sub-vertical mineralised zones extending from tens of metres to over 200m width, with variable strike lengths of up to 1km, and extending to depths of several hundred metres. Mineralisation is controlled by northeast to southwest trending strike-slip shear zones, north-northwest to south-southeast trending extensional shear zones and dilatational fractures. Gold mineralisation is associated with stockwork veining and in particular quartz with fine pyrite veins, quartz-carbonate veins, and quartz with coarse pyrite veins.
Legal aspects and tenure
Refer to “Item 4B: Business Overview—The Regulatory Environment Enabling AngloGold Ashanti to Mine—Americas—Colombia—AngloGold Ashanti’s rights and permits”.
Processing plants and other available facilities
Key infrastructure planned includes: a TSF, waste rock facility, site water management, a creek diversion, roads and bridges, central workshop, offices and camp, and a process plant. Power is expected to be supplied from the national power grid some 25km away. Access is through a national road located less than 1km from the project.
Mineral processing
A range of treatment options for sulphide ore were investigated in previous studies, including whole ore leaching, heap leaching and a float leach process. The float leach process was selected as offering much better economics. Most of the metallurgical designs have been confirmed during the technical update to the feasibility study conducted during 2022. The process design is as follows:
•Processing by a semi-autogenous grinding stream treating approximately 11Mtpa of sulphide ore;
•Gold recovery post milling by flotation and concentrate leach; and
•Conventional tailings deposition.
LA COLOSA
Property description
La Colosa is wholly-owned and managed by AngloGold Ashanti. It is currently in force majeure due to delays in granting environmental permits by national and local environmental authorities and, as a result, the project remains on hold. La Colosa is an exploration stage project with no Mineral Reserve declared. However, open pit mining (with potentially some underground mining) is the preferred mining method.
The La Colosa project is currently at an early project stage and has identified a number of possible technical options all of which are capital intensive. The most recent one year grant of force majeure, during which time the specified timelines for completing the various phases of the mining project under the concession contract are suspended, will expire on 22 June 2023.
Location
The project is located 150km west of Bogotá, and 30km west of the major town of Ibagué, which is the capital of the Tolima Department. Ibagué is the location of local government entities monitoring the project.
Mineralisation style
La Colosa is a large porphyry Au deposit located on the eastern flank of the Central Cordillera of Colombia. Mineralisation is exposed on the surface. The La Colosa site contains an intrusive complex with two magmatic centers known as the La Colosa and San Antonio porphyry stocks, hosted by schistose country rocks. The complex is present over a map area of 3.5km2 and includes a series of porphyry intrusions with compositions ranging from diorite to tonalite. The predominant type of hydrothermal alteration in the early porphyries is moderately intense potassic alteration (secondary biotite+K-feldspar). Pyrite is the most abundant sulphide, followed by pyrrhotite, which is commonly found close to the contacts with the country rocks. Gold mineralisation at La Colosa occurs predominantly as native gold and electrum. Sub-microscopic gold has been observed in sulphides (pyrite, due to its abundance) and iron oxide (magnetite-hematite).
Legal aspects and tenure
Refer to “Item 4B: Business Overview—The Regulatory Environment Enabling AngloGold Ashanti to Mine—Americas—Colombia—AngloGold Ashanti’s rights and permits”.
Processing plants and other available facilities
Currently, the project has field infrastructure that supports access to the Mineral Resource with roads, accommodation, and office and surface infrastructure for pre-logging and organisation of the drilling core. There is a core shed facility in the city of Ibagué where geological and geotechnical logging was performed in the past.
Mineral processing
The project is currently at an early stage. However, flotation of sulphide ore is being considered as a treatment option.
QUEBRADONA
Property description
The Quebradona project is wholly-owned and managed by AngloGold Ashanti and comprises the Nuevo Chaquiro deposit, a significant copper-gold porphyry. The project was previously a joint venture between AngloGold Ashanti and B2Gold. It completed a conceptual study in 2016 as well as a pre-feasibility study in 2018, which supported first-time reporting of a Mineral Reserve. When B2Gold’s participation dropped below five percent during 2019, AngloGold Ashanti became the 100 percent owner and manager of the project. B2Gold will be entitled to a royalty equal to two percent of the net profit generated from the sale of any mineral product by the project.
Quebradona will be a copper mine with gold and silver as by-products and is at a development stage. The preferred mining method is sub-level caving to extract the mineral deposit from underground. While the permits for the construction and mining operation had been approved by the relevant mining authority (Secretaría de Minas de Antioquia), the national environmental authority (Autoridad Nacional de Licencias Ambientales or “ANLA”) archived AngloGold Ashanti's environmental licence application relating to the Quebradona project in November 2021. AngloGold Ashanti is in the process of preparing a new Environmental Impact Assessment for the Quebradona project to submit to ANLA in connection with its environmental licence application.
Location
The Quebradona project is situated in the Middle Cauca region of Colombia, in the Department of Antioquia, 90km southwest (104km commute via the national highway) of Medellín, the capital of the Antioquia Department.
Mineralisation style
Five main targets have been identified in the exploration work, namely Nuevo Chaquiro, Aurora, Tenedor, Isabela, and La Sola. Nuevo Chaquiro is the most advanced ofand the targets.sole mineral deposit considered in the feasibility study and licensing process. Nuevo Chaquiro, a significant copper-gold porphyry,porphyry-style mineralised system, is one of five known porphyry centres on the property and has been the focus of exploration activities since the beginning of 2011 with more than 75 kilometres75km of drilling completed. Nuevo Chaquiro was the sole deposit considered in the feasibility study.
Quebradona comprises one tenement (5881) which is the result of the integration of the five original tenements (5869, 6318, 6359, 7579 and 5881). Integrated tenement 5881 was issued on the 9 December 2016 and totals 7,593ha.
drilling. Quebradona will be a copper mine with gold and silver as by-products.
Legal aspects and tenure
Refer to “Item 4B: Business Overview—The Regulatory Environment Enabling AngloGold Ashanti to Mine—Americas—Colombia—AngloGold Ashanti’s rights and permits”.
Processing plants and other available facilities
The Quebradona project site is close to an existing national highway, as well as state and rural roads, and HV/MVhigh or medium voltage power infrastructure. The planned mining method is sub level caving. The planned underground infrastructure consists of an adittwin adits to access the orebody and number of internal vertical ore passes that gravity feeds to the main ore transfer level. The material will be transferred to the main internala centralised (underground) crusher by load and haul dump vehicles.
Crushed material will then be transferred downhill to surface via a 6 kilometre6km conveyor, inthrough a dedicated adit to a single coarse ore stockpile.
GeologyMineral processing
Feasibility study test work confirmed that the ore will be treated by a typical porphyry copper flotation circuit producing copper and gold concentrate from the processing of approximately 6.2Mtpa of underground ore over a 23-year operating period. Ore extracted from the sub-level cave is crushed underground where tramp metal is removed before loading onto the underground conveyor system for delivery to the surface processing coarse ore stockpile with a 24-hour live capacity (approximately 21,300t).
The host rock geology of Nuevo Chaquiro comprises a volcaniclastic sequence of Miocene age (ash, tuffs, agglomerates and andesites) intruded by small dykes of diorite and quartz diorite, also of Miocene age. The intrusions are by various pulses of diorites with the primary intrusive being a fine to medium grained quartz diorite. Most of the intrusives do not outcrop. These intrusives are categorised into pre-mineral, early, intra-mineral and late, according to cross cutting relations, locality and copper-gold values. The developed alteration follows a well zoned porphyry type alteration system ranging from a high temperature, potassium silicate central zone (biotite, magnetite, chalcopyrite, and molybdenite), which trends into an overlying sericitic alteration zone (muscovite, chlorite, quartz, pyrite,+-tourmaline) surrounded by more distal propylitic alteration (chlorite, epidote, illite, carbonate). There is also an inner core of calcic-potassic alteration featuring biotite, actinolite, epidote, and anhydrite with lower copper, gold and molybdenum values. The mineralised zone is characterised by fine stock works, disseminations and veinlets of quartz, magnetite, pyrite, chalcopyrite and molybdenite.
AUSTRALIA
Description
Australia comprises two operational mines. Sunrise Dam, which is wholly owned, and Tropicana Gold Mine, a JV with IGO Limited, which holds a 30 percent stake, are both located in Western Australia. Mining is from both open pit and underground, with Sunrise Dam currently being an underground mine and Tropicana an open pit with underground in development.
Australia - Sunrise Dam
Description
Sunrise Dam, which is wholly owned, is located 220 kilometres northeast of Kalgoorlie and 55 kilometres south of Laverton in Western Australia. Underground mining, which is conducted by a contract mining company, is the primary source of ore, with supplementary mill feed provided by stockpiles.
Open pit production began in 1997 was completed at a final depth of 500 metres below surface. Underground mining commenced in 2003 with a number of different mining methods being applied, depending on the style of mineralisation and grade of the geological domain. By 2014, the mine was wholly an underground mining operation supplemented with stockpile feed. The underground mining infrastructure has been undergoing continuous upgrades with an extra power feed to the underground mine completed in 2017 and a major ventilation fan upgrade completed in 2018.
Sunrise Dam operates within two mining leases covering over 7,800ha, which are in good standing with the expiry dates in 2038. All Mineral Resource, Ore Reserves and mine infrastructure are hosted within lease M39/1116 while lease M39/1117 hosts water extraction infrastructure used to supply the operation with water.
Mining is carried out by underground mining contractors and productivity improvements over the past few years has seen total underground tonnages mined reach a steady state of around 2.8Mtpa. This has been possible by the use of bulk mechanised sub-level open stoping using stabilising pillars and waste backfill where possible. Paste fill has been introduced in selected areas from 2019 to improve ore recovery in the higher grade parts of the Vogue ore zone. Ore is treated in a conventional gravity and CIL process plant. Installation of a new fine grind and flotation circuit was completed the second half of 2018. The plant throughput rate for Sunrise dam is 4.1Mtpa. Power at Sunrise Dam is self-generated, and the mine uses natural gas supplied via an APA Operations (Pty) Limited pipeline.
Geology
Gold ore at Sunrise Dam is structurally and lithologically controlled within gently dipping high strain shear zones and steeply dipping brittle-ductile low strain shear zones. Host rocks include andesitic volcanic rocks, volcanogenic sediments and magnetic shales.
Australia - Tropicana
Description
Tropicana, a joint venture between AngloGold Ashanti (70 percent and operator) and IGO Limited (30 percent), is located 200 kilometres east of Sunrise Dam and 330 kilometres east-northeast of Kalgoorlie Boulder, Western Australia. Open pit mining began during 2012 with first gold production occurring during September 2013. The operation features a large scale, modern processing plant which uses conventional CIL technology and includes high-pressure grinding rolls for energy-efficient comminution. Open pit mining activities are carried out by a contract mining company and the plant is owner-operated.
Tropicana has security of tenure for all current exploration licences and the mining lease that covers its future Ore Reserve. This lease is M39/1096 and is valid from 11 March 2015 to 10 March 2036 covering a total area of 27,228ha. The previous 31 mining leases comprising 27,228ha (including M39/980, M39/981, M39/982 and M39/1052), were conditionally surrendered in favour of the grant of a single mining lease, M39/1096, on 11 March 2015 for 21 years with all existing rights and obligations preserved. This process was completed with the co-operation of the Department of Mines and Petroleum.
The Tropicana joint venture has active exploration programmes seeking both satellite extensions to the Tropicana Gold Mine and discoveries with standalone potential. The Boston Shaker underground was approved through a feasibility study in February 2019, and has been in development since May 2019, with first ore stopes scheduled for July 2020. A prefeasibility study is examining the options around mining the depths of the Havana pits. The study will trade-off open pit vs.proposes a processing circuit that includes primary crushing underground, options for material below the current pit.
All surface infrastructure facilities are in place and operational. The processing plant and TSF are operating well, consistent with design specifications. The infrastructure includes, but is not limited to, a dedicated gas and diesel power station, water supply, processing plant, mine, dewatering infrastructure, tailing dump facility, workshops, camp facilities and airstrips. The processing plant comprisessecondary crushing, high pressure grinding rolls, oneball milling, rougher-scavenger flotation for all elements (copper, gold, silver as well as pyrite), followed by regrinding of the concentrate and cleaning using a mix of column and mechanically agitated cells. The majority of the pyrite in the ore reports to the cleaner circuit tails and will be stored in a lined and eventually sealed impoundment within the TSF to avoid any potential acid rock drainage from the bulk high volume rougher tails. Molybdenum is present in the ore and is not planned for recovery in the initial stages of production.
UNITED STATES OF AMERICA (NEVADA)
All projects are exploration stage grindingproperties wholly-owned by AngloGold Ashanti. The Silicon project is located approximately 12km east of the town of Beatty in Nye County, Nevada, USA. The North Bullfrog project is located approximately 14km northwest of the town of Beatty. The Mother Lode project is located 10km east of the town of Beatty. The Secret Pass and CIL recoveryDaisy deposits of the Sterling project are located 6km east of the town of Beatty. The remaining deposits of the Sterling project are located 14km southeast of the town of Beatty.
North Bullfrog and Mother Lode were acquired through the acquisition of Corvus Gold in January 2022. Sterling, which includes the Crown Block deposits of SNA, Secret Pass and Daisy, was acquired through the acquisition of Coeur Sterling in November 2022. The addition of the North Bullfrog project as well as the Mother Lode and Sterling projects into the AngloGold Ashanti North America portfolio, together with the Silicon project and other exploration targets, provides the opportunity to develop a world-class operational cluster within the Beatty district in Nevada.
The North Bullfrog project is the most advanced of AngloGold Ashanti’s exploration properties within the Beatty district, an area with a capacitylong history of between 8gold mining. A first-time Mineral Resource at Silicon was declared in 2021. North Bullfrog, Mother Lode and 9Mtpa.Sterling declared Mineral Resource for the first time in 2022. The 2019 achieved annual throughputNorth Bullfrog project is currently progressing through a feasibility study, while the Silicon project is progressing through a pre-feasibility study.
NORTH BULLFROG
Property description
The North Bullfrog project is an exploration stage property wholly-owned and managed by AngloGold Ashanti. North Bullfrog is currently progressing through a feasibility study. The proposed mining method is conventional open pit mining. No Mineral Reserve has been declared at North Bullfrog.
An additional geotechnical study is underway for feasibility study level pit design slope recommendations. The blast fragmentation size is another area of opportunity to deliver improved value in heap leach ROM ore recovery. The mining rate was 8.65Mtpa. Power is suppliedan area of notable opportunity, as are selectivity studies.
Further metallurgical testing will be needed during operation to ensure that ore is routed to the correct processing option. The study and definition of the unoxidised mineralised zones below the current mine by on site gasplan are a significant opportunity and diesel power stations, natural gaswill add value if they are found to be sufficiently amenable to the process flowsheets available in the North Bullfrog project.
Location
The North Bullfrog project is supplied vialocated approximately 14km northwest of the town of Beatty in Nye County, Nevada, USA. The project is within the Bullfrog Hills subdistrict, of the Bullfrog Hills-Bare Mountains District.The Bullfrog Hills-Bare Mountains District is an APA Operations (Pty) Limited pipeline.historic mining centre that produced approximately 3Moz of gold and 4Moz of silver, primarily from the Barrick-owned Bullfrog pit.
GeologyMineralisation style
The project lays within the Walker Lane mineral belt and the Southwestern Nevada Volcanic Field ("SWNVF"). The regional stratigraphy includes a basement of Late Proterozoic to Late Paleozoic metamorphic and sedimentary rocks. The North Bullfrog project is a combination of four mineralised deposits comprised of YellowJacket, Sierra Blanca, Jolly Jane, and Mayflower. The YellowJacket deposit is a very continuous high-grade vein within the moderate-grade stockwork mineralisation. The other three deposits are low to medium-grade.
Gold mineralisation at Tropicana occursNorth Bullfrog is primarily hosted in high metamorphicthe middle Miocene Sierra Blanca tuff. Two styles of precious metal epithermal mineralisation are present at the project: high-grade, structurally controlled fissure veins and associated stockwork zones, and low-grade disseminated or replacement deposits within altered volcanic rocks. Two district-scale north striking normal faults are the dominant structural features in the project area, but several smaller-scale faults between them are important controls for distribution of hydrothermal alteration and gold mineralisation.
Legal aspects and tenure
Refer to “Item 4B: Business Overview—The Regulatory Environment Enabling AngloGold Ashanti to Mine—Americas—United States of America (Nevada)—AngloGold Ashanti’s rights and permits”.
Processing plants and other available facilities
Currently, there is minimal infrastructure on-site, as it is an exploration area. Current access roads are unsealed and will require upgrading prior to commencing the project. The North Bullfrog project is in Nevada, which has several large mining operations currently in production, and as such provides access to all required major mining and processing equipment. The transport infrastructure in Nevada is very well established and maintained.
The town of Beatty and urban centres in the region such as Pahrump and Las Vegas offer infrastructure and services that can support the operation.
Mineral processing
Processing will include heap leaching of lower grade gneissic rocks,oxide ores that have demonstrated amenability to this process during metallurgical characterisation programs. Higher grade material containing some coarse gold will be processed in a mill. The leached tails from the mill will be dewatered and combined with heap leach material delivered from the mine.
SILICON
Property description
The Silicon project is an exploration stage property wholly-owned and managed by AngloGold Ashanti. Mineral Resource conversion drilling was a focus during 2022, which dip gentlysupported an ongoing pre-feasibility study. The nature of the Silicon mineralisation lends itself to conventional large scale open pit mining. No Mineral Reserve has been declared at Silicon.
Location
The Silicon project is located approximately 12km east of the town of Beatty in Nye County, Nevada, USA. The project is within the Bare Mountains subdistrict, of the Bullfrog Hills-Bare Mountains District.
Mineralisation style
The project resides within the southern extension of the Walker Lane trend and overlies the far-western margins of the SWNVF. The main mineralisation event occurred at approximately 11.6Ma in the hiatus between large scale ignimbrite events, in apparent association with rhyolitic volcanism. There is a strong structural control to the south east.higher-grade mineralisation, with it being centred on the Silicon-Tramway faults. Lower-grade disseminated gold mineralisation is hosted in a rhyolite flow ascribed to the rhyolite of Picture Rock. Actual gold deposition appears to have occurred under less acidic and low to intermediate sulphidation conditions. Mineralisation at Silicon exhibits a strong vertical control and is structurallystrongly associated with the emplacement of hydrothermal breccias and banded epithermal veins. Pre-existing subvertical faults, particularly centred on the Silicon-Tramway fault system, strongly controlled the emplacement of the quartz ± pyrite veinlet zones. Disseminated adularia-quartz-pyrite mineralisation is a second-order stratigraphic feature and occurs withinis closely associated with a preferred hostfavourable lava flow unit within the gneissic package. Post mineralisation faulting has separated the once continuous ore zone, with open pits developed on eachapproximately 14Ma rhyolite of the fault bounded blocks.Picture Rock.
Legal aspects and tenure
ORE RESERVE
Refer to “Item 4B: Business Overview—The combined Proven and Probable gold Ore ReserveRegulatory Environment Enabling AngloGold Ashanti to Mine—Americas—United States of the group amounted to 43.8 million ounces (Moz) as at 31 December 2019. The Probable copper Ore Reserve of the group amounted to 3,068 million pounds (Mlbs) as at 31 December 2019.
Ore Reserve estimates are reported in accordance with the requirements of the SEC’s Industry Guide 7. Accordingly, as of the date of reporting, all Ore Reserve is planned to be mined out under the life-of-mine plans within the period of AngloGold Ashanti’s existing rights to mine, or within the renewal periods of America (Nevada)—AngloGold Ashanti’s rights and permits”.
Processing plants and other available facilities
The Silicon project area currently has minimal infrastructure on site, as it is an exploration area. Current access roads are unsealed and will require upgrading prior to mine. In addition, ascommencing the project. The scope of the dateSilicon project is similar to several large mining operations currently in production, and existing suppliers are well established in Nevada to support mining and processing operations. The transport infrastructure in Nevada is very well established and maintained.
The town of reporting, all OreBeatty and urban centres in the region such as Pahrump and Las Vegas offer infrastructure and services that can support the operation.
Mineral processing
Mineralised rock from the Silicon project will be processed on heap leach pads. Material found to be amenable to leaching at coarse sizes will be delivered directly to the pad from the mine for leaching (ROM heap leaching). Deeper, less weathered mineralised rock that was found to be more sensitive to the particle size will be crushed as needed to improve the production from the leach facility.
MOTHER LODE
Property description
The Mother Lode project is an exploration stage property wholly-owned and managed by AngloGold Ashanti. A preliminary economic assessment was completed by Corvus Gold in 2020, resulting in the declaration of a Mineral Resource. AngloGold Ashanti acquired Corvus Gold in January 2022. The Mother Lode gold deposits contain mineralisation at or near the surface that is suitable for open pit mining methods. No Mineral Reserve has been declared at Mother Lode.
Location
The Mother Lode project is covered by required mining permits or therelocated approximately 10km east of the town of Beatty in Nye County, Nevada, USA. The project is within the Bare Mountains subdistrict, of the Bullfrog Hills-Bare Mountains District.
Mineralisation style
The project lies within the Walker Lane mineral belt and the SWNVF. Mother Lode is characterised as a sediment, intrusive and locally volcanic-hosted disseminated gold deposit. Mineralisation most closely resembles Carlin-type sediment-hosted gold deposits of north-central Nevada. Mother Lode consists of structurally and stratigraphically-controlled disseminated gold mineralisation hosted primarily in rhyolite porphyry dykes, sedimentary rocks of Joshua Hollow, and to a lesser degree, Paleozoic sedimentary rocks. The primary structural control feeding mineralisation at Mother Lode is a high probabilityseries of north-trending, 50° to 70° west-dipping rhyolite dyke-filled structures. Mineralisation is both semi-tabular and highly irregular as fluids ascended along dyke-filled structures in the underlying Paleozoic rocks through the Tertiary unconformity and expanded upward into the Tertiary section. Mineralising fluids appear to have bled out laterally away from mineralised dykes into favourable permeable lithologies and secondary structures.
Legal aspects and tenure
Refer to “Item 4B: Business Overview—The Regulatory Environment Enabling AngloGold Ashanti to Mine—Americas—United States of America (Nevada)—AngloGold Ashanti’s rights and permits”.
Processing plants and other available facilities
The Mother Lode project area currently has minimal infrastructure on-site, as it is an exploration area with a reclaimed overburden facility and a small open pit. Current access roads are unsealed and will require upgrading prior to commencing the project. The Mother Lode project is in Nevada, which has several large mining operations currently in production, and as such provides access to all required major mining and processing equipment. The transport infrastructure in Nevada is very well established and maintained.
The town of Beatty and urban centres in the region such as Pahrump and Las Vegas offer infrastructure and services that these approvalscan support the operation.
Mineral processing
Previous operations included crushing and heap leaching of oxide ores from the Mother Lode pit. Mineralised material from the expanded pit will be secured.
AngloGold Ashanti has standard procedures forprocessed either without crushing on a heap leach pad (oxidised material) or in a mill using agitated tank bio-oxidation and cyanidation (sulphide). Although the estimation of Ore Reserve. These standard procedures are performed by experienced technical personnel at the mining operations and reviewed by regional and corporate Competent Persons.
In the case of its underground mines, the procedure is as follows: Firstly, gold content and tonnage are estimated for in-situ mineralised material at a mining operation. This mineralised material is not necessarily economically viable over the full extent of the operation. Exclusions on the grounds of safety (for example, stability pillars and shaft pillars) are then also defined. Grade-tonnage curves specific for each of the deposits, in conjunction with parameters such as the cost structure, yield, mine call factor and gold price estimates are usedsulphide mineral samples responded well to determine an optimal mining mix. This process facilitates the determination of the average gradethis method, additional work will need to be mined by each operation. This grade is then applied to the grade-tonnage curves, which in turn facilitates the determination of the cut-off grade and Ore Reserve tonnage for the operation. A full mine design is carried out on the blocks of mineralised material, excluding any large mining areas that do not meet the cut-off grade criterion. This mining plan is revieweddone to ensure that it satisfiesbio-oxidation is the economic criteriamost appropriate pre-oxidation process for this project.
STERLING
Property description
The Sterling project is an exploration stage property, wholly-owned and practical limitationsmanaged by AngloGold Ashanti. In November 2022, AngloGold Ashanti acquired the Sterling project through its acquisition of accessCoeur Sterling. The Sterling project includes the Crown Block deposits of SNA, Secret Pass and timing. IfDaisy, and the review process is positive, thentenements surrounding the mineralised material (with dilution and discounts) included in the mining plan is declared and published as the Ore Reserve for that operation.
In the case of open-pit mines the procedure is as follows: revenue and costs are calculated for each mining block within a three-dimensional modelproperties. The elevation of the ore body using estimated values for gold price, operating costs and metallurgical recoveries. An optimization processoperation is then applied to determinearound 1,200m, on the combinationlower, eastern slopes of blocks withinBare Mountain. The local terrain is characterised by rounded or craggy ridges separated by ephemeral washes. The northern “Crown” strip comprises the model that make a positive contribution under these estimations. Block selection is within a shell whose limits are defined by the planned slope anglesgeneral area of Fluorspar Canyon. No Mineral Reserve has been declared at Sterling.
Open pit mining of the pit. Within this process, a cut-off gradeSterling mine deposit began in 1980 and continued until 1989. Underground mining began in 1980 and proceeded until mid-1997 when market conditions impacted profitability. The Crown deposits contain mineralisation at or near the surface that is applied which determines the ore blocks to be treated and included in the Ore Reserve. These blocks are scheduled with consideration being given to practicalsuitable for open pit mining constraints and limitations. Scheduled ore blocks that are classified as Proven or Probable constitute the Ore Reserve.methods.
The gold price used for determining the 2019Mineral Resource is based on estimates that contain inherent risk and 2018 Ore Reserve are outlined in the following table:
|
| | | | | | | | | | |
| 2019 |
| | 2019 |
| | 2018 |
| |
Units |
(3 year average) |
| | (Ore Reserve) |
| | (3 year average) |
| |
Ore Reserve Gold Price | 1,307 |
| | 1,100 |
| | 1,258 |
| | $ per ounce |
The copper price used for determining the 2019depend upon geological interpretation and 2018 Ore Reserve are outlined in the following table:
|
| | | | | | | | | | |
| 2019 |
| | 2019 |
| | 2018 |
| |
Units |
(3 year average) |
| | (Ore Reserve) |
| | (3 year average) |
| |
Ore Reserve Copper Price | 2.83 |
| | 2.65 |
| | 2.66 |
| | $ per pound |
The SEC test indicatesstatistical inferences drawn from drilling and sampling analyses. Based on uncertainty due to geological interpretation from widespread drill hole information, an Inferred Mineral Resource confidence was applied to all of the SAMREC Ore Reserve, apart from CVSA,Sterling Mineral Resource. Further Mineral Resource drilling and appropriate analyses will be required to upgrade the confidence to an Indicated Mineral Resource.
Location
The Sterling property is economic and meetssituated in southern Nye County, Nevada, near the requirementstown of Beatty, about 185 km northwest of Las Vegas. The project is within the Bare Mountains subdistrict, of the SEC.Bullfrog Hills-Bare Mountains District. The CVSA SEC ReserveSecret Pass and Daisy deposits of the Sterling project are located 6km east of the town of Beatty. The remaining deposits of the Sterling project are located 14km southeast of the town of Beatty.
Mineralisation style
The Sterling deposits are characterised as either epithermal deposits (Secret Pass) like the North Bullfrog and Silicon deposits or Carlin type deposits (Daisy, Sterling and SNA). The Carlin-type deposits are sediment-hosted, disseminated precious metal deposits, found in the Great Basin province of eastern Nevada which formed during profound crustal extension and high heat flow beginning in the mid-Tertiary (approximately 35Ma to 40Ma).
Sterling is typical of sediment-hosted, disseminated precious metal deposits also termed Carlin-type deposits. Gold occurs in the rims of microscopic arsenian pyrite grains. Significant mineralisation occurs in:
•Gouge or breccia in the Reudy Fault zone and locally along the dyke margin;
•Adjacent to the fault (on both sides) in Bonanza King silty dolostone or dolostone, and to a lesser degree in underlying Carrara silty limestone or limestone (proximity to the Reudy Fault is not requisite for mineralisation); and
•In hydrothermal breccias derived from the above lithologies.
Legal aspects and tenure
Refer to “Item 4B: Business Overview—The Regulatory Environment Enabling AngloGold Ashanti to Mine—Americas—United States of America (Nevada)—AngloGold Ashanti’s rights and permits”.
Processing plants and other available facilities
Sterling is accessible by road from Las Vegas, a distance of 185km via U.S. Highway 95. A good secondary, 13km long gravel road turns off the north side of the highway at mile 45.9, 24km southeast of the town of Beatty. The gravel road is maintained by Nye County and Sterling personnel. Las Vegas is the nearest major airport. Mine buildings consist of several trailers used for office work, geological research and logging, sample preparation (during mining), and personnel facilities. A large steel container is used to securely store 144 Zone drill core, pulps, and rejects. There is also a large mechanical shop for on-site maintenance of equipment and vehicles. Electrical power is provided by a generator on-site. The mine has no living quarters or canteen and is currently on care and maintenance.
The town of Beatty and urban centres in the region such as Pahrump and Las Vegas offer infrastructure and services that can support the operation.
Mineral processing
Previous processing included heap leaching the oxidised Sterling mine ore. After mine production ceased, the heap leach pad continued to be turned over until October 2001, with additional ore from a low-grade stockpile added in early 2001. Gold recovery continued until August 2002 when a final strip was carried out. Mineralised material from the Crown deposits will be 0.077Moz less thanprocessed either without crushing on a heap leach pad (oxidised material) or in a mill using agitated tank bio-oxidation and cyanidation (sulphide).
MINERAL RESOURCE AND MINERAL RESERVE
In October 2018, the SAMREC OreUnited States Securities and Exchange Commission (“SEC”) adopted Subpart 1300 of Regulation S-K (17 CFR § 229.1300) (“Regulation S-K 1300”), along with amendments to related rules and guidance, in order to modernise the property disclosure requirements for mining registrants under the Securities Act and the Securities Exchange Act. Registrants engaged in mining operations were required to comply with the final rules of Regulation S-K 1300 for the first fiscal year beginning on or after 1 January 2021. Accordingly, this is the second fiscal year in which the Company is providing disclosure in compliance with Regulation S-K 1300.
Mineral Resource and Mineral Reserve dueare estimates that contain inherent risk and depend upon geological interpretation and statistical inferences drawn from drilling and sampling analysis, which may prove to be unreliable. For additional information on the hyperinflationrisks and uncertainties associated with AngloGold Ashanti’s mining properties, see “Item 3D: Risk Factors".
Price assumptions
The Mineral Resource and Mineral Reserve are based on the use of reasonable economic assumptions which provide a reasonable basis for establishing the US$/ARSreasonable prospects of economic extraction for the Mineral Resource, and for establishing the expected price for the Mineral Reserve. These economic assumptions, which include long-range commodity price, exchange rate where the three-year average SEC exchange rateforecasts and management estimates using a range of 32.21 is much lower compared to the AGA exchange rate (based on the last year rates only) of 51.89.techniques including historic price averages, are prepared in-house and reviewed annually. AngloGold Ashanti selects a conservative OreMineral Reserve price relative to its peers, in line with AngloGold Ashanti’speers. This is done to fit into its strategy of including a margin in the mine planning process. The resultant plan is then valued at a higher business planning price.
Gold price
The following gold prices were used as the basis for estimation, unless otherwise stated:
| | | | | | | | | | | | | | | | | |
| | Local prices of gold(1) |
| Gold price(1) | Australia | Brazil | Argentina | Colombia |
| $/oz | AUD/oz | BRL/oz | ARS/oz | COP/oz |
Mineral Reserve | | | | | |
2022 | 1,400 | 1,919 | 7,830 | 208,000 | 4,261,380 |
2021 | 1,200 | 1,633 | 6,182 | 134,452 | 3,849,000 |
Mineral Resource | | | | | |
2022 | 1,750 | 2,416 | 9,401 | 253,500 | 6,076,725 |
2021 | 1,500 | 2,072 | 7,940 | 173,065 | 5,336,250 |
Copper price
The following copper prices(2) were used as the basis for estimation, unless otherwise stated:
| | | | | | | | |
| Copper price(1)(2) | Local price of copper(1)(2) |
| $/lb | COP/lb |
Mineral Reserve | | |
2022 | 2.90 | 9,302 |
2021 | 2.90 | 9,302 |
Mineral Resource | | |
2022 | 3.50 | 12,451 |
2021 | 3.50 | 12,451 |
| | |
Notes:
(1) Considered over the period 2012 to 2022.
(2) Only applicable to the Quebradona project.
The Mineral Resource, as reported, is exclusive(1) of the Mineral Reserve component. Mineral Resource and Mineral Reserve estimates are reported as at 31 December 2022 and are net of 2022 production depletion.
MINERAL RESOURCE
Gold
The AngloGold Ashanti is legally required to publicly report Ore Reservegold Measured and Indicated Mineral Resource according(exclusive of Mineral Reserve(*)) increased from 51.7Moz as at 31 December 2021 to 60.6Moz as at 31 December 2022. The net increase of 8.8Moz for Measured and Indicated Mineral Resource includes 3.6Moz in relation to the South African Codefirst-time reporting of the Mineral Resource for ReportingNorth Bullfrog and Mother Lode (following the Corvus Gold acquisition). Increases due to changes in economic assumptions of Exploration Results, Mineral Resources1.3Moz, and Mineral Reserves (The SAMREC Code, 2016 edition). exploration and modelling changes of 6.6Moz were partially offset by other factors of 2.7Moz.
The SEC’s Industry Guide 7 does not recognise Mineral Resource. Accordingly, AngloGold Ashanti does not report estimatesgold Inferred Mineral Resource(exclusive of Mineral Reserve(*)) decreased from 42.3Moz as at 31 December 2021 to 40.8Moz as at 31 December 2022. The net decrease of 1.6Moz for Inferred Mineral Resource includes decreases due to exploration and modelling changes of 3.1Moz and other factors of 1.3Moz. This decrease was partially offset by an increase of 1.5Moz in this annual report on Form 20-F.relation to the first-time reporting of the Mineral Resource for North Bullfrog, Mother Lode and Sterling (following the Corvus Gold and Coeur Sterling acquisitions), and changes in economic assumptions of 1.3Moz.
The Mineral Resource was estimated using a gold price of $1,750/oz, unless otherwise stated (2021: $1,500/oz). Refer to the below table, prepared in accordance with Table 1 to Paragraph (b) of Item 1303 of Regulation S-K.
Copper
Gold:
The AngloGold Ashanti copper Mineral Resource(exclusive of Mineral Reserve(*)) remained unchanged at 1.32Mt (2,902Mlb) Measured and Indicated Mineral Resource and 1.47Mt (3,231Mlb) Inferred Mineral Resource as at 31 December 2022 as compared to 31 December 2021, as a feasibility study optimisation is still ongoing and no
additional exploration has been completed at Quebradona. The Mineral Resource was estimated at a copper price of $3.50/lb, unless otherwise stated (2021: $3.50/lb). Refer to the below table, prepared in accordance with Table 1 to Paragraph (b) of Item 1303 of Regulation S-K.
MINERAL RESERVE
Gold
The AngloGold Ashanti Oregold Mineral Reserve reducedincreased from 44.1Moz in28.1Moz as at 31 December 20182021 to 43.8Moz in28.8Moz as at 31 December 2019.2022. This grossexcludes Gramalote, as the joint operation partner has decided not to publish the Mineral Reserve. This annual decreasenet increase of 0.3Moz0.7Moz includes depletion of 3.7Moz. The increase before depletion of 3.4Moz, resulted from additions due to exploration and modelling changes of 3.6Moz,2.9Moz and changes in economic assumptions of 0.4Moz1.0Moz. This increase was partially offset by depletion of 2.9Moz and a change in ownershipreductions due to other factors of 0.1Moz. Other factors resulted in a 0.7Moz reduction.0.3Moz. The OreMineral Reserve was estimated using a gold price of US$1,100/$1,400/oz, (2018: US$1,100/unless otherwise stated (2021: $1,200/oz). Refer to the below table, prepared in accordance with Table 2 to Paragraph (b) of Item 1303 of Regulation S-K.
Copper
The principal changes in AngloGold Ashanti’s OreAshanti copper Mineral Reserveremained unchanged at 1.47Mt (3,250Mlb) as at 31 December 2019,2022 as compared with those published as atto 31 December 2018, are2021, as follows:
|
| | | |
ORE RESERVE - GOLD | Moz |
|
Ore Reserve as at 31 December 2018 | 44.1 |
|
Depletions | | (3.7 | ) |
| Sub Total | 40.4 |
|
Additions | Due To | |
Obuasi | Model updates which resulted in new designs for Sansu, Blocks 8 and 11.
| 1.3 |
|
Kibali | Exploration which upgraded Inferreda feasibility study optimisation is still ongoing and no additional exploration has been completed at Quebradona. The Mineral Resource which was partially offset by higher open pit costs which resulted from the changes in the DRC mining code. Fresh rock processing costs also increased. | 0.8 |
|
Geita | Exploration additions at Nyankanga and Star and Comet and the steepening of the planned eastern pit wall at Nyankanga Cut 8. | 0.8 |
|
AGA Mineração | Additions to the Cuiabá model, mainly at Serrotinho, which were countered by increased costs used in the feasibility study for mining of the secondary orebodies as well as a review of mining methods. At Lamego, additions resulted from exploration at Carruagem.
| 0.5 |
|
Iduapriem | Inclusion of Block 5 in the Ore Reserve given reduced mining costs. | 0.5 |
|
Quebradona | Remodelling and change in ownership. | 0.3 |
|
Other | Additions less than 0.3Moz. | 0.3 |
|
| Sub Total | 44.9 |
|
Reductions | | |
Other | Reductions less than 0.3Moz. | (1.1 | ) |
Ore Reserve as at 31 December 2019 | 43.8 |
|
Copper:
The AngloGold Ashanti Ore Reserve increased from 1.26Mt (2,769Mlbs) in December 2018 to 1.39Mt (3,068Mlbs) in December 2019. This gross annual increase of 0.14Mt includes an increase of 0.07Mt due to methodology and 0.07Mt due to change in ownership from 94.876% to 100% as B2Gold’s shareholding was converted to a share of profits. The Ore Reserve was estimated at a copper price of US$2.65/$2.90/lb, (2018: US$2.65/unless otherwise stated (2021: $2.90/lb). Refer to the below table, prepared in accordance with Table 2 to Paragraph (b) of Item 1303 of Regulation S-K.
Notes:
(*) The Mineral Resource exclusive of Mineral Reserve (“Exclusive Mineral Resource”) is defined as the Inclusive Mineral Resource less the Mineral Reserve before dilution and other factors are applied.
|
| | | | | | |
ORE RESERVE - COPPER | Mt |
| Mlb |
|
Ore Reserve as at 31 December 2018 | 1.26 |
| 2,769 |
|
Additions | Due To | | |
Quebradona | Remodelling and change in ownership. | 0.14 |
| 300 |
|
Ore Reserve as at 31 December 2019 | 1.39 |
| 3,068 |
|
The below table is prepared in accordance with Table 1 to Paragraph (b) of Item 1303 of Regulation S-K - Summary Mineral Resource(1) (exclusive of Mineral Reserve) for gold at the end of the fiscal year ended 31 December 2022, based on an estimated gold price of $1,750/oz, unless otherwise stated.
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Mineral Resource (1) | Measured | Indicated | Measured and Indicated Total | Inferred |
Gold | Tonnes (3) | Grade | Contained Gold | Tonnes (3) | Grade | Contained Gold | Tonnes (3) | Grade | Contained Gold | Tonnes (3) | Grade | Contained Gold |
as at 31 December 2022 | Million | g/t | Tonnes | Moz | Million | g/t | Tonnes | Moz | Million | g/t | Tonnes | Moz | Million | g/t | Tonnes | Moz |
Africa Region | 11.14 | | 4.23 | | 47.19 | | 1.52 | | 259.42 | | 1.93 | | 499.44 | | 16.06 | | 270.57 | | 2.02 | | 546.63 | | 17.57 | | 201.72 | | 3.01 | | 607.95 | | 19.55 | |
Democratic Republic of the Congo | 7.22 | | 3.18 | | 22.97 | | 0.74 | | 22.15 | | 2.64 | | 58.44 | | 1.88 | | 29.37 | | 2.77 | | 81.41 | | 2.62 | | 13.16 | | 2.61 | | 34.43 | | 1.11 | |
Kibali (45 %)(2)(9)(13) | 7.22 | | 3.18 | | 22.97 | | 0.74 | | 22.15 | | 2.64 | | 58.44 | | 1.88 | | 29.37 | | 2.77 | | 81.41 | | 2.62 | | 13.16 | | 2.61 | | 34.43 | | 1.11 | |
Ghana | 2.12 | | 7.89 | | 16.72 | | 0.54 | | 82.17 | | 2.94 | | 241.81 | | 7.77 | | 84.28 | | 3.07 | | 258.53 | | 8.31 | | 73.25 | | 5.27 | | 385.68 | | 12.40 | |
Iduapriem(13) | 0.15 | | 0.89 | | 0.14 | | — | | 54.50 | | 1.36 | | 74.21 | | 2.39 | | 54.66 | | 1.36 | | 74.35 | | 2.39 | | 33.45 | | 1.42 | | 47.52 | | 1.53 | |
Obuasi(13)(14) | 1.96 | | 8.44 | | 16.59 | | 0.53 | | 27.66 | | 6.06 | | 167.59 | | 5.39 | | 29.63 | | 6.22 | | 184.18 | | 5.92 | | 39.80 | | 8.50 | | 338.17 | | 10.87 | |
Guinea | — | | — | | — | | — | | 114.79 | | 1.02 | | 117.24 | | 3.77 | | 114.79 | | 1.02 | | 117.24 | | 3.77 | | 79.10 | | 1.16 | | 92.13 | | 2.96 | |
Siguiri (85 %)(2)(13) | — | | — | | — | | — | | 114.79 | | 1.02 | | 117.24 | | 3.77 | | 114.79 | | 1.02 | | 117.24 | | 3.77 | | 79.10 | | 1.16 | | 92.13 | | 2.96 | |
Tanzania | 1.80 | | 4.15 | | 7.50 | | 0.24 | | 40.32 | | 2.03 | | 81.96 | | 2.63 | | 42.12 | | 2.12 | | 89.45 | | 2.88 | | 36.21 | | 2.64 | | 95.71 | | 3.08 | |
Geita(13) | 1.80 | | 4.15 | | 7.50 | | 0.24 | | 40.32 | | 2.03 | | 81.96 | | 2.63 | | 42.12 | | 2.12 | | 89.45 | | 2.88 | | 36.21 | | 2.64 | | 95.71 | | 3.08 | |
Americas Region | 16.88 | | 4.20 | | 70.94 | | 2.28 | | 41.41 | | 2.77 | | 114.85 | | 3.69 | | 58.29 | | 3.19 | | 185.78 | | 5.97 | | 61.85 | | 3.57 | | 220.98 | | 7.10 | |
Argentina | 4.82 | | 2.88 | | 13.89 | | 0.45 | | 17.49 | | 2.23 | | 39.09 | | 1.26 | | 22.31 | | 2.37 | | 52.98 | | 1.70 | | 5.00 | | 2.35 | | 11.74 | | 0.38 | |
Cerro Vanguardia (92.5 %)(2)(4)(13) | 4.82 | | 2.88 | | 13.89 | | 0.45 | | 17.49 | | 2.23 | | 39.09 | | 1.26 | | 22.31 | | 2.37 | | 52.98 | | 1.70 | | 5.00 | | 2.35 | | 11.74 | | 0.38 | |
Brazil | 12.06 | | 4.73 | | 57.05 | | 1.83 | | 23.92 | | 3.17 | | 75.76 | | 2.44 | | 35.98 | | 3.69 | | 132.80 | | 4.27 | | 56.85 | | 3.68 | | 209.24 | | 6.73 | |
AGA Mineração - Córrego do Sítio(13) | 3.07 | | 3.31 | | 10.18 | | 0.33 | | 7.92 | | 3.19 | | 25.24 | | 0.81 | | 10.99 | | 3.22 | | 35.42 | | 1.14 | | 20.46 | | 3.94 | | 80.63 | | 2.59 | |
AGA Mineração - Cuiabá(5)(13) | 4.17 | | 7.66 | | 31.96 | | 1.03 | | 2.73 | | 5.83 | | 15.93 | | 0.51 | | 6.91 | | 6.93 | | 47.89 | | 1.54 | | 12.56 | | 4.95 | | 62.20 | | 2.00 | |
AGA Mineração - Lamego(5)(13) | 1.18 | | 2.92 | | 3.44 | | 0.11 | | 3.05 | | 1.98 | | 6.05 | | 0.19 | | 4.23 | | 2.24 | | 9.49 | | 0.31 | | 4.56 | | 2.12 | | 9.65 | | 0.31 | |
Serra Grande(13) | 3.63 | | 3.15 | | 11.46 | | 0.37 | | 10.21 | | 2.79 | | 28.54 | | 0.92 | | 13.85 | | 2.89 | | 40.01 | | 1.29 | | 19.26 | | 2.95 | | 56.76 | | 1.82 | |
Australia Region | 38.85 | | 1.44 | | 55.96 | | 1.80 | | 30.58 | | 1.58 | | 48.40 | | 1.56 | | 69.44 | | 1.50 | | 104.36 | | 3.36 | | 55.36 | | 2.25 | | 124.79 | | 4.01 | |
Sunrise Dam(13) | 20.31 | | 1.64 | | 33.27 | | 1.07 | | 22.79 | | 1.56 | | 35.60 | | 1.14 | | 43.09 | | 1.60 | | 68.87 | | 2.21 | | 29.28 | | 2.02 | | 59.19 | | 1.90 | |
Butcher Well (70 %)(2)(11) | — | | — | | — | | — | | — | | — | | — | | — | | — | | — | | — | | — | | 3.06 | | 3.49 | | 10.67 | | 0.34 | |
Tropicana (70 %)(2)(13) | 18.55 | | 1.22 | | 22.69 | | 0.73 | | 7.79 | | 1.64 | | 12.80 | | 0.41 | | 26.34 | | 1.35 | | 35.49 | | 1.14 | | 23.02 | | 2.39 | | 54.93 | | 1.77 | |
Projects | 98.19 | | 0.40 | | 38.96 | | 1.25 | | 1,311.77 | | 0.77 | | 1,007.67 | | 32.40 | | 1,409.96 | | 0.74 | | 1,046.63 | | 33.65 | | 682.59 | | 0.46 | | 314.29 | | 10.10 | |
Colombia | 45.15 | | 0.37 | | 16.93 | | 0.54 | | 1,071.76 | | 0.78 | | 838.58 | | 26.96 | | 1,116.91 | | 0.77 | | 855.51 | | 27.51 | | 558.94 | | 0.44 | | 244.17 | | 7.85 | |
Gramalote (50 %)(2)(10)(11) | — | | — | | — | | — | | 89.36 | | 0.70 | | 62.38 | | 2.01 | | 89.36 | | 0.70 | | 62.38 | | 2.01 | | 35.11 | | 0.53 | | 18.67 | | 0.60 | |
La Colosa(7)(11) | — | | — | | — | | — | | 833.49 | | 0.87 | | 726.31 | | 23.35 | | 833.49 | | 0.87 | | 726.31 | | 23.35 | | 217.89 | | 0.71 | | 154.86 | | 4.98 | |
Quebradona(4)(6)(8)(12) | 45.15 | | 0.37 | | 16.93 | | 0.54 | | 148.91 | | 0.34 | | 49.89 | | 1.60 | | 194.06 | | 0.34 | | 66.82 | | 2.15 | | 305.94 | | 0.23 | | 70.64 | | 2.27 | |
United States of America | 53.04 | | 0.42 | | 22.04 | | 0.71 | | 240.01 | | 0.70 | | 169.09 | | 5.44 | | 293.05 | | 0.65 | | 191.12 | | 6.14 | | 123.65 | | 0.57 | | 70.13 | | 2.25 | |
North Bullfrog(4)(11) | 28.71 | | 0.24 | | 6.77 | | 0.22 | | 82.54 | | 0.37 | | 30.18 | | 0.97 | | 111.25 | | 0.33 | | 36.95 | | 1.19 | | 44.35 | | 0.25 | | 11.07 | | 0.36 | |
Silicon(4)(11) | — | | — | | — | | — | | 121.56 | | 0.87 | | 105.90 | | 3.40 | | 121.56 | | 0.87 | | 105.90 | | 3.40 | | 36.03 | | 0.70 | | 25.23 | | 0.81 | |
Mother Lode(4)(8)(11) | 24.33 | | 0.63 | | 15.26 | | 0.49 | | 35.91 | | 0.92 | | 33.01 | | 1.06 | | 60.24 | | 0.80 | | 48.28 | | 1.55 | | 9.86 | | 0.55 | | 5.39 | | 0.17 | |
Sterling(11)(15) | — | | — | | — | | — | | — | | — | | — | | — | | — | | — | | — | | — | | 33.41 | | 0.85 | | 28.43 | | 0.91 | |
AngloGold Ashanti Total | 165.06 | | 1.29 | | 213.05 | | 6.85 | | 1,643.18 | | 1.02 | | 1,670.35 | | 53.70 | | 1,808.25 | | 1.04 | | 1,883.40 | | 60.55 | | 1,001.52 | | 1.27 | | 1,268.02 | | 40.77 | |
Notes:
Rounding of numbers may result in computational discrepancies in the Mineral Resource tabulations. The Mineral Resource estimates with respect to our material properties have been prepared by the Qualified Persons (employed by AngloGold Ashanti strivesunless stated otherwise). The net difference between the Mineral Resource at the end of the last completed fiscal year and the preceding fiscal year will be detailed for material properties, if applicable. To reflect that figures are not precise calculations and that there is uncertainty in their estimation, AngloGold Ashanti reports tonnage, grade and content for gold to actively create valuetwo decimals. All ounces are Troy ounces. “Moz” refers to million ounces.
(1) All disclosure of Mineral Resource is exclusive of Mineral Reserve. The Mineral Resource exclusive of Mineral Reserve (“Exclusive Mineral Resource”)
is defined as the inclusive Mineral Resource less the Mineral Reserve before dilution and other factors are applied. (2) Mineral Resource attributable to AngloGold Ashanti’s percentage interest shown.
(3) "Tonnes" refers to a metric tonne which is equivalent to 1,000 kilograms.
(4) The inclusive Mineral Resource contains 81.7Moz of silver for Cerro Vanguardia; 92.9Moz of silver for Quebradona; 6.0Moz of silver for North Bullfrog;
17.8Moz of silver for Silicon and 1.9Moz of silver for Mother Lode as a by-product.
(5) The inclusive Mineral Resource contains 1.60 million tonnes of sulphur as a by-product for AGA Mineração - Cuiabá and Lamego.
(6) The inclusive Mineral Resource contains 89.3 kilotonnes of molybdenum as a potential by-product.
(7) Based on a gold price of $1,400/oz.
(8) Based on a gold price of $1,500/oz.
(9) Operated by growing its major asset -Barrick Gold Corporation ("Barrick"). AngloGold Ashanti has recognised that in preparing this annual report, the Ore Reserve. This drive isQualified Persons have, relied on information provided by Barrick. Based on a gold price of $1,700/oz. (10) Managed by B2Gold Corp. Based on a gold price of $1,800/oz.
(11) Property currently in an exploration stage.
(12) Property currently in a development stage.
(13) Property currently in a production stage.
(14) Open pit based on a well-defined brownfieldsgold price of $1,600/oz.
(15) Based on a gold price of $1,700/oz.
The below table is prepared in accordance with Table 1 to Paragraph (b) of Item 1303 of Regulation S-K - Summary Mineral Resource(1) (exclusive of Mineral Reserve) for copper at the end of the fiscal year ended 31 December 2022, based on an estimated copper price of $3.50/lb, unless otherwise stated.
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Mineral Resource (1) | Measured | Indicated | Measured and Indicated Total | Inferred |
Copper | Tonnes (2) | Grade | Contained Copper | Tonnes (2) | Grade | Contained Copper | Tonnes (2) | Grade | Contained Copper | Tonnes (2) | Grade | Contained Copper |
as at 31 December 2022 | Million | %Cu | Tonnes Million | Pounds Million | Million | %Cu | Tonnes Million | Pounds Million | Million | %Cu | Tonnes Million | Pounds Million | Million | %Cu | Tonnes Million | Pounds Million |
Americas Region | 45.15 | | 0.69 | | 0.31 | | 684 | | 148.91 | | 0.68 | | 1.01 | | 2,218 | | 194.06 | | 0.68 | | 1.32 | | 2,902 | | 305.94 | | 0.48 | | 1.47 | | 3,231 | |
Colombia | 45.15 | | 0.69 | | 0.31 | | 684 | | 148.91 | | 0.68 | | 1.01 | | 2,218 | | 194.06 | | 0.68 | | 1.32 | | 2,902 | | 305.94 | | 0.48 | | 1.47 | | 3,231 | |
Quebradona(3)(4)(5) | 45.15 | | 0.69 | | 0.31 | | 684 | | 148.91 | | 0.68 | | 1.01 | | 2,218 | | 194.06 | | 0.68 | | 1.32 | | 2,902 | | 305.94 | | 0.48 | | 1.47 | | 3,231 | |
AngloGold Ashanti Total | 45.15 | | 0.69 | | 0.31 | | 684 | | 148.91 | | 0.68 | | 1.01 | | 2,218 | | 194.06 | | 0.68 | | 1.32 | | 2,902 | | 305.94 | | 0.48 | | 1.47 | | 3,231 | |
Notes:
Rounding of numbers may result in computational discrepancies in the Mineral Resource tabulations. To reflect that figures are not precise calculations and greenfields exploration programme, innovationthat there is uncertainty in both geological modellingtheir estimation, AngloGold Ashanti reports tonnage and mine planninggrade to two decimals and optimizationcontent for copper with no decimals. “Mlb” refers to million pounds.(1) All disclosure of its asset portfolio.Mineral Resource is exclusive of Mineral Reserve. The Mineral Resource exclusive of Mineral Reserve (“Exclusive Mineral Resource”)
is defined as the Inclusive Mineral Resource less the Mineral Reserve before dilution and other factors are applied.
(2) "Tonnes" refers to a metric tonne which is equivalent to 1,000 kilograms.
(3) The inclusive Mineral Resource contains 92.9Moz of silver as a by-product.
(4) The inclusive Mineral Resource contains 89.3 kilotonnes of molybdenum as a potential by-product.
(5) Property currently in a development stage.
The Orebelow table is prepared in accordance with Table 2 to Paragraph (b) of Item 1303 of Regulation S-K - Summary Mineral Reserve for gold at the end of the fiscal year ended 31 December 2022, based on an estimated gold price of $1,400/oz, unless otherwise stated.
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Mineral Reserve | Proven | Probable | Total Mineral Reserve |
Gold | Tonnes (2) | Grade | Contained Gold | Tonnes (2) | Grade | Contained Gold | Tonnes (2) | Grade | Contained Gold |
as at 31 December 2022 | Million | g/t | Tonnes | Moz | Million | g/t | Tonnes | Moz | Million | g/t | Tonnes | Moz |
Africa Region | 50.54 | | 2.37 | | 120.00 | | 3.86 | | 213.89 | | 2.43 | | 520.44 | | 16.73 | | 264.43 | | 2.42 | | 640.45 | | 20.59 | |
Democratic Republic of the Congo | 14.49 | | 3.47 | | 50.33 | | 1.62 | | 29.17 | | 3.15 | | 91.86 | | 2.95 | | 43.67 | | 3.26 | | 142.19 | | 4.57 | |
Kibali (45 %)(1)(5)(8) | 14.49 | | 3.47 | | 50.33 | | 1.62 | | 29.17 | | 3.15 | | 91.86 | | 2.95 | | 43.67 | | 3.26 | | 142.19 | | 4.57 | |
Ghana | 11.31 | | 4.42 | | 50.03 | | 1.61 | | 70.08 | | 3.78 | | 264.67 | | 8.51 | | 81.39 | | 3.87 | | 314.70 | | 10.12 | |
Iduapriem(8) | 6.84 | | 1.07 | | 7.30 | | 0.23 | | 48.83 | | 1.39 | | 68.00 | | 2.19 | | 55.67 | | 1.35 | | 75.30 | | 2.42 | |
Obuasi(8) | 4.47 | | 9.55 | | 42.73 | | 1.37 | | 21.25 | | 9.26 | | 196.67 | | 6.32 | | 25.72 | | 9.31 | | 239.40 | | 7.70 | |
Guinea | 15.20 | | 0.65 | | 9.95 | | 0.32 | | 75.68 | | 0.83 | | 62.72 | | 2.02 | | 90.88 | | 0.80 | | 72.67 | | 2.34 | |
Siguiri (85 %)(1)(8) | 15.20 | | 0.65 | | 9.95 | | 0.32 | | 75.68 | | 0.83 | | 62.72 | | 2.02 | | 90.88 | | 0.80 | | 72.67 | | 2.34 | |
Tanzania | 9.54 | | 1.02 | | 9.70 | | 0.31 | | 38.95 | | 2.60 | | 101.19 | | 3.25 | | 48.49 | | 2.29 | | 110.89 | | 3.57 | |
Geita(8) | 9.54 | | 1.02 | | 9.70 | | 0.31 | | 38.95 | | 2.60 | | 101.19 | | 3.25 | | 48.49 | | 2.29 | | 110.89 | | 3.57 | |
Americas Region | 8.16 | | 3.39 | | 27.64 | | 0.89 | | 23.64 | | 2.79 | | 65.88 | | 2.12 | | 31.80 | | 2.94 | | 93.53 | | 3.01 | |
Argentina | 2.22 | | 3.20 | | 7.11 | | 0.23 | | 9.16 | | 1.75 | | 16.00 | | 0.51 | | 11.38 | | 2.03 | | 23.11 | | 0.74 | |
Cerro Vanguardia (92.5 %)(1)(3)(8) | 2.22 | | 3.20 | | 7.11 | | 0.23 | | 9.16 | | 1.75 | | 16.00 | | 0.51 | | 11.38 | | 2.03 | | 23.11 | | 0.74 | |
Brazil | 5.93 | | 3.46 | | 20.54 | | 0.66 | | 14.48 | | 3.44 | | 49.88 | | 1.60 | | 20.41 | | 3.45 | | 70.41 | | 2.26 | |
AGA Mineração - Córrego do Sítio(8) | 1.17 | | 2.95 | | 3.44 | | 0.11 | | 2.21 | | 4.32 | | 9.53 | | 0.31 | | 3.37 | | 3.84 | | 12.97 | | 0.42 | |
AGA Mineração - Cuiabá(4)(8) | 2.37 | | 4.57 | | 10.82 | | 0.35 | | 5.99 | | 4.22 | | 25.28 | | 0.81 | | 8.35 | | 4.32 | | 36.11 | | 1.16 | |
AGA Mineração - Lamego(4)(8) | 0.35 | | 2.54 | | 0.89 | | 0.03 | | 1.18 | | 2.71 | | 3.20 | | 0.10 | | 1.53 | | 2.67 | | 4.10 | | 0.13 | |
Serra Grande(8) | 2.05 | | 2.63 | | 5.38 | | 0.17 | | 5.10 | | 2.32 | | 11.86 | | 0.38 | | 7.15 | | 2.41 | | 17.24 | | 0.55 | |
Australia Region | 21.96 | | 1.54 | | 33.88 | | 1.09 | | 22.30 | | 2.15 | | 47.88 | | 1.54 | | 44.26 | | 1.85 | | 81.76 | | 2.63 | |
Sunrise Dam(8) | 12.02 | | 1.51 | | 18.17 | | 0.58 | | 6.55 | | 2.72 | | 17.83 | | 0.57 | | 18.57 | | 1.94 | | 36.00 | | 1.16 | |
Tropicana (70 %)(1)(8) | 9.94 | | 1.58 | | 15.71 | | 0.51 | | 15.74 | | 1.91 | | 30.05 | | 0.97 | | 25.69 | | 1.78 | | 45.76 | | 1.47 | |
Projects | — | | — | | — | | — | | 120.01 | | 0.67 | | 80.83 | | 2.60 | | 120.01 | | 0.67 | | 80.83 | | 2.60 | |
Colombia | — | | — | | — | | — | | 120.01 | | 0.67 | | 80.83 | | 2.60 | | 120.01 | | 0.67 | | 80.83 | | 2.60 | |
Quebradona(3)(6)(7) | — | | — | | — | | — | | 120.01 | | 0.67 | | 80.83 | | 2.60 | | 120.01 | | 0.67 | | 80.83 | | 2.60 | |
AngloGold Ashanti Total | 80.66 | | 2.25 | | 181.53 | | 5.84 | | 379.84 | | 1.88 | | 715.03 | | 22.99 | | 460.49 | | 1.95 | | 896.56 | | 28.83 | |
Notes:
Rounding of numbers may result in computational discrepancies in the Mineral Reserve tabulations. The Mineral Reserve estimates with respect to our material properties have been prepared by the Qualified Persons (employed by AngloGold Ashanti unless stated otherwise). The net difference between the Mineral Reserve at the end of the last completed fiscal year and the preceding fiscal year will be detailed for material properties, if applicable. To reflect that figures are not precise calculations and that there is uncertainty in their estimation, AngloGold Ashanti reports tonnage, grade and content for gold to two decimals. All ounces are Troy ounces. “Moz” refers to million ounces.
(1) Mineral Reserve attributable to AngloGold Ashanti’s percentage interest shown.
(2) "Tonnes" refers to a metric tonne which is equivalent to 1,000 kilograms.
(3) The Mineral Reserve contains 21.9Moz of silver for Cerro Vanguardia and 28.1Moz of silver for Quebradona to be recovered as a by-product.
(4) The Mineral Reserve contains 0.29 million tonnes of sulphur to be recovered as a by-product for AGA Mineração - Cuiabá and Lamego.
(5) Operated by Barrick. AngloGold Ashanti has recognised that in preparing this document includeannual report, the OreQualified Persons have relied on information provided by Barrick. Based on a gold price of $1,300/oz. Pamoa Main pit was based on a gold price of $1,400/oz and Pamoa South pit was based on a gold price of $1,500/oz. (6) Based on a gold price of $1,200/oz. (7) Property currently in a development stage.
(8) Property currently in a production stage.
The below table is prepared in accordance with Table 2 to Paragraph (b) of Item 1303 of Regulation S-K - Summary Mineral Reserve belowfor copper at the current infrastructureend of underground mines. These include minesthe fiscal year ended 31 December 2022, based on an estimated copper price of $2.90/lb, unless otherwise stated.
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Mineral Reserve | Proven | Probable | Total Mineral Reserve |
Copper | Tonnes (1) | Grade | Contained Copper | Tonnes (1) | Grade | Contained Copper | Tonnes (1) | Grade | Contained Copper |
as at 31 December 2022 | Million | %Cu | Tonnes Million | Pounds Million | Million | %Cu | Tonnes Million | Pounds Million | Million | %Cu | Tonnes Million | Pounds Million |
Americas Region | — | | — | | — | | — | | 120.01 | | 1.23 | | 1.47 | | 3,250 | | 120.01 | | 1.23 | | 1.47 | | 3,250 | |
Colombia | — | | — | | — | | — | | 120.01 | | 1.23 | | 1.47 | | 3,250 | | 120.01 | | 1.23 | | 1.47 | | 3,250 | |
Quebradona(2)(3) | — | | — | | — | | — | | 120.01 | | 1.23 | | 1.47 | | 3,250 | | 120.01 | | 1.23 | | 1.47 | | 3,250 | |
AngloGold Ashanti Total | — | | — | | — | | — | | 120.01 | | 1.23 | | 1.47 | | 3,250 | | 120.01 | | 1.23 | | 1.47 | | 3,250 | |
Notes:
Rounding of numbers may result in South Africa, Ghana, Australia, Brazilcomputational discrepancies in the Mineral Reserve tabulations. To reflect that figures are not precise calculations and Colombia.that there is uncertainty in their estimation, AngloGold Ashanti reports tonnage and grade to two decimals and content for copper with no decimals. “Mlb” refers to million pounds.(1) "Tonnes" refers to a metric tonne which is equivalent to 1,000 kilograms.
(2) The Mineral Reserve contains 28.1Moz of silver to be recovered as a by-product.
By-products(3)Property currently in a development stage.
BY-PRODUCTS
Several by-products willare expected to be recovered as a result of processing of the gold OreMineral Reserve and copper OreMineral Reserve. These include 0.39Mt0.29Mt of sulphur from Brazil, 18.76Moz21.9Moz of silver from Argentina and 25.95Moz28.1Moz of silver from Colombia. Molybdenum, at present, is not planned for recovery at Quebradona. The Quebradona process plant has been designed to treat underground ore and to produce copper concentrate with provision of space in the plant site for a molybdenum plant in the future.
ExternalCORPORATE GOVERNANCE
AngloGold Ashanti has an established Mineral Resource and Mineral Reserve Leadership Team ("RRLT") that is responsible for setting and overseeing its Mineral Resource and Mineral Reserve governance framework, and for ensuring that it meets the Company’s goals and objectives while complying with all relevant regulatory codes.
The Audit and Risk Committee as well as the Investment Committee of the Company’s board of directors ("board"), review the Mineral Resource and Mineral Reserve and make a recommendation to the board, which provides the final approval for the publication of the Mineral Resource and Mineral Reserve estimates.
AngloGold Ashanti has developed and implemented a rigorous system of internal and external reviews aimed at providing assurance in respect of Mineral Resource and OreMineral Reserve Statement
During the course of 2019,estimates. In 2022, the following operations and projects were subject to an external review in line withon the policybasis that each operation/operation or project will be reviewed by an independent third partythird-party on average once every three years:
• Mineral Resource and OreMineral Reserve at SiguiriGeita;
• Mineral Resource and OreMineral Reserve at GeitaCerro Vanguardia; and
• Mineral Resource at North Bullfrog project.
No material risks were identified following completion of these external reviews.
In addition, numerous internal Mineral Resource and OreMineral Reserve at AGA Mineração Cuiabáprocess reviews were completed by suitably qualified technical experts from within AngloGold Ashanti and Lamego
no significant deficiencies were identified. The Mineral Resource and OreMineral Reserve at AGA Mineração Córrego do Sítio
The external reviews were conductedgovernance framework is underpinned by Golder Associates Pty Ltdappropriate Mineral Resource management processes and certificates of sign-offprotocols that ensure adequate corporate governance. These procedures have been receiveddeveloped to statebe compliant with the guiding principles of the U.S. Sarbanes-Oxley Act of 2002 ("SOX").
AngloGold Ashanti makes use of a web-based group reporting database called the Resource and Reserve Reporting System ("RCubed") for the compilation and authorisation of Mineral Resource and Mineral Reserve reporting. It is a fully integrated system for the reporting and reconciliation of Mineral Resource and Mineral Reserve that supports various regulatory reporting requirements, including the SEC reporting requirements under Regulation S-K 1300, and the JSE reporting requirements under the SAMREC Code. AngloGold Ashanti uses RCubed to ensure a documented chain of responsibility exists from the technical experts at the operations to the Company’s RRLT.
AngloGold Ashanti has also developed an enterprise-wide risk management tool that provides consistent and reliable data that allows for visibility of risks and actions across the group. This tool is used to facilitate, control and monitor material risks to the Mineral Resource and/and Mineral Reserve, thus ensuring that the appropriate risk management and mitigation plans are in place.
If technical experts involved in the estimation of Mineral Resource or OreMineral Reserve comply withfeel that their technical advice has been ignored which may represent a risk to the SAMREC Code.Mineral Resource or Mineral Reserve to be published, they are obliged to inform the RRLT in writing. In addition, AngloGold Ashanti’s “Speak-up” programme can also be used if the technical experts deem they may be compromised in the process. .
Competent Persons
QUALIFIED PERSONS
The information in this annual report on Form 20-F relating to Exploration Results, Mineral ResourcesResource and Ore ReservesMineral Reserve on AngloGold Ashanti’s material properties is based on information compiled by, or under the supervision of, the CompetentQualified Persons, as defined in the SAMREC Code.Regulation S-K 1300. All CompetentQualified Persons arewere employed by AngloGold Ashanti exceptat the time of preparing the Technical Report Summaries in respect of AngloGold’s material properties. However, two of the Qualified Persons who provided the information for the Technical Report Summaries (effective date: 31 December 2021) in respect of Kibali and Morila,Obuasi are no longer employed by AngloGold Ashanti as of the date hereof. Mr. Richard Peattie, the Qualified Person providing information in respect of the Mineral Resource at Kibali, is now employed by Barrick, which has a 45 percent interest in Kibali. Ms. Emmarentia Maritz, the Qualified Person providing information in respect of the Mineral Resource at Obuasi, is now employed by Barrick. Both of these Qualified Persons have
provided updated consents to the use of the their names, or any quotation from, or summarisation of, the Technical Report Summaries (effective date: 31 December 2021) prepared by them in this annual report, and to the filing of the Technical Report Summaries (effective date: 31 December 2021) as exhibits hereto. All Qualified Persons have sufficient experience relevant to the style of mineralisation and the type of deposit under consideration, and relevant to the activity which they are undertaking. AngloGold Ashanti has recognised that in preparing this annual report with respect to Kibali, the Qualified Persons have relied on information provided by Barrick. The legal tenure of each operation and projectmaterial property has been verified to the satisfaction of the accountable CompetentQualified Person and all Ore Reserves haveof the Mineral Reserve has been confirmed to be covered by the required mining permits or there exists a realistic expectation that these permits will be issued. The CompetentQualified Persons have provided consent to the inclusion of Exploration Results, Mineral Resource and OreMineral Reserve information in this annual report, in the form and context in which it appears.appears as well as the public filing of the Technical Report Summary for each respective material mining property filed as exhibits hereto.
Qualified Persons
| | | | | | | | | | | | | | | | | |
Responsibility | Qualified Person | Professional organisation | Membership number | Relevant experience | Qualification |
Kibali Mineral Resource | Richard Peattie (1) | FAusIMM | 301 029 | 26 years | MPhil (Geostatistics) |
Kibali Mineral Reserve | Romulo Sanhueza | MAusIMM | 211 794 | 25 years | BSc Eng (Mining) |
Obuasi Mineral Resource | Emmarentia Maritz(1) | SACNASP | 118345 | 19 years | MSc (Mineral Resource Evaluation) |
Obuasi Mineral Reserve | Douglas Atanga | MAusIMM | 334 391 | 14 years | BSc (Mining Engineering) |
Geita Mineral Resource | Damon Elder | MAusIMM | 208 240 | 26 years | BSc Hons (Geology) |
Geita Mineral Reserve | Duan Campbell | ECSA | 202 101 953 | 20 years | BEng (Mining) |
Notes:
All Qualified Persons were employed by AngloGold Ashanti at the time of preparing the Technical Report Summaries in respect of AngloGold’s material properties.
(1) Two of the Qualified Persons who provided the information for the Technical Report Summaries (effective date: 31 December 2021) in respect of
Kibali and Obuasi Mineral Resource are no longer employed by AngloGold Ashanti as of the date hereof and are currently employed by Barrick.
Accordingly, the ChairmanChairperson of the Mineral Resource and OreMineral Reserve Steering Committee, VA Chamberlain, MSc (Mining Engineering)Leadership Team, Mrs. TM Flitton, Master of Engineering (Mining), BSc (Hons) (Geology)Bachelor of Science (Honours, Geology), MGSSA, FAusIMM,RM SME, Pr.Sci.Nat (SACNASP), FGSSA, assumes responsibility for the Mineral Resource and OreMineral Reserve processes for AngloGold Ashanti and is satisfied that the Competent Persons have fulfilled their responsibilities. VA ChamberlainAshanti. Mrs. TM Flitton has 3221 years’ experience in explorationmining with ten years directly leading and miningmanaging Mineral Resource and Mineral Reserve reporting. She is employed full-time by AngloGold Ashanti and can be contacted at the following address: 76 Rahima Moosa Street, Newtown, 2001,112 Oxford Road, Houghton Estate, Johannesburg, 2198, South Africa.
A detailed breakdown Mrs. TM Flitton consents to the inclusion of Mineral Resource and OreMineral Reserve information in this annual report, in the form and backup detail willcontext in which it appears in the narrative disclosure and in the exhibits filed hereto.
GENERAL CONSIDERATIONS
The following considerations should be providednoted in respect of the information in this “Item 4D: Property plants and equipment”:
•All figures are expressed on the AngloGold Ashanti website (www.anglogoldashanti.com)an attributable basis unless otherwise indicated;
•All disclosure of Mineral Resource is exclusive of Mineral Reserve;
•Unless otherwise stated, $ or dollar refers to U.S. dollars;
•Group and www.aga-reports.com.Company are used interchangeably;
•Mine, operation, business unit and property are used interchangeably;
Gold
|
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Ore Reserve: Imperial | At 31 December 2019 | | |
| Proven Ore Reserve (1) (2) | | Probable Ore Reserve (1) (2) | | Metallurgical | | Cut-off |
| Tons(5) | | | Grade | | | Gold Content | | | Tons (5) |
| | Grade |
| | Gold Content |
| | Recovery Factor | | Grade | (9) |
| (million) | | | (oz/ton) | | | (Moz) | | | (million) |
| | (oz/ton) |
| | (Moz) |
| | percent | | (oz/ton) |
Continental Africa | | | | | | | | | | | | | | | |
Democratic Republic of the Congo | | | | | | | | | | | | | | | |
Kibali (45 percent) (3) (10) | 10.25 | | | 0.120 | | | 1.23 | | | 23.72 |
| | 0.123 |
| | 2.93 |
| | 84.5-89.8 | (4) | | 0.044-0.070 | (4) |
Ghana | | | | | | | | | | | | | | | |
Iduapriem | 3.74 | | | 0.024 | | | 0.09 | | | 42.86 |
| | 0.040 |
| | 1.71 |
| | 93.0-95.85 | (4) | | 0.025-0.028 | (4) |
Obuasi (2) | — |
| | | — |
| | �� | — |
| | | 26.74 |
| | 0.266 |
| | 7.12 |
| | 87.0 | | | 0.120-0.152 | (4) |
Guinea | | | | | | | | | | | | | | | |
Siguiri (85 percent) (3) | 20.07 | | | 0.019 | | | 0.37 | | | 59.66 |
| | 0.023 |
| | 1.39 |
| | 88.0-93.0 | (4) | | 0.015-0.022 | (4) |
Mali | | | | | | | | | | | | | | | |
Morila (40 percent) (3) (10)(11) | — | | | — | | | — |
| | | — |
| | — |
| | — |
| | | | | | |
Sadiola (41 percent) (3) | — | | | — | | | — |
| | | 27.00 |
| | 0.059 |
| | 1.58 |
| | 75.0-94.0 | (4) | | 0.015-0.023 | (4) |
Tanzania | | | | | | | | | | | | | | | |
Geita | — | | | — | | | — |
| | | 14.81 |
| | 0.102 |
| | 1.51 |
| | 77.8-92.7 | (4) | | 0.036-0.115 | (4) |
South Africa | | | | | | | | | | | | | | | |
West Wits | | | | | | | | | | | | | | | |
Mponeng (2) | 1.14 | | | 0.235 | | | 0.27 | | | 38.75 |
| | 0.280 |
| | 10.83 |
| | 97.1-97.9 | (4) | | 0.167-0.239 | (4) |
Surface | | | | | | | | | | | | | | | | | |
Surface Operations (8) | 70.51 | | | 0.007 | | | 0.49 |
| | | 504.74 |
| | 0.008 |
| | 3.88 |
| | 44.0-90.9 | (4) | | 0.006-0.010 | (4) |
Australia | | | | | | | | | | | | | | | |
Sunrise Dam (2) | 12.29 | | | 0.040 | | | 0.49 | | | 7.32 |
| | 0.083 |
| | 0.61 |
| | 84.5-85.0 | (4) | | 0.020-0.046 | (4) |
Tropicana (70 percent) (2)(3) | 18.16 | | | 0.030 | | | 0.54 | | | 25.35 |
| | 0.062 |
| | 1.58 |
| | 89.9-90.0 | (4) | | 0.020-0.078 | (4) |
Americas | | | | | | | | | | | | | | | |
Argentina | | | | | | | | | | | | | | | |
Cerro Vanguardia (92.5 percent)(3)(6) | 4.52 | | | 0.037 | | | 0.17 | | | 6.50 |
| | 0.081 |
| | 0.52 |
| | 65.8-95.8 | (4) | | 0.010-0.159 | (4) |
Brazil | | | | | | | | | | | | | | | |
AGA Mineraçáo (2) (7) | 2.48 | | | 0.123 | | | 0.31 | | | 10.68 |
| | 0.136 |
| | 1.46 |
| | 53.0-94.3 | (4) | | 0.010-0.155 | (4) |
Serra Grande (2) | 1.71 | | | 0.083 | | | 0.14 | | | 2.81 |
| | 0.095 |
| | 0.27 |
| | 92.4-95.7 | (4) | | 0.027-0.052 | (4) |
Colombia | | | | | | | | | | | | | | | | |
Gramalote (51 percent) (3) | — |
| | | — |
| | | — |
| | | 70.23 |
| | 0.025 |
| | 1.76 |
| | 83.9-95.0 | (4) | | 0.005-0.006 | (4) |
Quebradona (2)(6) | — |
| | | — |
| | | — |
| | | 122.62 |
| | 0.021 |
| | 2.53 |
| | 60.0 | | | | |
Total | 144.87 | | | 0.028 | | | 4.10 | | | 983.80 |
| | 0.040 |
| | 39.68 |
| | | | |
Copper
|
| | | | | | | | | | | | | | | | | | | | | | | |
Ore Reserve: Imperial | At 31 December 2019 | | |
| Proven Ore Reserve (1) (2) | | Probable Ore Reserve (1) (2) | | Metallurgical | | Cut-off |
| Tons(5) | | Grade | | Copper Content | | Tons (5) | | Grade | | Copper Content | | Recovery Factor | | Grade | (9) |
| (million) | | percent | | (Mlbs) | | (million) | | percent | | (Mlbs) | | percent | | ($/t) |
Colombia | | | | | | | | | | | | | | | | |
Quebradona (2)(6) | — |
| | | — |
| | | — |
| | | 122.62 | | 1.25 | | 3,068 | | | 95.80 | | 25-45 | (12) |
Total | — |
| | | — |
| | | — |
| | | 122.62 | | 1.25 | | 3,068 | | | | | | |
| |
(1)
| Ore Reserve includes marginally economic and diluting materials delivered for treatment and allow for losses that may occur during mining. |
| |
(2)
| Proven and/or Probable Ore Reserve includes Ore Reserve below infrastructure. See table that follows. |
| |
(3)
| Ore Reserve attributable to AngloGold Ashanti’s percentage interest shown. |
| |
(4)
| Recovery factor and cut-off grade vary according to ore type. |
| |
(5)
| Tons refers to a short ton, which is equivalent to 2000 pounds avoirdupois. |
| |
(6)
| The Ore Reserve contains 18.76 million ounces of silver for Cerro Vanguardia and 25.95 million ounces for Quebradona to be recovered as a by-product. |
| |
(7)
| The Ore Reserve contains 0.43 million tons of sulphur to be recovered as a by-product. |
| |
(8)
| Includes Mine Waste Solutions (MWS). |
| |
(9)
| In-situ cut-off grade. |
| |
(10)
| Ore Reserve is estimated by Competent Persons employed by Barrick Gold (Holdings) Limited. |
| |
(11)
| No Ore Reserve is declared, Morila is only treating tailings and the Ore Reserve has been written off. |
| |
(12)
| Copper ore cut-off Net Smelter Return (NSR). |
•Rounding of numbers may result in computational differences.discrepancies;
•To reflect that figures are not precise calculations and that there is uncertainty in their estimation, AngloGold Ashanti reports tonnage, grade and content for gold to two decimals and content for copper with no decimals;
•Metric tonnes (t) are used throughout this annual report and all ounces are Troy ounces;
•Abbreviations used in this annual report include: gold– Au, copper – Cu, silver – Ag, Sulphur – S, molybdenum – Mo;
•Internal controls are discussed in the "—Corporate Governance" section above as well as in the “—Mineral Resource and Mineral Reserve Internal Controls Disclosure" section below;
•Maps presented for material properties in this Item 4D show infrastructure, licences and coordinates of the mine, as represented by the plant (or stated otherwise), in the geographic coordinate system.
Refer to the "Glossary of selected terms—Mining terms" for terminology and definitions used in Mineral Resource and Mineral Reserve reporting under Regulation S-K 1300. In addition, the Mineral Resource exclusive of Mineral Reserve (“Exclusive Mineral Resource”) is defined as the Inclusive Mineral Resource less the Mineral Reserve before dilution and other factors are applied. The Exclusive Mineral Resource consists of the following components:
•Inferred Mineral Resource, including that within the Mineral Reserve design or stope shape;
•Mineral Resource that sits above the Mineral Resource cut-off grade but below the Mineral Reserve cut-off grade that resides within the defined Mineral Reserve volume;
•Mineral Resource that lies between the life of mine (“LOM”) pit shell or mine design and the Mineral Resource pit shell/mine design (this material will become economic if the gold price increases); and
•Mineral Resource in which the technical studies to engineer a Mineral Reserve have not yet been completed.
All reports of Mineral Resource must satisfy the requirement that there are reasonable prospects for economic extraction, regardless of the classification of the Mineral Resource. Portions of a deposit that do not have reasonable prospects for eventual economic extraction are not included in a Mineral Resource. The Mineral Resource is estimated using all relevant drilling and sampling information along with a detailed geological model.
The 2019 Provengeological models are based on combinations of core and/or chip logging, mapping, geophysics, geochemistry and Probable Ore Reserve includes Ore Reserve below infrastructuregeological understanding and have been developed for each deposit. Most of our deposits have been the subject of research by third-party specialists in the relevant class of gold deposit.
The grade estimation for each deposit has been developed over the life of the mine, and is constantly reviewed in terms of grade control information and reconciliation with the metallurgical plant. In general, the open pits and shallow underground mines use kriging with post processing by Uniform Conditioning (“UC”) or Localised Uniform Conditioning (“LUC”) to generate a recoverable Mineral Resource model where appropriate.
In order to comply with the economic requirement of the definition of Mineral Resource, all our Mineral Resource is constrained at an upside gold price, with all other parameters being kept the same as used for estimation of the Mineral Reserve. In the underground gold mines, scoping studies are conducted on all coherent blocks of ground that lie above the calculated Mineral Resource cut-off grade. These studies include all cost and capital requirements to access the block. In the case of open pit operations, pit optimisations are conducted at the following underground minesMineral Resource gold price and all material outside these shells is excluded from the Mineral Resource unless it is potentially mineable from underground.
It is the opinion of AngloGold Ashanti that the Mineral Resource represents a realistic view of an upside potential to the Mineral Reserve. In interpreting the Mineral Resource it is critical to factor in the following:
•That there is a reasonable expectation of economic extraction;
•The Mineral Resource is quoted in situ and has not been corrected for dilution, mining losses or recovery; and
•Many of the areas lying in the Exclusive Mineral Resource are currently in production:being actively drilled and are the subject of economic and technical studies. It can, however, not be assumed at this stage that the Company has intent to mine these areas.
Gold
|
| | | | | | | | |
Mine | Tons (millions) | | Grade (ounces/ton) | | Gold Content (million ounces) |
Mponeng | 30.67 | | | 0.27 | | | 8.17 | |
Obuasi | 3.08 | | | 0.56 | | | 1.72 | |
Sunrise Dam | 1.11 | | | 0.14 | | | 0.16 | |
Tropicana | 2.09 | | | 0.11 | | | 0.22 | |
AGA Mineração | 6.34 | | | 0.14 | | | 0.92 | |
Serra Grande | 2.18 | | | 0.10 | | | 0.22 | |
Quebradona | 122.62 | | | 0.02 | | | 2.53 | |
Total | 168.10 | | | 0.08 | | | 13.93 | |
Copper
|
| | | | | | | | |
Mine | Tons (millions) | | Grade (%) | | Copper Content (million pounds) |
Quebradona | 122.62 | | | 1.25 | | | 3,068 | |
Total | 122.62 | | | 1.25 | | | 3,068 | |
The Ore ReserveInferred Mineral Resource category is intended to cover situations in which a mineral concentration or occurrence has been determined based onidentified and limited measurements and sampling have been completed, economic studies.but in which the data are insufficient to allow the geological or grade continuity to be interpreted with confidence. While it would be reasonable to expect that the majority of Inferred Mineral Resource would upgrade to Indicated Mineral Resource with continued exploration, due to the uncertainty of Inferred Mineral Resource, it should not be assumed that such upgrading will always occur.
Gold
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Ore Reserve: Imperial | At 31 December 2018 | | |
| Proven Ore Reserve (1) (2) | | Probable Ore Reserve (1) (2) | | Metallurgical | | Cut-off |
| Tons(5) | | Grade | | Gold Content | | Tons (5) | | Grade | | Gold Content | | Recovery Factor | | Grade | (9) |
| (million) | | (oz/ton) | | (Moz) | | (million) | | (oz/ton) | | (Moz) | | percent | | (oz/ton) |
Continental Africa | | | | | | | | | | | | | | | |
Democratic Republic of the Congo | | | | | | | | | | | | | | | |
Kibali (45 percent) (3) (10) | 10.07 | | 0.121 | | 1.22 | | 21.04 | | 0.120 | | 2.53 | | 84.5-88.9 | (4) | | 0.045-0.070 | (4) |
Ghana | | | | | | | | | | | | | | | |
Iduapriem | 3.02 | | 0.026 | | 0.08 | | 40.11 | | 0.039 | | 1.56 | | 93.0-95.9 | (4) | | 0.016-0.026 | (4) |
Obuasi (2) | — |
| | | — |
| | | — |
| | | 22.35 | | 0.262 | | 5.86 | | 87.0 | | | 0.120-0.152 | (4) |
Guinea | | | | | | | | | | | | | | | |
Siguiri (85 percent) (3) | 23.74 | | 0.019 | | 0.46 | | 65.48 | | 0.024 | | 1.60 | | 88.0-93.0 | (4) | | 0.016-0.020 | (4) |
Mali | | | | | | | | | | | | | | | |
Morila (40 percent) (3) (10) | 2.71 | | 0.018 | | 0.05 | | 0.18 | | 0.038 | | 0.01 | | 57.0-91.0 | (4) | | 0.014-0.023 | (4) |
Sadiola (41 percent) (3) | 0.05 | | 0.048 | | — |
| | | 28.78 | | 0.057 | | 1.63 | | 75.0-94.0 | (4) | | 0.015-0.023 | (4) |
Tanzania | | | | | | | | | | | | | | | |
Geita | — |
| | | — |
| | | — |
| | | 10.44 | | 0.128 | | 1.33 | | 77.8-92.7 | (4) | | 0.042-0.100 | (4) |
South Africa | | | | | | | | | | | | | | | |
Vaal River (11) | | | | | | | | | | | | | | | |
Kopanang | — |
| | | — |
| | | — |
| | | — |
| | | — |
| | | — |
| | | | | |
Moab Khotsong | — |
| | | — |
| | | — |
| | | — |
| | | — |
| | | — |
| | | | | |
West Wits | | | | | | | | | | | | | | | |
Mponeng (2) | 1.59 | | 0.225 | | 0.36 | | 38.61 | | 0.292 | | 11.29 | | 97.1-97.9 | (4) | | 0.171-0.252 | (4) |
Surface | | | | | | | | | | | | | | | |
Surface sources (8) | 117.10 | | 0.006 | | 0.73 | | 583.12 | | 0.008 | | 4.42 | | 45.0-88.0 | (4) | | 0.007-0.008 | (4) |
| | | | | | | | | | | | | | | | |
Australia | | | | | | | | | | | | | | | |
Sunrise Dam (2) | 13.89 | | 0.041 | | 0.57 | | 6.05 | | 0.105 | | 0.64 | | 86.0-87.0 | (4) | | 0.020-0.079 | (4) |
Tropicana (70 percent) (2)(3) | 15.24 | | 0.034 | | 0.51 | | 35.43 | | 0.059 | | 2.11 | | 89.9-90.0 | (4) | | 0.020-0.092 | (4) |
Americas | | | | | | | | | | | | | | | |
Argentina | | | | | | | | | | | | | | | |
Cerro Vanguardia (92.5 percent)(3)(6) | 8.51 | | 0.068 | | 0.57 | | 8.98 | | 0.055 | | 0.50 | | 66.3-96.3 | (4) | | 0.013-0.161 | (4) |
Brazil | | | | | | | | | | | | | | | |
AGA Mineraçáo (2) (7) | 2.14 | | 0.127 | | 0.27 | | 9.69 | | 0.148 | | 1.43 | | 50.0-94.3 | (4) | | 0.018-0.161 | (4) |
Serra Grande (2) | 1.74 | | 0.085 | | 0.15 | | 2.48 | | 0.097 | | 0.24 | | 92.1-98.8 | (4) | | 0.018-0.055 | (4) |
Colombia | | | | | | | | | | | | | | | | |
Gramalote (51 percent) (3) | — |
| | | — |
| | | — |
| | | 70.23 | | 0.025 | | 1.76 | | 83.9-95.0 | (4) | | 0.005-0.006 | (4) |
Quebradona (94.876 percent) (2)(3)(6) | — |
| | | — |
| | | — |
| | | 114.69 | | 0.019 | | 2.22 | | 60.0 | | | | |
Total | 199.80 | | 0.025 | | 4.97 | | 1057.65 | | 0.037 | | 39.12 | | | | |
Copper
|
| | | | | | | | | | | | | | | | | | | | | | | |
Ore Reserve: Imperial | At 31 December 2018 | | |
| Proven Ore Reserve (1) (2) | | Probable Ore Reserve (1) (2) | | Metallurgical | | Cut-off |
| Tons(5) | | Grade | | Copper Content | | Tons (5) | | Grade | | Copper Content | | Recovery Factor | | Grade | (9) |
| (million) | | percent | | (Mlbs) | | (million) | | percent | | (Mlbs) | | percent | | ($/t) |
Colombia | | | | | | | | | | | | | | | | |
Quebradona (94.876 percent) (2)(3)(6) | — |
| | | — |
| | | — |
| | | 114.69 | | 1.21 | | 2,769 | | | 95.80 | | 25-45 | (12) |
Total | — |
| | | — |
| | | — |
| | | 114.69 | | 1.21 | | 2,769 | | | | | |
| |
(1)
| Ore Reserve includes marginally economic and diluting materials delivered for treatment and allow for losses that may occur during mining. |
| |
(2)
| Proven and/or Probable Ore Reserve includes Ore Reserve below infrastructure. See table that follows. |
| |
(3)
| Ore Reserve attributable to AngloGold Ashanti’s percentage interest shown. |
| |
(4)
| Recovery factor and cut-off grade vary according to ore type. |
| |
(5)
| Tons refers to a short ton, which is equivalent to 2000 pounds avoirdupois. |
| |
(6)
| The Ore Reserve contains 32.68 million ounces of silver for Cerro Vanguardia and 23.58 million ounces for Quebradona to be recovered as a by-product. |
| |
(7)
| The Ore Reserve contains 0.38 million tons of sulphur to be recovered as a by-product. |
| |
(8)
| Includes Mine Waste Solutions (MWS). |
| |
(9)
| In-situ cut-off grade. |
| |
(10)
| Ore Reserve is estimated by Competent Persons employed by Barrick Gold (Holdings) Limited. |
| |
(11)
| No Ore Reserve is declared for 2018 - sale of Kopanang and Moab Khotsong. |
| |
(12)
| Copper ore cut-off Net Smelter Return (NSR). |
Rounding may resultIn order to reduce this risk, AngloGold Ashanti limits the use of Inferred Mineral Resource in computational differences.
The 2018 Proven and Probable Oreits Mineral Reserve includes Ore Reserve below infrastructureestimation process but the Inferred Mineral Resource is included in the casepit shell or underground extraction shape determination. As such the Inferred Mineral Resource may influence the extraction shape. The quoted Mineral Reserve from these volumes includes only the converted Measured and Indicated Mineral Resource and no Inferred Mineral Resource is converted to Mineral Reserve. The cash flow analysis does not include the Inferred Mineral Resource in demonstrating the economic viability of the following underground mines currentlyMineral Reserve.
AngloGold Ashanti requires that the Mineral Reserve that is an outcome of this process is generated at a minimum of apre-feasibility study level.
MINERAL RESOURCE AND MINERAL RESERVE INTERNAL CONTROLS DISCLOSURE
AngloGold Ashanti has a tiered internal review process whereby newly issued Mineral Resource and Mineral Reserve are reviewed at a regional level prior to publication. Selected corporate reviews happen after that process. Each property has an external Mineral Resource and Mineral Reserve audit on a three-year rolling basis, and issues raised in production:these audits are addressed by a formal audit reply from each mine on which the progress is tracked.
Gold
|
| | | | | | | | |
Mine | Tons (millions) | | Grade (ounces/ton) | | Gold Content (million ounces) |
Mponeng | 30.27 | | | 0.28 | | | 8.53 | |
Obuasi | 1.87 | | | 0.60 | | | 1.13 | |
Sunrise Dam | 1.42 | | | 0.11 | | | 0.16 | |
Tropicana | 2.08 | | | 0.11 | | | 0.22 | |
AGA Mineração | 7.42 | | | 0.16 | | | 1.18 | |
Serra Grande | 1.75 | | | 0.11 | | | 0.20 | |
Quebradona | 114.69 | | | 0.02 | | | 2.22 | |
Total | 159.50 | | | 0.09 | | | 13.64 | |
Copper
|
| | | | | | | | |
Mine | Tons (millions) | | Grade (%) | | Copper Content (million pounds) |
Quebradona | 114.69 | | | 1.21 | | | 2,769 | |
Total | 114.69 | | | 1.21 | | | 2,769 | |
The OreAngloGold Ashanti’s Mineral Reserve has been determined based on completed economic studies.
Gold
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Ore Reserve: Metric | At 31 December 2019 | | |
| Proven Ore Reserve (1) (2) | | Probable Ore Reserve (1) (2) | | Metallurgical | | Cut-off |
| Tonnes(5) | | Grade | | Gold Content | | Tonnes (5) | | Grade | | Gold Content | | Recovery Factor | | Grade | (9) |
| (million) | | (g/t) | | (tonnes) | | (million) | | (g/t) | | tonnes | | percent | | (g/t) |
Continental Africa | | | | | | | | | | | | | | | |
Democratic Republic of the Congo | | | | | | | | | | | | | | | |
Kibali (45 percent) (3) (10) | 9.29 |
| | | 4.13 |
| | | 38.36 |
| | | 21.52 |
| | | 4.23 |
| | | 90.99 |
| | | 84.5-89.8 | (4) | | 1.50-2.40 | (4) |
Ghana | | | | | | | | | | | | | | | |
Iduapriem | 3.40 |
| | | 0.84 |
| | | 2.85 |
| | | 38.88 |
| | | 1.36 |
| | | 53.05 |
| | | 93.0-95.9 | (4) | | 0.85-0.95 | (4) |
Obuasi (2) | — |
| | | — |
| | | — |
| | | 24.26 |
| | | 9.13 |
| | | 221.47 |
| | | 87.0 | | | | 4.10-5.20 | (4) |
Guinea | | | | | | | | | | | | | | | |
Siguiri (85 percent) (3) | 18.20 |
| | | 0.63 |
| | | 11.55 |
| | | 54.12 |
| | | 0.80 |
| | | 43.27 |
| | | 88.0-93.0 | (4) | | 0.50-0.75 | (4) |
Mali | | | | | | | | | | | | | | | |
Morila (40 percent) (3) (10)(11) | — |
| | | — |
| | | — |
| | | — |
| | | — |
| | | — |
| | | | | | | |
Sadiola (41 percent) (3) | — |
| | | — |
| | | — |
| | | 24.50 |
| | | 2.01 |
| | | 49.23 |
| | | 75.0-94.0 | (4) | | 0.51-0.78 | (4) |
Tanzania | | | | | | | | | | | | | | | |
Geita | — |
| | | — |
| | | — |
| | | 13.44 |
| | | 3.50 |
| | | 47.03 |
| | | 77.8-92.7 | (4) | | 1.25-3.95 | (4) |
South Africa | | | | | | | | | | | | | | | |
West Wits | | | | | | | | | | | | | | | |
Mponeng (2) | 1.03 |
| | | 8.05 |
| | | 8.31 |
| | | 35.16 |
| | | 9.59 |
| | | 337.0 |
| | | 97.1-97.9 | (4) | | 5.72-8.18 | (4) |
Surface | | | | | | | | | | | | | | | |
Surface sources (8) | 63.97 |
| | | 0.24 |
| | | 15.18 |
| | | 457.89 |
| | | 0.26 |
| | | 120.83 |
| | | 44.0-90.9 | (4) | | 0.20-0.34 | (4) |
Australia | | | | | | | | | | | | | | | |
Sunrise Dam (2) | 11.15 |
| | | 1.38 |
| | | 15.39 |
| | | 6.64 |
| | | 2.84 |
| | | 18.88 |
| | | 84.5-85.0 | (4) | | 0.70-1.56 | (4) |
Tropicana (70 percent) (2) (3) | 16.48 |
| | | 1.02 |
| | | 16.89 |
| | | 22.99 |
| | | 2.13 |
| | | 49.07 |
| | | 89.9-90.0 | (4) | | 0.70-2.69 | (4) |
Americas | | | | | | | | | | | | | | | |
Argentina | | | | | | | | | | | | | | | |
Cerro Vanguardia (92.5 percent) (3) (6) | 4.10 |
| | | 1.26 |
| | | 5.17 |
| | | 5.90 |
| | | 2.77 |
| | | 16.33 |
| | | 65.8-95.8 | (4) | | 0.33-5.46 | (4) |
Brazil | | | | | | | | | | | | | | | |
AGA Mineraçáo (2) (7) | 2.25 |
| | | 4.23 |
| | | 9.50 |
| | | 9.69 |
| | | 4.68 |
| | | 45.33 |
| | | 53.0-94.3 | (4) | | 0.33-5.31 | (4) |
Serra Grande (2) | 1.55 |
| | | 2.83 |
| | | 4.40 |
| | | 2.55 |
| | | 3.27 |
| | | 8.32 |
| | | 92.4-95.7 | (4) | | 0.92-1.77 | (4) |
Colombia | | | | | | | | | | | | | | | | |
Gramalote (51 percent) (3) | — |
| | | — |
| | | — |
| | | 63.71 |
| | | 0.86 |
| | | 54.67 |
| | | 83.9-95.0 | (4) | | 0.16-0.22 | (4) |
Quebradona (2) (6) | — |
| | | — |
| | | — |
| | | 111.24 |
| | | 0.71 |
| | | 78.60 |
| | | 60.0 | | | | |
Total | 131.42 |
| | | 0.97 |
| | | 127.60 |
| | | 892.49 |
| | | 1.38 |
| | | 1,234.08 |
| | | | | |
Copper
|
| | | | | | | | | | | | | | | | | | | | | | | | | |
Ore Reserve: Metric | At 31 December 2019 | | |
| Proven Ore Reserve (1) (2) | | Probable Ore Reserve (1) (2) | | Metallurgical | | Cut-off |
| Tonnes(5) | | Grade | | Copper Content | | Tonnes (5) |
| | Grade |
| | Copper Content | | Recovery Factor | | Grade | (9) |
| (million) | | percent | | (tonnes million) | | (million) |
| | percent |
| | (tonnes million) | | percent | | ($/t) |
Colombia | | | | | | | | | | | | | | | | |
Quebradona (2)(6) | — |
| | | — |
| | | — |
| | | 111.24 |
| | 1.25 |
| | 1.39 | | | 95.80 | | 25-45 | (12) |
Total | — |
| | | — |
| | | — |
| | | 111.24 |
| | 1.25 |
| | 1.39 | | | | | | |
| |
(1)
| Ore Reserve includes marginally economic and diluting materials delivered for treatment and allow for losses that may occur during mining. |
| |
(2)
| Proven and/or Probable Ore Reserve includes Ore Reserve below infrastructure. See table that follows. |
| |
(3)
| Ore Reserve attributable to AngloGold Ashanti’s percentage interest shown. |
| |
(4)
| Recovery factor and cut-off grade vary according to ore type. |
| |
(5)
| Tonnes refers to a metric tonne which is equivalent to 1000 kilograms. |
| |
(6)
| The Ore Reserve contains 583 tonnes of silver for Cerro Vanguardia and 807 tonnes for Quebradona to be recovered as a by-product. |
| |
(7)
| The Ore Reserve contains 0.39 million tonnes of sulphur to be recovered as a by-product. |
| |
(8)
| Includes Mine Waste Solutions (MWS). |
| |
(9)
| In-situ cut-off grade. |
| |
(10)
| Ore Reserve is estimated by Competent Persons employed by Barrick Gold (Holdings) Limited. |
| |
(11)
| No Ore Reserve is declared as the Ore Reserve has been written off. |
| |
(12)
| Copper ore cut-off Net Smelter Return (NSR) |
Rounding may result in computational differences.
The 2019 Provenis an outcome of the Company’s business planning process which runs annually. This process operates within a comprehensive framework where all inputs, including costs and Probable Ore Reserve includes Ore Reserve below infrastructurecapital requirements, are generated by the operation, and reviewed at a regional and corporate level within the Company, thereby providing confidence in the case ofestimates.
A group wide Mineral Resource to production reconciliation system is also in place whereby the following underground mines currentlyMineral Resource mined each month is reconciled all the way to the produced gold doré. Oversight for this process is handled at the group level. A comprehensive sample and assay QC/QA process is in production:place, and our laboratories are inspected frequently by on-site teams.
Gold
|
| | | | | | | | | | | |
Mine | Tons (millions) | | Grade (grams/tonne) | | Gold Content (tonnes) |
Mponeng | 27.83 | | | | 9.13 | | | | 254.02 | | |
Obuasi | 2.80 | | | | 19.14 | | | | 53.54 | | |
Sunrise Dam | 1.01 | | | | 4.92 | | | | 4.97 | | |
Tropicana | 1.89 | | | | 3.60 | | | | 6.82 | | |
AGA Mineração | 5.75 | | | | 4.96 | | | | 28.49 | | |
Serra Grande | 1.98 | | | | 3.40 | | | | 6.73 | | |
Quebradona | 111.24 | | | | 0.71 | | | | 78.60 | | |
Total | 152.50 | | | | 2.84 | | | | 433.17 | | |
Copper
|
| | | | | | | | | | |
Mine | Tons (millions) | | Grade (%) | Copper Content (million tonnes) |
Quebradona | 111.24 | | | | 1.25 | | | 1.39 | | |
Total | 111.24 | | | | 1.25 | | | 1.39 | | |
ITEM 4A: UNRESOLVED STAFF COMMENTS
The Ore Reserve has been determined based on completed economic studies.
Gold
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Ore Reserve: Metric | At 31 December 2018 | | |
| Proven Ore Reserve (1) (2) | | Probable Ore Reserve (1) (2) | | Metallurgical | | Cut-off |
| Tonnes(5) | | Grade | | Gold Content | | Tonnes (5) | | Grade | | Gold Content | | Recovery Factor | | Grade | (9) |
| (million) | | (g/t) | | (tonnes) | | (million) | | (g/t) | | tonnes | | percent | | (g/t) |
Continental Africa | | | | | | | | | | | | | | | |
Democratic Republic of the Congo | | | | | | | | | | | | | | | |
Kibali (45 percent) (3) (10) | 9.14 |
| | | 4.15 |
| | | 37.87 |
| | | 19.08 |
| | | 4.12 |
| | | 78.70 |
| | | 84.5-88.9 | (4) | | 1.53-2.41 | (4) |
Ghana | | | | | | | | | | | | | | | |
Iduapriem | 2.74 |
| | | 0.88 |
| | | 2.41 |
| | | 36.39 |
| | | 1.33 |
| | | 48.42 |
| | | 93.0-95.9 | (4) | | 0.55-0.90 | (4) |
Obuasi (2) | — |
| | | — |
| | | — |
| | | 20.28 |
| | | 9.00 |
| | | 182.40 |
| | | 87.0 | | | | 4.10-5.20 | (4) |
Guinea | | | | | | | | | | | | | | | |
Siguiri (85 percent) (3) | 21.54 |
| | | 0.67 |
| | | 14.40 |
| | | 59.40 |
| | | 0.84 |
| | | 49.82 |
| | | 88.0-93.0 | (4) | | 0.55-0.70 | (4) |
Mali | | | | | | | | | | | | | | | |
Morila (40 percent) (3) (10) | 2.46 |
| | | 0.63 |
| | | 1.54 |
| | | 0.17 |
| | | 1.31 |
| | | 0.22 |
| | | 57.0-91.0 | (4) | | 0.49-0.79 | (4) |
Sadiola (41 percent) (3) | 0.05 |
| | | 1.66 |
| | | 0.08 |
| | | 26.11 |
| | | 1.94 |
| | | 50.64 |
| | | 75.0-94.0 | (4) | | 0.51-0.78 | (4) |
Tanzania | | | | | | | | | | | | | | | |
Geita | — |
| | | — |
| | | — |
| | | 9.47 |
| | | 4.38 |
| | | 41.49 |
| | | 77.8-92.7 | (4) | | 1.45-3.43 | (4) |
South Africa | | | | | | | | | | | | | | | |
Vaal River (11) | | | | | | | | | | | | | | | |
Kopanang | — |
| | | — |
| | | — |
| | | — |
| | | — |
| | | — |
| | | | | | | |
Moab Khotsong | — |
| | | — |
| | | — |
| | | — |
| | | — |
| | | — |
| | | | | | | |
West Wits | | | | | | | | | | | | | | | |
Mponeng (2) | 1.44 |
| | | 7.71 |
| | | 11.13 |
| | | 35.03 |
| | | 10.02 |
| | | 351.12 |
| | | 97.1-97.9 | (4) | | 5.86-8.64 | (4) |
Surface | | | | | | | | | | | | | | | |
Surface sources (8) | 106.23 |
| | | 0.21 |
| | | 22.76 |
| | | 529.00 |
| | | 0.26 |
| | | 137.47 |
| | | 45.0-88.0 | (4) | | 0.23-0.29 | (4) |
| | | | | | | | | | | | | | | | |
Australia | | | | | | | | | | | | | | | |
Sunrise Dam (2) | 12.60 |
| | | 1.40 |
| | | 17.59 |
| | | 5.49 |
| | | 3.60 |
| | | 19.76 |
| | | 86.0-87.0 | (4) | | 0.68-2.71 | (4) |
Tropicana (70 percent) (2) (3) | 13.83 |
| | | 1.15 |
| | | 15.91 |
| | | 32.14 |
| | | 2.04 |
| | | 65.50 |
| | | 89.9-90.0 | (4) | | 0.70-3.17 | (4) |
Americas | | | | | | | | | | | | | | | |
Argentina | | | | | | | | | | | | | | | |
Cerro Vanguardia (92.5 percent) (3) (6) | 7.72 |
| | | 2.32 |
| | | 17.88 |
| | | 8.14 |
| | | 1.89 |
| | | 15.41 |
| | | 66.3-96.3 | (4) | | 0.45-5.51 | (4) |
Brazil | | | | | | | | | | | | | | | |
AGA Mineraçáo (2) (7) | 1.94 |
| | | 4.35 |
| | | 8.43 |
| | | 8.79 |
| | | 5.06 |
| | | 44.47 |
| | | 50.0-94.3 | (4) | | 0.61-5.53 | (4) |
Serra Grande (2) | 1.58 |
| | | 2.90 |
| | | 4.59 |
| | | 2.25 |
| | | 3.32 |
| | | 7.48 |
| | | 92.1-98.8 | (4) | | 0.60-1.87 | (4) |
Colombia | | | | | | | | | | | | | | | | |
Gramalote (51 percent) (3) | — |
| | | — |
| | | — |
| | | 63.71 |
| | | 0.86 |
| | | 54.67 |
| | | 83.9-95.0 | (4) | | 0.16-0.22 | (4) |
Quebradona (94.876 percent) (2) (3) (6) | — |
| | | — |
| | | — |
| | | 104.05 |
| | | 0.66 |
| | | 69.12 |
| | | 60.0 | | | | |
Total | 181.26 |
| | | 0.85 |
| | | 154.60 |
| | | 959.49 |
| | | 1.27 |
| | | 1,216.69 |
| | | | | |
Copper
|
| | | | | | | | | | | | | | | | | | | | | | | | | |
Ore Reserve: Metric | At 31 December 2018 | | |
| Proven Ore Reserve (1) (2) | | Probable Ore Reserve (1) (2) | | Cut-off |
| Tonnes(5) | | | Grade | | | Copper Content | | | Tonnes (5) | Grade | Copper Content | Recovery Factor | | | Grade | (9) |
| (million) | | | percent | | | (tonnes million) | | | (million) | percent | (tonnes million) | percent | | | ($/t) |
Colombia | | | | | | | | | | | | | |
Quebradona (94.876 percent) (2)(3)(6) | — | | | — | | | — | | | 104.05 | 1.21 | 1.26 | | | 95.80 | | | 25-45 | (12) |
Total | — | | | — | | | �� | | | 104.05 | 1.21 | | 1.26 |
| | | | | |
| |
(1)
| Ore Reserve includes marginally economic and diluting materials delivered for treatment and allow for losses that may occur during mining. |
| |
(2)
| Proven and/or Probable Ore Reserve includes Ore Reserve below infrastructure. See table that follows. |
| |
(3)
| Ore Reserve attributable to AngloGold Ashanti’s percentage interest shown. |
| |
(4)
| Recovery factor and cut-off grade vary according to ore type. |
| |
(5)
| Tonnes refers to a metric tonne which is equivalent to 1000 kilograms. |
| |
(6)
| The Ore Reserve contains 1,016 tonnes of silver for Cerro Vanguardia and 733 tonnes for Quebradona to be recovered as a by-product. |
| |
(7)
| The Ore Reserve contains 0.37 million tonnes of sulphur to be recovered as a by-product. |
| |
(8)
| Includes Mine Waste Solutions (MWS). |
| |
(9)
| In-situ cut-off grade. |
| |
(10)
| Ore Reserve is estimated by Competent Persons employed by Barrick Gold (Holdings) Limited. |
| |
(11)
| No Ore Reserve is declared for 2018 - sale of Kopanang and Moab Khotsong. |
| |
(12)
| Copper ore cut-off Net Smelter Return (NSR). |
Rounding may result in computational differences
The 2018 Proven and Probable Ore Reserve includes Ore Reserve below infrastructure in the case of the following underground mines currently in production:
Gold
|
| | | | | | | | | | | |
Mine | Tons (millions) | | Grade (grams/tonne) | | Gold Content (tonnes) |
Mponeng | 27.46 | | | | 9.66 | | | | 265.29 | |
Obuasi | 1.70 | | | | 20.68 | | | | 35.15 | |
Sunrise Dam | 1.29 | | | | 3.85 | | | | 4.95 | |
Tropicana | 1.89 | | | | 3.65 | | | | 6.89 | |
AGA Mineração | 6.73 | | | | 5.45 | | | | 36.64 | |
Serra Grande | 1.59 | | | | 3.94 | | | | 6.28 | |
Quebradona | 104.05 | | | | 0.66 | | | | 69.12 | |
Total | 144.70 | | | | 2.93 | | | | 424.32 | |
Copper
|
| | | | | | | | | | |
Mine | Tons (millions) | | Grade (%) | Copper Content (million tonnes) |
Quebradona | 104.05 | | | | 1.21 | | | 1.26 | |
Total | 104.05 | | | | 1.21 | | | 1.26 | |
The Ore Reserve has been determined based on completed economic studies.
Stockpiles: Imperial
Stockpiles are previously mined ore scheduled for future process plant feed. The Proven and Probable Ore Reserve includes the following stockpile material:
|
| | | | | | | | | |
Stockpiles | At 31 December 2019 |
| Tons (million) | | Grade (ounces/ton) | | Gold content (million ounces) |
Continental Africa | | | | | |
Democratic Republic of the Congo | | | | | |
Kibali (45 percent) (1) | 1.09 | | | 0.050 | | | 0.05 |
| |
Ghana | | | | | |
Iduapriem | 16.41 | | | 0.021 | | | 0.35 |
| |
Guinea | | | | | |
Siguiri (85 percent) (1) (3) | 55.29 | | | 0.017 | | | 0.93 |
| |
Mali | | | | | |
Sadiola (41 percent) (1) | 1.46 | | | 0.068 | | | 0.10 |
| |
Tanzania | | | | | |
Geita | 4.50 | | | 0.046 | | | 0.20 |
| |
South Africa | | | | | |
Surface sources (2) | 575.26 | | | 0.008 | | | 4.37 |
| |
Australia | | | | | |
Sunrise Dam | 9.40 | | | 0.028 | | | 0.26 |
| |
Tropicana (70 percent) (1) | 16.97 | | | 0.028 | | | 0.47 |
| |
Americas | | | | | |
Argentina | | | | | |
Cerro Vanguardia (92.5 percent) (1) | 6.58 | | | 0.013 | | | 0.08 |
| |
Brazil | | | | | |
Serra Grande | 0.01 | | | 0.058 | | | 0.00 |
| |
| |
(1)
| Ore Reserve attributable to AngloGold Ashanti’s percentage interest shown. |
| |
(2)
| Centralised operations treating material on surface that was previously generated by several underground operations, includes tailings material. |
| |
(3)
| Spent heap included in Ore Reserve. |
Rounding may result in computational differences.
Stockpiles: Imperial
Stockpiles are previously mined ore scheduled for future process plant feed. The Proven and Probable Ore Reserve includes the following stockpile material:
|
| | | | | | | | |
Stockpiles | At 31 December 2018 |
| Tons (million) | | Grade (ounces/ ton) | | Gold content (million ounces) |
Continental Africa | | | | | |
Ghana | | | | | |
Iduapriem | 16.42 | | | 0.021 | | | 0.35 | |
Guinea | | | | | |
Siguiri (85 percent) (1) (3) | 57.67 | | | 0.017 | | | 0.97 | |
Mali | | | | | |
Morila (40 percent) (1) | 2.71 | | | 0.018 | | | 0.05 | |
Sadiola (41 percent) (1) | 3.29 | | | 0.045 | | | 0.15 | |
Tanzania | | | | | |
Geita | 3.00 | | | 0.038 | | | 0.11 | |
South Africa | | | | | |
Surface sources (2) | 700.22 | | | 0.007 | | | 5.15 | |
| | | | | |
Australia | | | | | |
Sunrise Dam | 10.66 | | | 0.028 | | | 0.30 | |
Tropicana (70 percent) (1) | 11.98 | | | 0.029 | | | 0.35 | |
Americas | | | | | |
Argentina | | | | | |
Cerro Vanguardia (92.5 percent) (1) | 10.91 | | | 0.014 | | | 0.15 | |
| |
(1)
| Ore Reserve attributable to AngloGold Ashanti’s percentage interest shown. |
| |
(2)
| Centralised operations treating material on surface that was previously generated by several underground operations, includes tailings material. |
| |
(3)
| Spent heap included in Ore Reserve. |
Rounding may result in computational differences.
Stockpiles: Metric
Stockpiles are previously mined ore scheduled for future process plant feed. The Proven and Probable Ore Reserve includes the following stockpile material:
|
| | | | | | | | | |
Stockpiles | At 31 December 2019 |
| Tonnes (million) | | Grade (grams/ tonne) | | Gold content (tonnes) |
Continental Africa | | | | | |
Democratic Republic of the Congo | | | | | |
Kibali (45 percent) (1) | 0.99 | | | 1.72 |
| | | 1.70 | |
Ghana | | | | | |
Iduapriem | 14.89 | | | 0.73 |
| | | 10.90 | |
Guinea | | | | | |
Siguiri (85 percent) (1) (3) | 50.16 | | | 0.58 |
| | | 28.84 | |
Mali | | | | | |
Sadiola (41 percent) (1) | 1.32 | | | 2.31 |
| | | 3.07 | |
Tanzania | | | | | |
Geita | 4.08 | | | 1.56 |
| | | 6.37 | |
South Africa | | | | | |
Surface sources (2) | 521.86 | | | 0.26 |
| | | 136.01 | |
Australia | | | | | |
Sunrise Dam | 8.53 | | | 0.94 |
| | | 8.05 | |
Tropicana (70 percent) (1) | 15.40 | | | 0.94 |
| | | 14.52 | |
Americas | | | | | |
Argentina | | | | | |
Cerro Vanguardia (92.5 percent) (1) | 5.97 | | | 0.44 |
| | | 2.64 | |
Brazil | | | | | |
Serra Grande | 0.01 | | | 2.00 |
| | | 0.02 | |
| |
(1)
| Ore Reserve attributable to AngloGold Ashanti’s percentage interest shown. |
| |
(2)
| Centralised operations treating material on surface that was previously generated by several underground operations, includes tailings material. |
| |
(3)
| Spent heap included in Ore Reserve. |
Rounding may result in computational differences.
Stockpiles: Metric
Stockpiles are previously mined ore scheduled for future process plant feed. The Proven and Probable Ore Reserve includes the following stockpile material:
|
| | | | | | | | |
Stockpiles | At 31 December 2018 |
| Tonnes (million) | | Grade (grams /tonne) | | Gold content (tonnes) |
Continental Africa | | | | | |
Ghana | | | | | |
Iduapriem | 14.89 | | | 0.73 | | | 10.91 | |
Guinea | | | | | |
Siguiri (85 percent) (1) (3) | 52.31 | | | 0.58 | | | 30.18 | |
Mali | | | | | |
Morila (40 percent) (1) | 2.46 | | | 0.63 | | | 1.54 | |
Sadiola (41 percent) (1) | 2.98 | | | 1.53 | | | 4.56 | |
Tanzania | | | | | |
Geita | 2.72 | | | 1.29 | | | 3.51 | |
South Africa | | | | | |
Surface sources (2) | 635.23 | | | 0.25 | | | 160.23 | |
| | | | | |
Australia | | | | | |
Sunrise Dam | 9.67 | | | 0.97 | | | 9.35 | |
Tropicana (70 percent) (1) | 10.87 | | | 1.01 | | | 10.95 | |
Americas | | | | | |
Argentina | | | | | |
Cerro Vanguardia (92.5 percent) (1) | 9.89 | | | 0.47 | | | 4.68 | |
| |
(1)
| Ore Reserve attributable to AngloGold Ashanti’s percentage interest shown. |
| |
(2)
| Centralised operations treating material on surface that was previously generated by several underground operations, includes tailings material. |
| |
(3)
| Spent heap included in Ore Reserve. |
Rounding may result in computational differences.
Drill hole spacing: Imperial
In determining the Proven and Probable Ore Reserve, AngloGold Ashanti applied the following drill hole spacing:
|
| | |
| Drill Hole Spacing |
| Proven Ore Reserve | Probable Ore Reserve |
Continental Africa | | |
Democratic Republic of the Congo | | |
Kibali | 16 x 33 feet, 33 x 82 feet | 98 x 131 feet, 131 x 131 feet |
Ghana | | |
Iduapriem | 66 x 49 feet | 164 x 246 feet |
Obuasi | 66 x 66 feet | 197 x 197 feet |
Guinea | | |
Siguiri | 33 x 16 feet | 66 x 131 feet, 82 x 82 feet,
164 x 82 feet
|
Mali | | |
Sadiola | 21 x 41 feet, 82 x 82 feet | 82 x 82 feet, 164 x 82 feet |
Tanzania | | |
Geita | None | 33 x 33 feet, 66 x 66 feet, 82 x 49 feet,
82 x 82 feet, 131 x 66 feet, 131 x 131 feet
|
South Africa | | |
Underground sources | Ore body opened up, developed and sampled on a 7 to 10 foot spacing on raise lines and on a 16 x 16 foot grid thereafter | From a 328 x 328 foot spacing up to
3281 x 3281 foot spacing
|
Surface sources | 164 x 164 feet to 1050 x 820 feet auger drilling, variable sampling strategies: belt samplers, cross stream residue samplers and bulk sampling campaigns | 328 x 328 feet to 984 x 1230 feet auger drilling, variable sampling strategies: belt samplers, cross stream residue samplers |
Australia | | |
Sunrise Dam | 33 x 33 feet, 82 x 82 feet | 131 x 66 feet, 131 x 131 feet |
Tropicana | 39 x 39 feet, 82 x 82 feet | 164 x 82 feet, 164 x 164 feet |
Americas | | |
Argentina | | |
Cerro Vanguardia | 20 x 66 feet, 39 x 16 feet | 131 x 131 feet |
Brazil | | |
AGA Mineração | 33 x 66 feet, 66 x 33 feet,
66 x 98 feet, 82 x 82 feet,
98 x 98 feet
| 66 x 131 feet, 82 x 131 feet, 98 x 82 feet,
131 x 197 feet, 164 x 98 feet,
164 x 164 feet, 197 x 131 feet, 197 x 197 feet
|
Serra Grande | 33 x 33 feet, 33 x 66 feet | 82 x 82 feet, 131 x 66 feet,
131 x 131 feet, 164 x 66 feet
|
Colombia | | |
Gramalote | None | 164 x 164 feet |
Quebradona | 98 x 98 feet | 197 x 197 feet |
Drill hole spacing: Metric
In determining the Proven and Probable Ore Reserve, AngloGold Ashanti applied the following table of drill hole spacing:
|
| | |
| Drill Hole Spacing |
| Proven Ore Reserve | Probable Ore Reserve |
Continental Africa | | |
Democratic Republic of the Congo | | |
Kibali | 5 x 10 metre, 10 x 25 metre | 30 x 40 metre, 40 x 40 metre |
Ghana | | |
Iduapriem | 20 x 15 metre | 50 x 75 metre |
Obuasi | 20 x 20 metre | 60 x 60 metre |
Guinea | | |
Siguiri | 5 x 10 metre | 20 x 40 metre, 25 x 25 metre,
50 x 25 metre
|
Mali | | |
Sadiola | 6.25 x 12.5 metre, 25 x 25 metre | 25 x 25 metre, 50 x 25 metre |
Tanzania | | |
Geita | None | 10 x 10 metre, 20 x 20 metre,
25 x 15 metre, 25 x 25 metre,
40 x 20 metre, 40 x 40 metre
|
South Africa | | |
Underground sources | Ore body opened up, developed and sampled on a 2 to 3 metre spacing on raise lines and on a 5 x 5 metre grid thereafter | From a 100 x 100 metre spacing up to
1000 x 1000 metre spacing
|
Surface sources | 50 x 50 metre to 320 x 250 metre auger drilling, variable sampling strategies: belt samplers, cross stream residue samplers and bulk sampling campaigns | 100 x 100 metre to 300 x 375 metre auger drilling, variable sampling strategies: belt samplers, cross stream residue samplers |
Australia | | |
Sunrise Dam | 10 x 10 metre, 25 x 25 metre | 40 x 20 metre, 40 x 40 metre |
Tropicana | 12 x 12 metre, 25 x 25 metre | 50 x 25 metre, 50 x 50 metre |
Americas | | |
Argentina | | |
Cerro Vanguardia | 6 x 20 metre, 12 x 5 metre | 40 x 40 metre |
Brazil | | |
AGA Mineração | 10 x 20 metre, 20 x 10 metre,
25 x 25 metre, 20 x 30 metre,
30 x 30 metre
| 20 x 40 metre, 25 x 40 metre,
30 x 25 metre, 40 x 60 metre,
50 x 30 metre, 50 x 50 metre,
60 x 40 metre, 60 x 60 metre
|
Serra Grande | 10 x 10 metre, 10 x 20 metre | 25 x 25 metre, 40 x 20 metre,
40 x 40 metre, 50 x 20 metre
|
Colombia | | |
Gramalote | None | 50 x 50 metre |
Quebradona | 30 x 30 metre | 60 x 60 metre |
| |
ITEM 4A: | UNRESOLVED STAFF COMMENTS |
Not applicable.
ITEM 5: OPERATING AND FINANCIAL REVIEW AND PROSPECTS
The following discussion provides information that management believes is relevant to an assessment and understanding of the consolidated financial condition and results of operations of AngloGold Ashanti Limited under IFRS for the three years ended and as at 31 December 2019, 20182022, 2021 and 2017.
The company announced the sale of its remaining South African producing assets and related liabilities (SA disposal group) on 12 February 2020. As a result of the contemplated sale of the SA disposal group, the SA disposal group was classified as an asset held for sale and recognised as a discontinued operation in the company’s consolidated financial statements for the year ended and as at 31 December 2019. See “Item 18: Financial Statements-Note 9-Discontinued operations and assets and liabilities held for sale” for further details. The company’s operating and financial results and the related comparative statements have been restated in accordance with IFRS 5 Non-current Assets Held for Sale and Discontinued Operations to recognise the SA disposal group as a discontinued operation for the years ended 31 December 2018 and 2017. The discussion of operating and financial results in this “Item 5: Operating and Financial Review and Prospects” relates to the company'sCompany’s continuing operations (unless the context indicates otherwise).
This item should be read in conjunction with the company’sCompany’s consolidated financial statements and the notes thereto which are included under Item 18 of this annual report.
Overview
AngloGold Ashanti is a global gold mining company headquartered in Johannesburg, South Africa. AngloGold Ashanti’s main product is gold. As part of extracting gold the companyCompany also produces silver and sulphuric acid as by-products. The company no longer produces uranium oxide as a by-product following the sale of its Vaal River operations, effective 28 February 2018. By-product revenue from continuing operations amounted to $86$113 million in 2019 (2018: $1332022 (2021: $126 million; 2017: $1392020: $105 million) out of total revenue from product sales from continuing operations of $3,525$4,501 million in 2019 (2018: $3,3362022 (2021: $4,029 million; 2017: $3,3942020: $4,595 million). See “Item“Item 18: Financial Statements-Note 3-RevenueStatements—Note 3—Revenue from product sales” for additional information. The companyCompany sells its products on world markets.
AngloGold Ashanti conducts gold-mininghas ten continuing mining operations in the following regions, which represent its business segments:
Continentalregions: Africa (comprising(the Democratic Republic of the Congo (“DRC”), Ghana, Guinea, Mali, the DRC and Tanzania);
South Africa (recorded as a discontinued operation);
Australia; and
Americas (comprising Argentina, Brazil and projects in Colombia).
AngloGold Ashanti has 12 continuing mining operations in Continental Africa,, Australia and the Americas (Argentina and Brazil) comprising open-pit and underground mines, which are supported by extensive, yet focusedglobal exploration activities. In addition, AngloGold Ashanti has greenfields projects located in Colombia and Nevada, USA. Until 30 September 2020, AngloGold Ashanti also conducted gold-mining operations in South Africa. On 1 October 2020, Harmony Gold Mining Company Limited (“Harmony”) took effective control of the Company’s remaining South African producing assets and related liabilities, which were recorded as discontinued operations for the year ended and as at 31 December 2020. In addition, AngloGold Ashanti sold its interests in the Morila and Sadiola gold mines in Mali in November and December 2020, respectively. None of our Malian assets were recorded as discontinued operations. For more information on the company’sCompany’s business and operations, see “Item“Item 4B: Business Overview”.
Under the new Operating Model, the manner in which the financial results are reported to the chief operating decision maker and the composition of the operating segments continue to be reported per geographical region (Africa, Australia and the Americas). In addition, a new segment, Projects has been introduced from the implementation of the new Operating Model (previously reported under the Americas segment). The Projects segment comprises all the major non-sustaining capital projects with the potential to be developed into operating entities. The comparative information of the affected operating segment information has been restated. AngloGold Ashanti’s segmental information is described in “Item 18: Financial Statements—Note 2—Segmental Information”.
As at 31 December 2019,2022, the companyCompany reported, on an attributable basis.basis, Proven and Probable OreMineral Reserve for gold of approximately 20.824.25 million ounces in subsidiaries 7.5and 4.57 million ounces in equity accountedequity-accounted joint ventures and 15.5 million ounces from discontinued operations.ventures. For the year ended 31 December 2019,2022, AngloGold Ashanti reported an attributable gold production of approximately 2.52.41 million ounces from subsidiaries 0.4and 0.34 million ounces from equity accountedequity-accounted joint ventures and 0.4 million ounces from discontinued operations.ventures. As at 31 December 2019,2022, the companyCompany reported an attributable Proven and Probable OreMineral Reserve for copper of 3,068Mlbs.3,250 million pounds. As at 31 December 2022, the Company reported, on an attributable basis, Measured and Indicated Mineral Resource (exclusive of Mineral Reserve(1)) for gold of approximately 57.94 million ounces in subsidiaries and 2.62 million ounces in equity-accounted joint ventures. As at 31 December 2022, the Company reported, on an attributable basis, Inferred Mineral Resource (exclusive of Mineral Reserve(1)) for gold of approximately 39.66 million ounces in subsidiaries and 1.11 million ounces in equity-accounted ventures. As at 31 December 2022, the Company reported an attributable Measured and Indicated Mineral Resource (exclusive of Mineral Reserve(1)) for copper of 2,902 million pounds and Inferred Mineral Resource (exclusive of Mineral Reserve(1)) for copper of 3,231 million pounds. For further information on the Company’s Mineral Resource and Mineral Reserve, see “Item 4D: Property, Plants and Equipment—Mineral Resource and Mineral Reserve Summary Disclosure”.
AngloGold Ashanti’s costs and expenses consist primarily of total cash costs, amortisation, corporate administration, other expenses, and exploration and evaluation costs. Total cash costs include cash operating costs (which include salaries and wages, stores, explosives, timber, reagents, logistics, fuel, power, water and contractors’ costs), royalties and other cash costs. The company’sCompany’s mining operations consist of deep-level underground mines as well as open-pit operations, both of which are labour intensive, therefore salaries and wages are a significant component of total cash costs.
(1) The Mineral Resource exclusive of Mineral Reserve (“Exclusive Mineral Resource”) is defined as the Inclusive Mineral Resource less the Mineral Reserve before dilution and other factors are applied.
5A: OPERATING RESULTS
Introduction
2019 was markedThe US real gross domestic product rose by low interest rates,2.1 percent in 2022, compared with an increase of 5.9 percent in 2021. While many components expanded in the ongoing US-China trade conflictlast quarter of 2022, they also showed softening, and global manufacturing growth slowdown, all of which led to recession fears. Central banks also played their part withexpectations remain for the US Federal Reserve cutting rates three times during theeconomy to slip into a recession in 2023.
Stock markets rounded off a tumultuous year pumping more than $400 billion worth of liquidity into the US Repo market. In the absence of inflation coupled with low yielding assets, gold gained favour from investors as both a store of value and a safe haven asset class. The price of gold soared by ten percent year on year. US Treasury bonds also benefitted from the flight to safety and consequently yields came tumbling down across the curve.
As is often the case during periods of high and rising gold prices, retail and professional investment behaviour diverge. Bar and coin investors are more inclined to capitalise on a price rise by selling existing holdings. In contrast, tactical positioninggains in long (purchases) by professional investors on the Comex reached all-time highs equivalent to 1,134 tonnes in September 2019. This bullish sentiment among professional investors contributed to the price rise, which in turn attracted further momentum-driven investment inflows, notably into Exchange Traded Funds (ETFs). Physically-backed ETFs and similar products closed 2019 at 2,885.5 tonnes with annual inflows of 401.1 tonnes, up 426 percent year on year. Total investment growth netted out at nine percent year on year as retail investors selling off-set professional investors purchases.
In the fourth quarter of 2019, central banks added a net 109.6 tonnes to global official gold reserves bringing full-year net purchases to 650.3 tonnes, just one percent short2022. Asian shares were boosted by China’s relaxation of the 2018 total of 656.2 tonnes. This marks ten consecutive years of net purchases, with global official reserves now 5,000 tonnes higher than atits zero-Covid policy, and European equities also advanced strongly. As prices fell, government bond yields edged up towards the end of 2009 at circa 34,700 tonnes and highlights the importancefourth quarter of 2022. This reflected some market disappointment with major central banks place on having an allocationreiterating plans to tighten monetary policy, even as inflation showed signs of gold in their reserve portfolio.
In 2019, global gold jewellery demand volumes fell six percent to 2,107 tonnes. Purely a second half of the year phenomenon, the weakness was primarily due to the big jump in the third quarter in the price of gold (in local currency terms), which impacted affordability. The price was well supported at elevated levels throughout the closing months of 2019, leading to a ten percent year on year droppeaking. Commodities gained in the fourth quarter of 2022, led by industrial metals.
The year 2022 was the strongest year for gold demand in over a decade and showed how gold’s diverse sources of demand and supply can counterbalance one another, providing gold with its uniquely stable performance as an investment asset. Annual gold demand increased by 18 percent to 584.54,741 tonnes with investment demand increasing by ten percent and reaching 1,107 tonnes. In US dollar terms,Demand for gold bars and coins increased by two percent to 1,217 tonnes. The need for wealth protection in the global inflationary environment remained a primary motive for gold investment purchases. Holdings of gold ETFs fell by a smaller amount (down 110 tonnes) than in 2021 (down 189 tonnes).
Central bank net purchases in the fourth quarter of 2022 totalled 417 tonnes increasing full year net purchases to a high of 1,136 tonnes. Geopolitical uncertainty and high inflation were highlighted as key reasons for holding gold by central banks.
Gold jewellery demand grewsoftened slightly in 2022 with total annual demand declining by three percent to a five-year high of $94.3 billion. Much of this came from a nine percent year2,086 tonnes. Declines in Chinese demand for gold jewellery throughout 2022 had an outsized impact on year increasethe world total.
Worsening global economic conditions in the fourth quarter demand, which reached $27.8 billion,of 2022, together with trade restrictions and supply chain issues generated a seven-year high.
Technology demand for gold weakened contributing to a twoseven percent falldecline in annual demand for gold in technology. Electronics demand mirrored the sector.
Total supply was slightly higherseven percent annual decline in 2019, up two percent year on year from 4,673.0 tonnesthe broader sector, dropping sharply in 2018 to 4,776.1 tonnes in 2019. This growth was attributable to the price performance of gold over the year, primarily through its impact on recycling, but also on net hedging to a certain extent. While mine production fell by one percent year on year, a sharp increase in gold recycling to its highest level since 2012 (up 11 percent year on year) helped boost higher total supply. Modest net producer hedging, the first year of net hedging since 2016, also contributed to overall supply.
The market spot gold price closed the fourth quarter of 2019 at $1,517 per ounce which was also2022 in response to the highestdeteriorating global economic picture and supply chain challenges, particularly in China.
Annual mine production increased one percent year-on-year although this remains below the record high seen in 2018. Full year recycled gold supply increased by one percent but remains 30 percent below the all-time high seen in 2012, despite a record annual average gold price in 2022. In the fourth quarter. The lowest market spotaggregate, total supply of gold price recorded inincreased by two percent year-on-year.
For the fourth quarter was $1,454 per ounce. The2022 year, the average market spot gold price was recorded at $1,483$1,802 per ounce, forgold income of the fourth quarter.Company was $4,388 million and the average gold price received by the Company was $1,793 per ounce. The average market spot gold price was recordedincreased by one percent over 2022, starting on 1 January 2022 at $1,394 per ounce for the full year 2019. The highest market spot gold price recorded in 2019 was $1,552approximately $1,801 per ounce and the lowest market spot gold price for the same period was $1,270ending on 30 December 2022 at approximately $1,824 per ounce. Management uses the market spot gold price and the average gold price received to monitor the performance of the gold price and its effect on the company’sCompany’s results. It gives an investor insight into the performance of the gold price and its impact on company results.
Restatement as a result of discontinued operations
On 12 February 2020, the company announced an agreement to sell its remaining South African producing assets and related liabilities (SA disposal group) to Harmony Gold Mining Company Limited. Consideration for the transaction is in cash and deferred payments with expected proceeds of around $300 million, subject to subsequent performance, and with additional proceeds if the West Wits assets are developed below current infrastructure. The consideration is comprised of $200 million in cash payable at the closing of the transaction and two components of deferred consideration, payable as follows:144
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1. | $260 per ounce payable on all underground production sourced within the West Wits mineral rights (comprising the Mponeng, Savuka and Tau Tona mines) in excess of 250,000 ounces per annum for 6 years commencing 1 January 2021; and |
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2. | $20 per ounce payable on underground production sourced within the West Wits mineral rights (comprising the Mponeng, Savuka and Tau Tona mines) below the datum of current infrastructure. |
The transaction principally comprises the following assets and liabilities:
The Mponeng mine and its associated assets and liabilities;
The Tau Tona and Savuka mines and associated rock-dump and tailings storage facility reclamation sites, mine rehabilitation and closure activities located in the West Wits region and their associated assets and liabilities;
First Uranium (Pty) Limited, which owns Mine Waste Solutions (Pty) Limited and Chemwes (Pty) Limited, as well as associated tailings assets and liabilities;
Covalent Water Company (Pty) Limited, AngloGold Security Services (Pty) Limited and Masakhisane Investments (Pty) Limited; and
Certain rock-dump reclamation, mine rehabilitation and closure activities located in the Vaal River region and their associated assets and liabilities.
Pursuant to the agreement, the silicosis obligation of $65 million and the post-retirement medical obligation of $93 million relating to South African employees will be retained by the group.
The agreement provides for terms customary in agreements of this nature and is subject to customary conditions precedent, including the obtaining of all necessary consents from the South African DMRE (including section 11 and section 102 approvals under the MPRDA) for the transfer of the mining rights related to the sale of the mining assets and securing the approval of the South African Competition Authorities in terms of the South African Competition Act, No. 89 of 1998. The company and Harmony Gold Mining Company Limited have committed to engage with the relevant authorities and other stakeholders in order to ensure the conditions precedent are fulfilled as soon as possible with the earliest closing anticipated on or about 30 June 2020.
As a result of the contemplated sale of the SA disposal group, the SA disposal group was classified as an asset held for sale and recognised as a discontinued operation in the company’s consolidated financial statements for the year ended and as at 31 December 2019. See “Item 18: Financial Statements-Note 9-Discontinued operations and assets and liabilities held for sale” for further details.
The company’s operating and financial results and the related comparative statements have been restated in accordance with IFRS 5 Non-current Assets Held for Sale and Discontinued Operations to recognise the SA disposal group as a discontinued operation for the years ended 31 December 2018 and 2017. The discussion of operating and financial results in this “Item 5: Operating and Financial Review and Prospects” relates to the company's continuing operations (unless the context indicates otherwise).
Change in presentation of “Special items” disclosure
Effective 1 January 2019, the group changed the disclosure of “Special items” in the income statement. In prior periods, the group disclosed items that, due to their size and/or nature, required separate disclosure on the face of the income statement as “Special items”. In addition, a disclosure category “Other operating expenses” was reported to disclose expenses which were not included in gross profit. Going forward these two categories of expenses and income will be disclosed as “Impairment, derecognition of assets and profit (loss) on disposal” and “Other expenses (income)” depending on materiality. This new presentation provides more useful information by reporting material items separately. The change in presentation has no impact on the reported totals, or on amounts presented in the statement of financial position. For further details, refer to “Item 18: Financial Statements-Note 1-Accounting Policies”.
Key factors affecting results
Gold prices
AngloGold Ashanti’s operating results are directly related to the market spot gold price, which can fluctuate widely and is affected by numerous factors beyond its control, including investment, jewellery and industrial demand (particularly in China and India), expectations with respect to the rate of inflation, the strength of the US dollar (the currency in which the price of gold is generally quoted) and of other currencies, interest rates, actual or expected gold sales and purchases by central banks and the International Monetary Fund (IMF)("IMF"), global or regional political or economic events or conditions (such as the impact of pandemics such as COVID-19,war between Russia and Ukraine), production and cost levels in major gold-producing regions.regions and, to a lesser extent during 2022, the impact of global health crises and pandemics (such as the COVID-19 pandemic).
The current demand for and supply of gold may affect gold prices, but not necessarily in the same manner as current supply and demand affects the prices of other commodities. The supply of gold consists of a combination of new production and fabricated gold held by governments, public and private financial institutions, industrial organisations and private individuals. As the global gold production in any single year constitutes a small portion of the total potential supply of gold, short-term variations in current production do not necessarily have a significant impact on the supply of gold or on its price.
The market for gold bullion bar, the company’sCompany’s primary product, is generally limited to the bullion banks. The number of these banks has declined over the last few years.decade. Additionally, due to the diversity and depth of the total gold market, the bullion banks do not possess significant pricing power.
The price of gold is often subject to sharp, short-term changes. The shift in gold demand from physical demand to investment and speculative demand may exacerbate the volatility of gold prices.
Yearly average market spot gold prices received per ounce have changed during the three years under review as follows:
2017•2020 - $1,251$1,772 per ounce
2018•2021 - $1,261$1,798 per ounce
2019•2022 - $1,387$1,802 per ounce
Gold income of the Company has changed during the three years under review as follows:
•2020 - $4,490 million
•2021 - $3,903 million
•2022 - $4,388 million
Yearly average gold prices received by the Company have changed during the three years under review as follows:
•2020 - $1,778 per ounce
•2021 - $1,796 per ounce
•2022 - $1,793 per ounce
Gold income of the Company increased by $485 million, or 12 percent, from $3,903 million in 2021 to $4,388 million in 2022. The average gold price received by the Company decreased by $3 per ounce, from $1,796 per ounce for the year ended 31 December 2021 to $1,793 per ounce for the year ended 31 December 2022. The average market spot gold price increased by $4 per ounce, from $1,798 per ounce for the year ended 31 December 2021 to $1,802 per ounce for the year ended 31 December 2022.
The market spot gold price opened the year on 1 January 2022 at $1,801 per ounce (compared to $1,905 per ounce on 4 January 2021). The market spot gold price in 2022 has been subject to volatile short-term swings, with a year high of $2,052 per ounce on 8 March 2022 and a year low of $1,622 per ounce on 26 September 2022. The average ofmarket spot gold price for 2022 was $1,802 per ounce. The market spot gold price at closing on 30 December 2022 was $1,824 per ounce (compared to $1,828 per ounce on 31 December 2021). Between 1 January 2023 and 10 March 2023, the market spot gold price from 1 January 2020 to 19 March 2020 was $1,580.88traded between a low of $1,811 per ounce and a high of $1,950 per ounce. On 1910 March 2020, the afternoon price for gold on the London Bullion Market was $1,474.25 per ounce. After an initial increase in the beginning of the year,2023, the market spot gold price decreased from a high of $1,687.00was $1,868 per ounce on 6 March 2020 to a low of $1,469.80 per ounce on 19 March 2020 in the midst of a wider market dislocation related to the COVID-19 pandemic and despite the alleged investor perception of gold as a relatively safe haven in periods of market volatility.ounce.
If income from gold sales falls for an extended period below the company’sCompany’s total cash costs at its operations, AngloGold Ashanti could determine that it is not economically feasible to continue production at some or all of its operations. Declining gold prices may also force a reassessment of the feasibility of a particular exploration or development project or projects, and could lead to the curtailment or suspension of such projects. A sustained decrease in gold prices may force the companyCompany to change its dividend payment policies, reduce expenditures and undertake measures to address its cost base. In addition, the
use of lower gold prices in OreMineral Reserve estimates and life-of-mine plans could result in material write-downswrite downs of the company’sCompany’s investment in mining properties and increase amortisation, environmental rehabilitation and mine closure charges.
On 22 and 28 January 2020, the company entered into Asian style zero-cost collars in respect of its Argentinean operations (CVSA) for a total of 130,900 ounces (70 percent of CVSA’s annual gold production) for the period February 2020 to December 2020. The strike prices are as follows: $1,500 per ounce on the floor and an average price of $1,701.34 per ounce on the cap.
Production levels
In addition to gold prices, AngloGold Ashanti’s gold income in any year is also influenced by its level of gold production. Production levels are in turn influenced by grades, tonnages mined and processed through the plant, and metallurgical recoveries. Attributable gold production (including joint ventures) remained fairly consistentfluctuated between 2017 - 20192020 to 2022, from 2.852.81 million ounces in 2017, 2.912020 to 2.47 million ounces in 20182021 to 2.862.74 million ounces in 2019.2022. For more information on the company’sCompany’s business and operations, see “Item“Item 4B: Business Overview”.
Operational impacts resulting from the COVID-19 pandemic
In addition toThe COVID-19 pandemic resulted in disruption and volatility in global financial markets and capital markets and a significant decrease in global economic activity, which had an adverse effect on worldwide demand for gold and adversely affected the profitability of the Company’s operations.
The direct impact on the Company’s production from COVID-19 for 2022 was estimated at 19,000 ounces, a decrease of 28,000 ounces, or 60 percent, compared with an estimated production impact of 47,000 ounces for 2021. The direct COVID-19 impact on the Company’s cost of sales was estimated at $6 million for 2022, a decrease of $8 million, or 57 percent, compared to $14 million for 2021. The direct impact from COVID-19 on the Company’s AISC was estimated at $12 per ounce, a decrease of $22 per ounce, or 65 percent, compared with an estimated $34 per ounce for 2021.
The Company remains mindful of the extent to which the COVID-19 pandemic could impact the Company’s results depending on the gold price discussed underscale, duration and geographic reach of future developments, which are highly uncertain and cannot be predicted, including the caption “-Gold Prices”,possibility of a recurrence or multiple waves of the outbreak and new variants. The Company continues to observe strict health protocols and to exercise vigilance in relation to business continuity including supply chain. The Company remains mindful that the COVID-19 pandemic, hasits impacts on communities and economies, and the potentialactions authorities may take in response to it, are subject to change in response to current and future conditions.
Geopolitical tensions
The geopolitical tensions and war between Russia and Ukraine and the retaliatory measures that have been taken, and could be taken in the future, by the United States, the EU, the United Kingdom, NATO and other jurisdictions have created global security concerns that could result in a regional or global conflict and otherwise have a significantlasting impact on our operationsregional and global economies, any or all of which could adversely affect AngloGold Ashanti’s business. See “Item 3D: Risk Factors—Global political and economic conditions could adversely affect the profitability of operations”.
Climate change and other environmental factors
Rising temperatures, changing rainfall patterns and severe weather conditions believed to be caused by causing supply chain delaysclimate change remain growing concerns for businesses, investors, broader society and disruptions, import restrictions or shipping disruptions,governments. This has led to increased pressure on companies, including those in the mining sector, to reduce greenhouse gas (“GHG”) emissions consistent with national commitments made by numerous countries under the Paris Agreement, to promote responsible corporate practices and to increase transparency about the risks and opportunities of transitioning to a low-carbon economy. Pressure from governments, investors and broader society for mining companies to improve environmental stewardship and reduce GHG emissions, both in terms of absolute emissions and in intensity of emissions per tonne mined, is likely to increase in the future.
In 2008, AngloGold Ashanti targeted a 30 percent reduction in absolute GHG emissions of its portfolio by 2022, from a 2007 base level. This target was reached by 2018, and at the end of 2021 Scope 1 and 2 GHG emissions were 46.6 percent below 2007 levels. The GHG emission reductions are due to changes in the Company’s asset mix, as well as operational shutdowns (includingenergy-efficiency and fuel switching initiatives implemented at the Company’s operations and projects. In October 2022, AngloGold Ashanti released a carbon emissions reduction target that aims to achieve a 30 percent absolute reduction in its Scope 1 and Scope 2 GHG emissions by 2030, as partcompared to 2021, through a combination of government-mandated containment measures or additional safety measuresrenewable energy projects, fleet electrification and lower-emission power sources. The capital cost required to achieve these reductions by 2030 is anticipated to be approximately $1.1 billion, of which $350 million is expected to be funded over that the company may also consider). The company operates mines in countries that have confirmed cases of COVID-19 and resulting death. A full or partial shutdown of the company’s mines in the affected areas and, as a result, a halt in related mining operations could occur if COVID-19 spread among our workforce, in case requested or mandatedperiod by governmental authorities or if otherwise elected by the company as a preventive measure to contain the spread of the virus. Governments of the countries in which we operate may impose significant restrictions on the movement of goods, services and persons, including by ordering nationwide lockdowns of businesses and their citizens, as was recently done in Argentina, which imposed a nationwide lockdown (quarantine), including travel restrictions, border closingsAngloGold Ashanti and the shutdownremaining $750 million through third-party funding, including from providers of most industries,renewable energy infrastructure. The Company has also committed to achieving net zero Scope 1 and Scope 2 GHG emissions by 2050.
The Company is also tracking the carbon intensity of its energy mix by measuring GHG emissions per Gigajoule (“GJ”) of energy used. This measure increased by 2.7 percent year-on-year in 2022 to approximately 65 kilograms of CO2e emitted per GJ of energy compared to 2021 as a result ofthe Company’s direct and indirect energy consumption was four percent higher than in 2021. Absolute Scope 1 and Scope 2 GHG emissions in 2022 increased by seven percent to 1.47Mt compared to 2021, which Cerro Vanguardia S.A. (CVSA) was required to temporarily suspend mining activities. Similarly,is the South African and State of Goiás governments imposed similar restrictions resulting in the temporary suspension of mining activities of the company’s South African operations and Serra Grande operations in Brazil, respectively.Company’s new baseline year.
Foreign exchange fluctuations
Total cash costs in all business segments are for local procurement largelypartly incurred in local currency where the relevant operation is located. US dollar denominated total cash costs and net income tend to be adversely impacted by local currency strength and favourably impacted by local currency weakness, assuming there are no other offsetting factors. AngloGold Ashanti’s financial results can be influenced significantly by the fluctuations in the Brazilian real, Australian dollar, and, to a lesser extent, the ArgentinianArgentinean peso and other local currencies. As set out below, during the year ended 31 December 2019, the Argentinian peso, Brazilian real and2022, the Australian dollar and Argentinean peso weakened and the Brazilian real strengthened against the US dollar, which collectively had a favourable impact on AngloGold Ashanti’s US dollar denominated total cash costs.
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Average annual exchange rates to the US dollar | 2022 | | 2021 | | 2020 |
Brazilian real | 5.16 | | | 5.40 | | | 5.15 | |
Australian dollar | 1.44 | | | 1.33 | | | 1.45 | |
Argentinean peso | 130.87 | | | 95.21 | | | 70.71 | |
|
| | | | | | | | |
Average annual exchange rates to the US dollar | 2019 |
| | 2018 |
| | 2017 |
|
Brazilian real | 3.94 |
| | 3.66 |
| | 3.19 |
|
Australian dollar | 1.44 |
| | 1.34 |
| | 1.30 |
|
Argentinian peso | 48.29 |
| | 28.14 |
| | 16.57 |
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In 2019,2022, the companyCompany derived 5547 percent (47(41 percent including joint ventures) of its revenues from continuing operations from Brazil, Australia and Argentina, and incurred 5449 percent (47(45 percent including joint ventures) of its total cash costs from continuing operations in Brazil, Australia and Argentina. ABased on average exchange rates in 2022, the Company estimates that a one percent strengthening of these local currenciesall of the Brazilian real, Argentinean peso, Australian dollar, Ghanaian cedi and the South African rand against the US dollar, will resultother factors remaining equal, would have resulted in an increase in cost of sales and total cash costs incurredper ounce of aboutapproximately $13 million or $5and $6 per ounce.ounce, respectively. As a result of the sale of its remaining South African operations, AngloGold Ashanti’s exposure to fluctuations in the strength of the South African rand has been reduced.
Certain exchange controls were in force in emerging markets in which the companyCompany operates during the period under review, including, for example in Argentina. In the case of Argentina, although the exchange rate of the ArgentinianArgentinean peso is primarily market determined, its value at any time may not be considered a true reflection of the underlying value while exchange controls exist. It is not possible to predict whether or when thisthe Argentinean government will occurrelax exchange controls or the future value of the ArgentinianArgentinean peso.
Total cash costs and effects of inflation
Total cash costs include cash operating costs (which include salaries and wages, stores, explosives, timber, reagents, logistics, fuel, power, water and contractors’ costs), royalties and other cash costs. The mining industry continues to experience price inflationincreases for costs of inputs used in the production of gold, which leads to higher total cash costs reported by many gold producers.
AngloGold Ashanti is unable to control the prices at which it sells its gold. Accordingly, in the event of significant inflation in Brazil, Argentina or Australia, without a concurrent devaluation of the local currency or an increase in the price of gold, there could be a material adverse effect upon the company’sCompany’s results and financial condition. See “Item 3D: Risk Factors—Inflation may have a material adverse effect on results of operations”.
At 31 December 2022, AngloGold Ashanti employs over 26,000 people (34,000globally on average approximately 32,594 people, including the SA disposal group) globally,contractors, most of whom are members of trade unions, particularly in Continental Africa and the Americas. Salaries and wages account for a significant component of local total cash costs and are impacted by annual wage increases. During 2022, COVID-19 continued to – although to a lesser extent than in prior years – present challenges with travel restrictions and shortages of critical skills resulting in higher labour and contractors’ costs at certain operations.
Energy costs, comprising power, fuel and lubricants, are another material component of total cash costs. Due to the remote location of some of its mines in Continental Africa, AngloGold Ashanti uses fuel to generate power and uses fuel and lubricants at its mines to run its fleet and processing plants. The price of Brent crudeCrude oil has increased from $54$42 per barrel in 2017,2020 to $71 per barrel in 20182021 to $65$97 per barrel in 2019,2022, a 20$55, or a 131 percent per barrel increase over the three-year period. AngloGold Ashanti estimates that for each $1$1.00 per barrel rise or fall in the oil price, other factors remaining equal, the averagecost of sales and total cash costs per ounce of all its operations increaseschange by about $3approximately $1 million or $0.9$0.50 per ounce, withrespectively. The sensitivity analysis includes the impacts of oil hedges. In July 2022, AngloGold Ashanti entered into forward contracts for a total of 999,000 barrels of Brent Crude oil for the period January 2023 to December 2023 that will be cash settled on a monthly basis against the contract price. The average price achieved on the forward contracts is $89.20 per barrel of Brent Crude oil. At 31 December 2022, the mark-to-market value of these oil derivatives was an unrealised loss of $6 million. The cost of sales and total cash costs per ounce of certain of the company’sCompany’s mines, particularly Siguiri, (Guinea), Geita, (Tanzania), Kibali (DRC), MorilaIduapriem and Sadiola (Mali),Tropicana, which are more dependent on fuel, being moreare most sensitive to changes in the price of oil.
On AngloGold Ashanti continues to monitor the developments in the war between Russia and Ukraine and their impact on the oil price. The escalation of the conflict dominated market sentiments during 2022, pushing oil prices higher to levels last seen during the 2008 global financial crisis. In recent weeks, the oil price has declined and, as of 10 February 2020,March 2023, the company entered into Asian style zero-cost collars for a totalprice of approximately 342,000 barrelsoil was at $82per barrel of Brent crude oil forCrude. See “Item 3D: Risk Factors—The profitability of mining companies’ operations and the period February 2020 to December 2020. The average strikecash flows generated by these operations are significantly affected by fluctuations in input production prices, are $45 per barrel on the floor and an average pricemany of $65 per barrel on the cap. On 26 February 2020, the company entered into an additional set of Asian style zero-cost collars for a total of approximately 622,000 barrels of Brent crude oil for the period March 2020 to December 2020. The average strike prices are $44.50 per barrel on the floor and an average price of $65 per barrel on the cap.
Energy costs, even in business segments which are supported by grid power have increased considerably overlinked to the three-year period. These increases have adversely impacted total cash costs.prices of oil and steel”.
AngloGold Ashanti has no influence over the cost of most consumables, many of which are linked to some degree to the price of oil and steel and in a number of cases have exceeded inflation.consumables. Furthermore, there has also been volatility recently in the price of steel, used in the manufacture of most forms of fixed and mobile mining equipment, which is a relatively large contributor to the operating costs and capital expenditure of a mine. Fluctuations in oil and steel prices as well as cost increases in respect of labour, explosives, cyanide and other production inputs have a significant impact on operating costs and capital expenditure. COVID-19 continued to – although to a lesser extent than in prior years – present challenges within the overall logistics sector resulting in higher cost of transportation, warehousing and inventory prices.
Royalties (excluding joint ventures), which are generally calculated as a percentage of revenue, varied over the past three years from $111 million incurred in 2017 to $133 million incurred in 2018 and $137$181 million in 2019,2020 to $162 million in 2021 to $185 million in 2022, a 23two percent increase over the three-year period, primarily due to the variations in the gold prices received, production and royalty rate increases. Royalties are likely to continue to vary in the coming years asdue to the variations in the gold prices and the fact that in a number of jurisdictions host governments increasingly seek to obtain a higher share of revenue by increasing the royalty rates for gold mines.
RehabilitationEnvironmental rehabilitation costs
Total provisions for decommissioning and for environmental restoration activities (excluding joint ventures and excluding liabilities related to assets held for sale)discontinued operations) totalled $637$659 million in 2018 and $6342020, $673 million in 2019, (including liabilities related to assets held for sale: $6372021 and $578 million in 20182022. During 2021, the provisions for decommissioning and $730restoration increased by $14 million in 2019). During 2019 $96 million was transferredlargely due to liabilities related to assets held for sale which
amount was partially offset bythe recognition of a change in estimate. The changeestimates relating to the ongoing transition to dry-stacking operations in estimates is attributableBrazil to comply with new legal requirements in Brazil as well as changes in the methodology for calculating such estimates. During 2022, the provisions for decommissioning and restoration decreased by $95 million mainly due to changes in estimates resulting from changes in discount rates, due to changes in global economic assumptions, changes in mine plans resulting in a change in cash flows andas well as changes in the design of tailings storage facilities and in methodology, following requests from the environmental regulatory authorities.(“TSFs”). See also “Item“Item 4B: Business Overview-RegulatoryOverview—Regulatory Environment Enabling AngloGold Ashanti to Mine”, “Item 4B: Business Overview-MineOverview—Mine Site Rehabilitation and Closure” and “Item 4B: Business Overview-Environmental, HealthOverview—Sustainability and SafetyEnvironmental, Social and Governance ("ESG") Matters”.
Amortisation of tangible assets
Amortisation of tangible assets increased during the 2020 to 2022 period by $25 million, or five percent, from $526 million in 2020 to $551 million in 2022, largely due to the Obuasi redevelopment project continuing to ramp up to full production, increased investment in TSFs at Serra Grande and higher deferred stripping at Tropicana and Iduapriem.
Amortisation of right of use assets, as recognised in accordance with IFRS 16 “Leases”, increased during the 2020 to 2022 period by $34 million, or 72 percent, from $47 million in 2020 to $81 million in 2022, mainly due to additional lease contracts entered into at the Brazilian operations and at the Geita mine.
Amortisation of intangible assets decreased during the 2017 - 20192020 to 2022 period by $1 million, or 50 percent, from $685$2 million in 2020 to $538$1 million largely due to open pit ore being depleted at Geita and lower production at Cerro Vanguardia and Siguiri.in 2022.
Exploration and evaluation costs
The companyCompany has expensed exploration expenditure during the years ended 31 December 2017, 20182020, 2021 and 20192022 in order to replenish depleting OreMineral Reserve and bring new ore bodies into pre-feasibility or feasibility. The expensed exploration costs incurred over the last three fiscal years amounted to $105$124 million in 2017, $982020, $164 million in 20182021 and $112$205 million in 2019.2022. Exploration expenditure increased during 20192022 mainly due to an increase in Brownfieldsgreenfields exploration and global specialist and management cost.in Nevada, United States.
Corporate administration, marketing and otherrelated expenses
The corporate administration, marketing and otherrelated expenses incurred amounted to $64$68 million in 2017, $762020, $73 million in 20182021 and $82$79 million in 2019.2022. The increase isin 2022 of $6 million, or eight percent, was mainly due to higher labourthe allocation of service costs (cash sharesto corporate costs and equity share costs), higher technical security costs and consultancy costs.following the implementation of the new Operating Model. This increase was partly offset by the exchange rate impact of a 11 percent weaker local currency.
Impairment, derecognition of assets and profit (loss) on disposal
For all of the AngloGold Ashanti reviewsGroup’s cash generating units (“CGUs”) where indicators of impairment or reversal of impairment have been identified, the recoverable amounts of the CGUs were determined. With the exception of Serra Grande, the Córrego do Sítio mining complex (“CdS”) and teststhe Mineração Cuiabá mining complex (“Cuiabá”) in Brazil, the recoverable amounts exceeded the carrying amounts of the CGUs and management has considered the sensitivity of the impairment calculations to various key inputs and assumptions such as the gold price and exchange rates and concluded that reasonably possible changes to these key inputs and assumptions applied would not result in any impairment loss or the reversal of a previous impairment loss to be recognised.
These sensitivities have been taken into consideration in determining the required impairments as disclosed below. Management assumptions for the value in use of its assets when events or changes in circumstances suggest that the carrying amount may not be recoverable. AngloGold Ashanti values individual mining assets at the lowest level for which cash flows are identifiable as independent of cash flows of other miningtangible assets and liabilities.
If there are indications that impairment may have occurred, AngloGold Ashanti prepares estimates of expected future cash flows for each group of assets. Expected future cash flows are inherently uncertain, and could materially change over time. They are significantly affected by Ore Reserve and production estimates, together with economic factors, such as market spot and forward gold prices, discount rates, currency exchange rates, estimates of costs to produce Ore Reserve and future capital expenditures. Alternatively, should any of these factors reverse, then AngloGold Ashanti may have to reverse previously recognised impairments.
When reviewing goodwill and other tangible assets for impairment, AngloGold Ashanti's assumption oninclude the gold price assumption, which
represents itsmanagement’s best estimate of the future price of gold. In arriving at the estimatedA long-term real gold price AngloGold Ashanti considers all available market information including current prices, historical averages, and forward pricing information and data. The long- term real gold price of $1,300$1,731 per ounce in 2019 and $1,239(2021: $1,599 per ounce in 2018, wereounce; 2020: $1,450 per ounce) is based on a range of economic and market conditions which were, at that time,are expected to exist over the remaining useful life of the assets.
In determining the impairment for each CGU, the real post-tax rate was derived from the weighted average cost of capital (“WACC”) using the Capital Asset Pricing Model (“CAPM”) to determine the required return on equity with risk factors consistent with the basis used in 2021. At 31 December 2022, the derived group WACC was 12.2 percent (real post-tax) which is 360 basis points higher than 8.6 percent at 31 December 2021, and is based on the industry average capital structure of the major gold companies considered to be appropriate peers. In determining the WACC for each CGU, sovereign and mining risk factors are considered to determine country specific risks. In certain instances, a specific risk premium was added to large projects being undertaken or the turnaround nature of a specific mine to address uncertainties in the forecast of the cash flows.
Córrego do Sítio (CdS)
CdS is owned and operated by AngloGold Ashanti considersMineração (“AGA Mineração”) in Brazil. The CdS mining complex has been in operation since 1989 and consists of open pit and underground mines. The property is currently in a production stage. In line with AngloGold Ashanti's reinvestment strategy, management took a decision during the long-term fundamentals that providethird quarter of 2022 to carve out the underperforming complex of CdS from the AGA Mineração CGU and to investigate alternative strategic options including either to sell the complex, place the complex under care and maintenance, close the complex or to consider additional capital expenditure to regain profitability of the complex. After the strategic review of CdS, the Company has elected to retain CdS. This decision resulted in the disaggregation of the AGA Mineração CGU into two separate CGUs, being the CdS mining complex CGU and the Cuiabá mining complex CGU. As a result of these impairment indicators, the recoverable amount for the CdS mining complex CGU was determined not to support its carrying values as at 30 September 2022 and an impairment loss of $151 million ($189 million gross of taxes) was recognised and included in the Americas segment. The disaggregation of CGUs did not have an impact on reportable segments in terms of IFRS 8 “Operating Segments” as disclosed in “Item 18: Financial Statements—Note 2—Segmental Information”. The recoverable amount of $5 million was determined with reference to the CGU’s value in use derived from a discounted cash flow model, using a discount rate of 8.5 percent, compared to the CGU’s carrying amount of $156 million.
Cuiabá
Cuiabá is owned and operated by AGA Mineração in Brazil. It has been in operation since 1834 and is an underground mine. The property is currently in the production stage. The Cuiabá mining complex CGU, which was disaggregated from the AGA Mineração CGU, recognised an impairment loss of $57 million ($70 million gross of taxes). This was largely due to the suspension of filtered tailings deposition on the Calcinados TSF and processing of gold price assumption. These include, amongst other things, gold asconcentrate at the Queiroz plant in December 2022 (with both servicing the Cuiabá mining complex). For further information, refer to “Item 4B: Business Overview—The Regulatory Environment Enabling AngloGold Ashanti to Mine—Americas—Brazil” and “Item 3D: Risk Factors—Compliance with tailings management requirements and standards, and potential liabilities in the event of a long-term storefailure to timely comply with these requirements or an incident involving a tailings storage facility, could adversely impact AngloGold Ashanti’s financial condition, results of value, hedge against inflation, safe haven status, strong physical demand from emerging markets, central bank purchases, quantitative easingoperations and devaluation of paper currency, falling global mine production and rising costs of producing gold, all of which represent significant and enduring trends supportive of AngloGold Ashanti's gold price assumption.reputation”.
The actual market spot gold price averaged $1,394 per ouncerecoverable amount of $304 million (compared to the CGU’s carrying amount of $361 million) was determined with reference to the CGU’s value in 2019use which requires the use of estimates. The impairment result was derived from a discounted cash flow model and $1,268 per ouncea discount rate of 8.5 percent.
Management modelled various scenarios, which included a combination of reasonably possible changes in 2018.key assumptions, to determine the impact on the recoverable amount. The market spot gold priceimpairment assessment required significant judgement and estimation uncertainty. The impairment loss was recognised and included in 2020the Americas segment.
Serra Grande
Mineração Serra Grande (“Serra Grande”) is wholly-owned by AngloGold Ashanti and is located in the northwest of Goiás state, central Brazil. It has been subject to volatile short-term swingsin operation since 1986 and consists of three underground and two open pit mines. The market spot gold price has averaged $1,580.88 per ounce from 1 January 2020 to 19 March 2020 and closed at $1,474.25 per ounce on 19 March 2020.
Other expenses
Other expenses decreasedproperty is currently in the production stage. The Serra Grande CGU recognised an impairment loss of $38 million ($45 million gross of taxes) during the 2017 - 2019 period, from $150 million to $83 million,December 2022 largely due to a projection of lower grades and ounces and an increase in the interest rates driven by global inflation and country risk which resulted in an increased discount rate. The recoverable amount of $128 million was determined with reference to the CGU’s value in use derived from a discounted cash flow model, using a discount rate of 8.5 percent, compared to the CGU’s carrying amount of $166 million. The impairment loss was recognised and included in the Americas segment.
Other (expenses) income
Other (expenses) income incurred over the last three fiscal years amounted to an expense of $57 million in 2020, an expense of $136 million in 2021 and an expense of $26 million in 2022. The decrease during 2022 was largely due to care and
maintenance activities of $45 million incurred in 2021 at the Obuasi mine during the voluntary suspension of underground mining between May and October 2021 following a sill pillar incident, retrenchment and related costs of $18 million incurred in 2021 as part of the transition to the new Operating Model and bond settlement costs of $24 million incurred in 2021 related to the tender offer for, and subsequent redemption of, the $750 million aggregate principal amount of 5.125% notes due 2022, none of which were repeated in 2022. The non-occurrence of the aforementioned costs in 2022 contributed to a decrease in legal settlement fees. In 2017, an initial provision forcost of $87 million. Further decreases in other expenses were primarily due to the settlementlower cost of the silicosis class actionlegacy tailings operations of $63$25 million, was made withmainly at Obuasi, as a subsequent adjustmentresult of $2fewer activities at such legacy tailings operations, and lower value added tax (“VAT”) of $7 million and other duties expensed. These decreases in 2019.other expenses were partly offset by higher due diligence project costs of $5 million during 2022.
Taxation
Taxation increaseddecreased over the period 2017 - 20192020 to 2022 from an expense of $163$625 million in 20172020 to an expense of $250$173 million in 2019. Increase2022. Decrease in taxation over the period 2017 - 2019 is2020 to 2022 was largely due to higherlower earnings in Australia, Ghana, Tanzania Brazil and Ghana.Argentina and higher impairments in Brazil.
Taxation is likely to continue to be volatile in the coming years, as host governmentsdue to fluctuations in a number of jurisdictions increasingly seek to obtain a higher share of revenue by increasing rates of existing taxesgold price and introducing new taxes on gold mines.production.
Production in 20192022
For the year ended 31 December 2019,In 2022, AngloGold Ashanti’s total attributable gold production of 2.86was 2.742 million ounces, was 50,000an increase of 270,000 ounces, or two11 percent, lower than the 2018compared with its total attributable gold production of 2.912.472 million ounces in 2021. Production was higher year-on-year mainly due to a ten percent increase in recovered grades and the resumption of stoping activities at Obuasi during 2022, following the temporary suspension of underground stoping activities in 2021 due to a sill pillar incident in May 2021. The improving grade profile following the reinvestment programme across the portfolio was a key driver of the overall production increase. For 2022, COVID-19 had a marginal estimated direct impact of 19,000 ounces on the Company’s production. By comparison, for 2021, the direct impact of COVID-19 on the Company’s production was estimated at 47,000 ounces.
ProductionIn the Africa region, production increased by two216,000 ounces, or 15 percent, or 26,000from 1,419,000 ounces in 2019 as compared2021 to 2018,1,635,000 ounces in the Continental Africa region.2022. The increase was mainly due to the transition to predominantly underground operations which resulted in higher grade materialproduction from Obuasi, Iduapriem, Siguiri and increased tonnes treated at Geita, and improvedpartly offset by lower production from Kibali. Gold production at Iduapriem increased by 46,000 ounces, or 23 percent, from 202,000 ounces in 2021 to 248,000 ounces in 2022. Gold production was higher year-on-year mainly due to higher ore volumes processed, further supported by higher grades recovered as the mine accesses ore tonnes from Block 5 and Teberebie Cut 2a compared to Block 5 and the drawdown from stockpiles in 2021. Gold production at Obuasi increased by 142,000 ounces, or 131 percent, from 108,000 ounces in 2021 to 250,000 ounces in 2022. Gold production was higher year-on-year mainly due to the Operational Excellence programme which focused on improved grade control practices. The increaseresumption of stoping activities during 2022 following the temporary suspension of underground stoping activities in 2021 due to a sill pillar incident in May 2021, as well as the continued ramp-up of the operations . Gold production at Siguiri increased by 21,000 ounces, or eight percent, from 258,000 ounces in 2021 to 279,000 ounces in 2022. Gold production was partiallyhigher year-on-year mainly due to higher recovered grades, partly offset by lower ore volumes processed (as a result of local community protests related to employment demands which led to mining disruptions and the temporary suspension of mining activities during the month of July 2022). Gold production at Geita increased by 35,000 ounces, or seven percent, from 486,000 ounces in 2021 to 521,000 ounces in 2022. Gold production was higher year-on-year mainly due to higher ore volumes processed as well as higher recovered grades. Gold production at Kibali decreased by 28,000 ounces, or eight percent, from 365,000 ounces in 2021 to 337,000 ounces in 2022. Gold production was lower year-on-year mainly due to lower grades recovered, partly offset by a marginal increase in ore volumes processed.
In the Americas region, production increased by 10,000 ounces, or two percent, from 559,000 ounces in 2021 to 569,000 ounces in 2022. The increase was mainly due to higher production from Serra Grande and Cerro Vanguardia, partly offset by lower production from AGA Mineração. Gold production at AGA Mineração decreased by 20,000 ounces, or six percent, from 331,000 ounces in 2021 to 311,000 ounces in 2022. Gold production was lower year-on-year mainly due to lower ore volumes processed, partly offset by higher grades recovered. In addition, extreme weather including intense rainfalls followed by widespread flooding in the state of Minas Gerais in Brazil during 2022 negatively impacted production. Infrastructure was temporarily inaccessible in and around the mine and employees were confined to their homes in nearby cities during the flooding. Gold production at Serra Grande increased by 5,000 ounces, or six percent, from 83,000 ounces in 2021 to 88,000 ounces in 2022. Gold production was higher year-on-year mainly due to higher recovered grades resulting from changes to the geological model, partly offset by lower ore volumes processed. Production during 2021 was negatively impacted by COVID-19 related restrictions and stabilisation challenges during the conversion of the TSFs to dry-stacking operations to comply with legal requirements in Brazil, which were not repeated in 2022. Gold production at Cerro Vanguardia increased by 25,000 ounces, or 17 percent, from 145,000 ounces in 2021 to 170,000 ounces in 2022. Gold production was higher year-on-year mainly due to a combination of higher ore volumes processed, higher recovered grades and fewer COVID-19 related limitations and restrictions that affected the mine’s ability to operate at full capacity.
In the Australia region, production increased by 44,000 ounces, or nine percent, from 494,000 ounces in 2021 to 538,000 ounces in 2022. This increase was mainly due to higher production from Sunrise Dam and Tropicana. Gold production at Sunrise Dam increased by 3,000 ounces, or one percent, from 229,000 ounces in 2021 to 232,000 ounces in 2022. Gold
production was marginally higher year-on-year mainly due to higher recovered grades, partly offset by lower ore volumes processed following COVID-19 related production challenges. Gold production at Tropicana increased by 41,000 ounces, or 15 percent, from 265,000 ounces in 2021 to 306,000 ounces in 2022. Gold production was higher year-on-year mainly due to a combination of higher ore volumes processed from the Boston Shaker open pit and underground mine and higher recovered grades as well as the adverse impact of the wall failure in the Boston Shaker open pit in June 2021, which delayed higher grade ore delivery, and which was not repeated during 2022.
Production in 2021
In 2021, AngloGold Ashanti’s total attributable gold production was 2.472 million ounces, a decrease at Siguiriof 334,000 ounces, or 12 percent, compared with its total attributable gold production of 2.806 million ounces in 2020. Production was lower mainly due to the integrationCompany undertaking significant reinvestment across key assets and the temporary suspension of underground mining activities at Obuasi, the direct impact of COVID-19 in the first half of 2021, and secondary impacts of the Carbon-in-Leach (CIL) combination plant thatpandemic, including on the mobility of labour, across 2021. The direct impact on the Company’s production from COVID-19 was completed duringestimated at 47,000 ounces for 2021, compared to 59,000 ounces in 2020.
In the year with a slower ramp-up than anticipated andAfrica region, production decreased by 184,000 ounces, or 11 percent, from 1,603,000 ounces in 2020 to 1,419,000 ounces in 2021. The decrease was mainly due to lower production from both SadiolaIduapriem, Obuasi and Morila as these two operations near the end of their mining activities.
ProductionGeita, partly offset by higher production from Siguiri. Gold production at Iduapriem decreased by two73,000 ounces, or 27 percent, or 11,000from 275,000 ounces in 2019 as compared2020 to 2018,202,000 ounces in the Australia region. The decrease resulted from2021. Gold production was lower mill feed gradesyear-on-year mainly due to lower underground mined volume combined with lower mined gradegrades from the depletion of ore in Cut 1 and delayed waste stripping at Sunrise Dam. The decreaseCut 2 of the Teberebie pit, as well as the impact of a drawdown on stockpiles. Gold production at Obuasi decreased by 19,000 ounces, or 15 percent, from 127,000 ounces in 2020 to 108,000 ounces in 2021. Gold production was partially offsetlower year-on-year mainly due to underground mining activities being voluntarily suspended between 18 May 2021 and 15 October 2021, following a sill pillar incident. From 15 October 2021, underground mining resumed to replenish the run-of-mine stockpile without corresponding gold production. Gold production at Siguiri increased by 44,000 ounces, or 21 percent, from 214,000 ounces in 2020 to 258,000 ounces in 2021. Gold production was higher year-on-year mainly due to an increase at Tropicanaimprovement in recovered grade which was attributable to improved plant recoveries as a result of the carbon-in-leach (“CIL”) conversion done at the end of 2020 and the commencement of processing Block 2 material in the second half of 2021. Gold production at Geita decreased by 137,000 ounces, or 22 percent, from 623,000 ounces in 2020 to 486,000 ounces in 2021. Gold production was lower year-on-year mainly due to mining lower grades and the drawdown on stockpiles, as significant reinvestments progressed across the Geita lease during 2021. Gold production at Kibali increased by 1,000 ounces, or less than one percent, from 364,000 ounces in 2020 to 365,000 ounces in 2021. Gold production was marginally higher mill throughput andyear-on-year as the mine delivered a good overall performance from the metallurgical plant, with increased tonnage during 2021, driven by higher open pit tonnes mined.mined as compared to 2020.
In the Americas region, production decreased by eight90,000 ounces, or 14 percent, or 66,000from 649,000 ounces in 20192020 to 559,000 ounces in 2021. Lower production was encountered at AGA Mineração, Serra Grande and Cerro Vanguardia. Gold production at AGA Mineração decreased by 31,000 ounces, or nine percent, from 362,000 ounces in 2020 to 331,000 ounces in 2021. The Córrego do Sítio mining complex was mainly impacted by challenges in the crushing and milling circuit and lower tonnes of ore treated. Production was also adversely impacted by a seven-day strike by mine workers in September 2021. The Cuiabá mining complex recorded an increase in tonnes of ore treated year-on-year, which was partly offset by lower grades. Gold production at Serra Grande decreased by 31,000 ounces, or 27 percent, from 114,000 ounces in 2020 to 83,000 ounces in 2021. Gold production was lower year-on-year mainly due to lower tonnage resulting from various delays in accessing mine stopes, as comparedwell as lower feed grades, the negative impact of COVID-19 on mining operations as well as operational impacts of the fatality that occurred in February 2021. The production performance was further impacted by stabilisation challenges during the commissioning of the new filter process in connection with work to 2018. Theconvert the TSFs to dry-stacking operations to comply with new legal requirements in Brazil. Gold production at Cerro Vanguardia decreased by 28,000 ounces, or 16 percent, from 173,000 ounces in 2020 to 145,000 ounces in 2021. Gold production was lower year-on-year mainly due to the effect of lower grades as per the mine plan for 2021 as well as COVID-19 related limitations and restrictions that affected the mine’s ability to operate at full capacity.
In the Australia region, production decreased by 60,000 ounces, or 11 percent, from 554,000 ounces in 2020 to 494,000 ounces in 2021. This decrease was mainly at Cerro Vanguardia due to lower production from Sunrise Dam and the mining ofTropicana. Gold production at Sunrise Dam decreased by 27,000 ounces, or 11 percent, from 256,000 ounces in 2020 to 229,000 ounces in 2021. Gold production was lower grades. Production was also lower at Serra Grandeyear-on-year mainly due to lower feedhead grade lower drilling productivity and fewer trucks available. Production was lower at AGA Mineração due to poor ground conditions at the Cuiabá complex and at Córrego do Sítio due to geological model changes, open pit license delays at Rosalino orebody, geotechnical issues and excessive rainfall.
Production in 2018
For the year ended 31 December 2018, AngloGold Ashanti’s total attributable gold production of 2.91 million ounces was 60,000 ounces, or two percent, higher than the 2017 production of 2.85 million ounces.
Production increased by four percent, or 59,000 ounces, in 2018 as compared to 2017, in the Continental Africa region. The increase was mainly due to higher recovered grades and increased tonnage treated due to improved plant performance at Kibali, higher tonnage treated due to improved plant efficiency and higher recovered grade, resulting from mining deeper, higher-grade areas in the Teberebie pit at Iduapriem, higher recovered grades due to a range of operational improvements which assisted in accessing higher grade ore particularly in the fourth quarter of 2018 at Geita. The increase in production was partially offset by a decrease at Siguiri due to a decrease in recovered grade from treating lower grade oxide material and a decrease in metallurgical recovery, which was partly offset by higher tonnes mined in the underground mine. Mine-to-mill grade reconciliations stabilised during the second half of 2021 and access to higher-grade underground ore was achieved at the end of 2021 in the newly accessed Frankie orebody. Gold production at Tropicana decreased by 33,000 ounces, or 11 percent, from 298,000 ounces in 2020 to 265,000 ounces in 2021. Gold production was lower year-on-year mainly due to delaysa lower mill feed grade as stockpile drawdowns increased while mining focused on waste removal in the commissioning of the CIL combination plant.
Production increased by 12 percent, or 66,000 ounces, in 2018 as compared to 2017, in the Australia region. Gold production increased at Sunrise Dam due to higher mill feed grades in the first and the last quarters of 2018. Improved mill feed grades and mill throughput resulted in higher production at Tropicana.
In the Americas region, production decreased by eight percent, or 64,000 ounces, in 2018 as compared to 2017. The decrease was in Brazil mainly at AGA Mineração due to development and infrastructure constraints at the Cuiabá complex and at Córrego do Sítio due to lower grades in the sulphide operation, excessive rainfall and open-pit licensing delays.Havana Stage 2 Cutback. Production was also adversely impacted by lower tonnes placed on the heap leach, model changes, and production stoppages due to strikes.wall failure in the Boston Shaker open pit in June 2021, which delayed higher grade ore delivery. Production at Tropicana was also lower at Serra Grande due to less ore mined following geological model changesadversely affected by labour market shortages which had an impact on open pit and excessive rainfall.underground material movement.
Comparison of financial performance in 2019, 20182022, 2021 and 20172020
| | Financial performance of AngloGold Ashanti | Year ended 31 December | Financial performance of AngloGold Ashanti | Year ended 31 December |
(in $ millions) | 2019 |
| | 2018 |
| | 2017 |
| (in $ millions) | 2022 | 2021 | | 2020 | |
| | | Restated | |
Continuing operations | | | | | | Continuing operations | |
Revenue from product sales | 3,525 |
| | 3,336 |
| | 3,394 |
| Revenue from product sales | 4,501 | | 4,029 | | | 4,595 | | |
Cost of sales | (2,626 | ) | | (2,584 | ) | | (2,607 | ) | Cost of sales | (3,362) | | (2,857) | | | (2,829) | | |
Total of all other (expenses) income | (448 | ) | | (429 | ) | | (481 | ) | Total of all other (expenses) income | (816) | | (463) | | | (417) | | |
Share of associates and joint ventures’ profit (loss) | 168 |
| | 122 |
| | 22 |
| Share of associates and joint ventures’ profit (loss) | 166 | | 249 | | | 278 | | |
Taxation | (250 | ) | | (212 | ) | | (163 | ) | Taxation | (173) | | (312) | | | (625) | | |
Discontinued operations | | | | | | Discontinued operations | |
Profit (loss) from discontinued operations | (376 | ) | | (83 | ) | | (336 | ) | Profit (loss) from discontinued operations | — | | — | | | 7 | | |
Profit for the period | | Profit for the period | 316 | | 646 | | | 1,009 | | |
| | | | | | |
Net profit (loss) attributable to equity shareholders | | | | | | Net profit (loss) attributable to equity shareholders | |
- Continuing operations | 364 |
| | 216 |
| | 145 |
| - Continuing operations | 297 | | 622 | | | 984 | | |
- Discontinued operations | (376 | ) | | (83 | ) | | (336 | ) | - Discontinued operations | — | | — | | | 7 | | |
Net profit (loss) attributable to non-controlling interests | | | | | | Net profit (loss) attributable to non-controlling interests | |
- Continuing operations
| 5 |
| | 17 |
| | 20 |
| - Continuing operations | 19 | | 24 | | | 18 | | |
Comparison of total cost of sales in 2019, 20182022, 2021 and 20172020
The following table presents cost of sales from continuing operations for the AngloGold Ashanti groupGroup for the three-year period ended 31 December 2019:2022: | | | | | | | | | | | | | | | | | |
Cost of sales for AngloGold Ashanti | Year ended 31 December |
(in $ millions) | 2022 | 2021 | | 2020 | |
| | | | Restated | |
Total cost of sales | 3,362 | | 2,857 | | | 2,829 | | |
Inventory change | 30 | | (6) | | | (14) | | |
Amortisation of tangible assets | (551) | | (411) | | | (526) | | |
Amortisation of intangible assets | (1) | | (3) | | | (2) | | |
Amortisation of right of use assets | (81) | | (63) | | | (47) | | |
Retrenchment costs | (6) | | (2) | | | (2) | | |
Rehabilitation and other non-cash costs | — | | (38) | | | (32) | | |
Total cash costs | 2,753 | | 2,334 | | | 2,206 | | |
|
| | | | | | | | |
Cost of sales for AngloGold Ashanti | Year ended 31 December |
(in $ millions) | 2019 |
| | 2018 |
| | 2017 |
|
Total cost of sales | 2,626 |
| | 2,584 |
| | 2,607 |
|
Inventory change | (5 | ) | | (9 | ) | | (14 | ) |
Amortisation of tangible assets | (538 | ) | | (553 | ) | | (685 | ) |
Amortisation of intangible assets | (3 | ) | | (5 | ) | | (5 | ) |
Amortisation of right of use assets | (42 | ) | | — |
| | — |
|
Retrenchment costs | (4 | ) | | (4 | ) | | (6 | ) |
Rehabilitation and other non-cash costs | (53 | ) | | (17 | ) | | (16 | ) |
Total cash costs | 1,981 |
| | 1,996 |
| | 1,881 |
|
Comparison of financial performance in 20192022 with 2018
2021
Our gold income is materially impacted by price and volume variances. All of our costs are impacted by the consequences of average exchange rate movements.
Exchange fluctuations in, and the average exchange rates for, the Brazilian real, Australian dollar and, to a lesser extent, the Argentinean peso and other local currencies have effects on the various components that make up our costs based on the level of local procurement of each of these costs. For a discussion of the effect of foreign exchange fluctuations on our financial results, see “Item 5A: Operating Results—Key factors affecting results—Foreign exchange fluctuations”.
Revenue from product sales
Revenue from product sales increased by $472 million, or 12 percent, from $4,029 million in 2021 to $4,501 million in 2022, mainly as a result of an increase in gold income, partly offset by a decrease in by-product revenue. Gold income increased by $485 million, or 12 percent, from $3,903 million in 2021 to $4,388 million in 2022. This increase was mainly due to an increase in ounces of gold sold, partly offset by a decrease in the average gold price received of $3 per ounce. Gold sold increased by
269,000 ounces, or 13 percent, from 2.116 million ounces in 2021 to 2.385 million ounces in 2022, which resulted in an increase in gold income of $491 million. The average gold price received decreased by $3 per ounce, from $1,796 per ounce during 2021 to $1,793 per ounce in 2022, which resulted in a decrease in gold income of $6 million. By-product revenue decreased by $13 million, or ten percent, from $126 million in 2021 to $113 million in 2022, mainly due to a decrease in revenue from silver.
Revenue from product sales from the Africa operations (excluding equity-accounted joint ventures) increased by $400 million, or 20 percent, from $1,988 million in 2021 to $2,388 million in 2022, mainly as a result of an increase in gold income. Gold income (excluding equity-accounted joint ventures) increased by $400 million, or 20 percent, from $1,985 million in 2021 to $2,385 million in 2022. This increase was mainly due to higher ounces of gold sold, partly offset by a decrease in the average gold price received. Gold sold increased by 221,000 ounces, or 21 percent, from 1.060 million ounces in 2021 to 1.281 million ounces in 2022, which resulted in an increase in gold income of $403 million. There was an increase in production across all Africa operations in 2022 when compared to 2021. For a discussion of the increase in production at the Africa operations during 2022, see “Item 5A: Operating Results—Key factors affecting results—Production in 2022”. The decrease in the average gold price received resulted in a decrease in gold income of $3 million. By-product revenue (excluding equity-accounted joint ventures) of $3 million in 2022 remained unchanged from $3 million in 2021.
Revenue from product sales from the Americas operations decreased by $5 million, from $1,147 million in 2021 to $1,142 million in 2022, mainly as a result of a decrease in by-product revenue, partly offset by an increase in gold income. Gold income increased by $8 million, or one percent, from $1,028 million in 2021 to $1,036 million in 2022. This increase was mainly due to higher ounces of gold sold, partly offset by a decrease in the average gold price received. Gold sold increased by 4,000 ounces, or one percent, from 561,000 ounces in 2021 to 565,000 ounces in 2022, which resulted in an increase in gold income of $10 million. There was an increase in production at Cerro Vanguardia and Serra Grande, partly offset by a decrease in production at AngloGold Ashanti Mineração. For a discussion of the increase in production at the Americas operations during 2022, see “Item 5A: Operating Results—Key factors affecting results—Production in 2022”. The decrease in average gold price received resulted in a decrease in gold income of $2 million. By-product revenue decreased by $13 million, or 11 percent, from $119 million in 2021 to $106 million in 2022, mainly due to a decrease in silver revenue from lower silver production in Argentina.
Revenue from product sales from the Australia operations increased by $77 million, or nine percent, from $894 million in 2021 to $971 million in 2022, mainly as a result of an increase in gold income. Gold income increased by $77 million, or nine percent, from $890 million in 2021 to $967 million in 2022. This increase was mainly due to higher ounces of gold sold, partly offset by a decrease in the average gold price received. Gold sold increased by 44,000 ounces, or nine percent, from 495,000 ounces in 2021 to 539,000 ounces in 2022, which resulted in an increase in gold income of $79 million. There was an increase in production at Tropicana which was partly offset by a decrease in production at Sunrise Dam. For a discussion of the increase in production at the Australia operations during 2022, see “Item 5A: Operating Results—Key factors affecting results—Production in 2022”. The decrease in the average gold price received resulted in a decrease in gold income of $2 million. By-product revenue of $4 million in 2022 remained unchanged from $4 million in 2021.
Cost of sales
Cost of sales increased by $505 million, or 18 percent from $2,857 million in 2021 to $3,362 million in 2022. The increase was primarily due to an increase in cash operating costs by $394 million, or 18 percent, from $2,160 million in 2021 to $2,554 million in 2022, an increase in amortisation of tangible assets by $140 million, or 34 percent, from $411 million in 2021 to $551 million in 2022, an increase in amortisation of right of use assets by $18 million, or 29 percent, from $63 million in 2021 to $81 million in 2022 and an increase in royalties paid by $23 million, or 14 percent, from $162 million in 2021 to $185 million in 2022, mainly due to higher ounces sold. This increase was partly offset by a decrease in environmental rehabilitation and other non-cash costs by $38 million, or 100 percent, from $38 million in 2021 to nil in 2022, an inventory change of $36 million, or 600 percent, from a charge of $6 million in 2021 to a credit of $30 million in 2022, and a decrease in amortisation of intangible assets by $2 million, or 67 percent, from $3 million in 2021 to $1 million in 2022.
The increase in cash operating costs was mainly due to higher labour and contractors’ costs, commodity prices, logistics costs, consumable stores, services, other charges, fuel and power costs. Higher labour and contractors’ costs were mainly due to the resumption of stoping activities during 2022 at Obuasi, following the temporary suspension of underground mining activities in 2021 due to a sill pillar incident in May 2021. At Geita, with the acceleration of the heavy mobile equipment (“HME”) fleet rebuilds as the open pit mine expanded, higher underground mining contractors’ costs were incurred. Higher labour and contractors’ costs were also due to shortages of critical skills at certain operations. Higher commodity costs were mainly due to an increase in the prices of steel, support and construction materials, explosives, timber and reagents. Higher fuel and power costs were mainly due to the increase in the average price of Brent Crude oil, which increased from $71 per barrel in 2021 to $97 per barrel in 2022, a $26, or a 37 percent, per barrel increase. The increase in amortisation of tangible assets was mainly due to the Obuasi redevelopment project continuing to ramp up to full production, higher deferred stripping amortisation at Tropicana and Iduapriem, and higher Mineral Reserve development amortisation at Tropicana and Geita. The increase in amortisation of right of use assets was mainly due to the business strategy whereby certain heavy mobile equipment is leased, mainly at the Brazil and Africa operations. The increase in royalties paid primarily arose from an increase in ounces of gold sold in 2022 as compared to 2021. The decrease in environmental rehabilitation and other non-cash costs primarily arose from
the changes to restoration provision cash flows in 2022 compared to 2021. The change in restoration provision cash flows was attributable to changes in discount rates due to changes in global economic assumptions, changes in mine plans resulting in a change in cash flows, changes in design of our TSFs in Brazil due to new legal requirements, and changes in the methodology used to calculate such estimates in response to comments from environmental regulatory authorities. The inventory change was mainly due to higher gold on hand at Obuasi, Siguiri, Geita, Tropicana and Sunrise Dam related to the timing of gold pours and shipments, lower amortisation of inventories in Brazil due to the suspension of tailings disposal and processing plant effluents treatment and lower amortisation of inventories at Cerro Vanguardia due to a higher volume of gold in process. The decrease in amortisation of intangible assets was mainly due to lower software and licence expenditure at Obuasi as compared to 2021.
In Africa, cost of sales increased by $354 million, or 21 percent, from $1,650 million in 2021 to $2,004 million in 2022. The increase was mainly due to an increase in labour and contractors’ costs, commodity prices, logistics costs, consumable stores, services, other charges, fuel and power costs, royalties paid and amortisation of tangible assets. Higher commodity costs were mainly due to an increase in the prices of steel, support and construction materials, explosives, timber and reagents. Higher fuel and power costs were mainly due to the increase in the price of Brent Crude oil. The increase in cost of sales was partly offset by lower environmental rehabilitation and other non-cash costs and inventory changes in 2022 as compared to 2021.
In the Americas, cost of sales increased by $91 million, or 11 percent, from $822 million in 2021 to $913 million in 2022. The increase was mainly due to an increase in labour and contractors’ costs, commodity prices, logistics costs, consumable stores, amortisation of tangible and right of use assets, services and other charges, power and fuel cost, and write down of inventory. Royalties paid were higher mainly due to an increase in ounces of gold sold in 2022 as compared to 2021. The higher labour and contractors’ costs were mainly due to cost increases resulting from shortages of critical skills. Higher commodity costs were due to an increase in the prices of steel, support and construction materials, explosives, timber and reagents. Higher fuel and power costs were mainly due to the increase in the price of Brent Crude oil. The strengthening of the Brazilian real by four percent against the US dollar further increased costs. The increase in cost of sales was partly offset by lower environmental rehabilitation and other non-cash costs, inventory changes and the weakening of the Argentinean peso by 37 percent against the US dollar, as compared to 2021.
In Australia, cost of sales increased by $43 million, or six percent, from $740 million in 2021 to $783 million in 2022. The increase was mainly due to an increase in labour and contractors’ costs, commodity prices, logistics costs, consumable stores, services and other charges, power and fuel costs, amortisation of tangible assets, and royalties paid mainly due to an increase in ounces of gold sold in 2022 as compared to 2021. The higher labour and contractors’ costs were mainly due to shortages of critical skills. Higher commodity costs were mainly due to an increase in the prices of steel, support and construction materials, explosives, timber and reagents. Higher fuel and power costs were mainly due to the increase in the price of Brent Crude oil. The increase in cost of sales was partly offset by lower environmental rehabilitation and other non-cash costs, and the weakening of the Australian dollar against the US dollar by eight percent as compared to 2021.
Total cash costs
Total cash costs increased by $419 million, or 18 percent, from $2,334 million in 2021 to $2,753 million in 2022. The increase was primarily due to an increase in cash operating costs and royalties paid. Total cash costs include cash operating costs (which include salaries and wages, stores, explosives, reagents, logistics, fuel, power, water and contractors’ costs), royalties and other cash costs. The strengthening of the Brazilian real against the US dollar contributed to the increase in total cash costs, which was partly offset by the weakening of local currencies against the US dollar in Australia and Argentina.
Cash operating costs increased by $394 million, or 18 percent, from $2,160 million in 2021 to $2,554 million in 2022, primarily due to higher labour and contractors’ costs, commodity prices, logistics costs, consumable stores, services and other charges as well as higher fuel and power costs.
The strengthening of the Brazilian real against the US dollar contributed to the increase in total cash costs, which was partly offset by the weakening of local currencies against the US dollar in Australia and Argentina. Cash operating costs include salaries and wages, stores, explosives, reagents, logistics, fuel, power, water and contractors’ costs.
Royalties, which are generally calculated as a percentage of revenue, increased by $23 million, or 14 percent, from $162 million in 2021 to $185 million in 2022. The increase was primarily due to an increase in gold sales across all mining operations with the exception of Sunrise Dam, AGA Mineração and Kibali. The increase was partly offset by a decrease in the average gold price received per ounce.
Retrenchment costs
Retrenchment costs included in cost of sales increased by $4 million, or 200 percent, from $2 million in 2021 to $6 million in 2022.
Rehabilitation and other non-cash costs
Environmental rehabilitation and other non-cash costs decreased by $38 million, or a 100 percent, from $38 million in 2021 to nil in 2022. The decrease was mainly due to changes in mine plans resulting in a change in cash flows, changes in the methodology used to calculate such estimates in response to comments from environmental regulatory authorities and changes in global economic assumptions. Lower restoration in Australia was mainly due to the completion of a study into reduced waste capping of waste dumps and TSFs, partly offset by ongoing changes in design of TSFs in Brazil to comply with new legal requirements.
Amortisation of tangible, intangible and right of use assets
Amortisation of tangible, intangible and right of use assets expense increased by $156 million, or 33 percent, from $477 million in 2021 to $633 million in 2022.
Amortisation of tangible assets increased by $140 million, or 34 percent, from $411 million in 2021 to $551 million in 2022. The increase was mainly due to higher amortisation at Iduapriem (mainly due to higher gold production combined with higher deferred stripping amortisation at Teberebie Cut 2a which commenced in 2022), at Tropicana (mainly due to higher deferred stripping amortisation due to mining and depletion of different ore bodies and due to increased capital additions), at Serra Grande (mainly due to higher gold production), at Obuasi (mainly due to higher production and the reset of the useful life for the mining fleet), at Geita (mainly due to the useful life reset done in 2022 for Mineral Reserve development and heavy mining equipment coming into production), at Cerro Vanguardia (mainly due to lower reserves at the end of 2022 compared with at the end of 2021 and higher deferred stripping amortisation) and at Siguiri (mainly due to higher gold production), partially offset by lower amortisation at CdS (mainly due to lower gold production and reduction in asset cost due to the impairment that occurred during 2022) and at Sunrise Dam (mainly due to a decrease in Mineral Reserve development due to strategy focusing on exploration activities).
Amortisation of intangible assets decreased by $2 million, or 67 percent, from $3 million in 2021 to $1 million in 2022, mainly due to lower software and licence expenditure at Obuasi as compared to 2021.
Amortisation of right of use assets increased by $18 million, or 29 percent, from $63 million in 2021 to $81 million in 2022, mainly due to additional lease contracts for heavy mobile equipment entered into at AGA Mineração, Serra Grande and Geita.
Inventory change
Inventory change was a charge of $6 million in 2021 as compared to a credit of $30 million in 2022, which represents a change of $36 million. This change was primarily due to lower cost of unsold gold at Obuasi of $16 million as a result of timing of shipments, lower cost at Siguiri of $5 million and at Geita of $7 million due to an increase in gold on hand, lower cost at the Australian operations of $3 million due to timing of gold pours and shipments, lower amortisation of inventories at the Brazil operations resulting from the suspension of tailings disposal and processing plant effluents treatment of $3 million, and lower amortisation of inventories at Cerro Vanguardia due to a higher volume of gold in process of $5 million. This change was partly offset by an increased cost due to higher sales and higher production in 2022 at Cerro Vanguardia of $3 million.
Impairment, derecognition of assets and profit (loss) on disposal
Impairment, derecognition of assets and profit (loss) on disposal was a profit of $11 million in 2021 as compared to a loss of $304 million in 2022, which represents a change of $315 million. This change was mainly due to the impairment of the Córrego do Sítio mining complex CGU of $189 million (gross of taxation), the impairment of the Serra Grande CGU of $45 million (gross of taxation), the impairment of the Cuiabá CGU of $70 million (gross of taxation) and asset derecognitions at Siguiri, Obuasi and Geita of $4 million, partly offset by disposal of properties held in Brazil of $4 million. For further information on the impairment losses in Brazil during 2022, refer to “Item 5A: Operating Results—Key factors affecting results—Impairment, derecognition of assets and profit (loss) on disposal”.
Other (expenses) income
Other (expenses) income decreased by $110 million, or 81 percent, from an expense of $136 million in 2021 to an expense of $26 million in 2022. The decrease during 2022 was largely due to care and maintenance activities of $45 million incurred in 2021 at the Obuasi mine during the voluntary suspension of underground mining between May and October 2021 following a sill pillar incident, retrenchment and related costs of $18 million incurred in 2021 as part of the transition to the new Operating Model and bond settlement costs of $24 million incurred in 2021 related to the tender offer for, and subsequent redemption of, the $750 million aggregate principal amount of 5.125% notes due 2022, none of which were repeated in 2022. The non-occurrence of the aforementioned costs in 2022 contributed to a decrease in cost of $87 million. Further decreases in other expenses were primarily due to the lower cost of legacy tailings operations, mainly at Obuasi, as a result of fewer activities at such legacy tailings operations, and lower VAT and other duties expensed. These decreases in other expenses were partly offset by higher due diligence project costs during 2022.
Finance costs and unwinding of obligations
Finance costs increased by $9 million, or eight percent, from $110 million in 2021 to $119 million in 2022, mainly due to a decrease in capitalisation of interest against the Obuasi redevelopment project, lower finance costs from borrowings and higher amortisation fees compared to 2021. Unwinding of obligations increased by $24 million, or 400 percent, from $6 million in 2021 to $30 million in 2022, mainly due to an increase in unwinding of other indirect taxes at Geita and non-current receivables at Siguiri as well as higher unwinding on the environmental rehabilitation provisions.
Share of associates and joint ventures’ profit
Share of associates and joint ventures’ profit decreased by $83 million, or 33 percent, from a profit of $249 million in 2021 to a profit of $166 million in 2022, mainly as a result of a decrease in equity earnings of $77 million at Kibali due to lower revenues and higher legal and dividend settlement fees, and $5 million at Rand Refinery (Pty) Limited.
Taxation
A taxation expense of $173 million was recorded in 2022, compared to a taxation expense of $312 million in 2021, which represents a $139 million, or 45 percent, decrease. Charges for current tax in 2022 amounted to $231 million, compared to $248 million in 2021, which represents a $17 million, or seven percent, decrease. The decrease in current tax was mainly due to lower pre-tax profit in Brazil. Charges for deferred tax in 2022 amounted to a deferred tax credit of $58 million, compared to an expense of $64 million in 2021, which represents a $122 million, or 191 percent, decrease. The decrease in deferred tax was mainly due to higher deferred tax assets raised in Ghana and higher impairments in Brazil.
Comparison of financial performance in 2021 with 2020
Our gold income is materially impacted by price and volume variances. All of our costs are impacted by the consequences of average exchange rate movements.
Exchange fluctuations in and the average exchange rates for the South African rand, Brazilian real, Australian dollar and the ArgentinianArgentinean peso have effects on the various components that make up our costs based on the level of local procurement of each of these costs. For a discussion of the effect of foreign exchange fluctuations on our financial results, see “Item“Item 5A: Operating Results-KeyResults—Key factors affecting results-Foreignresults—Foreign exchange fluctuations”.
Revenue from product sales
Revenue from product sales increaseddecreased by $189$566 million, or six12 percent, from $3,336$4,595 million in 20182020 to $3,525$4,029 million in 2019,2021, mainly as a result of thea decrease in gold income, partly offset by an increase in by-product revenue. Gold income decreased by $587 million, or 13 percent, from $4,490 million in 2020 to $3,903 million in 2021. This decrease was mainly due to a decrease in ounces of gold sold, partly offset by an increase in the average gold price received of $128$18 per ounce. Gold income increased by $236 million, or seven percent, from $3,203 million in 2018 to $3,439 million in 2019, due to the increase in the gold price received partially offset by the decrease in gold sold. Gold sold decreased by 50,000354,000 ounces, or two14 percent, from 2.462.470 million ounces in 20182020 to 2.412.116 million ounces in 2019.2021, which resulted in a decrease in gold income of $619 million. The average gold price received increased by $128$18 per ounce, or tenone percent, from $1,266$1,778 per ounce during 20182020 to $1,394$1,796 per ounce in 2019,2021, which resulted in an increase in gold income of $316$32 million. By-product revenue decreasedincreased by $47$21 million, or 3520 percent, to $86 million from $133$105 million in 2018,2020 to $126 million in 2021, mainly due to a decreasean increase in revenue from silver.
Revenue from product sales from the Continental Africa operations increased(excluding equity-accounted joint ventures) decreased by $185$305 million, or 13 percent, to $1,590from $2,293 million in 2019 from $1,4052020 to $1,988 million in 2018,2021, mainly as a result of thea decrease in gold income. Gold income (excluding equity-accounted joint ventures) decreased by $305 million, or 13 percent, from $2,290 million in 2020 to $1,985 million in 2021. This decrease was mainly due to lower ounces of gold sold, partly offset by an increase in the average gold price received,received. Gold sold decreased by 189,000 ounces, or 15 percent, from 1.249 million ounces in 2020 to 1.060 million ounces in 2021, which resulted in an increase of gold
income of $140 million. The increase in gold ounces sold resulted in an increasea decrease in gold income of $47$317 million. The increasedecrease was mainly due to the transition to predominantly underground operations which resulted inlower production from Iduapriem, Obuasi and Geita, partly offset by higher grade material and increased tonnes treated at Geita and improved production at Iduapriem due toSiguiri. For a discussion of the Operational Excellence programme which focused on improved grade control practices.decrease in production at the Africa operations during 2021, see “Item 5A: Operating Results—Key factors affecting results—Production in 2021”. The increase in production was partially offset by a decrease at Siguiri due to the integration of the CIL combination plant that was completed during the year and a slower ramp-up than anticipated.
Revenue from product sales from Australia increased by $72 million, or nine percent, from $782 million in 2018 to $854 million in 2019. The increase in theaverage gold price received resulted in an increase in gold income of $78$12 million. Gold production decreased as a resultBy-product revenue (excluding equity-accounted joint ventures) of lower mill feed grades due to lower underground mined volume combined with lower mined grade at Sunrise Dam. The decrease$3 million in production was partially offset by an increase at Tropicana as a result of higher mill throughput and tonnes mined. The decrease2021 remained unchanged from $3 million in gold ounces sold resulted in a decrease in gold income of $8 million.2020.
Revenue from product sales from the Americas operations decreased by $68$163 million, or six12 percent, from $1,149$1,310 million in 20182020 to $1,081$1,147 million in 2019.2021, mainly as a result of a decrease in gold income, partly offset by an increase in by-product revenue. Gold income decreased by $21$183 million, or two15 percent, from $1,021$1,211 million in 20182020 to $1,000$1,028 million in 2019.The2021. This decrease was mainly due to a decreaselower ounces of 78,000gold sold, partly offset by an increase in the average gold price received. Gold sold decreased by 103,000 ounces, or 16 percent, from 664,000 million ounces in gold sold2020 to 561,000 ounces in 2019,2021, which resulted in a decrease in gold income of $113$194 million. GoldFor a discussion of the decrease in production primarily decreased at Cerro Vanguardiathe Americas operations during 2021, see “Item 5A: Operating Results—Key factors affecting results—Production in 2021”. The increase in average gold price received resulted in an increase of gold income of $11 million. By-product revenue increased by $20 million, or 20 percent, from $99 million in 2020 to $119 million in 2021, mainly due to development and infrastructure constraints, coupled with lower grades. Thean increase in revenue from silver.
Revenue from product sales from the Australia operations decreased by $98 million, or ten percent, from $992 million in 2020 to $894 million in 2021, mainly as a result of a decrease in gold income, partly offset by an increase in by-product revenue. Gold income decreased by $99 million, or ten percent, from $989 million in 2020 to $890 million in 2021. This decrease was partiallymainly due to lower ounces of gold sold, partly offset by an increase in the average gold price received. Gold sold decreased by 62,000 ounces, or 11 percent, from 557,000 million ounces in 2020 to 495,000 ounces in 2021, which resulted in a decrease in gold income of $108 million. For a discussion of the decrease in production at the Australia operations during 2021, see “Item 5A: Operating Results—Key factors affecting results—Production in 2021”. The increase in the average gold price received which resulted in an increase in gold income of $92$9 million. By-product revenue decreasedincreased by $47$1 million, or 3733 percent, to $81 million from $128$3 million in 2018,2020 to $4 million in 2021, mainly due to a decreasean increase in revenue from silver.
Cost of sales
Cost of sales increased by $28 million, or one percent, from $2,584$2,829 million in 20182020 to $2,626$2,857 million in 2019, which represents a $42 million, or two percent, increase.2021. The increase was primarily due to a $36an increase in cash operating costs by $148 million, or seven percent, from $2,012 million in 2020 to $2,160 million in 2021, an increase in environmental rehabilitation and other non-cash costs by $6 million, or 19 percent, from $17$32 million in 20182020 to $53$38 million in 2019.2021, and an increase in amortisation of right of use assets by $16 million, or 34 percent, from $47 million in 2020 to $63 million in 2021. The increase was partly offset by a decrease in royalties paid by $19 million, or ten percent, from $181 million in 2020 to $162 million in 2021, a decrease in amortisation of tangible assets of $115 million, or 22 percent, from $526 million in 2020 to $411 million in 2021 and an inventory change of $8 million, or 57 percent, from a charge of $14 million in 2020 to a charge of $6 million in 2021. The increase in cash operating costs was mainly due to higher labour and contractors’ costs, commodity prices, logistics costs, consumable stores, COVID-19 pandemic related expenditure, services, other charges, fuel and power costs. Higher labour and contractors’ costs were mainly due to COVID-19 related cost increases resulting from challenges with travel restrictions and shortages of critical skills at certain operations. Higher commodity costs were mainly due to an increase in the prices of steel, support and construction materials, lime and other reagents. COVID-19 presented challenges within the overall logistics sector resulting in higher cost of transportation, warehousing and inventory prices. Higher fuel and power costs were mainly due to the increase in the average price of Brent Crude oil, which increased from $42 per barrel in 2020 to $71 per barrel in 2021, a $29, or a 69 percent, per barrel increase. The increase in environmental rehabilitation and other non-cash costs primarily arose from the changes to restoration provision cash flows inflation rates andin 2021 compared to 2020. The change in restoration provision cash flows was attributable to changes in discount rates due to changes in global economic assumptions, changes in mine plans resulting in a change in cash flows, changes in design of our TSFs in Brazil due to new legal requirements, and changes in the methodology used to calculate such estimates in response to comments from environmental regulatory authorities. The increase in amortisation of right of use assets was mainly due to an increase in number of right of use assets in 2021 as compared to 2018.2020 largely due to a change in business strategy whereby certain heavy mobile equipment is leased. The decrease in royalties paid primarily arose from a decrease in ounces of gold sold in 2021 as compared to 2020. The decrease in amortisation of tangible assets was mainly due to lower amortisation of waste stripping and lower gold production in 2021 as compared to 2020.
In Continental Africa, cost of sales increaseddecreased by $62 million, or five percent, from $1,127$1,362 million in 20182020 to $1,173$1,300 million in 2019, which represents2021. The decrease was mainly due to lower amortisation of waste stripping and lower royalties paid due to a $46decrease in ounces of gold sold in 2021 as compared to 2020. The decrease in cost of sales was partly offset by an increase in labour and contractors’ costs, commodity prices, logistics costs, consumable stores, environmental rehabilitation and other non-cash costs, amortisation of right of use assets, services and other charges, power and fuel costs and higher ore stockpile adjustments. Higher commodity costs were mainly due to an increase in the prices of steel, support and construction materials, lime and other reagents. COVID-19 presented challenges within the overall logistics sector resulting in higher cost of transportation, warehousing and inventory prices. The higher fuel and power costs were mainly due to the increase in the price of Brent Crude oil.
In the Americas, cost of sales increased by $58 million, or foureight percent, increase.from $764 million in 2020 to $822 million in 2021. The increase was mainly due to an increase in royalties,labour and contractors’ costs, commodity prices, logistics costs, consumable stores, amortisation of right of use assets, services and other charges, power and fuel cost, write down of inventory and environmental rehabilitation and other non-cash costs. The higher labour and contractors’ costs amortisationwere mainly due to COVID-19 related cost increases resulting from challenges with travel restrictions and shortages of critical skills. Higher commodity costs were mainly due to an increase in the prices of steel, support and construction materials, lime and other reagents. COVID-19 presented challenges within the overall logistics sector resulting in higher cost of transportation, warehousing and inventory change.prices. The higher fuel costs were mainly due to the increase in the price of Brent Crude oil. The increase in cost of sales was partly offset by lower royalties paid due to a decrease in ounces of gold sold in 2021 as compared to 2020, lower amortisation of tangible assets due to a decrease in ounces of gold produced in 2021 as compared to 2020 and the weakening of the local currencies against the US dollar. The Argentinean peso weakened by 35 percent and the Brazilian real by five percent, against the US dollar.
In Australia, cost of sales increased by $35 million, or five percent, from $622$705 million in 20182020 to $632$740 million in 2019, which represents a $10 million, or two percent, increase.2021. The increase was mainly due to an increase in labour and contractors’ costs, commodity prices, logistics costs, consumable stores, amortisation of right of use assets, services and inventory change. The increase was partially offset by a decrease in service-relatedother charges, power and fuel costs, ore stockpile adjustments and the weakeningstrengthening of the Australian dollar against the US dollar.dollar by eight percent. The higher labour and contractors’ costs were
mainly due to COVID-19 related cost increases resulting from challenges with travel restrictions and shortages of critical skills. Higher commodity costs were mainly due to an increase in the Americas,prices of steel, support and construction materials, lime and other reagents. COVID-19 presented challenges within the overall logistics sector resulting in higher cost of sales decreased from $838 million in 2018 to $822 million in 2019, which represents a $16 million, or two percent, decrease.transportation, warehousing and inventory prices. The decrease washigher fuel costs were mainly due to the weakeningincrease in the price of the local currencies, the Argentinian pesoBrent Crude oil. The increase in cost of sales was partly offset by 72 percentlower environmental rehabilitation and the Brazilian real by eight percent, against the US dollar.other non-cash costs, lower amortisation of waste stripping due to lower levels of stripping in 2021 as compared to 2020 and lower royalties paid due to a decrease in ounces of gold sold in 2021 as compared to 2020.
Total cash costs
Total cash costs decreasedincreased by $128 million, or six percent, from $1,996$2,206 million in 20182020 to $1,981$2,334 million in 2019, which represents a $15 million, or one percent, decrease.2021. The decreaseincrease was primarily due to the weakening of local currencies against the US dollar. The decrease was partially offset by an increase in royalties.cash operating costs, partly offset by a decrease in royalties paid. Total cash costs include cash operating costs (which include salaries and wages, stores, explosives, timber, reagents, logistics, fuel, power, water and contractors’ costs), royalties and other cash costs.
Cash operating The strengthening of the Australian dollar against the US dollar contributed to the increase in total cash costs, decreased from $1,850 million in 2018 to $1,831 million in 2019, which represents a $19 million, or one percent, decrease, primarily due towas partly offset by the weakening of local currencies against the US dollar.dollar in Brazil and Argentina.
Cash operating costs increased by $148 million, or seven percent, from $2,012 million in 2020 to $2,160 million in 2021, primarily due to higher labour and contractors’ costs, commodity prices, logistics costs, consumable stores, COVID-19 pandemic related expenditure, services and other charges as well as higher fuel and power costs. The strengthening of the Australian dollar against the US dollar contributed to the increase in total cash costs, which was partly offset by the weakening of local currencies against the US dollar in Brazil and Argentina. Cash operating costs includes salaries and wages, stores, explosives, timber, reagents, logistics, fuel, power, water and contractors’ costs.
Royalties, which are generally calculated as a percentage of revenue, increaseddecreased by $19 million, or ten percent, from $133$181 million in 20182020 to $137$162 million in 2019, which represents a $4 million, or three percent, increase,2021. The decrease was primarily due to an increase in the spot gold prices and an increase in production at Geita and Iduapriem partially offset by a decrease in production in Argentina.gold sales across all mining operations with the exception of Siguiri and Kibali. The decrease was partly offset by an increased average gold price received per ounce.
Retrenchment costs
Retrenchment costs included in cost of sales remained unchanged at $2 million in 2019 at $4 million2021 as in 2018.compared to 2020.
Rehabilitation and other non-cash costs
RehabilitationEnvironmental rehabilitation and other non-cash costs increased by $6 million, or a 19 percent, from $17$32 million in 20182020 to $53$38 million in 2019, which represents a $36 million increase. This2021.The increase was primarily due to a change in discount ratesmainly due to changes in global economic assumptions anddesign of TSFs in Brazil to dry-stacked structures to comply with new legal requirements, changes in mine plans resulting in a change in cash flows and changes in design facilities andthe methodology following requestsused to calculate such estimates in response to comments from environmental regulatory authorities compared to 2018.and changes in global economic assumptions.
Amortisation of tangible, intangible and right of use assets
Amortisation of tangible, intangible and right of use assets expense increaseddecreased by $98 million, or 17 percent, from $558$575 million in 20182020 to $583$477 million in 2019, which represents a $25 million, or four percent, increase. 2021.
Amortisation of tangible assets decreased by $15$115 million, or three22 percent, from $553$526 million in 20182020 to $538$411 million in 2019, largely2021. The decrease was mainly due to lower amortisation at Geita due to lower production and the closure of the Nyankanga Cut 8 open pit in 2021, the reset of useful life in February 2021 for the heavy moving equipment fleet resulting in lower amortisation compared to 2020, and the reset of the useful life in February 2021 for Mineral Reserve development amortisation drivers and lower Mineral Reserve development capital expenditures in 2021 compared to 2020. At Iduapriem, amortisation was lower than in 2020 mainly due to lower production and lower deferred stripping amortisation in 2021 at Cerro Vanguardia,Teberebie Cut 1 and Cut 3, at AGA Mineração, amortisation was lower depreciation on the wastemainly due to lower production, and at Tropicana, amortisation was lower mainly due to lower production and lower deferred stripping assetamortisation, partly offset by higher Mineral Reserve development amortisation. This decrease was partly offset by higher amortisation at Obuasi as the open pit ore is being depleted, lower depreciation on the mining fleetredevelopment project progressed.
Amortisation of intangible assets increased by $1 million, or 50 percent, from $2 million in 2020 to $3 million in 2021, mainly due to higher software and licence expenditure at Obuasi as compared to 2020.
Amortisation of right of use assets increased by $16 million, or 34 percent, from $47 million in 2020 to $63 million in 2021 largely at AGA Mineração, Serra Grande and Geita mainly due to a change in fleet managementbusiness strategy whereby certain heavy mobile equipment is leased at these operations.
Inventory change
Inventory change decreased from a charge of $14 million in 2020 to a charge of $6 million in 2021, which represents a $8 million, or 57 percent, decrease. This decrease was primarily due to lower cost and amortisation at Cerro Vanguardia of $23 million due to fewer ounces produced and sold than in 2020 and lower cost at Geita of $11 million with fewer ounces produced and lower production at Serra Grande. The decrease was partiallysold, partly offset by an inventory valuation upward adjustment at Obuasi of $14 million as a result of timing of shipment.
Impairment, derecognition of assets and profit (loss) on disposal
Impairment, derecognition of assets and profit (loss) on disposal increased by $12 million from a loss of $1 million in 2020 to a profit of $11 million in 2021. During 2021, profit on disposal of assets was $17 million mainly due to the disposal of properties held in Brazil, partly offset by derecognition of assets at Obuasi of $4 million, impairment of assets at the Corporate office of $1 million due to relocation to new premises and impairment of the La Cascada hydroelectric power plant assets at Gramalote of $1 million. This compares to a $1 million loss from real estate activities in Brazil in 2020.
Other (expenses) income
Other (expenses) income increased by $79 million, or 139 percent, from an expense of $57 million in 2020 to an expense of $136 million in 2021. The increase in amortisation at Iduapriem due to completion of the stripping activities in the 2019.
Amortisation relating to right of use assets as recognised in accordance with IFRS 16 Leases (effective from 1 January 2019) was $42 million in 2019. Amortisation relating to right of use assets was $18 million at Geita, $16 million at the Australian operations and $6 million at Córrego do Sítio.
Inventory change
Inventory decreased from $9 million in 2018 to $5 million in 2019, which represents a $4 million, or 44 percent decrease.
Other expenses
Other expenses increased from $79 million in 2018 to $83 million in 2019, which represents a $4 million, or five percent, increase. The increaseduring 2021 was largely due to care and maintenance activities at the Obuasi mine, retrenchment and related costs, premium on settlement of bonds and a refund from an increaseinsurance claim in government fiscal claims, cost2020 which was not repeated in 2021. Underground mining activities were voluntarily suspended between 18 May 2021 and 15 October 2021 at the Obuasi mine, following a sill pillar incident. From 15 October 2021, underground mining resumed to replenish the run-of-mine stockpile without corresponding gold production. Since the voluntary suspension of tailing operations and other expenses,underground mining activities, care and maintenance costs of $45 million were incurred at Obuasi during 2021. Retrenchment and related costs of $18 million were incurred during 2021 as part of the public infrastructure contributiontransition to the new Operating Model. Bond settlement costs during 2021 related to costs associated with the tender offer for, and subsequent redemption of, the $750 million aggregate principal amount of 5.125% notes due 2022 and amounted to $24 million. These increases in Guinea. The increase was partiallyexpenses were partly offset by a decrease in corporate retrenchmentsthe lower cost of legacy tailings operations, mainly at Obuasi, due to fewer activities at such legacy tailings operations, lower VAT and power grid refunds in Brazil.other duties expensed.
Finance costs and unwinding of obligations
Finance costs increaseddecreased by $3$28 million, or two20 percent, to $143from $138 million in 2019, compared2020 to $140$110 million in 20182021, mainly due to an increase in capitalisation of interest against the effect of IFRS 16 Leases (effective from1 January 2019) on finance costs partially offset byObuasi redevelopment project, lower finance costs from borrowings.borrowings and amortisation fees as 2020 included finance costs related to a $1.0 billion standby credit facility not repeated in 2021. Unwinding of obligations of $29decreased by $33 million, was recorded in 2019 compared with $28or 85 percent, from $39 million in 2018.2020 to $6 million in 2021, mainly due to a decrease in unwinding of other indirect taxes at Geita.
Share of associates and joint ventures'ventures’ profit
Share of associates and joint ventures'ventures’ profit increaseddecreased by $46$29 million, or 38ten percent, from a profit of $278 million in 2020 to a profit of $168$249 million in 2019, compared to a profit of $122 million in 2018,2021 mainly as a result of an increasea decrease in equity earnings of $39$7 million at Kibali.Kibali and $5 million at Rand Refinery (Pty) Limited, as well as a profit of $19 million on the sale of the Morila and Sadiola mines in Mali during 2020 not repeated in 2021, partly offset by losses of $2 million at Gramalote during 2020 not repeated during 2021.
Taxation
A taxation expense of $250$312 million was recorded in 2019,2021, compared to ana taxation expense of $212$625 million in 2018,2020, which represents a $38$313 million, or 1850 percent, increase.decrease. Charges for current tax in 20192021 amounted to $298$248 million, compared to $242$562 million in 2018,2020, which represents a $56$314 million, or 2356 percent, increase.decrease. The increasedecrease in current tax iswas mainly due to higher earningslower pre-tax profit in Ghana, Australia, TanzaniaBrazil, Argentina and Ghana.Tanzania. Charges for deferred tax in 20192021 amounted to a net deferred tax benefitexpense of $48$64 million, compared to a net deferred tax benefit of $30$63 million in 2018,2020, which represents a $18$1 million, or 60two percent, increase. The increase in the deferred taxation benefit mainly relates to higher capital expenditure in Tanzania and higher estimated deferred tax resets in Guinea (related to a tax holiday agreement from 2020).
Discontinued operations
A lossprofit from discontinued operations of $376$7 million was recorded in 2019, compared to a loss2020, which was not repeated in 2021. The profit of $83 million in 2018, which represents a $293 million increase. The loss of $376$7 million consists of an operating profitloss after tax of $9 million and an impairment lossreversal of $385$16 million. TheAs a result of the sale of the Company’s remaining South African producing assets and related liabilities in September 2020, the South African operations have beenwere accounted for as discontinued operations. Refer to “Item 18: Financial Statements-Note 9-Discontinued operations and assets and liabilities held for sale” for further details.
Comparison of financial performance in 2018 with 2017
Our gold income is materially impacted by price and volume variances. All of our costs are impacted by the consequences of average exchange rate movements.
Exchange fluctuations in and the average exchange rates for the South African rand, Brazilian real, Australian dollaryear ended and the Argentinian peso have effects on the various components that make up our costs based on the level of local procurement of each of these costs. For a discussion of the effect of foreign exchange fluctuations on our financial results, see “Item 5A: Operating Results-Key factors affecting results-Foreign exchange fluctuations”.as at 31 December 2020.
Revenue from product sales
Revenue from product sales decreased by $58 million, or two percent, from $3,394 million in 2017 to $3,336 million in 2018, mainly as a result of the decrease in gold sold of 42,000 ounces partially offset by an increase in the gold price received. Gold income decreased by $52 million, or two percent, from $3,255 million in 2017 to $3,203 million in 2018, mainly due to the decrease
159
in gold sold. The gold price received increased by $10 per ounce, or one percent, from $1,251 per ounce in 2017 to $1,261 per ounce in 2018, which resulted in an increase in gold income of $38 million. By-product revenue decreased by $6 million, or four percent, to $133 million in 2018 from $139 million in 2017, mainly due to less revenue from silver.
Revenue from product sales from the Continental Africa operations decreased by $39 million, or three percent, to $1,405 million in 2018 from $1,444 million in 2017, mainly as a result of the decrease in gold sold of 24,000 ounces, which resulted in a decrease of gold income of $49 million. The decrease in production was mainly due to lower recovered grades at Siguiri partially offset by increased production at Iduapriem and Geita. The decrease in revenue was partially offset by an increase in the gold price received resulting in an increase in gold income of $10 million.
Revenue from product sales from Australia increased by $71 million, or ten percent, from $711 million in 2017 to $782 million in 2018. The increase was due to the increase of 53,000 ounces in gold sold in 2018, which resulted in an increase in gold income of $65 million. Gold production increased at Sunrise Dam due to increased mill feed grades and improved mill throughput resulted in higher production at Tropicana. The increase in the gold price received resulted in an increase in gold income of $6 million.
Revenue from product sales from the Americas operations decreased by $90 million, or seven percent, from $1,239 million in 2017 to $1,149 million in 2018. The decrease was due to a decrease of 72,000 ounces in gold sold in 2018, which resulted in a decrease in gold income of $91 million. Gold production primarily decreased at AGA Mineração mainly due to development and infrastructure constraints, coupled with lower grades. The increase in the gold price received resulted in an increase in gold income of $8 million.
Cost of sales
Cost of sales decreased from $2,607 million in 2017 to $2,584 million in 2018, which represents a $23 million, or one percent, decrease. The decrease was primarily due to a $132 million, or 19 percent, decrease in total amortisation from $690 million in 2017 to $558 million in 2018.
In Continental Africa, cost of sales increased from $1,072 million in 2017 to $1,127 million in 2018, which represents a $55 million, or five percent, increase. The increase was mainly due to an increase in contractor costs, labour costs, fuel and power costs, service related costs, royalties, rehabilitation and other non-cash costs and inventory change. The increase was partially offset by a decrease in amortisation of tangible assets.
In Australia, cost of sales increased from $551 million in 2017 to $622 million in 2018, which represents a $71 million, or 13 percent, increase. The increase was mainly due to an increase in contractor costs, service related costs and amortisation of tangible assets. The increase was partially offset by the weakening of the Australian dollar against the US dollar.
In the Americas, cost of sales decreased from $987 million in 2017 to $838 million in 2018, which represents a $149 million, or 15 percent, decrease. The decrease was mainly due to the weakening of the local currencies, the Argentinian peso by 70 percent and the Brazilian real by 15 percent, against the US dollar.
Total cash costs
Total cash costs increased from $1,881 million in 2017 to $1,996 million in 2018, which represents a $115 million, or six percent, increase. The increase was primarily due to an increase in cash operating costs and royalties, partially offset by weaker local currencies against the US dollar. Total cash costs include cash operating costs (which include salaries and wages, stores, explosives, timber, reagents, fuel, power, water and contractors’ costs), royalties and other cash costs.
Cash operating costs increased from $1,756 million in 2017 to $1,850 million in 2018, which represents a $94 million, or five percent, increase. The increase was primarily due to inflationary increases, partially offset by weaker local currencies against the US dollar. Cash operating costs includes salaries and wages, stores, explosives, timber, reagents, fuel, power, water and contractors’ costs.
Royalties, which are generally calculated as a percentage of revenue, increased from $111 million in 2017 to $133 million in 2018, which represents a $22 million, or 20 percent, increase, primarily due to an increase in the spot gold prices and an increase in production at Geita.
Retrenchment costs
Retrenchment costs included in cost of sales decreased from $6 million in 2017 to $4 million in 2018, which represents a $2 million, or 33 percent, decrease. The decrease was mainly due to lower retrenchment costs in Brazil.
Rehabilitation and other non-cash costs
Rehabilitation and other non-cash costs increased from $16 million in 2017 to $17 million in 2018, which represents a $1 million increase. This increase was primarily due to a change in discount rates due to changes in global economic assumptions and
changes in mine plans resulting in a change in cash flows and changes in design facilities and methodology following requests from environmental regulatory authorities compared to 2017.
Amortisation of tangible, and intangible assets
Amortisation of tangible and intangible assets expense decreased from $690 million in 2017 to $558 million in 2018, which represents a $132 million, or 19 percent, decrease. Amortisation of tangible assets decreased by $132 million, or 19 percent, from $685 million in 2017 to $553 million in 2018, largely due to the depletion of open pit ore at Geita, lower production at Siguiri, lower production at Cerro Vanguardia and lower production and capital spend at Córrego do Sítio and Serra Grande. The decrease was partially offset by an increase in amortisation at Sunrise Dam and Tropicana in Australia due to higher production.
Inventory change
Inventory decreased from $14 million in 2017 to $9 million in 2018, which represents a $5 million, or 36 percent, decrease.
Other expenses
Other expenses decreased from $150 million in 2017 to $79 million in 2018, which represents a $71 million, or 47 percent, decrease. The decrease was mainly due to the provision for the settlement of the silicosis class action of $63 million not repeated in 2018.
Finance costs and unwinding of obligations
Finance costs decreased by $1 million, or one percent, to $140 million in 2018, compared to $141 million in 2017. Unwinding of obligations of $28 million was recorded in 2018 compared with $16 million in 2017.
Share of associates and joint ventures' profit
Share of associates and joint ventures' profit increased by $100 million to a profit of $122 million in 2018, compared to a profit of $22 million in 2017, mainly as a result of an increase in equity earnings after taxation of $86 million (mainly at Kibali) and an increase in net impairment reversals from $15 million in 2017 to $29 million in 2018.
Taxation
A taxation expense of $212 million was recorded in 2018, compared to an expense of $163 million in 2017, which represents a $49 million, or 30 percent, increase. Charges for current tax in 2018 amounted to $242 million, compared to $176 million in 2017, which represents a $66 million, or 38 percent, increase. The increase in current tax is mainly due to higher earnings in Ghana and Argentina in 2018 compared to credits received for changes to tax legislation enacted in North America during December 2017. Charges for deferred tax in 2018 amounted to a net deferred tax benefit of $30 million, compared to a net deferred tax benefit of $13 million in 2017 , which represents a $17 million, or 131 percent, increase. The increase in the deferred taxation benefit mainly relates to lower withholding tax in Tanzania and a taxation holiday agreement from 2018 in Guinea.
Discontinued operations
A loss from discontinued operations of $83 million was recorded in 2018, compared to a loss of $336 million in 2017, which represents a $253 million decrease. The South African operations have been accounted for as discontinued operations. Refer to “Item 18: Financial Statements-Note 9-Discontinued operations and assets and liabilities held for sale” for further details.
Comparison of capital expenditure in 2019, 20182022, 2021 and 20172020
The following table presents capital expenditure data from continuing operations for the AngloGold Ashanti groupGroup for the three-year period ended 31 December 2019:2022: | | | | | | | | | | | | | | | | | | | | |
Capital expenditure data for AngloGold Ashanti | | Year ended 31 December |
(in $ millions) | | 2022 | | 2021 | | 2020 |
| | | | | | Restated |
Capital expenditure | | 1,118 | | | 1,100 | | | 795 | |
- Consolidated entities | | 1,028 | | | 1,028 | | | 739 | |
- Equity-accounted joint ventures | | 90 | | | 72 | | | 56 | |
|
| | | | | | | | | |
Capital expenditure data for AngloGold Ashanti | | Year ended 31 December |
(in $ millions) | | 2019 |
| | 2018 |
| | 2017 |
|
Capital expenditure | | 754 |
| | 645 |
| | 798 |
|
- Consolidated entities | | 703 |
| | 576 |
| | 675 |
|
- Equity accounted joint ventures | | 51 |
| | 69 |
| | 123 |
|
Comparison of capital expenditure in 2022 with 2021
Total capital expenditure was $754(including equity-accounted joint ventures) increased by $18 million, or two percent, from $1,100 million in 2019, compared2021 to $645$1,118 million in 2018. This represents a $109 million, or 17 percent, increase from 2018.2022. This increase iswas mainly due to increased expenditure on sustaining capital ($1 million) and non-sustaining project capital ($17 million). AngloGold Ashanti embarked on a multi-year initiative at the beginning of 2020 to increase investment in Mineral Reserve development and brownfields exploration. The aim of this investment is to increase the rate of Mineral Reserve conversion, extend the reserve lives of our assets, enhance mining flexibility and further improve our knowledge of the ore bodies in the portfolio.
In Africa (including equity-accounted joint ventures), capital expenditure increased by $70 million, or 14 percent, from $506 million in 2021 to $576 million in 2022. At Iduapriem in Ghana, capital expenditure increased by $41 million from $105 million in 2021 to $146 million in 2022, mainly due to waste stripping at Cut 2 and increased non-sustaining project capital expenditure for work relating to buttressing the TSF, partly offset by lower pre-stripping activities. At Obuasi in Ghana, capital expenditure decreased by $9 million from $168 million in 2021 to $159 million in 2022, mainly due to lower non-sustaining project capital expenditure as construction of Phase 2 of the Obuasi redevelopment project was completed at the end of December 2021. Phase 3 of the Obuasi redevelopment project, which relates principally to capital expenditure to refurbish existing infrastructure around the KMS Shaft, as well as to service the mine in deeper production areas, continues to progress. At Siguiri in Guinea, capital expenditure decreased by $11 million from $38 million in 2021 to $27 million in 2022, mainly due to lower non-sustaining project capital expenditure at Block 2 during 2022 and lower stay-in-business capital expenditure due to expenditure relating to the construction of a haul road by Block 2 during 2021 not being repeated in 2022. At Geita in Tanzania, capital expenditure increased by $31 million from $123 million in 2021 to $154 million in 2022, mainly due to an increase in sustaining capital expenditure, partly offset by lower non-sustaining capital expenditure. Sustaining capital expenditure increased mainly due to an increase in deferred stripping, higher stay-in-business capital expenditure and Mineral Reserve development expenditure as the underground portal development at Geita Hill East progressed according to plan. Lower non-sustaining project capital expenditure was mainly due to the Nyamulilima open pit being commissioned during 2022. At Kibali in the DRC, capital expenditure increased by $18 million from $72 million in 2021 to $90 million in 2022, mainly due to increased sustaining capital expenditure on growth related projects ($166 million) partially offsetthe cyanide recovery plant and increased non-sustaining exploration.
In the Americas, capital expenditure decreased by decreased expenditure on$24 million, or seven percent, from $346 million in 2021 to $322 million in 2022. In Brazil, AngloGold Ashanti completed the conversion of existing operations ($38 million).TSFs to dry-stacking facilities at all mine sites, in a market characterised by increased competition for skills and engineering resources due to the COVID-19 pandemic and the industry-wide requirements to meet regulatory deadlines relating to TSFs. Capital expenditures required in 2022 to implement this new technology amounted to approximately $83 million. At AGA Mineração in Brazil, capital expenditure increased by $198$4 million at Obuasi,from $195 million in Ghana,2021 to $199 million in 2022, mainly due to significant project ramp uphigher sustaining capital expenditure for mine development costs and continuing expenditure on TSFs to meet regulatory requirements. At Serra Grande in 2019Brazil, capital expenditure decreased by $25 million from $82 million in 2021 to $57 million in 2022, mainly due to lower mine development expenditure offset by higher TSF expenditure. At Cerro Vanguardia in Argentina, capital expenditure decreased by $3 million from $69 million in 2021 to $66 million in 2022, mainly due to lower expenditure on TSF embankment raise and lower deferred stripping capital compared to 20182021.
In Australia, capital expenditure increased by $17 million, or eight percent, from $185 million in 2021 to $202 million in 2022. At Sunrise Dam in Australia, capital expenditure decreased by $12 million from $62 million in 2021 to $50 million in 2022, mainly due to non-sustaining project capital expenditure incurred on the areas of mining fleet acquisitionGolden Delicious open pit growth project having been commissioned in 2021 and underground mining development related costs, processing plant refurbishment and upgrade, surface and underground infrastructure, project team
and owner cost and pre-production capital. Capitalnot repeated in 2022. At Tropicana in Australia, capital expenditure increased by $30 million at Tropicana,from $122 million in Australia,2021 to $152 million in 2022, mainly due to pre-strippingincreased non-sustaining project capital expenditure at Tropicana's Boston Shaker 4for increased waste mining in the Havana Cutback Project during 2022. At Australia other, capital expenditure decreased by $1 million from $1 million in 2021 to nil in 2022, mainly due to a shiftlower exploration equipment expenditure.
In Projects, capital expenditure decreased by $35 million, or 67 percent, from $52 million in mining activity. Capital expenditure increased by $292021 to $17 million atin 2022. At Quebradona in Colombia, capital expenditure decreased by $28 million from $33 million in 2021 to $5 million in 2022, mainly due to the higher capitalisation of land and feasibility study costs for the growth project in 2021. At Gramalote in Colombia, capital expenditure decreased by $9 million from $19 million in 2021 to $10 million in 2022, mainly due to the purchase of the
La Cascada property in 2021 and higher feasibility study costs of the project. Capitalgrowth project in 2021. During 2022, there was no capital expenditure at La Colosa in Colombia. In Nevada, USA, capital expenditure increased by $16$1 million from nil in 2021 to $1 million in 2022, mainly due to pre-feasibility studies, and purchase of light motor vehicles and land.
At the Corporate Office in Johannesburg, capital expenditure decreased by $10 million from $11 million in 2021 to $1 million in 2022, mainly due to expenditure on new furniture and computer equipment in connection with the relocation of the Corporate Office to a new building having been incurred in 2021 and not being repeated in 2022.
Comparison of capital expenditure in 2021 with 2020
Total capital expenditure (including equity-accounted joint ventures) increased by $304 million, or 38 percent, from $796 million in 2020 to $1,100 million in 2021. This increase was mainly due to increased expenditure on sustaining capital ($281 million) and non-sustaining project capital ($23 million). AngloGold Ashanti embarked on a multi-year initiative at the beginning of 2020 to increase investment in Mineral Reserve development and brownfields exploration. The aim of this investment is to increase the rate of Mineral Reserve conversion, extend the reserve lives of our assets, enhance mining flexibility and further improve our knowledge of the ore bodies in the portfolio.
In Africa (including equity-accounted joint ventures), capital expenditure increased by $71 million, or 16 percent, from $435 million in 2020 to $506 million in 2021. At Iduapriem in Ghana, capital expenditure increased by $45 million from $60 million in 2020 to $105 million in 2021, mainly due to higher pre-stripping activities and stay-in-business capital expenditure. At Obuasi in Ghana, capital expenditure increased by $38 million from $130 million in 2020 to $168 million in 2021, mainly due to a change in scoping activities, the commissioning and ramping up of underground activities and the start of Phase 3 of the Obuasi redevelopment project. Phase 2 construction was completed at the end of December 2021. At Siguiri in Guinea, capital expenditure increased by $8 million from $30 million in 2020 to $38 million in 2021, mainly due to increased stay-in-business capital expenditure incurred to construct a haul road by Block 2. At Geita in Tanzania, capital expenditure increased by $36 million from $87 million in 2020 to $123 million in 2021, mainly due to an increase in ore reserve developmentnon-sustaining project capital underground infrastructure development, and higher other sustaining capital as underground activities ramp up. Theexpenditure with the start of the Nyamulilima project, an increase in non-sustaining exploration costs, partly offset by lower stay-in-business capital expenditure was partially offset by decreased expenditure at Siguiri, in Guinea by $74 million duemainly related to the completion and commissioning of the CIL combination plant in early 2019. Capital expenditure decreased at Sunrise Dam, in Australia, by $36 million due to decreased ore reserveMineral Reserve development and sustaining capital due to the completion of large projects. Capital expenditure decreased at Iduapriem, in Ghana, by $27 million due to lower pre-stripping costs partially offset by stay in business capital. Capital expenditure decreased atexpenditure. At Kibali in the DRC, capital expenditure increased by $13$20 million from $52 million in 2020 to $72 million in 2021, mainly due to higher deferred stripping and non-sustaining project capital expenditure.
In the Americas, capital expenditure increased by $178 million, or 106 percent, from $168 million in 2020 to $346 million in 2021. In Brazil, AngloGold Ashanti continued its investment to convert existing TSFs to dry-stacking facilities at all mine sites, in a market characterised by increased competition for skills and engineering resources due to the completion of capital projects in 2018.
Total capital expenditure was $645 million in 2018, compared to $798 million in 2017. This represents a $153 million, or 19 percent, decrease from 2017. This decrease is due to decreased capital expenditure on existing operations ($138 million) partially offset by increased expenditure on growth related projects ($38 million). Capital expenditure decreased at Geita, in Tanzania, by $96 million due to lower ore reserve development capital, less expenditure on the new power plant in 2018 and less deferred stripping expenditure in 2018. Capital expenditure decreased at Kibali, in the DRC, by $46 million due to the hydro-power plant commissioned in 2017, lower deferred stripping and ore reserve development capitalCOVID-19 pandemic and the underground plant commissionedindustry-wide requirements to meet regulatory deadlines relating to TSFs. Capital expenditures required in 2017. Capital expenditure decreased at2021 to implement this new technology amounted to approximately $140 million. At AGA Mineração in Brazil, capital expenditure increased by $92 million from $103 million in 2020 to $195 million in 2021, mainly due to the impact of the weaker exchange rate of the Brazilian real against the US dollar, review of the business strategy with reductionhigher mine development costs and higher expenditure on TSFs. At Serra Grande in investments, optimising cash flow, less spend on assetsBrazil, capital expenditure increased by $49 million from $33 million in 2020 to maintain operations, less$82 million in 2021, mainly due to higher mine development and stripping. Capital expenditure decreased atTSF expenditures. At Cerro Vanguardia in Argentina, capital expenditure increased by $20$38 million from $31 million in 2020 to $69 million in 2021, mainly due to higher expenditure on TSF embankment raise and higher deferred stripping capital.
In Australia, capital expenditure increased by $42 million, or 29 percent, from $143 million in 2020 to $185 million in 2021. At Sunrise Dam in Australia, capital expenditure increased by $9 million from $53 million in 2020 to $62 million in 2021, mainly due to non-sustaining project capital expenditure incurred on the Golden Delicious open pit growth project. At Tropicana in Australia, capital expenditure increased by $33 million from $89 million in 2020 to $122 million in 2021, mainly due to higher deferred stripping, Mineral Reserve and other stay-in-business capital expenditure, as well as increased non-sustaining project capital expenditure with the approval of the Havana Cutback Project in 2021. At Australia other, capital expenditure increased by $1 million from nil in 2020 to $1 million in 2021, mainly due to exploration equipment expenditure.
In Projects, capital expenditure increased by $3 million, or six percent, from $49 million in 2020 to $52 million in 2021. At Quebradona in Colombia, capital expenditure decreased by $7 million from $40 million in 2020 to $33 million in 2021, mainly due to the impacthigher capitalisation of a 70 percent weaker exchange rateland for the growth project in 2020. At Gramalote in Colombia, capital expenditure increased by $10 million from $9 million in 2020 to $19 million in 2021, mainly due to higher feasibility study costs of the Argentinian peso against the US dollar and lower development costs due to reduction of workforce. Capital expenditure decreased at Tropicana, in Australia, by $15 million due to decreased deferred waste and pre-stripping of $27 million and other sustaining capital expenditure of $10 million partially offset by $22 million spend on the Ball Mill Infrastructure. The decrease in capital expenditure was partially offset by increased expenditure of $48 million at Obuasi, in Ghana, due to lack of spending in 2017 asgrowth project. During 2021, there was no budget. Capitalcapital expenditure at La Colosa in Colombia or in Nevada, USA.
At the Corporate Office in Johannesburg, capital expenditure increased at Siguiri,by $9 million from $2 million in Guinea, by $142020 to $11 million in 2021, mainly due to additional expenditure on new furniture and computer equipment in connection with the CIL combination plant project.relocation of the Corporate Office to a new building.
Comparison of operating performance on a segment basis for 2019, 20182022, 2021 and 20172020
The companyCompany produces gold as its primary product and does not have distinct divisional segments in terms of principal business activity, but manages its business on the basis of different geographic segments. Therefore, information regarding separate geographic segments is provided.
Gold income | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
(in millions) | Year ended 31 December |
| 2022 | | 2021 | | 2020 |
| $ | | percent | | $ | | percent | | $ | | percent |
| | | | | | | | | Restated |
Geographical analysis of gold income by origin is as follows: | | | | | | | | | | | |
Africa | 2,981 | | | 68 | | | 2,644 | | | 68 | | | 2,937 | | | 60 | |
Australia | 967 | | | 22 | | | 890 | | | 23 | | | 989 | | | 20 | |
Americas | 1,036 | | | 24 | | | 1,028 | | | 26 | | | 1,211 | | | 25 | |
| 4,984 | | | | | 4,562 | | | | | 5,137 | | | |
Less : Associates and equity-accounted joint ventures included above | (596) | | | (14) | | | (659) | | | (17) | | | (647) | | | (13) | |
Continuing operations | 4,388 | | | | | 3,903 | | | | | 4,490 | | | |
Discontinued operations | — | | | — | | | — | | | — | | | 408 | | | 8 | |
| 4,388 | | | 100 | | | 3,903 | | | 100 | | | 4,898 | | | 100 | |
|
| | | | | | | | | | | | | | | | | |
(in millions) | Year ended 31 December |
| 2019 | | 2018 | | 2017 |
| $ |
| | percent |
| | $ |
| | percent |
| | $ |
| | percent |
|
Geographical analysis of gold income by origin is as follows: | | | | | | | | | | | |
Continental Africa | 2,203 |
| | 55 |
| | 1,983 |
| | 52 |
| | 1,895 |
| | 44 |
|
Australia | 851 |
| | 21 |
| | 780 |
| | 20 |
| | 709 |
| | 16 |
|
Americas | 1,000 |
| | 25 |
| | 1,021 |
| | 27 |
| | 1,104 |
| | 25 |
|
| 4,054 |
| | | | 3,784 |
| | | | 3,708 |
| | |
Less : Associates and equity accounted joint ventures included above | (615 | ) | | (15 | ) | | (581 | ) | | (15 | ) | | (453 | ) | | (10 | ) |
Continuing operations | 3,439 |
| | | | 3,203 |
| | | | 3,255 |
| | |
Discontinued operations | 554 |
| | 14 |
| | 602 |
| | 16 |
| | 1,101 |
| | 25 |
|
| 3,993 |
| | 100 |
| | 3,805 |
| | 100 |
| | 4,356 |
| | 100 |
|
Assets | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
(in millions) | Year ended 31 December |
| 2022 | | 2021 | | 2020 |
| $ | | percent | | $ | | percent | | $ | | percent |
| | | | | Restated | | Restated |
Geographical analysis of assets by origin is as follows: | | | | | | | | | | | |
Africa | 4,083 | | | 51 | | | 4,226 | | | 53 | | | 3,989 | | | 52 | |
Australia | 960 | | | 12 | | | 1,034 | | | 13 | | | 1,044 | | | 13 | |
Americas | 1,406 | | | 17 | | | 1,573 | | | 20 | | | 1,370 | | | 18 | |
Projects (1) | 872 | | | 11 | | | 313 | | | 4 | | | 256 | | | 3 | |
Other, including non-gold producing subsidiaries | 751 | | | 9 | | | 854 | | | 10 | | | 1,046 | | | 14 | |
Total assets | 8,072 | | | 100 | | | 8,000 | | | 100 | | | 7,705 | | | 100 | |
Assets(1) A new segment for Projects (previously reported under the Americas segment) has been introduced due to the implementation of the new Operating Model which comprises all the major non-sustaining capital projects with the potential to be developed into operating entities. Comparative information has been restated.
|
| | | | | | | | | | | | | | |
(in millions) | Year ended 31 December |
| 2019 | | 2018 | | 2017 |
| $ |
| | percent | | $ |
| | percent | | $ |
| | percent |
Geographical analysis of assets by origin is as follows: | | | | | | | | | | | |
South Africa | 697 |
| | 10 | | 1,106 |
| | 17 | | 1,734 |
| | 24 |
Continental Africa | 3,514 |
| | 51 | | 3,135 |
| | 47 | | 3,153 |
| | 44 |
Australia | 972 |
| | 14 | | 888 |
| | 13 | | 929 |
| | 13 |
Americas | 1,427 |
| | 21 | | 1,286 |
| | 19 | | 1,258 |
| | 17 |
Other, including non-gold producing subsidiaries | 253 |
| | 4 | | 228 |
| | 4 | | 145 |
| | 2 |
Total assets | 6,863 |
| | 100 | | 6,643 |
| | 100 | | 7,219 |
| | 100 |
At 31 December 2019, ten percent2022, 31 December 2021 and 31 December 2020, none of AngloGold Ashanti’s totalproducing assets were located in South Africa, compared with 17ten percent at 31 December 2019, as a result of the endsale of 2018.the Company’s remaining South African producing assets and related liabilities to Harmony in September 2020. The remaining operations collectively accounted for approximately 90100 percent of AngloGold Ashanti’s total assets at 31 December 20192022 compared to 8390 percent at the end of the same period in 2017.2019.
At 31 December 2018, 17 percent of AngloGold Ashanti’s total assets were located in South Africa compared with 24 percent at the end of 2017. The remaining operations collectively accounted for approximately 83 percent of AngloGold Ashanti’s total assets at 31 December 2018 compared to 76 percent at the end of the same period in 2017.
Non-GAAP analysis
All-in sustaining costs and all-in costs
During June 2013,2018, the World Gold Council (WGC)(“WGC”), an industry body, published aan updated Guidance Note on “all-in sustaining costs” and “all-in costs” metrics, which gold mining companies can use to supplement their overall non-GAAP disclosure. The WGC worked closely with its members (including AngloGold Ashanti) to develop these non-GAAP measures which are intended to provide further transparency into the full cost associated with producing gold. It is expected that these metrics, in particular, the “all-in sustaining cost” and “all-in cost” metrics which AngloGold Ashanti provides in this annual report on Form 20-F, will be helpful to investors, governments, local communities and other stakeholders in understanding the economics of gold mining. “All-in sustaining costs” is a non-GAAP measure which is an extension of the existing “total cash costs net of by-product revenue” metric and incorporates all costs related to sustaining production and in particular, recognises sustaining capital expenditures associated with developing and maintaining gold mines. In addition, this metric includes the cost associated with Corporate Office structures that support these operations, the community and environmental rehabilitation costs attendant with responsible mining and any exploration and evaluation cost associated with sustaining current operations. “All-in sustaining costs per ounce” is arrived at by dividing the dollar value of this cost metric by the ounces of gold sold. “All-in
costs” is a non-GAAP measure comprising “all-in sustaining costs” including additional costs which reflect the varying costs of producing gold over the life-cycle of a mine including costs incurred at new operations and costs related to majorgrowth projects at existing operations, which are expected to increase production. “All-in costs per ounce” is arrived at by dividing the dollar value of this cost metric by the ounces of gold sold.
Total cash costs net of by-product revenue
“Total cash costs net of by-product revenue” is calculated in accordance with the guidelines of the Gold Institute industry standard and industry practice and is a non-GAAP measure. The Gold Institute, which has been incorporated into the National Mining Association, is a non-profit international association of miners, refiners, bullion suppliers and manufacturers of gold products, which developed a uniform format for reporting total cash costs on a per ounce basis. The guidance was first adopted in 1996 and revised in November 1999.
"“Total cash costs net of by-product revenue"revenue” as calculated and reported by AngloGold Ashanti include costs for all mining, processing, onsite administration costs, royalties and production taxes, as well as contributions from by-products, but exclusive ofexclude amortisation of tangible, intangible and right of use assets, rehabilitation costs and other non-cash costs, retrenchment costs, corporate administration, marketing and otherrelated costs, capital costs and exploration costs. “Total cash costs per ounce” is calculated by dividing attributable total cash costs net of by-product revenue by attributable ounces of gold produced.
Average gold price received per ounce
“Average gold price received per ounce” is a non-GAAP measure which gives an indication of revenue earned per unit of gold sold and includes gold income and realised non-hedge derivatives in its calculation and serves as a benchmark of performance against the market spot gold price. This metric is calculated by dividing attributable gold income (price received) by attributable ounces of gold sold.
“All-in sustaining costs”, “all-in sustaining costs per ounce”, “all-in costs”, “all-in costs per ounce”, “total cash costs net of by-product revenue” and, “total cash costs per ounce” and “average gold price received per ounce” should not be considered by investors in isolation or as alternatives to cost of sales, profit/(loss) applicable to equity shareholders, profit/(loss) before taxation, cash flows from operating activities or any other measure of financial performance presented in accordance with IFRS or as an indicator of the company’sCompany’s performance. While the WGC has published guidance on how to define “all-in sustaining costs” and “all-in costs” and the Gold Institute has provided definitions for the calculation of “total cash costs per ounce”, the calculation of these metrics may vary significantly among gold mining companies, and by themselves do not necessarily provide a basis for comparison with other gold mining companies.
However, AngloGold Ashanti believes that “all-in sustaining costs”, “all-in costs” and “total cash costs net of by-product revenue” in total by mine and per ounce by mine as well as “average gold price received per ounce”, are useful indicators to investors and management as they provide:
•an indication of profitability, efficiency and cash flows;
•the trend in costs as the mining operations mature over time on a consistent basis; and
•an internal benchmark of performance to allow for comparison against other mines, both within the AngloGold Ashanti groupGroup and at other gold mining companies.
Reconciliations
A reconciliation of both cost of sales and total cash costsgold income as included in the company’sCompany’s audited financial statements to “average gold price received per ounce” for each of the three years in the period ended 31 December 2022 is presented on a total basis in the table below.
| | | | | | | | | | | | | | | | | |
Average gold price received per ounce for AngloGold Ashanti | Year ended 31 December |
| 2022 | 2021 | | 2020 | |
| | | | Restated | |
Gold income (million US dollars) | 4,388 | | 3,903 | | | 4,490 | | |
Adjusted for non-controlling interests (million US dollars) | (112) | | (103) | | | (95) | | |
| 4,276 | | 3,800 | | | 4,395 | | |
Associates and joint ventures’ share of gold income including realised non-hedge derivatives (million US dollars) | 596 | | 659 | | | 647 | | |
Attributable gold income (million US dollars) | 4,872 | | 4,459 | | | 5,042 | | |
Attributable gold sold - oz (000) | 2,717 | | 2,483 | | | 2,835 | | |
Average gold price received per ounce ($/oz) | 1,793 | | 1,796 | | | 1,778 | | |
A reconciliation of cost of sales as included in the Company’s audited financial statements to “all-in sustaining costs”, “all-in sustaining costs per ounce”, "all-in costs"“all-in costs”, "all-in“all-in costs per ounce"ounce”, “total cash costs net of by-product revenue” and "total“total cash costs per ounce"ounce” for each of the three years in the period ended 31 December 20192022 is presented on a total and segment basis in the tables below.below starting on page 173. In addition, the companyCompany has provided detail of the attributable ounces of gold produced and sold by mine for each of those periods below.
The following table presents selected total operating data from continuing operations for the AngloGold Ashanti groupGroup for the three-year period ended 31 December 2019:2022:
| | | | | | | | | | | | | | | | | |
Operating data for AngloGold Ashanti operations - Total | Year ended 31 December |
(continuing operations)
| 2022 | 2021 | | 2020 | |
| | | | Restated | |
Cost of sales (million US dollars) - Subsidiaries | 3,362 | | 2,857 | | | 2,829 | | |
Cost of sales (million US dollars) - Joint Ventures | 342 | | 350 | | | 340 | | |
All-in sustaining costs per ounce ($/oz) - Subsidiaries(1) | 1,439 | | 1,441 | | | 1,082 | | |
All-in sustaining costs per ounce ($/oz) - Joint Ventures(1) | 979 | | 856 | | | 810 | | |
All-in costs per ounce ($/oz) - Subsidiaries(1) | 1,658 | | 1,695 | | | 1,259 | | |
All-in costs per ounce ($/oz) - Joint Ventures(1) | 1,075 | | 900 | | | 824 | | |
Total cash costs per ounce ($/oz) - Subsidiaries(1) | 1,066 | | 1,017 | | | 836 | | |
Total cash costs per ounce ($/oz) - Joint Ventures(1) | 725 | | 647 | | | 629 | | |
|
| | | | | | | | |
Operating data for AngloGold Ashanti operations - Total | Year ended 31 December |
(continuing operations)
| 2019 |
| | 2018 |
| | 2017 |
|
Cost of sales (million US dollars) - Subsidiaries | 2,626 |
| | 2,584 |
| | 2,607 |
|
Cost of sales (million US dollars) - Joint Ventures | 428 |
| | 480 |
| | 441 |
|
All-in sustaining costs per ounce ($/oz) - Subsidiaries(1) | 1,017 |
| | 970 |
| | 975 |
|
All-in sustaining costs per ounce ($/oz) - Joint Ventures(1) | 767 |
| | 820 |
| | 1,087 |
|
All-in costs per ounce ($/oz) - Subsidiaries(1) | 1,218 |
| | 1,075 |
| | 1,062 |
|
All-in costs per ounce ($/oz) - Joint Ventures(1) | 785 |
| | 846 |
| | 1,186 |
|
Total cash costs per ounce ($/oz) - Subsidiaries(1) | 763 |
| | 743 |
| | 683 |
|
Total cash costs per ounce ($/oz) - Joint Ventures(1) | 657 |
| | 680 |
| | 819 |
|
| |
(1)
| “All-in sustaining costs per ounce $/oz”, "all-in costs per ounce $/oz” and “total cash costs per ounce $/oz" are non-GAAP measures. For a detailed reconciliation of "all-in sustaining costs per ounce", "all-in costs per ounce" and "total cash costs per ounce" for the company’s total operations for each of the three years in the period ended 31 December 2019, refer to the relevant “AngloGold Ashanti operations - Total” tables below. |
(1)“All-in sustaining costs per ounce”, “all-in costs per ounce” and “total cash costs per ounce” are non-GAAP measures. For a detailed reconciliation of “all-in sustaining costs per ounce”, “all-in costs per ounce” and “total cash costs per ounce” for the Company’s total operations for each of the three years in the period ended 31 December 2022, refer to the relevant “AngloGold Ashanti operations - Total” tables below.
Comparison of operating performance on a segment basis in 20192022 with 20182021
Cost of sales
In Continental Africa - Subsidiaries, cost of sales increased by $46$362 million, or four28 percent, to $1,173from $1,300 million in 2019 from $1,1272021 to $1,662 million in 2018.2022. The increase was largely due to an increase in labour and contractors’ costs, commodity prices, consumable stores, services, other charges, fuel and power costs, royalties paid and amortisation of tangible assets. Higher fuel and power costs were mainly due to increasesthe increase in total amortisation, inventory change, rehabilitation and other non-cash costs. In Tanzania, at Geita,the average price of Brent Crude oil, which increased from $71 per barrel in 2021 to $97 per barrel in 2022, a $26, or a 37 percent, per barrel increase. COVID-19 continued to present challenges within the overall logistics sector resulting in higher cost of sales decreased by $41 million, or seven percent,transportation, warehousing and inventory prices, but to $571 milliona lesser extent than in 2019 from $612 million2021.
At Iduapriem in 2018. In Ghana, at Iduapriem, cost of sales increased by $55$76 million, or 2432 percent, to $288from $238 million in 2019 from $2332021 to $314 million in 2018. In Guinea,2022. Cost of sales at Siguiri,Iduapriem increased year-on-year mainly due to higher amortisation of tangible assets as a result of higher production and higher capital expenditure in 2022. This increase in cost of sales was partly offset by lower environmental rehabilitation and other non-cash costs in 2022.
At Obuasi in Ghana, cost of sales increased by $29$102 million, or ten62 percent, to $315from $164 million in 2019 from $2862021 to $266 million in 2018.2022. Cost of sales at Obuasi increased year-on-year mainly due to the resumption of stoping activities during 2022, following the temporary suspension of underground stoping activities in 2021 due to a sill pillar incident in May 2021. Amortisation of heavy mobile equipment increased mainly due to the reset of the useful life of the mining fleet and Mineral Reserve development amortisation increased as the assets were transferred from being under construction to Mineral Reserve development assets in 2022. Royalties paid were higher due to higher ounces of gold sold in 2022. Phase 3 of the Obuasi redevelopment project, which relates principally to capital expenditure to refurbish existing infrastructure around the KMS Shaft, as well as to service the mine in deeper production areas, continued to progress. This increase in cost of sales was partly offset by lower environmental rehabilitation and other non-cash costs, and favourable gold inventory movements due to the lower cost of unsold gold with the timing of gold shipments.
At Siguiri in Guinea, cost of sales increased by $78 million, or 19 percent, from $410 million in 2021 to $488 million in 2022. Cost of sales at Siguiri increased year-on-year mainly due to higher fuel costs and an unfavourable movement in the exchange rate of the Guinean franc against the US dollar. This increase in cost of sales was partly offset by lower environmental rehabilitation and other non-cash costs.
At Geita in Tanzania, cost of sales increased by $106 million, or 22 percent, from $488 million in 2021 to $594 million in 2022. Cost of sales at Geita increased year-on-year mainly due to higher fuel costs, increased engineering costs from the acceleration of HME fleet rebuilds as the open pit mine expanded, as well as higher underground mining contractors’ costs and higher royalties paid. Mineral Reserve development amortisation increased mainly due to a variation in the expenditure pattern which did not occur in 2021. Amortisation of leases increased mainly due to contract modifications in 2022. Amortisation of
tangible assets increased mainly due to a reset of the amortisation drivers early in 2022. This increase in cost of sales was partly offset by lower inventory costs.
In Continental Africa - Joint Ventures, cost of sales decreased by $52$8 million, or 11two percent, to $428from $350 million in 2019 from $4802021 to $342 million in 2018.2022. The decrease was mainly due to favourable inventory movements, lower amortisation of tangible assets, favourable movements in stockpiles and lower royalties paid due to a decrease in ounces sold, partly offset by higher fuel expense. In Mali, at Morila, cost of sales decreased by $6 million, or 14 percent, to $36 millioncosts. The Kibali mine in 2019 from $42 million in 2018. At Sadiola, cost of sales decreased by $11 million, or 17 percent, to $54 million in 2019 from $65 million in 2018. In the DRC at Kibali, cost of sales decreased by $35 million, or nine percent, to $338 millionwas the only operating asset in 2019 from $373 millionAfrica - Joint Ventures in 2018.2022.
In the Americas, cost of sales decreasedincreased by $16$91 million, or two11 percent, tofrom $822 million in 2019 from $8382021 to $913 million in 2018. The decrease was mainly due to the weakening of the local currencies, the Argentinian peso by 72 percent and the Brazilian real by eight percent, against the US dollar. In Brazil, at AngloGold Ashanti Córrego do Sítio Mineração, cost of sales increased by $35 million, or nine percent, to $417 million in 2019 from $382 million in 2018. At Serra Grande, cost of sales increased by $1 million, or one percent, to $130 million in 2019 from $129 million in 2018. In Argentina, at Cerro Vanguardia, cost of sales decreased by $51 million, or 16 percent, to $274 million in 2019 from $325 million in 2018.
In Australia, cost of sales increased by $10 million, or two percent, to $632 million in 2019 from $622 million in 2018.2022. The increase was mainly due to an increase in labour and contractors’ costs, commodity prices, logistics costs, consumable stores, amortisation of right of use assets, services and other charges, power and fuel cost, and write down of inventory, and the strengthening of the Brazilian real against the US dollar. The higher labour and contractors’ costs were mainly due to challenges relating to shortages of critical skills. Higher commodity costs were mainly due to increases in the prices of steel, support and construction materials, explosives, timber and reagents. COVID-19 continued to present challenges within the overall logistics sector resulting in higher cost of transportation, warehousing and inventory change.prices, but to a lesser extent than in 2021. The higher fuel costs were mainly due to the increase in the price of Brent Crude oil. The increase was partiallypartly offset by lower environmental rehabilitation and other non-cash costs in 2022 as compared with 2021 as well as the weakening of the Argentinean peso against the US dollar.
At AGA Mineração in Brazil, cost of sales increased by $42 million, or ten percent, from $435 million in 2021 to $477 million in 2022. Cost of sales at AGA Mineração increased year-on-year mainly due to higher commodity prices (oil, iron ore and construction materials) and higher costs of services, fuel, power and labour, write down of inventory, and a four percent strengthening of the Brazilian real against the US dollar.
At Serra Grande in Brazil, cost of sales increased by $39 million, or 32 percent, from $123 million in 2021 to $162 million in 2022. Cost of sales at Serra Grande increased year-on-year mainly due to higher commodity prices, higher cost of labour, consumables, fuel and power as well as activity changes primarily caused by various production challenges encountered during 2022. Cost of sales was further increased by a four percent strengthening of the Brazilian real against the US dollar.
At Cerro Vanguardia in Argentina, cost of sales increased by $12 million, or five percent, from $261 million in 2021 to $273 million in 2022. Cost of sales at Cerro Vanguardia increased year-on-year mainly due to higher salary increases, fuel costs, higher materials consumption (such as fuel, explosives, and spare parts) because of higher tonnes mined. This increase was partly offset by a decrease37 percent weakening of the Argentinean peso against the US dollar, and favourable inventory change movements.
In the Americas other segment, cost of sales decreased by $2 million, or 67 percent, from $3 million in service-related2021 to $1 million in 2022.
In Australia, cost of sales increased by $43 million, or six percent, from $740 million in 2021 to $783 million in 2022. The increase was mainly due to an increase in mining contractors’ costs, commodity prices, logistics costs, consumable stores, services and theother charges, power and fuel costs, gold in process adjustments, deferred stripping amortisation and amortisation of mining assets. This increase was partly offset by an eight percent weakening of the Australian dollar against the US dollar. The higher mining contractors’ costs were mainly due to cost increases resulting from challenges with shortages of critical skills. Higher commodity costs were mainly due to an increase in the prices of steel, support and construction materials, explosives, timber and reagents. COVID-19 continued to present challenges within the overall logistics sector resulting in higher cost of transportation, warehousing and inventory prices, but to a lesser extent than in 2021. The higher fuel costs were mainly due to the increase in the price of Brent Crude oil. The increase in deferred stripping amortisation was mainly due to the mining and depletion of different ore bodies. The increase in the amortisation of mining assets was mainly due to higher production in 2022 compared with 2021. These increases were partly offset by a decrease in environmental rehabilitation and other non-cash costs in 2022.
At Sunrise Dam in Australia, cost of sales increased by $8$7 million, or threetwo percent, to $318from $364 million in 2019 from $3102021 to $371 million in 2018. 2022. Cost of sales at Sunrise Dam increased year-on-year primarily due to higher mining contractors’ costs (mainly higher cost of labour due to critical skill shortages), and higher fuel and mining costs. This increase was partly offset by a lower cost of gold inventory changes due to timing of gold pours and shipments.
At Tropicana in Australia, cost of sales increased by $4$36 million, or oneten percent, to $297from $346 million in 2019 from $2932021 to $382 million in 2018.2022. Cost of sales at Tropicana increased year-on-year mainly due to higher mining contractors’ costs (mainly higher cost of labour due to critical skill shortages), consumable stores, service costs, fuel and power costs, gold inventory changes, royalties paid and higher Mineral Reserve development and deferred stripping amortisation. This increase was partly offset by lower environmental rehabilitation and other non-cash costs and ore stockpile movements.
Overall, the subsidiaries’ cost of sales increased by $505 million, or 18 percent, from $2,584$2,857 million in 20182021 to $2,626$3,362 million in 2019, which represents a $42 million, or two percent increase.2022. The increase was primarily due to aan increase in cash operating costs by $394 million, or 18 percent, from $2,160 million in 2021 to $2,554 million in 2022, an increase in royalties paid by $23 million, or 14 percent, from $162 million in 2021
to $185 million in 2022, an increase in amortisation of tangible assets of $140 million, or 34 percent, from $411 million in 2021 to $551 million in 2022, an increase in amortisation of right of use assets of $18 million, or 29 percent, from $63 million in 2021 to $81 million in 2022. This increase was partly offset by an inventory change of $36 million, increasefrom a charge of $6 million in 2021 to a credit of $30 million in 2022, and a decrease in environmental rehabilitation and other non-cash costs of $38 million, or 100 percent, from $38 million in 2021 to nil in 2022. The increase in cash operating costs was primarily due to higher labour and contractors’ costs, commodity prices, logistics costs, consumable stores, services and other charges as well as fuel and power costs in 2022 compared to 2021. The increase in royalties paid was mainly due to higher ounces sold in 2022 compared to 2021. The increase in amortisation of tangible assets was mainly due to the Obuasi redevelopment project continuing to ramp up to full production, higher deferred stripping amortisation at Tropicana and Iduapriem, and higher Mineral Reserve development amortisation at Tropicana and Geita in 2022 compared to 2021. The increase in amortisation of right of use assets was mainly due to a resultchange in business strategy whereby certain heavy mobile equipment is leased, mainly at the Brazil operations. The decrease in inventory change was mainly due to lower amortisation of inventories resulting from the suspension of tailings disposal and processing plant effluents treatment. The decrease in environmental rehabilitation and other non-cash costs was mainly due to changes to restoration provision cash flows, inflation rateslower costs and discount rates.rates in 2022 compared to 2021.
All-in sustaining costs per ounce
In Continental Africa - Subsidiaries, all-in sustaining costs increased by $6$27 per ounce, or onetwo percent, to $947from $1,264 per ounce in 2019 from $9412021 to $1,291 per ounce in 2018.2022. This increase was mainly due to an increase in cost of sales at Geita. Theand an increase was partially offset by the decreased spending in sustaining capital expenditure, at Iduapriem andpartly offset by an increase in ounces of 30,000gold sold. For a discussion of the increase in cost of sales in Africa - Subsidiaries during 2022, see “Item 5A: Operating Results—Comparison of operating performance on a segment basis in 2022 with 2021—Cost of sales”. Sustaining capital expenditure in Africa - Subsidiaries increased as the region continued to implement its reinvestment programme. At Iduapriem in Ghana, sustaining capital expenditure decreased year-on-year mainly due to lower pre-stripping expenditure in Cut 2. At Obuasi in Ghana, sustaining capital expenditure increased year-on-year mainly due to the ongoing progress of Phase 3 of the Obuasi redevelopment project, which relates principally to capital expenditure to refurbish existing infrastructure around the KMS Shaft, as well as to service the mine in deeper production areas. At Siguiri in Guinea, sustaining capital expenditure increased year-on-year mainly due to increased stay-in-business capital expenditure in 2022. At Geita, sustaining capital expenditure increased year-on-year mainly due to higher deferred stripping activities, stay-in-business capital expenditure and Mineral Reserve development capital expenditure. Gold sold in Africa - Subsidiaries increased by 221,000 ounces, or 21 percent, from 1.060 million ounces in gold sold (excluding pre-production ounces)2021 to 1.281 million ounces in 2022. The increase was largely due to higher production across all operations in Africa other than Kibali. For a discussion of the increase in production at the Africa operations (other than Kibali) during 2022, see “Item 5A: Operating Results—Key factors affecting results—Production in 2022”.
In Continental Africa - Joint Ventures, all-in sustaining costs decreasedincreased by $53$123 per ounce, or six14 percent, to $767from $856 per ounce in 2019 from $8202021 to $979 per ounce in 2018.2022. This increase was mainly due to an increase in sustaining capital expenditure and lower ounces of gold sold, partly offset by lower cost of sales. For a discussion of the decrease in cost of sales in Africa - Joint Ventures during 2022, see “Item 5A: Operating Results—Comparison of operating performance on a segment basis in 2022 with 2021—Cost of sales”. Sustaining capital expenditure in Africa - Joint Ventures increased mainly due to higher stay-in-business capital expenditure. Gold sold in Africa - Joint Ventures decreased by 35,000 ounces, or ten percent, from 367,000 ounces in 2021 to 332,000 ounces in 2022. The decrease was mainly due to lower production from Kibali. For a discussion of the decrease in cost of sales and a decreaseproduction at Kibali during 2022, see “Item 5A: Operating Results—Key factors affecting results—Production in sustaining capital expenditure at Kibali. This decrease2022”.The Kibali mine in the DRC was partially offset by a decreasethe only operating asset in total amortisation and a decrease of 17,000 ouncesAfrica - Joint Ventures in gold sold.2022.
In the Americas, all-in sustaining costs increased by $177$136 per ounce, or 219 percent, to $1,032from $1,582 per ounce in 2019 from $8552021 to $1,718 per ounce in 2018.2022. This increase was mainly due to a decrease of 83,000 ounces in gold sold (excluding pre-production ounces) and a decrease of total amortisation at Cerro Vanguardia and Serra Grande. Thean increase was partially offset by a decrease in cost of sales, and an overall decrease of spending inpartly offset by lower sustaining capital expenditure.expenditure and higher ounces of gold sold. For a discussion of the increase in cost of sales in the Americas during 2022, see “Item 5A: Operating Results—Comparison of operating performance on a segment basis in 2022 with 2021—Cost of sales”. Sustaining capital expenditure in the Americas decreased as the region had lower investment in TSF projects in 2022 as compared to 2021. At AGA Mineração in Brazil, sustaining capital expenditure increased year-on-year mainly due to higher Mineral Reserve development expenditures. At Serra Grande in Brazil, sustaining capital expenditure decreased year-on-year mainly due to lower TSF expenditures, partly offset by higher Mineral Reserve development expenditures. At Cerro Vanguardia in Argentina, sustaining capital expenditure decreased year-on-year mainly due to lower expenditure on TSFs in 2022, partly offset by higher deferred stripping capital and Mineral Reserve development expenditures in 2022. Gold sold in the Americas increased by 4,000 ounces, or one percent, from 561,000 ounces in 2021 to 565,000 ounces in 2022. This increase was mainly due to higher production from Serra Grande and Cerro Vanguardia, partly offset by lower production from AGA Mineração. For a discussion of the increase in production at the Americas operations during 2022, see “Item 5A: Operating Results—Key factors affecting results—Production in 2022”.
In Australia, all-in sustaining costs decreased by $48$155 per ounce, or ten percent, from $1,500 per ounce in 2021 to $1,345 per ounce in 2022. The decrease was mainly due to lower sustaining capital expenditure and an increase in ounces of gold sold, partly offset by an increase in cost of sales. For a discussion of the increase in cost of sales in Australia during 2022, see “Item 5A: Operating Results—Comparison of operating performance on a segment basis in 2022 with 2021—Cost of sales”. Sustaining capital expenditure decreased in Australia mainly due to lower stripping and pre-stripping expenditure. At Sunrise
Dam in Australia, sustaining capital expenditure increased year-on-year mainly due to the camp extension. At Tropicana in Australia, sustaining capital expenditure decreased year-on-year mainly due to lower deferred stripping and pre-stripping expenditure due to mining different ore bodies and at different phases to 2021. Gold sold in Australia increased by 44,000 ounces, or 9 percent, from 495,000 ounces in 2021 to 539,000 ounces in 2022. This increase was mainly due to higher production at Sunrise Dam and Tropicana. For a discussion of the increase in production at the Australia operations during 2022, see “Item 5A: Operating Results—Key factors affecting results—Production in 2022”.
All-in costs per ounce
In Africa - Subsidiaries, all-in costs decreased by $82 per ounce, or five percent, to $990from $1,516 per ounce in 2019 from $1,0382021 to $1,434 per ounce in 2018.2022. This decrease was mainly due to an increase in total amortisationgold sold, lower non-sustaining project capital expenditure and lower care and maintenance costs, partly offset by higher all-in sustaining costs. At Obuasi in Ghana, Phase 3 of the Obuasi redevelopment project, which relates principally to capital expenditure to refurbish existing infrastructure around the KMS Shaft, as well as to service the mine in deeper production areas, continues to progress. Care and maintenance activities of $45 million incurred in 2021 at Sunrise Damthe Obuasi mine during the voluntary suspension of underground mining between May and Tropicana andOctober 2021 following a decreasesill pillar incident were not repeated in spending in sustaining2022. Non-sustaining project capital expenditure at Sunrise DamObuasi was lower mainly due to different project scopes and Tropicana. Thecash flows. This decrease was partiallylargely offset by anhigher non-sustaining project capital expenditure at Iduapriem in Ghana mainly due to increased TSF investment in 2022. For a discussion of the increase in costounces of sales.
gold sold in Africa - Subsidiaries during 2022, see “Item 5A: Operating Results—Comparison of operating performance on a segment basis in 2022 with 2021—All-in sustaining costs per ounceounce”.
In Continental Africa - Subsidiaries,Joint Ventures, all-in costs increased by $138$175 per ounce, or 1319 percent, to $1,237from $900 per ounce in 2019 from $1,0992021 to $1,075 per ounce in 2018.2022. This increase was mainly due to an increase in all-in sustaining costs and anhigher non-sustaining project capital expenditure, and lower gold sold. For a discussion of the decrease in ounces of gold sold in Africa - Joint Ventures during 2022, see “Item 5A: Operating Results—Comparison of operating performance on a segment basis in 2022 with 2021—All-in sustaining costs per ounce”. The Kibali mine in the DRC was the only operating asset in Africa - Joint Ventures in 2022.
In the Americas, all-in costs decreased by $83 per ounce, or 4 percent, from $1,858 per ounce in 2021 to $1,775 per ounce in 2022. This decrease was mainly due to higher ounces of gold sold and lower non-sustaining exploration and study cost expenditure at the Colombian and Nevada growth projects, partly offset by higher all-in sustaining costs. For a discussion of the increase in ounces of gold sold in the Americas during 2022, see “Item 5A: Operating Results—Comparison of operating performance on a segment basis in 2022 with 2021—All-in sustaining costs per ounce”.
In Australia, all-in costs decreased by $94 per ounce, or 5 percent, from $1,725 per ounce in 2021 to $1,631 per ounce in 2022. This decrease was mainly due to lower all-in sustaining costs, lower non-sustaining exploration and study costs relating to growth deposits at Sunrise Dam and Tropicana, and higher ounces of gold sold, partly offset by higher non-sustaining project capital expenditure at Obuasi partiallyTropicana on the Havana cutback project. For a discussion of the increase in ounces of gold sold in Australia during 2022, see “Item 5A: Operating Results—Comparison of operating performance on a segment basis in 2022 with 2021—All-in sustaining costs per ounce”.
Total cash costs per ounce
The currencies of Argentina and Australia were, on average, weaker against the US dollar during 2022 as compared to 2021, which positively impacted total cash costs per ounce for 2022. This positive impact was partly offset by the 30,000-ouncecurrency of Brazil being, on average, stronger against the US dollar during 2022 as compared to 2021. Total production in 2022 was higher as compared to 2021, which positively impacted total cash costs per ounce for 2022. For a discussion of production during 2022, see “Item 5A: Operating Results—Key factors affecting results—Production in 2022”.
In Africa - Subsidiaries, total cash costs per ounce increased by $32 per ounce, or three percent, from $991 per ounce in 2021 to $1,023 per ounce in 2022. The increase was mainly due to an increase in total cash costs, partly offset by a 244,000 ounce increase in production.
At Iduapriem in Ghana, total cash costs per ounce decreased by $111 per ounce, or ten percent, from $1,081 per ounce in 2021 to $970 per ounce in 2022. Total cash costs per ounce decreased year-on-year mainly due to higher production and favourable movements in stockpiles, partly offset by an increase in fuel costs and higher royalties paid.
At Obuasi in Ghana, total cash costs per ounce decreased by $198 per ounce, or 18 percent, from $1,112 per ounce in 2021 to $914 per ounce in 2022. Total cash costs per ounce decreased year-on-year mainly due to higher production.
At Siguiri in Guinea, total cash costs per ounce increased by $119 per ounce, or ten percent, from $1,200 per ounce in 2021 to $1,319 per ounce in 2022. Total cash costs per ounce increased year-on-year mainly due to higher fuel costs and an unfavourable movement in the exchange rate of the Guinean franc against the US dollar, partly offset by an increase in production.
At Geita in Tanzania, total cash costs per ounce increased by $122 per ounce, or 15 percent, from $822 per ounce in 2021 to $944 per ounce in 2022. Total cash costs per ounce increased year-on-year mainly due to higher fuel costs, increased engineering costs from the heavy mining equipment maintenance as the open-pit mine expanded, as well as higher underground mining contractors’ costs and higher royalties paid. This increase was partly offset by higher gold sold (excluding pre-production ounces).production.
In Continental Africa - Joint Ventures, all-intotal cash costs decreasedper ounce increased by $61$78 per ounce, or seven12 percent, to $785from $647 per ounce in 2019 from $8462021 to $725 per ounce in 2018.2022. The increase was mainly due to lower production and higher fuel costs, partly offset by favourable movements in stockpiles and lower royalties paid. The Kibali mine in the DRC was the only operating asset in Africa - Joint Ventures in 2022.
In the Americas, total cash costs per ounce increased by $157 per ounce, or 17 percent, from $921 per ounce in 2021 to $1,078 per ounce in 2022. The increase was mainly due to an increase in total cash costs, partly offset by a 10,000 ounce increase in production.
At AGA Mineração in Brazil, total cash costs per ounce increased by $230 per ounce, or 27 percent, from $858 per ounce in 2021 to $1,088 per ounce in 2022 . Total cash costs per ounce were higher year-on-year mainly due to lower production, higher fuel costs, lower by-product revenue, unfavourable movement in inventories, repair costs incurred in the second half of 2022 due to extreme weather earlier in 2022, and an unfavourable movement in the exchange rate of the Brazilian real against the US dollar.
At Serra Grande in Brazil, total cash costs per ounce increased by $163 per ounce, or 14 percent, from $1,192 per ounce in 2021 to $1,355 per ounce in 2022. Total cash costs per ounce increased year-on-year mainly due to higher fuel costs, higher royalties paid and an unfavourable movement in the exchange rate of the Brazilian real against the US dollar, partly offset by higher production.
At Cerro Vanguardia in Argentina, total cash costs per ounce increased by $19 per ounce, or two percent, from $894 per ounce in 2021 to $913 per ounce in 2022. Total cash costs per ounce were higher year-on-year mainly due to higher fuel costs, higher materials consumption (such as fuel, explosives, and spare parts) as a result of higher tonnes mined and lower by-product revenue due to lower silver sales. This increase was partly offset by higher gold production and a favourable movement in the exchange rate of the Argentinean peso against the US dollar.
In Australia, total cash costs per ounce decreased by $39 per ounce, or three percent, from $1,196 per ounce in 2021 to $1,157 per ounce in 2022, primarily due to a 44,000 ounce increase in production, partly offset by an increase in total cash costs.
At Sunrise Dam in Australia, total cash costs per ounce increased by $81 per ounce, or six percent, from $1,321 per ounce in 2021 to $1,402 per ounce in 2022. Total cash costs per ounce were higher year-on-year primarily due to higher fuel and mining costs, partly offset by a favourable movement in the exchange rate of the Australian dollar against the US dollar.
At Tropicana in Australia, total cash costs per ounce decreased by $106 per ounce, or 11 percent, from $987 per ounce in 2021 to $881 per ounce in 2022. Total cash costs per ounce decreased year-on-year mainly due to higher gold production, lower mining costs related to an increase in ore mining volumes in the Boston Shaker open pit and underground mine, a favourable movement in ore stockpiles and a favourable movement in the exchange rate of the Australian dollar against the US dollar, partly offset by higher fuel costs and higher royalties paid.
Overall the subsidiaries’ total cash costs per ounce increased by $49, or five percent, from $1,017 per ounce in 2021 to $1,066 per ounce in 2022. The increase was mainly due to an increase in total cash costs partly offset by a 298,000 ounce increase in production.
Comparison of operating performance on a segment basis in 2021 with 2020
Cost of sales
In Africa - Subsidiaries, cost of sales decreased by $62 million, or five percent, from $1,362 million in 2020 to $1,300 million in 2021. The decrease was mainly due to a significant amount of waste stripping capitalised, a decrease in royalties paid due to lower ounces of gold sold in 2021 and improved efficiencies, partly offset by an increase in labour and contractors’ costs, commodity prices, logistics costs, consumable stores, environmental rehabilitation and other non-cash costs, amortisation of right of use assets, services and other charges, power and fuel costs and higher ore stockpile adjustments. COVID-19 presented challenges within the overall logistics sector resulting in higher cost of transportation, warehousing and inventory prices. Higher fuel and power costs were mainly due to the increase in the average price of Brent Crude oil, which increased from $42 per barrel in 2020 to $71 per barrel in 2021, a $29, or a 69 percent, per barrel increase.
At Iduapriem in Ghana, cost of sales decreased by $42 million, or 15 percent, from $280 million in 2020 to $238 million in 2021. Cost of sales at Iduapriem decreased year-on-year mainly due to a significant amount of waste stripping capitalised at
Teberebie Cut 2 in 2021 compared to 2020, together with a decrease in royalties paid due to lower ounces of gold sold and an inventory change due to ore stockpile movements.
At Obuasi in Ghana, cost of sales in 2021 remained unchanged from 2020 at $164 million. Phase 1 of the Obuasi redevelopment project commenced commercial production from 1 October 2020. Underground mining activities were voluntarily suspended between 18 May 2021 and 15 October 2021 at the Obuasi mine, following a sill pillar incident. From 15 October 2021, underground mining resumed to replenish the run-of-mine stockpile without corresponding gold production and related cost of sales. Since the voluntary suspension of underground mining activities, care and maintenance costs of $45 million were incurred at Obuasi during 2021.
At Siguiri in Guinea, cost of sales increased by $33 million, or nine percent, from $377 million in 2020 to $410 million in 2021. Cost of sales at Siguiri increased year-on-year mainly as a result of additional volumes of ore mined resulting in higher operating costs, increases on fuel and reagent costs, and higher royalties paid from additional volumes sold in 2021.
At Geita in Tanzania, cost of sales decreased by $54 million, or ten percent, from $542 million in 2020 to $488 million in 2021. Cost of sales at Geita decreased year-on-year mainly due to lower royalties paid and improved efficiencies in that more open pit tonnes were mined in 2021 at a lower rate per tonne than in 2020. This decrease was partly offset by lower grades as well as the depletion of ore stockpiles in 2021 compared to an increase in ore stockpiles during 2020.
In Africa - Joint Ventures, cost of sales increased by $10 million, or three percent, from $340 million in 2020 to $350 million in 2021. The increase was mainly due to lower open-pit recovered grades, unfavourable movements in stockpiles, higher royalties paid due to an increase in the average gold price received, and additional reagent consumption costs, as compared to 2020. The Kibali mine in the DRC was the only operating asset in Africa - Joint Ventures in 2021.
In the Americas, cost of sales increased by $58 million, or eight percent, from $764 million in 2020 to $822 million in 2021. The increase was mainly due to an increase in labour and contractors’ costs, commodity prices, logistics costs, consumable stores, amortisation of right of use assets, services and other charges, power and fuel cost, write down of inventory and environmental rehabilitation and other non-cash costs. The higher labour and contractors’ costs were mainly due to COVID-19 related cost increases resulting from challenges with travel restrictions and shortages of critical skills. Higher commodity costs were mainly due to an increase in the prices of steel, support and construction materials, lime and other reagents. COVID-19 presented challenges within the overall logistics sector resulting in higher cost of transportation, warehousing and inventory prices. The higher fuel costs were mainly due to the increase in the price of Brent Crude oil. The increase in cost of sales was partly offset by lower royalties paid due to lower ounces of gold sold in 2021 as compared to 2020, lower amortisation of tangible assets due to lower ounces of gold produced in 2021 as compared to 2020 as well as the weakening of the local currencies against the US dollar.
At AGA Mineração in Brazil, cost of sales increased by $43 million, or 11 percent, from $392 million in 2020 to $435 million in 2021. Cost of sales at AGA Mineração increased year-on-year mainly due to higher commodity prices (oil, iron ore and construction materials) and higher costs of services and labour. This increase was partly offset by lower royalties paid due to lower ounces of gold sold and a five percent weakening of the Brazilian real against the US dollar.
At Serra Grande in Brazil, cost of sales increased by $22 million, or 22 percent, to $123 million in 2021 from $101 million in 2020. Cost of sales at Serra Grande increased year-on-year mainly due to higher commodity prices and higher cost of services and labour as well as inefficiencies primarily caused by higher absenteeism due to COVID-19 and various production challenges encountered during 2021. This increase was partly offset by a five percent weakening of the Brazilian real against the US dollar.
At Cerro Vanguardia in Argentina, cost of sales decreased by $8 million, or three percent, from $269 million in 2020 to $261 million in 2021. Cost of sales at Cerro Vanguardia decreased year-on-year mainly due to a 35 percent weakening of the Argentinean peso against the US dollar, and favourable inventory change movements. This decrease was partly offset by higher salary increases, additional costs relating to COVID-19 tests and other related medical costs in line with COVID-19 protocols and higher materials consumption (such as fuel, explosives and spare parts) as a result of higher tonnes mined.
In the Americas other segment, cost of sales increased by $1 million, or 50 percent, from $2 million in 2020 to $3 million in 2021.
In Australia, cost of sales increased by $35 million, or five percent, from $705 million in 2020 to $740 million in 2021. The increase was mainly due to an increase in labour and contractors’ costs, commodity prices, logistics costs, consumable stores, amortisation of right of use assets, services and other charges, power and fuel costs, ore stockpile adjustments and the strengthening of the Australian dollar against the US dollar by eight percent. The higher labour and contractors’ costs were mainly due to COVID-19 related cost increases resulting from challenges with travel restrictions and shortages of critical skills. Higher commodity costs were mainly due to an increase in the prices of steel, support and construction materials, lime and other reagents. COVID-19 presented challenges within the overall logistics sector resulting in higher cost of transportation, warehousing and inventory prices. The higher fuel costs were mainly due to the increase in the price of Brent Crude oil. This
increase in cost of sales was partly offset by a decrease in environmental rehabilitation and other non-cash costs, amortisation of waste stripping and royalties paid.
At Sunrise Dam in Australia, cost of sales increased by $22 million, or six percent, from $342 million in 2020 to $364 million in 2021. Cost of sales at Sunrise Dam increased year-on-year primarily due to higher mining costs (mainly higher cost of labour due to critical skill shortages), partly offset by lower royalties paid.
At Tropicana in Australia, cost of sales increased by $8 million, or two percent, from $338 million in 2020 to $346 million in 2021. Cost of sales at Tropicana increased year-on-year mainly due to higher mining costs (mainly higher cost of labour due to critical skill shortages), inventory movements and the impact of higher underground and open pit mining costs.
Overall the subsidiaries’ cost of sales increased by $28 million, or one percent, from $2,829 million in 2020 to $2,857 million in 2021. The increase was primarily due to an increase in cash operating costs by $148 million, or seven percent, from $2,012 million in 2020 to $2,160 million in 2021, an increase in environmental rehabilitation and other non-cash costs by $6 million, or 19 percent, from $32 million in 2020 to $38 million in 2021, an increase in amortisation of right of use assets by $16 million, or 34 percent, from $47 million in 2020 to $63 million in 2021. This increase was partly offset by a decrease in royalties paid by $19 million, or ten percent, from $181 million in 2020 to $162 million in 2021, a decrease in amortisation of tangible assets of $115 million, or 22 percent, from $526 million in 2020 to $411 million in 2021 and an inventory change of $8 million, or 57 percent, from a charge of $14 million in 2020 to a charge of $6 million in 2021. The increase in cash operating costs was mainly due to higher labour and contractors’ costs, commodity prices, logistics costs, consumable stores, COVID-19 pandemic related expenditure, services and other charges as well as fuel and power costs. The increase in environmental rehabilitation and other non-cash costs was mainly due to the changes to restoration provision cash flows, cost increases and discount rates in 2021 compared to 2020. The increase in amortisation of right of use assets was mainly due to an increase in number of right of use assets in 2021 as compared to 2020. The decrease in royalties paid was mainly due to a decrease in ounces of gold sold in 2021 as compared to 2020. The decrease in amortisation of tangible assets was mainly due to lower amortisation of waste stripping and lower gold production in 2021 as compared to 2020.
All-in sustaining costs per ounce
In Africa - Subsidiaries, all-in sustaining costs increased by $262 per ounce, or 26 percent, from $1,002 per ounce in 2020 to $1,264 per ounce in 2021. This increase was mainly due to an increase in cost of sales, an increase in sustaining capital expenditure and a 17,000-ouncedecrease in ounces of gold sold. For a discussion of the increase in cost of sales in Africa - Subsidiaries during 2021, see “Item 5A: Operating Results—Comparison of operating performance on a segment basis in 2021 with 2020—Cost of sales”. Sustaining capital expenditure in Africa - Subsidiaries increased as the region continued to implement its re-investment programme. At Iduapriem in Ghana, sustaining capital expenditure increased year-on-year mainly due to higher pre-stripping activities and stay-in-business capital expenditure. At Obuasi in Ghana, the Obuasi redevelopment project led to an increase in sustaining capital expenditure as Phase 2 of the project was completed at the end of December 2021. At Siguiri in Guinea, sustaining capital expenditure increased year-on-year mainly due to increased stay-in-business capital expenditure. At Geita in Tanzania, sustaining capital expenditure increased year-on-year mainly due to an increase in deferred stripping and Mineral Reserve development expenditure as the underground portal development at Geita Hill East progressed according to plan. Gold sold in Africa - Subsidiaries decreased by 189,000 ounces, or 15 percent, from 1.249 million ounces in 2020 to 1.060 million ounces in 2021. The decrease was mainly due to lower production from Iduapriem and Geita, partly offset by higher production from Siguiri. For a discussion of the decrease in production at the Africa operations (other than Kibali) during 2021, see “Item 5A: Operating Results—Key factors affecting results—Production in 2021”.
In Africa - Joint Ventures, all-in sustaining costs increased by $46 per ounce, or six percent, from $810 per ounce in 2020 to $856 per ounce in 2021. This increase was mainly due to an increase in cost of sales and an increase in sustaining capital expenditure, partly offset by higher ounces of gold sold. For a discussion of the increase in cost of sales in Africa - Joint Ventures during 2021, see “Item 5A: Operating Results—Comparison of operating performance on a segment basis in 2021 with 2020—Cost of sales”. Sustaining capital expenditure in Africa - Joint Ventures increased mainly due to higher deferred stripping. The increase was partly offset by an increase in gold sold andin Africa - Joint Ventures by 2,000 ounces, or one percent, from 365,000 ounces in 2020 to 367,000 ounces in 2021. The marginal increase was mainly due to a decreasemarginally higher production from Kibali. For a discussion of the marginal increase in major project spendingproduction at Kibali.Kibali during 2021, see “Item 5A: Operating Results—Key factors affecting results—Production in 2021”. The Kibali mine in the DRC was the only operating asset in Africa - Joint Ventures in 2021.
In the Americas, all-in sustaining costs increased by $251$584 per ounce, or 58 percent, from $1,003 per ounce in 2020 to $1,587 per ounce in 2021. This increase was mainly due to an increase in cost of sales, an increase in sustaining capital expenditure and lower ounces of gold sold. For a discussion of the increase in cost of sales in the Americas during 2021, see “Item 5A: Operating Results—Comparison of operating performance on a segment basis in 2021 with 2020—Cost of sales”. Sustaining capital expenditure in the Americas increased as the region continued to implement its re-investment programme and the transition of the TSFs in Brazil to dry-stacked structures to comply with new legal requirements. At AGA Mineração and Serra Grande in Brazil, sustaining capital expenditure increased year-on-year mainly due to higher mine development and TSF expenditures. At Cerro Vanguardia in Argentina, sustaining capital expenditure increased year-on-year mainly due to higher expenditure on TSFs and higher deferred stripping capital. Gold sold in the Americas decreased by 103,000 ounces, or 16
percent, from 664,000 ounces in 2020 to 561,000 ounces in 2021. This decrease was mainly due to lower production from all of the Americas operations. For a discussion of the decrease in production at the Americas operations during 2021, see “Item 5A: Operating Results—Key factors affecting results—Production in 2021”.
In Australia, all-in sustaining costs increased by $275 per ounce, or 22 percent, from $1,225 per ounce in 2020 to $1,500 per ounce in 2021. This increase was mainly due to an increase in cost of sales, an increase in sustaining capital expenditure and lower ounces of gold sold. For a discussion of the increase in cost of sales in Australia during 2021, see “Item 5A: Operating Results—Comparison of operating performance on a segment basis in 2021 with 2020—Cost of sales”. Sustaining capital expenditure increased in Australia as Mineral Reserve development, deferred stripping and other stay-in-business capital expenditure increased. At Sunrise Dam in Australia, sustaining capital expenditure increased year-on-year mainly due to an increase in Mineral Reserve development. At Tropicana in Australia, sustaining capital expenditure increased year-on-year mainly due to higher deferred stripping, Mineral Reserve development and other stay-in-business capital expenditure. Gold sold in Australia decreased by 62,000 ounces, or 11 percent, from 557,000 ounces in 2020 to 495,000 ounces in 2021. This decrease was mainly due to lower production from Sunrise Dam and Tropicana. For a discussion of the decrease in production at the Australia operations during 2021, see “Item 5A: Operating Results—Key factors affecting results—Production in 2021”.
All-in costs per ounce
In Africa - Subsidiaries, all-in costs increased by $323 per ounce, or 27 percent, to $1,183from $1,193 per ounce in 2019 from $9322020 to $1,516 per ounce in 2018.2021. This increase was mainly due to an increase in all-in sustaining costs, higher care and maintenance expenditure and higher non-sustaining project capital expenditure. At Obuasi in Ghana, underground mining activities were voluntarily suspended between 18 May 2021 and 15 October 2021, following a sill pillar incident. From 15 October 2021, underground mining resumed to replenish the run-of-mine stockpile without corresponding gold production. Since the voluntary suspension of underground mining activities, care and maintenance costs of $45 million were incurred at Obuasi during 2021. Non-sustaining capital expenditure at Geita in Tanzania increased mainly due to an increase in non-sustaining exploration and studyproject capital with the start of the Nyamulilima project. For a discussion of the decrease in ounces of gold sold in Africa - Subsidiaries during 2021, see “Item 5A: Operating Results—Comparison of operating performance on a segment basis in 2021 with 2020—All-in sustaining costs per ounce”.
In Africa - Joint Ventures, all-in costs increased by $76 per ounce, or nine percent, from $824 per ounce in 2020 to $900 per ounce in 2021. This increase was mainly due to an increase in all-in sustaining costs and higher non-sustaining project capital expenditure . For a discussion of the 83,000-ounceincrease in ounces of gold sold in Africa - Joint Ventures during 2021, see “Item 5A: Operating Results—Comparison of operating performance on a segment basis in 2021 with 2020—All-in sustaining costs per ounce”. The Kibali mine in the DRC was the only operating asset in Africa - Joint Ventures in 2021.
In the Americas, all-in costs increased by $603 per ounce, or 58 percent, from $1,032 per ounce in 2020 to $1,635 per ounce in 2021. This increase was mainly due to an increase in closure and social responsibility costs not related to current operations. For a discussion of the decrease in ounces of gold sold (excluding pre-production ounces)in the Americas during 2021, see “Item 5A: Operating Results—Comparison of operating performance on a segment basis in 2021 with 2020—All-in sustaining costs per ounce”.
In Australia, all-in costs increased by $2$369 per ounce, to $1,072or 27 percent, from $1,356 per ounce in 2019 from $1,0702020 to $1,725 per ounce in 20182021. This increase was mainly due to an increase in majorall-in sustaining costs, higher non-sustaining project spendingcapital expenditure at Sunrise Dam on the Golden Delicious open pit growth project and at Tropicana an increase inon the Havana cutback project, and higher non-sustaining exploration and study costs relating to growth deposits at Sunrise Dam and Tropicana andTropicana. For a 1,000-ouncediscussion of the decrease in ounces of gold sold. The increase was partially offset bysold in Australia during 2021, see “Item 5A: Operating Results—Comparison of operating performance on a decreasesegment basis in all-in2021 with 2020—All-in sustaining costs.costs per ounce”.
Total cash costs per ounce
The currencies of Argentina Australia and Brazil were, on average, weaker against the US dollar during 20192021 as compared to 20182020, which positively impacted total cash costs per ounce for 2019.2021. This positive impact was partly offset by the currency of Australia being, on average, stronger against the US dollar during 2021 as compared to 2020. Total production in 2021 was lower as compared to 2020, which negatively impacted total cash costs per ounce for 2021. For a discussion of production during 2021, see “Item 5A: Operating Results—Key factors affecting results—Production in 2021”.
In Continental Africa - Subsidiaries, total cash costs per ounce decreasedincreased by $12,$150 per ounce, or one18 percent, to $801from $841 per ounce in 2019 from $8132020 to $991 per ounce in 2018.2021. The decreaseincrease was mainly due to a 31,000-ounce increase in production (excluding pre-production ounces). The decrease was partially offset by an increase in total cash costs.
In Tanzania, at Geita, total cash costs per185,000 ounce decreased by $109, or 14 percent, to $695 per ounce in 2019 from $804 per ounce in 2018. The decrease was mainly due to the decrease in total cash costs and a 40,000-ounce increase in production (excluding pre-production ounces).
In Ghana, at Iduapriem, total cash costs per ounce increased by $11, or one percent, to $815 per ounce in 2019 compared to $804 per ounce in 2018 mainly due to an increase in total cash costs. The increase was partially offset by a 21,000-ounce increase in production.
In Guinea, at Siguiri, total cash costs per ounce increased by $247, or 29 percent, to $1,091 per ounce in 2019 from $844 per ounce in 2018 mainly due to a 29,000-ounce decrease in production and an increase in total cash costs.
At Iduapriem in Ghana, total cash costs per ounce increased by $350 per ounce, or 48 percent, from $731 per ounce in 2020 to $1,081 per ounce in 2021. Total cash costs per ounce increased year-on-year mainly due to lower production and ore stockpile movements. This increase was partly offset by a significant amount of waste stripping capitalised at Teberebie Cut 2 in 2021 compared to 2020, together with a decrease in royalties paid due to lower volumes sold.
At Obuasi in Ghana, total cash costs per ounce decreased by $195 per ounce, or 15 percent, from $1,307 per ounce in 2020 to $1,112 per ounce in 2021. Total cash costs per ounce decreased year-on-year mainly due to the ramp-up of Phase 2 production, despite the temporary suspension of underground stoping activities in 2021 due to a sill pillar incident in May 2021. During the temporary suspension period, care and maintenance costs of $45 million were incurred until underground stoping activities resumed in mid-October 2021.
At Siguiri in Guinea, total cash costs per ounce decreased by $93 per ounce, or seven percent, from $1,293 per ounce in 2020 to $1,200 per ounce in 2021. Total cash costs per ounce decreased year-on-year mainly as a result of higher production, partly offset by higher operating costs, increases on fuel and reagent costs, and higher royalties paid from additional volumes sold in 2021.
At Geita in Tanzania, total cash costs per ounce increased by $181 per ounce, or 28 percent, from $641 per ounce in 2020 to $822 per ounce in 2021. Total cash costs per ounce increased year-on-year mainly due to lower grades, together with the depletion of ore stockpiles in 2021 compared to an increase in ore stockpiles during 2020. This increase was partly offset by lower royalties paid and improved efficiencies in that more open pit tonnes were mined in 2021 at a lower rate per tonne than in 2020.
In Continental Africa - Joint Ventures, total cash costs per ounce decreased by $23, or three percent, to $657 per ounce in 2019 from $680 per ounce in 2018. The decrease was mainly due to a decrease in total cash costs. The decrease was partially offset by a 7,000-ounce decrease in production.
In Mali, at Morila, total cash costs per ounce increased by $60, or five percent, to $1,205$18 per ounce, in 2019 from $1,145 per ounce in 2018. The increase was mainly due to a 3,000-ounce decrease in production. The increase was partially offset by a decrease in total cash costs. At Sadiola, total cash costs per ounce increased by $28, or three percent, from $938$629 per ounce in 20182020 to $966$647 per ounce in 2019.2021. The increase was mainly due to an 8,000-ounce decreaseincrease in production partiallytotal cash costs, partly offset by a decrease1,000 ounce increase in total cash costs.
In the DRC, at Kibali, totalproduction.Total cash costs per ounce decreased by $28, or five percent, to $572 per ounceincreased year-on-year mainly as a result of lower open-pit recovered grades, unfavourable movements in 2019 from $600 per ounce in 2018. The decrease was mainlystockpiles, higher royalties paid due to a 3,000-ouncean increase in productionthe average gold price received, and a decreaseadditional reagent consumption, as compared to 2020. The Kibali mine in total cash costs.the DRC was the only operating asset in Africa - Joint Ventures in 2021.
In the Americas, total cash costs per ounce increased by $112,$200 per ounce, or 1828 percent, to $736from $721 per ounce in 2019 from $6242020 to $921 per ounce in 2018.2021. The increase was mainly due to a 66,000-ounce90,000 ounce decrease in production and a decrease in by-product revenue. Thean increase was partially offset by a decrease in total cash costs.
In Brazil, at AngloGold Ashanti Córrego do SítioAGA Mineração, total cash costs per ounce increased by $59,$111 per ounce, or eight15 percent, to $782from $747 per ounce in 2019 from $7232020 to $858 per ounce in 2018 primarily2021. Total cash costs per ounce increased year-on-year mainly due to anlower production and higher commodity prices (oil, iron ore and construction materials) and higher costs of services and labour. This increase in total cash costswas partly offset by higher sulphuric acid by-product revenue and a 2,000-ounce decrease in production (excluding pre-production ounces). lower royalties paid due to lower volumes sold.
At Serra Grande, total cash costs per ounce increased by $47,$527 per ounce, or seven79 percent, to $707from $665 per ounce in 2019 from $6602020 to $1,192 per ounce in 2018 primarily2021. Total cash costs per ounce increased year-on-year mainly due to an increase in total cash costslower production, higher commodity prices (oil, iron ore and 7,000-ounce decrease inconstruction materials) and higher cost of services and labour as well as inefficiencies primarily caused by higher absenteeism due to COVID-19 and various production (excluding pre-production ounces).challenges encountered during 2021.
In Argentina, at Cerro Vanguardia, total cash costs per ounce increased by $197,$195 per ounce, or 4128 percent, to $673from $699 per ounce in 2019 from $4762020 to $894 per ounce in 2018 primarily2021. Total cash costs per ounce increased year-on-year mainly due to salary increases, additional costs relating to COVID-19 tests and other related medical costs in line with COVID-19 protocols, higher commodity prices and higher materials consumption (such as fuel, explosives and spare parts) as a 57,000-ounce decrease in production and a decrease in by-product revenue.result of higher tonnes mined. The increase was partiallypartly offset by a decrease in total cash costs.the weakening of the Argentinean peso against the US dollar and higher by-product revenue derived from higher ounces of silver sold.
In Australia, total cash costs per ounce decreasedincreased by $32,$228 per ounce, or four24 percent, to $730from $968 per ounce in 2019 from $7622020 to $1,196 per ounce in 20182021, primarily due to a 11,000-ounce decrease in production and an increase in total cash costs.
At Sunrise Dam, total cash costs per ounce increased by $94, or ten percent, to $1,014 per ounce in 2019 compared to $920 per ounce in 2018 mainly due to a 35,00060,000 ounce decrease in production and an increase in total cash costs.
At Sunrise Dam, total cash costs per ounce increased by $252 per ounce, or 24 percent, from $1,069 per ounce in 2020 to $1,321 per ounce in 2021. Total cash costs per ounce increased year-on-year primarily due to lower production and higher mining costs (mainly higher cost of labour due to critical skill shortages), partly offset by lower royalties paid.
At Tropicana, total cash costs per ounce decreasedincreased by $90,$180 per ounce, or 1522 percent, to $504from $807 per ounce in 2019 compared2020 to $594$987 per ounce in 20182021. Total cash costs per ounce increased year-on-year mainly due to a 24,000-ounce increase in production. The decrease was partially offset by an increase in total cashlower grades, inventory movements and the impact of higher underground and open pit mining costs.
Overall the subsidiaries’ total cash costs per ounce increased by $20,$181, or three22 percent, to $763from $836 per ounce in 2019 compared2020 to $743$1,017 per ounce in 2018.2021. The increase was mainly due to an increase in total cash costs and a 45,000-ounce335,000-ounce decrease in production.
ComparisonReconciliations
The following tables present a reconciliation of operating performance on a segment basis in 2018 with 2017
Cost of sales
In Continental Africa - Subsidiaries, cost of sales increased by $56 million, or five percent,as included in the Company’s audited financial statements to $1,127 million in 2018 from $1,071 million in 2017. The increase was mainly due to inflation increases on cash operating costs and higher royalty expense, partially offset by a decrease in amortisation costs. In Tanzania, at Geita, cost of sales increased by $92 million, or 18 percent, to $612 million in 2018 from $520 million in 2017. In Ghana, at Iduapriem, cost of sales increased by $23 million, or 11 percent, to $233 million in 2018 from $210 million in 2017. In Guinea, at Siguiri, cost of sales decreased by $58 million, or 17 percent, to $286 million in 2018 from $344 million in 2017.
In Continental Africa - Joint Ventures, cost of sales increased by $39 million, or nine percent, to $480 million in 2018 from $441 million in 2017. The increase was mainly due to higher levels of production and inflation increases on cash operating costs and higher royalty expense. In Mali, at Morila, cost of sales increased by $8 million, or 24 percent, to $42 million in 2018 from $34 million in 2017. At Sadiola, cost of sales decreased by $2 million, or three percent, to $65 million in 2018 from $67 million in 2017. In the DRC, at Kibali, cost of sales increased by $33 million, or ten percent, to $373 million in 2018 from $340 million in 2017.
In the Americas, cost of sales decreased by $149 million, or 15 percent, to $838 million in 2018 from $987 million in 2017. The decrease was mainly due to the weakening of the local currencies, the Argentinian peso by 70 percent and the Brazilian real by 15 percent, against the US dollar. In Brazil, at AngloGold Ashanti Córrego do Sítio Mineração, cost of sales decreased by $65 million, or 15 percent, to $382 million in 2018 from $447 million in 2017. At Serra Grande, cost of sales decreased by $24 million, or 16 percent, to $129 million in 2018 from $153 million in 2017. In Argentina, at Cerro Vanguardia, cost of sales decreased by $60 million, or 16 percent, to $325 million in 2018 from $385 million in 2017.
In Australia, cost of sales increased by $71 million, or 13 percent, to $622 million in 2018 from $551 million in 2017. The increase was mainly due to an increase in contractor costs, service related costs and amortisation of tangible assets. The increase was partially offset by the weakening of the Australian dollar against the US dollar. At Sunrise Dam, cost of sales increased by $50 million, or 19 percent, to $310 million in 2018 from $260 million in 2017. At Tropicana, cost of sales increased by $17 million, or six percent, to $293 million in 2018 from $276 million in 2017.
Overall the subsidiaries’ cost of sales decreased by $23 million, or one percent, to $2,584 million in 2018 from $2,607 million in 2017. The decrease was mainly due to lower amortisation expense partially offset by inflation increases on cash operating costs and higher royalty expense.
All-in“all-in sustaining costs”, “all-in sustaining costs per ounce
In Continental Africa - Subsidiaries, all-in sustaining costs increased by $32 per ounce, or four percent, to $941 per ounce in 2018 from $909 per ounce in 2017. This increase was mainly due to an increase in cost of sales, a decrease in amortisation of tangible and intangible assets at Geita and Siguiri and a 24,000-ounce decrease in gold sold (excluding pre-production ounces). The increase was partially offset by the decreased spending in sustaining capital expenditure at Geita.
In Continental Africa - Joint Ventures, all-in sustaining costs decreased by $267 per ounce, or 25 percent, to $820 per ounce in 2018 from $1,087 per ounce in 2017. This decrease was mainly due to a 97,000-ounce increase in gold sold and a decrease in sustaining capital expenditure at Kibali. This decrease was partially offset by an increase in cost of sales.
In the Americas, all-in sustaining costs decreased by $88 per ounce, or nine percent, to $855 per ounce in 2018 from $943 per ounce in 2017. This decrease was mainly due to a decrease in costs of sales partially offset by a decrease of 71,000 ounces in gold sold in 2018 (excluding pre-production ounces).
In Australia, all-in sustaining costs decreased by $24 per ounce, or two percent, to $1,038 per ounce in 2018 from $1,062 per ounce in 2017. This decrease was mainly due to an increase of 53,000 ounces in gold sold in 2018 and an increase in amortisation of tangible and intangible assets partially offset by an increase in cost of sales.
All-inounce”, “all-in costs”, “all-in costs per ounce
In Continental Africa - Subsidiaries, all-inounce”, “total cash costs increased by $80 per ounce, or eight percent, to $1,099 per ounce in 2018 from $1,019 per ounce in 2017. This increase was mainly due to an increase in all-in sustaining costsnet of by-product revenue” and an increase in non-sustaining project capital expenditure at Siguiri and Obuasi partially offset by a 24,000-ounce increase in gold sold (excluding pre-production ounces).
In Continental Africa - Joint Ventures, all-in costs decreased by $340 per ounce, or 29 percent, to $846 per ounce in 2018 from $1,186 per ounce in 2017. This decrease was mainly due to a decrease in all-in sustaining costs, a 97,000-ounce increase in gold sold and a decrease in major project spending at Kibali as projects were completed and commissioned.
In the Americas, all-in costs decreased by $86 per ounce, or eight percent, to $932 per ounce in 2018 from $1,018 per ounce in 2017. This decrease was mainly due to a decrease in all-in sustaining costs partially offset by a 71,000-ounce decrease in gold sold (excluding pre-production ounces).
In Australia, all-in costs decreased by $10 per ounce, or one percent, to $1,070 per ounce in 2018 from $1,080 per ounce in 2017 mainly due to an increase of 53,000 ounces in gold sold partially offset by an increase in all-in sustaining costs.
Total“total cash costs per ounceounce” for each of the three years in the period ended 31 December 2022 on a total
and segment basis. In addition, the Company has provided detail of Argentina, Australiathe attributable ounces of gold produced and Brazil were, on average, weaker against the US dollar during 2018 as compared to 2017 which positively impacted total cash costs per ouncesold by mine for 2018.each of those periods below.
In Continental Africa - Subsidiaries, total cash costs per ounce increased by $125, or 18 percent, to $813 per ounce in 2018 from $688 per ounce in 2017. The increase was mainly due to an increase in cost of sales and a 34,000-ounce decrease in production (excluding pre-production ounces).
In Tanzania, at Geita, total cash costs per ounce increased by $196, or 32 percent, to $804 per ounce in 2018 from $608 per ounce in 2017. The increase was mainly due an increase in cost of sales partially offset by a 25,000-ounce increase in production (excluding pre-production ounces).
In Ghana, at Iduapriem, total cash costs per ounce decreased by $19, or two percent, to $804 per ounce in 2018 compared to $823 per ounce in 2017 mainly due to a 26,000-ounce increase in production. The decrease was partially offset by an increase in cost of sales.
In Guinea, at Siguiri, total cash costs per ounce increased by $119, or 16 percent, to $844 per ounce in 2018 from $725 per ounce in 2017 mainly due to a 81,000-ounce decrease in production partially offset by a decrease in cost of sales.
In Continental Africa - Joint Ventures, total cash costs per ounce decreased by $139, or 17 percent, to $680 per ounce in 2018 from $819 per ounce in 2017. The decrease was mainly due to a 92,000-ounce increase in production partially offset by an increase in cost of sales.
In Mali, at Morila, total cash costs per ounce increased by $171, or 18 percent, to $1,145 per ounce in 2018 from $974 per ounce in 2017. The increase was mainly due to an increase in cost of sales partially offset by a 2,000-ounce increase in production. At Sadiola, total cash costs per ounce increased by $38, or four percent, from $900 per ounce in 2017 to $938 per ounce in 2018. The increase was mainly due to a 4,000-ounce decrease in production partially offset by a decrease in cost of sales.
In the DRC, at Kibali, total cash costs per ounce decreased by $184, or 23 percent, to $600 per ounce in 2018 from $784 per ounce in 2017. The decrease was mainly due to a 95,000-ounce increase in production partially offset by an increase in cost of sales.
In the Americas, total cash costs per ounce decreased by $14, or two percent, to $624 per ounce in 2018 from $638 per ounce in 2017. The decrease was mainly due to a decrease in cost of sales. The decrease was partially offset by a 64,000-ounce decrease in production (excluding pre-production ounces) and a decrease in amortisation of tangible assets.
In Brazil, at AngloGold Ashanti Córrego do Sítio Mineração, total cash costs per ounce increased by $52, or eight percent, to $723 per ounce in 2018 from $671 per ounce in 2017 primarily due to a decrease in amortisation of tangible assets. The increase was partially offset by a decrease in cost of sales and a 60,000-ounce increase in production (excluding pre-production ounces). At Serra Grande, total cash costs per ounce decreased by $104, or 14 percent, to $660 per ounce in 2018 from $764 per ounce in 2017 primarily due to a decrease in cost of sales. The decrease was partially offset by a 3,000-ounce decrease in production (excluding pre-production ounces).
In Argentina, at Cerro Vanguardia, total cash costs per ounce decreased by $46, or nine percent, to $476 per ounce in 2018 from $522 per ounce in 2017 primarily due to a decrease in cost of sales. The decrease was partially offset by a 1,000-ounce decrease in production and a decrease in amortisation of tangible assets.
In Australia, total cash costs per ounce increased by $19, or three percent, to $762 per ounce in 2018 from $743 per ounce in 2017 primarily due to an increase in cost of sales. The increase was partially offset by a 66,000-ounce increase in production.
At Sunrise Dam, total cash costs per ounce increased by $1, or 0.1 percent, to $920 per ounce in 2018 compared to $919 per ounce in 2017 mainly due to an increase in cost of sales. The increase was partially offset by a 51,000-ounce increase in production.
At Tropicana, total cash costs per ounce increased by $30, or five percent, to $594 per ounce in 2018 compared to $564 per ounce in 2017 mainly due to an increase in cost of sales. The increase was partially offset by a 14,000-ounce increase in production.
Overall the subsidiaries’ total cash costs per ounce increased by $60, or nine percent, to $743 per ounce in 2018 compared to $683 per ounce in 2017. The increase was mainly due to a 32,000-ounce decrease in production and a decrease in total amortisation partially offset by a decrease in cost of sales.
For the year ended 31 December 20192022
Corporate and other
(in $ millions, except as otherwise noted) | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | Corporate (4) |
All-in sustaining costs | | | | | | | | | | | | | | | | | | | |
Cost of sales per segmental information(5) | | | | | | | | | | | | | | | | | | | 4 | |
By-product revenue | | | | | | | | | | | | | | | | | | | — | |
Cost of sales | | | | | | | | | | | | | | | | | | | 4 | |
Realised other commodity contracts | | | | | | | | | | | | | | | | | | | |
Amortisation of tangible, intangible and right of use assets | | | | | | | | | | | | | | | | | | | (4) | |
Adjusted for decommissioning and inventory amortisation | | | | | | | | | | | | | | | | | | | — | |
Corporate administration and marketing expenditure | | | | | | | | | | | | | | | | | | | 79 | |
Lease payment sustaining | | | | | | | | | | | | | | | | | | | 2 | |
Sustaining exploration and study costs | | | | | | | | | | | | | | | | | | | — | |
Total sustaining capital expenditure | | | | | | | | | | | | | | | | | | | 1 | |
All-in sustaining costs | | | | | | | | | | | | | | | | | | | 82 | |
Adjusted for non-controlling interests and non-gold producing companies(1) | | | | | | | | | | | | | | | | | | | — | |
All-in sustaining costs adjusted for non-controlling interests and non-gold producing companies | | | | | | | | | | | | | | | | | | | 82 | |
All-in sustaining costs | | | | | | | | | | | | | | | | | | | 82 | |
Non-sustaining project capital expenditure | | | | | | | | | | | | | | | | | | | — | |
Non-sustaining lease payments | | | | | | | | | | | | | | | | | | | — | |
Non-sustaining exploration and study costs | | | | | | | | | | | | | | | | | | | — | |
Care and maintenance | | | | | | | | | | | | | | | | | | | — | |
Closure and social responsibility costs not related to current operations | | | | | | | | | | | | | | | | | | | 7 | |
Other provisions | | | | | | | | | | | | | | | | | | | 14 | |
All-in costs | | | | | | | | | | | | | | | | | | | 103 | |
Adjusted for non-controlling interests and non-gold producing companies(1) | | | | | | | | | | | | | | | | | | | — | |
All-in costs adjusted for non-controlling interests and non-gold producing companies | | | | | | | | | | | | | | | | | | | 103 | |
Gold sold - oz (000)(2) | | | | | | | | | | | | | | | | | | | — | |
All-in sustaining cost per unit - $/oz(3) | | | | | | | | | | | | | | | | | | | — | |
All-in cost per unit - $/oz(3) | | | | | | | | | | | | | | | | | | | — | |
(1)Adjusting for non-controlling interest of items included in calculation, to disclose the attributable portions only.
(2)Attributable portion.
(3)In addition to the operational performances of the mines, “all-in sustaining cost per ounce”, “all-in cost per ounce” and “total cash costs per ounce” are affected by fluctuations in the currency exchange rate. AngloGold Ashanti reports “all-in sustaining cost per ounce” and “all-in cost per ounce” calculated to the nearest US dollar amount and gold sold in ounces. AngloGold Ashanti reports “total cash costs per ounce” calculated to the nearest US dollar amount and gold produced in ounces.
(4)Corporate includes non-gold producing subsidiaries.
(5)Refer to “Item 18: Financial Statements—Note 2—Segmental Information”.
(6)A new segment for Projects (previously reported under the Americas segment) has been introduced due to the implementation of the new Operating Model which comprises all the major non-sustaining capital projects with the potential to be developed into operating entities. Comparative information has been restated.
Rounding of figures may result in computational discrepancies.
For the year ended 31 December 2022
Corporate and other
(in $ millions, except as otherwise noted) | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | Corporate(4) |
Total cash costs | | | | | | | | | | | | | | | | | | | |
Cost of sales per segmental information(5) | | | | | | | | | | | | | | | | | | | 4 | |
By-product revenue | | | | | | | | | | | | | | | | | | | — | |
Inventory change | | | | | | | | | | | | | | | | | | | — | |
Amortisation of tangible assets | | | | | | | | | | | | | | | | | | | (3) | |
Amortisation of right of use assets | | | | | | | | | | | | | | | | | | | (1) | |
Amortisation of intangible assets | | | | | | | | | | | | | | | | | | | — | |
Rehabilitation and other non-cash costs | | | | | | | | | | | | | | | | | | | — | |
Retrenchment costs | | | | | | | | | | | | | | | | | | | — | |
Total cash costs net of by-product revenue | | | | | | | | | | | | | | | | | | | — | |
Adjusted for non-controlling interests and non-gold producing companies (1) | | | | | | | | | | | | | | | | | | | — | |
Total cash costs adjusted for non-controlling interests and non-gold producing companies | | | | | | | | | | | | | | | | | | | — | |
Gold produced – oz (000)(2) | | | | | | | | | | | | | | | | | | | — | |
Total cash costs per unit – $/oz(3) | | | | | | | | | | | | | | | | | | | — | |
(1)Adjusting for non-controlling interest of items included in calculation, to disclose the attributable portions only.
(2)Attributable portion.
(3)In addition to the operational performances of the mines, “all-in sustaining cost per ounce”, “all-in cost per ounce” and “total cash costs per ounce” are affected by fluctuations in the currency exchange rate. AngloGold Ashanti reports “all-in sustaining cost per ounce” and “all-in cost per ounce” calculated to the nearest US dollar amount and gold sold in ounces. AngloGold Ashanti reports “total cash costs per ounce” calculated to the nearest US dollar amount and gold produced in ounces.
(4)Corporate includes non-gold producing subsidiaries.
(5)Refer to “Item 18: Financial Statements—Note 2—Segmental Information”.
(6)A new segment for Projects (previously reported under the Americas segment) has been introduced due to the implementation of the new Operating Model which comprises all the major non-sustaining capital projects with the potential to be developed into operating entities. Comparative information has been restated.
Rounding of figures may result in computational discrepancies.
For the year ended 31 December 2022
Operations Africa
(in $ millions, except as otherwise noted) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| AFRICA | AFRICA |
| Kibali | Other | Joint Ventures | Iduapriem | Obuasi | Siguiri | Geita | Africa Other | Subsidiaries |
All-in sustaining costs | | | | | | | | | |
Cost of sales per segmental information(5) | 342 | | — | | 342 | | 314 | | 266 | | 488 | | 594 | | — | | 1,662 | |
By-product revenue | (1) | | — | | (1) | | (1) | | (1) | | — | | (1) | | — | | (3) | |
Cost of sales | 341 | | — | | 341 | | 313 | | 265 | | 488 | | 593 | | — | | 1,659 | |
Realised other commodity contracts | | | | | | | | | |
Amortisation of tangible, intangible and right of use assets | (95) | | — | | (95) | | (80) | | (40) | | (50) | | (102) | | — | | (272) | |
Adjusted for decommissioning and inventory amortisation | — | | — | | — | | — | | — | | — | | — | | — | | — | |
Corporate administration and marketing expenditure | — | | — | | — | | — | | — | | — | | — | | — | | — | |
Lease payment sustaining | 8 | | — | | 8 | | 4 | | — | | 1 | | 22 | | — | | 27 | |
Sustaining exploration and study costs | — | | — | | — | | 2 | | — | | 5 | | 8 | | — | | 15 | |
Total sustaining capital expenditure | 71 | | — | | 71 | | 81 | | 79 | | 23 | | 111 | | — | | 294 | |
All-in sustaining costs | 325 | | — | | 325 | | 320 | | 304 | | 467 | | 632 | | — | | 1,723 | |
Adjusted for non-controlling interests and non -gold producing companies(1) | — | | — | | — | | — | | — | | (70) | | — | | — | | (70) | |
All-in sustaining costs adjusted for non-controlling interests and non-gold producing companies | 325 | | — | | 325 | | 320 | | 304 | | 397 | | 632 | | — | | 1,653 | |
All-in sustaining costs | 325 | | — | | 325 | | 320 | | 304 | | 467 | | 632 | | — | | 1,723 | |
Non-sustaining project capital expenditure | 19 | | — | | 19 | | 65 | | 80 | | 4 | | 43 | | — | | 192 | |
Non-sustaining lease payments | — | | — | | — | | — | | — | | — | | 3 | | — | | 3 | |
Non-sustaining exploration and study costs | 2 | | — | | 2 | | 1 | | — | | 7 | | 5 | | — | | 13 | |
Care and maintenance | — | | — | | — | | — | | — | | — | | — | | — | | — | |
Closure and social responsibility costs not related to current operations | 10 | | 1 | | 11 | | 1 | | (23) | | — | | — | | — | | (22) | |
Other provisions | — | | — | | — | | — | | — | | — | | — | | — | | — | |
All-in costs | 356 | | 1 | | 357 | | 387 | | 361 | | 478 | | 683 | | — | | 1,909 | |
Adjusted for non-controlling interests and non-gold producing companies(1) | — | | — | | — | | — | | — | | (72) | | — | | — | | (72) | |
All-in costs adjusted for non-controlling interests and non-gold producing companies | 356 | | 1 | | 357 | | 387 | | 361 | | 406 | | 683 | | — | | 1,837 | |
Gold sold – oz (000)(2) | 332 | | — | | 332 | | 247 | | 241 | | 278 | | 515 | | — | | 1,281 | |
All-in sustaining cost per unit – $/oz(3) | 979 | | — | | 979 | | 1,299 | | 1,264 | | 1,428 | | 1,227 | | — | | 1,291 | |
All-in cost per unit – $/oz(3) | 1,072 | | — | | 1,075 | | 1,570 | | 1,499 | | 1,461 | | 1,325 | | — | | 1,434 | |
For the year ended 31 December 2022
Operations Africa
(in $ millions, except as otherwise noted) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| AFRICA | AFRICA |
| Kibali | Other | Joint Ventures | Iduapriem | Obuasi | Siguiri | Geita | Africa other | Subsidiaries |
Total cash costs | | | | | | | | | |
Cost of sales per segmental information(5) | 342 | | — | | 342 | | 314 | | 266 | | 488 | | 594 | | — | | 1,662 | |
By-product revenue | (1) | | — | | (1) | | (1) | | (1) | | — | | (1) | | — | | (3) | |
Inventory change | 3 | | — | | 3 | | 3 | | 6 | | 4 | | 7 | | (1) | | 19 | |
Amortisation of tangible assets | (93) | | — | | (93) | | (77) | | (39) | | (49) | | (77) | | — | | (242) | |
Amortisation of right of use assets | (2) | | — | | (2) | | (3) | | — | | (1) | | (25) | | — | | (29) | |
Amortisation of intangible assets | — | | — | | — | | — | | (1) | | — | | — | | — | | (1) | |
Rehabilitation and other non-cash costs | (4) | | — | | (4) | | 4 | | (2) | | (8) | | (7) | | — | | (13) | |
Retrenchment costs | — | | — | | — | | — | | — | | — | | — | | — | | — | |
Total cash costs net of by-product revenue | 245 | | — | | 245 | | 240 | | 229 | | 434 | | 491 | | (1) | | 1,393 | |
Adjusted for non-controlling interests non-gold producing companies and other(1) | — | | — | | — | | — | | — | | (65) | | — | | — | | (65) | |
Total cash costs adjusted for non-controlling interests and non-gold producing companies and other | 245 | | — | | 245 | | 240 | | 229 | | 369 | | 491 | | (1) | | 1,328 | |
Gold produced - oz (000)(2) | 337 | | — | | 337 | | 248 | | 250 | | 279 | | 521 | | — | | 1,298 | |
Total cash costs per unit - $/oz(3) | 725 | | — | | 725 | | 970 | | 914 | | 1,319 | | 944 | | — | | 1,023 | |
For the year ended 31 December 2022
Operations in Australia, America and Projects
(in $ millions, except as otherwise noted) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| AUSTRALIA | AMERICAS | PROJECTS (6) |
Sunrise Dam | Tropicana | Australia other | Total Australia | Cerro Vanguardia | AngloGold Ashanti Mineração | Serra Grande | Americas other | Total Americas |
All-in sustaining costs | | | | | | | | | | |
Cost of sales per segmental information(5) | 371 | | 382 | | 30 | | 783 | | 273 | | 477 | | 162 | | 1 | | 913 | | — | |
By-product revenue | (1) | | (3) | | — | | (4) | | (75) | | (31) | | — | | — | | (106) | | — | |
Cost of sales | 370 | | 379 | | 30 | | 779 | | 198 | | 446 | | 162 | | 1 | | 807 | | — | |
Realised other commodity contracts | | | | | | | | | | |
Amortisation of tangible, intangible and right of use assets | (54) | | (117) | | (1) | | (172) | | (39) | | (106) | | (40) | | — | | (185) | | — | |
Adjusted for decommissioning and inventory amortisation | — | | 1 | | — | | 1 | | 6 | | — | | (1) | | — | | 5 | | — | |
Corporate administration and marketing expenditure | — | | — | | — | | — | | — | | — | | — | | — | | — | | — | |
Lease payment sustaining | 12 | | 11 | | 1 | | 24 | | — | | 32 | | 4 | | — | | 36 | | 1 | |
Sustaining exploration and study costs | 1 | | 1 | | — | | 2 | | 3 | | 1 | | — | | — | | 4 | | — | |
Total sustaining capital expenditure | 50 | | 41 | | — | | 91 | | 66 | | 199 | | 57 | | — | | 322 | | — | |
All-in sustaining costs | 379 | | 316 | | 30 | | 725 | | 234 | | 572 | | 182 | | 1 | | 989 | | 1 | |
Adjusted for non-controlling interests and non -gold producing companies(1) | — | | — | | — | | — | | (18) | | — | | — | | — | | (18) | | — | |
All-in sustaining costs adjusted for non-controlling interests and non-gold producing companies | 379 | | 316 | | 30 | | 725 | | 216 | | 572 | | 182 | | 1 | | 971 | | 1 | |
All-in sustaining costs | 379 | | 316 | | 30 | | 725 | | 234 | | 572 | | 182 | | 1 | | 989 | | 1 | |
Non-sustaining project capital expenditure | — | | 111 | | — | | 111 | | — | | — | | — | | — | | — | | 17 | |
Non-sustaining lease payments | — | | — | | — | | — | | — | | — | | — | | — | | — | | — | |
Non-sustaining exploration and study costs | 18 | | 6 | | 19 | | 43 | | 1 | | 9 | | 3 | | 1 | | 14 | | 113 | |
Care and maintenance | — | | — | | — | | — | | — | | — | | — | | — | | — | | — | |
Closure and social responsibility costs not related to current operations | — | | — | | — | | — | | — | | 16 | | 2 | | — | | 18 | | — | |
Other provisions | — | | — | | — | | — | | — | | — | | — | | — | | — | | — | |
All-in costs | 397 | | 433 | | 49 | | 879 | | 235 | | 597 | | 187 | | 2 | | 1,021 | | 131 | |
Adjusted for non-controlling interests and non -gold producing companies(1) | — | | — | | — | | — | | (18) | | — | | — | | — | | (18) | | — | |
All-in costs adjusted for non-controlling interests and non-gold producing companies | 397 | | 433 | | 49 | | 879 | | 217 | | 597 | | 187 | | 2 | | 1,003 | | 131 | |
Gold sold – oz (000)(2) | 228 | | 311 | | — | | 539 | | 166 | | 310 | | 89 | | — | | 565 | | — | |
All-in sustaining cost per unit – $/oz(3) | 1,666 | | 1,014 | | — | | 1,345 | | 1,301 | | 1,841 | | 2,053 | | — | | 1,718 | | — | |
All-in cost per unit – $/oz(3) | 1,746 | | 1,391 | | — | | 1,631 | | 1,309 | | 1,923 | | 2,102 | | — | | 1,775 | | — | |
For the year ended 31 December 2022
Operations in Australia, America and Projects
(in $ millions, except as otherwise noted) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| AUSTRALIA | AMERICAS | |
| Sunrise Dam | Tropicana | Australia other | Total Australia | Cerro Vanguardia | AngloGold Ashanti Mineração | Serra Grande | Americas other | Total Americas |
Total cash costs | | | | | | | | | | |
Cost of sales per segmental information(5) | 371 | | 382 | | 30 | | 783 | | 273 | | 477 | | 162 | | 1 | | 913 | | |
By-product revenue | (1) | | (3) | | — | | (4) | | (75) | | (31) | | — | | — | | (106) | | |
Inventory change | 8 | | (5) | | — | | 3 | | 9 | | 1 | | (1) | | (1) | | 8 | | |
Amortisation of tangible assets | (43) | | (109) | | — | | (152) | | (39) | | (79) | | (36) | | — | | (154) | | |
Amortisation of right of use assets | (11) | | (8) | | (1) | | (20) | | — | | (27) | | (4) | | — | | (31) | | |
Amortisation of intangible assets | — | | — | | — | | — | | — | | — | | — | | — | | — | | |
Rehabilitation and other non-cash costs | 2 | | 12 | | (1) | | 13 | | 2 | | (1) | | (1) | | — | | — | | |
Retrenchment costs | — | | — | | (1) | | (1) | | (2) | | (2) | | (1) | | — | | (5) | | |
Total cash costs net of by-product revenue | 326 | | 269 | | 27 | | 622 | | 168 | | 338 | | 119 | | — | | 625 | | |
Adjusted for non-controlling interests, non-gold producing companies and other(1) | — | | — | | — | | — | | (13) | | — | | — | | — | | (13) | | |
Total cash costs net of by-product revenue adjusted for non-controlling interests and non-gold producing companies | 326 | | 269 | | 27 | | 622 | | 155 | | 338 | | 119 | | — | | 612 | | |
Gold produced – oz (000)(2) | 232 | | 306 | | — | | 538 | | 170 | | 311 | | 88 | | — | | 569 | | |
Total cash costs per unit – $/oz(3) | 1,402 | | 881 | | — | | 1,157 | | 913 | | 1,088 | | 1,355 | | — | | 1,078 | | |
For the year ended 31 December 2022
AngloGold Ashanti operations – Total
(in $ millions, except as otherwise noted) | | | | | | | | |
| JOINT VENTURES | SUBSIDIARIES |
All-in sustaining costs | | |
Cost of sales per segmental information(5) | 342 | | 3,362 | |
By-product revenue | (1) | | (113) | |
Cost of sales | 341 | | 3,249 | |
Realised other commodity contracts | | |
Amortisation of tangible, intangible and right of use assets | (95) | | (633) | |
Adjusted for decommissioning and inventory amortisation | — | | 6 | |
Corporate administration and marketing expenditure | — | | 79 | |
Lease payment sustaining | 8 | | 90 | |
Sustaining exploration and study costs | — | | 21 | |
Total sustaining capital expenditure | 71 | | 708 | |
All-in sustaining costs | 325 | | 3,520 | |
Adjusted for non-controlling interests and non-gold producing companies(1) | — | | (88) | |
All-in sustaining costs adjusted for non-controlling interests and non-gold producing companies | 325 | | 3,432 | |
All-in sustaining costs | 325 | | 3,520 | |
Non-sustaining project capital expenditure | 19 | | 320 | |
Non-sustaining lease payments | — | | 3 | |
Non-sustaining exploration and study costs | 2 | | 183 | |
Care and maintenance | — | | — | |
Closure and social responsibility costs not related to current operations | 11 | | 3 | |
Other provisions | — | | 14 | |
All-in costs | 357 | | 4,043 | |
Adjusted for non-controlling interests and non-gold producing companies(1) | — | | (90) | |
All-in costs adjusted for non-controlling interests and non-gold producing companies | 357 | | 3,953 | |
Gold sold – oz (000)(2) | 332 | | 2,385 | |
All-in sustaining cost per unit – $/oz(3) | 979 | | 1,439 | |
All-in cost per unit – $/oz(3) | 1,075 | | 1,658 | |
For the year ended 31 December 2022
AngloGold Ashanti operations – Total
(in $ millions, except as otherwise noted) | | | | | | | | |
| JOINT VENTURES | SUBSIDIARIES |
Total cash costs | | |
Cost of sales per segmental information(5) | 342 | | 3,362 | |
By-product revenue | (1) | | (113) | |
Inventory change | 3 | | 30 | |
Amortisation of tangible assets | (93) | | (551) | |
Amortisation of right of use assets | (2) | | (81) | |
Amortisation of intangible assets | — | | (1) | |
Rehabilitation and other non-cash costs | (4) | | — | |
Retrenchment costs | — | | (6) | |
Total cash costs net of by-product revenue | 245 | | 2,640 | |
Adjusted for non-controlling interests and non-gold producing companies(1) | — | | (78) | |
Total cash costs net of by-product revenue adjusted for non-controlling interests and non-gold producing companies | 245 | | 2,562 | |
Gold produced – oz (000)(2) | 337 | | 2,405 | |
Total cash costs (adjusted) per unit – $/oz(3) | 725 | | 1,066 | |
For the year ended 31 December 2021
Corporate and other
(in $ millions, except as otherwise noted) | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | Corporate (4) |
All-in sustaining costs | | | | | | | | | | | | | | | | | | | |
Cost of sales per segmental information(5) | | | | | | | | | | | | | | | | | | | (5) | |
By-product revenue | | | | | | | | | | | | | | | | | | | — | |
Cost of sales | | | | | | | | | | | | | | | | | | | (5) | |
Realised other commodity contracts | | | | | | | | | | | | | | | | | | | |
Amortisation of tangible, intangible and right of use assets | | | | | | | | | | | | | | | | | | | (3) | |
Adjusted for decommissioning and inventory amortisation | | | | | | | | | | | | | | | | | | | — | |
Corporate administration and marketing expenditure | | | | | | | | | | | | | | | | | | | 73 | |
Lease payment sustaining | | | | | | | | | | | | | | | | | | | 3 | |
Sustaining exploration and study costs | | | | | | | | | | | | | | | | | | | — | |
Total sustaining capital expenditure | | | | | | | | | | | | | | | | | | | 11 | |
All-in sustaining costs | | | | | | | | | | | | | | | | | | | 79 | |
Adjusted for non-controlling interests and non-gold producing companies(1) | | | | | | | | | | | | | | | | | | | — | |
All-in sustaining costs adjusted for non-controlling interests and non-gold producing companies | | | | | | | | | | | | | | | | | | | 79 | |
All-in sustaining costs | | | | | | | | | | | | | | | | | | | 79 | |
Non-sustaining project capital expenditure | | | | | | | | | | | | | | | | | | | — | |
Non-sustaining lease payments | | | | | | | | | | | | | | | | | | | — | |
Non-sustaining exploration and study costs | | | | | | | | | | | | | | | | | | | — | |
Care and maintenance | | | | | | | | | | | | | | | | | | | — | |
Closure and social responsibility costs not related to current operations | | | | | | | | | | | | | | | | | | | 4 | |
Other provisions | | | | | | | | | | | | | | | | | | | 1 | |
All-in costs | | | | | | | | | | | | | | | | | | | 84 | |
Adjusted for non-controlling interests and non-gold producing companies(1) | | | | | | | | | | | | | | | | | | | — | |
All-in costs adjusted for non-controlling interests and non-gold producing companies | | | | | | | | | | | | | | | | | | | 84 | |
Gold sold - oz (000)(2) | | | | | | | | | | | | | | | | | | | — | |
All-in sustaining cost per unit - $/oz(3) | | | | | | | | | | | | | | | | | | | — | |
All-in cost per unit - $/oz(3) | | | | | | | | | | | | | | | | | | | — | |
(1)Adjusting for non-controlling interest of items included in calculation, to disclose the attributable portions only.
(2)Attributable portion.
(3)In addition to the operational performances of the mines, “all-in sustaining cost per ounce”, “all-in cost per ounce” and “total cash costs per ounce” are affected by fluctuations in the currency exchange rate. AngloGold Ashanti reports “all-in sustaining cost per ounce” and “all-in cost per ounce” calculated to the nearest US dollar amount and gold sold in ounces. AngloGold Ashanti reports “total cash costs per ounce” calculated to the nearest US dollar amount and gold produced in ounces.
(4)Corporate includes non-gold producing subsidiaries.
(5)Refer to “Item 18: Financial Statements—Note 2—Segmental Information”.
(6)A new segment for Projects (previously reported under the Americas segment) has been introduced due to the implementation of the new Operating Model which comprises all the major non-sustaining capital projects with the potential to be developed into operating entities. Comparative information has been restated.
Rounding of figures may result in computational discrepancies.
For the year ended 31 December 2021
Corporate and other
(in $ millions, except as otherwise noted) | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | Corporate (4) |
Total cash costs | | | | | | | | | | | | | | | | | | | |
Cost of sales per segmental information(5) | | | | | | | | | | | | | | | | | | | (5) | |
By-product revenue | | | | | | | | | | | | | | | | | | | — | |
Inventory change | | | | | | | | | | | | | | | | | | | — | |
Amortisation of tangible assets | | | | | | | | | | | | | | | | | | | (1) | |
Amortisation of right of use assets | | | | | | | | | | | | | | | | | | | (1) | |
Amortisation of intangible assets | | | | | | | | | | | | | | | | | | | (1) | |
Rehabilitation and other non-cash costs | | | | | | | | | | | | | | | | | | | — | |
Retrenchment costs | | | | | | | | | | | | | | | | | | | — | |
Total cash costs net of by-product revenue | | | | | | | | | | | | | | | | | | | (8) | |
Adjusted for non-controlling interests,(1) | | | | | | | | | | | | | | | | | | | — | |
Total cash costs for non-controlling interests | | | | | | | | | | | | | | | | | | | (8) | |
Gold produced – oz (000)(2) | | | | | | | | | | | | | | | | | | | — | |
Total cash costs per unit – $/oz(3) | | | | | | | | | | | | | | | | | | | — | |
(1)Adjusting for non-controlling interest of items included in calculation, to disclose the attributable portions only.
(2)Attributable portion.
(3)In addition to the operational performances of the mines, “all-in sustaining cost per ounce”, “all-in cost per ounce” and “total cash costs per ounce” are affected by fluctuations in the currency exchange rate. AngloGold Ashanti reports “all-in sustaining cost per ounce” and “all-in cost per ounce” calculated to the nearest US dollar amount and gold sold in ounces. AngloGold Ashanti reports “total cash costs per ounce” calculated to the nearest US dollar amount and gold produced in ounces.
(4)Corporate includes non-gold producing subsidiaries.
(5)Refer to “Item 18: Financial Statements—Note 2—Segmental Information”.
(6)A new segment for Projects (previously reported under the Americas segment) has been introduced due to the implementation of the new Operating Model which comprises all the major non-sustaining capital projects with the potential to be developed into operating entities. Comparative information has been restated.
Rounding of figures may result in computational discrepancies.
For the year ended 31 December 2021
Operations Africa
(in $ millions, except as otherwise noted) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| AFRICA | AFRICA |
| Kibali | Other | Joint Ventures | Iduapriem | Obuasi | Siguiri | Geita | Africa Other | Subsidiaries |
All-in sustaining costs | | | | | | | | | |
Cost of sales per segmental information(5) | 350 | | — | | 350 | | 238 | | 164 | | 410 | | 488 | | — | | 1,300 | |
By-product revenue | (2) | | — | | (2) | | (1) | | — | | (1) | | (1) | | — | | (3) | |
Cost of sales | 348 | | — | | 348 | | 237 | | 164 | | 409 | | 487 | | — | | 1,297 | |
Realised other commodity contracts | | | | | | | | | |
Amortisation of tangible, intangible and right of use assets | (105) | | — | | (105) | | (19) | | (22) | | (47) | | (75) | | — | | (163) | |
Adjusted for decommissioning and inventory amortisation | 1 | | — | | 1 | | 1 | | — | | — | | 1 | | — | | 2 | |
Corporate administration and marketing expenditure | — | | — | | — | | — | | — | | — | | — | | — | | — | |
Lease payment sustaining | 9 | | — | | 9 | | 2 | | — | | 1 | | 19 | | — | | 22 | |
Sustaining exploration and study costs | — | | — | | — | | 1 | | — | | 3 | | 4 | | — | | 8 | |
Total sustaining capital expenditure | 61 | | — | | 61 | | 103 | | 46 | | 18 | | 65 | | — | | 232 | |
All-in sustaining costs | 314 | | — | | 314 | | 325 | | 188 | | 384 | | 501 | | — | | 1,398 | |
Adjusted for non-controlling interests and non -gold producing companies(1) | — | | — | | — | | — | | — | | (58) | | — | | — | | (58) | |
All-in sustaining costs adjusted for non-controlling interests and non-gold producing companies | 314 | | — | | 314 | | 325 | | 188 | | 326 | | 501 | | — | | 1,340 | |
All-in sustaining costs | 314 | | — | | 314 | | 325 | | 188 | | 384 | | 501 | | — | | 1,398 | |
Non-sustaining project capital expenditure | 11 | | — | | 11 | | 2 | | 122 | | 20 | | 58 | | — | | 202 | |
Non-sustaining lease payments | — | | — | | — | | — | | — | | — | | 2 | | — | | 2 | |
Non-sustaining exploration and study costs | 2 | | — | | 2 | | 3 | | 2 | | 2 | | 1 | | — | | 8 | |
Care and maintenance | — | | — | | — | | — | | 45 | | — | | — | | — | | 45 | |
Closure and social responsibility costs not related to current operations | 3 | | — | | 3 | | — | | 10 | | — | | — | | — | | 10 | |
Other provisions | — | | — | | — | | — | | — | | — | | 3 | | — | | 3 | |
All-in costs | 330 | | — | | 330 | | 330 | | 367 | | 406 | | 565 | | — | | 1,668 | |
Adjusted for non-controlling interests and non-gold producing companies(1) | — | | — | | — | | — | | — | | (61) | | — | | — | | (61) | |
All-in costs adjusted for non-controlling interests and non-gold producing companies | 330 | | — | | 330 | | 330 | | 367 | | 345 | | 565 | | — | | 1,607 | |
Gold sold – oz (000)(2) | 367 | | — | | 367 | | 201 | | 114 | | 258 | | 487 | | — | | 1,060 | |
All-in sustaining cost per unit – $/oz(3) | 856 | | — | | 856 | | 1,619 | | 1,653 | | 1,267 | | 1,029 | | — | | 1,264 | |
All-in cost per unit – $/oz(3) | 898 | | — | | 900 | | 1,642 | | 3,229 | | 1,340 | | 1,161 | | — | | 1,516 | |
For the year ended 31 December 2021
Operations Africa
(in $ millions, except as otherwise noted) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| AFRICA | AFRICA |
| Kibali | Other | Joint Ventures | Iduapriem | Obuasi | Siguiri | Geita | Africa other | Subsidiaries |
Total cash costs | | | | | | | | | |
Cost of sales per segmental information(5) | 350 | | — | | 350 | | 238 | | 164 | | 410 | | 488 | | — | | 1,300 | |
By-product revenue | (2) | | — | | (2) | | (1) | | — | | (1) | | (1) | | — | | (3) | |
Inventory change | (1) | | — | | (1) | | 1 | | (10) | | (1) | | (1) | | — | | (11) | |
Amortisation of tangible assets | (100) | | — | | (100) | | (17) | | (21) | | (46) | | (55) | | — | | (139) | |
Amortisation of right of use assets | (5) | | — | | (5) | | (2) | | — | | (1) | | (20) | | — | | (23) | |
Amortisation of intangible assets | — | | — | | — | | — | | (1) | | — | | — | | — | | (1) | |
Rehabilitation and other non-cash costs | (5) | | — | | (5) | | (1) | | (12) | | 2 | | (12) | | — | | (23) | |
Retrenchment costs | — | | — | | — | | — | | — | | — | | — | | — | | — | |
Total cash costs net of by-product revenue | 237 | | — | | 237 | | 218 | | 120 | | 363 | | 399 | | — | | 1,100 | |
Adjusted for non-controlling interests non-gold producing companies and other(1) | — | | — | | — | | — | | — | | (55) | | — | | — | | (55) | |
Total cash costs adjusted for non-controlling interests and non-gold producing companies and other | 237 | | — | | 237 | | 218 | | 120 | | 308 | | 399 | | — | | 1,045 | |
Gold produced - oz (000)(2) | 365 | | — | | 365 | | 202 | | 108 | | 258 | | 486 | | — | | 1,054 | |
Total cash costs per unit - $/oz(3) | 647 | | — | | 647 | | 1,081 | | 1,112 | | 1,200 | | 822 | | — | | 991 | |
For the year ended 31 December 2021
Operations in Australia, America and Projects
(in $ millions, except as otherwise noted) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| AUSTRALIA | AMERICAS | PROJECTS (6) Restated |
Sunrise Dam | Tropicana | Australia other | Total Australia | Cerro Vanguardia | AngloGold Ashanti Mineração | Serra Grande | Americas other | Total Americas |
All-in sustaining costs | | | | | | | | | | |
Cost of sales per segmental information(5) | 364 | | 346 | | 30 | | 740 | | 261 | | 435 | | 123 | | 3 | | 822 | | — | |
By-product revenue | (1) | | (3) | | — | | (4) | | (93) | | (26) | | — | | — | | (119) | | — | |
Cost of sales | 363 | | 343 | | 30 | | 736 | | 168 | | 409 | | 123 | | 3 | | 703 | | — | |
Realised other commodity contracts | | | | | | | | | | |
Amortisation of tangible, intangible and right of use assets | (60) | | (88) | | (2) | | (150) | | (27) | | (108) | | (25) | | (1) | | (161) | | — | |
Adjusted for decommissioning and inventory amortisation | 1 | | 1 | | — | | 2 | | — | | (4) | | — | | — | | (4) | | — | |
Corporate administration and marketing expenditure | — | | — | | — | | — | | — | | — | | — | | — | | — | | — | |
Lease payment sustaining | 13 | | 12 | | — | | 25 | | — | | 15 | | 4 | | 1 | | 20 | | — | |
Sustaining exploration and study costs | — | | — | | — | | — | | 1 | | 1 | | — | | — | | 2 | | — | |
Total sustaining capital expenditure | 47 | | 82 | | 1 | | 130 | | 69 | | 193 | | 82 | | — | | 344 | | — | |
All-in sustaining costs | 364 | | 350 | | 29 | | 743 | | 211 | | 506 | | 184 | | 3 | | 904 | | — | |
Adjusted for non-controlling interests and non -gold producing companies(1) | — | | — | | — | | — | | (16) | | — | | — | | — | | (16) | | — | |
All-in sustaining costs adjusted for non-controlling interests and non-gold producing companies | 364 | | 350 | | 29 | | 743 | | 195 | | 506 | | 184 | | 3 | | 888 | | — | |
All-in sustaining costs | 364 | | 350 | | 29 | | 743 | | 211 | | 506 | | 184 | | 3 | | 904 | | — | |
Non-sustaining project capital expenditure | 15 | | 40 | | — | | 55 | | — | | 2 | | — | | — | | 2 | | 52 | |
Non-sustaining lease payments | — | | — | | — | | — | | — | | — | | — | | — | | — | | — | |
Non-sustaining exploration and study costs | 27 | | 8 | | 21 | | 56 | | 1 | | 11 | | 4 | | 1 | | 17 | | 72 | |
Care and maintenance | — | | — | | — | | — | | — | | — | | — | | — | | — | | — | |
Closure and social responsibility costs not related to current operations | — | | — | | — | | — | | — | | 7 | | 2 | | 1 | | 10 | | — | |
Other provisions | — | | — | | — | | — | | — | | — | | — | | — | | — | | — | |
All-in costs | 406 | | 398 | | 50 | | 854 | | 212 | | 526 | | 190 | | 5 | | 933 | | 124 | |
Adjusted for non-controlling interests and non -gold producing companies(1) | — | | — | | — | | — | | (16) | | — | | — | | — | | (16) | | — | |
All-in costs adjusted for non-controlling interests and non-gold producing companies | 406 | | 398 | | 50 | | 854 | | 196 | | 526 | | 190 | | 5 | | 917 | | 124 | |
Gold sold – oz (000)(2) | 231 | | 264 | | — | | 495 | | 144 | | 334 | | 83 | | — | | 561 | | — | |
All-in sustaining cost per unit – $/oz(3) | 1,573 | | 1,326 | | — | | 1,500 | | 1,353 | | 1,519 | | 2,220 | | — | | 1,587 | | — | |
All-in cost per unit – $/oz(3) | 1,757 | | 1,506 | | — | | 1,725 | | 1,362 | | 1,582 | | 2,283 | | — | | 1,635 | | — | |
For the year ended 31 December 2021
Operations in Australia, America and Projects
(in $ millions, except as otherwise noted) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| AUSTRALIA | AMERICAS | |
| Sunrise Dam | Tropicana | Australia other | Total Australia | Cerro Vanguardia | AngloGold Ashanti Mineração | Serra Grande | Americas other | Total Americas |
Total cash costs | | | | | | | | | | |
Cost of sales per segmental information(5) | 364 | | 346 | | 30 | | 740 | | 261 | | 435 | | 123 | | 3 | | 822 | | |
By-product revenue | (1) | | (3) | | — | | (4) | | (93) | | (26) | | — | | — | | (119) | | |
Inventory change | (3) | | 3 | | — | | — | | 7 | | (3) | | 1 | | — | | 5 | | |
Amortisation of tangible assets | (49) | | (80) | | — | | (129) | | (27) | | (94) | | (21) | | — | | (142) | | |
Amortisation of right of use assets | (11) | | (8) | | (1) | | (20) | | — | | (14) | | (4) | | (1) | | (19) | | |
Amortisation of intangible assets | — | | — | | (1) | | (1) | | — | | — | | — | | — | | — | | |
Rehabilitation and other non-cash costs | 3 | | 3 | | (1) | | 5 | | (8) | | (12) | | — | | — | | (20) | | |
Retrenchment costs | — | | — | | — | | — | | (1) | | (1) | | — | | — | | (2) | | |
Total cash costs net of by-product revenue | 303 | | 261 | | 27 | | 591 | | 139 | | 285 | | 99 | | 2 | | 525 | | |
Adjusted for non-controlling interests, non-gold producing companies and other(1) | — | | — | | — | | — | | (10) | | — | | — | | — | | (10) | | |
Total cash costs net of by-product revenue adjusted for non-controlling interests and non-gold producing companies | 303 | | 261 | | 27 | | 591 | | 129 | | 285 | | 99 | | 2 | | 515 | | |
Gold produced – oz (000)(2) | 229 | | 265 | | — | | 494 | | 145 | | 331 | | 83 | | — | | 559 | | |
Total cash costs per unit – $/oz(3) | 1,321 | | 987 | | — | | 1,196 | | 894 | | 858 | | 1,192 | | — | | 921 | | |
For the year ended 31 December 2021
AngloGold Ashanti operations – Total
(in $ millions, except as otherwise noted) | | | | | | | | |
| JOINT VENTURES | SUBSIDIARIES |
All-in sustaining costs | | |
Cost of sales per segmental information(5) | 350 | | 2,857 | |
By-product revenue | (2) | | (126) | |
Cost of sales | 348 | | 2,731 | |
Realised other commodity contracts | | |
Amortisation of tangible, intangible and right of use assets | (105) | | (477) | |
Adjusted for decommissioning and inventory amortisation | 1 | | — | |
Corporate administration and marketing expenditure | — | | 73 | |
Lease payment sustaining | 9 | | 70 | |
Sustaining exploration and study costs | — | | 10 | |
Total sustaining capital expenditure | 61 | | 717 | |
All-in sustaining costs | 314 | | 3,124 | |
Adjusted for non-controlling interests and non-gold producing companies(1) | — | | (74) | |
All-in sustaining costs adjusted for non-controlling interests and non-gold producing companies | 314 | | 3,050 | |
All-in sustaining costs | 314 | | 3,124 | |
Non-sustaining project capital expenditure | 11 | | 311 | |
Non-sustaining lease payments | — | | 2 | |
Non-sustaining exploration and study costs | 2 | | 153 | |
Care and maintenance | — | | 45 | |
Closure and social responsibility costs not related to current operations | 3 | | 24 | |
Other provisions | — | | 4 | |
All-in costs | 330 | | 3,663 | |
Adjusted for non-controlling interests and non-gold producing companies(1) | — | | (77) | |
All-in costs adjusted for non-controlling interests and non-gold producing companies | 330 | | 3,586 | |
Gold sold – oz (000)(2) | 367 | | 2,116 | |
All-in sustaining cost per unit – $/oz(3) | 856 | | 1,441 | |
All-in cost per unit – $/oz(3) | 900 | | 1,695 | |
For the year ended 31 December 2021
AngloGold Ashanti operations – Total
(in $ millions, except as otherwise noted) | | | | | | | | |
| JOINT VENTURES | SUBSIDIARIES |
Total cash costs | | |
Cost of sales per segmental information(5) | 350 | | 2,857 | |
By-product revenue | (2) | | (126) | |
Inventory change | (1) | | (6) | |
Amortisation of tangible assets | (100) | | (411) | |
Amortisation of right of use assets | (5) | | (63) | |
Amortisation of intangible assets | — | | (3) | |
Rehabilitation and other non-cash costs | (5) | | (38) | |
Retrenchment costs | — | | (2) | |
Total cash costs net of by-product revenue | 237 | | 2,208 | |
Adjusted for non-controlling interests, non-gold producing companies and other(1) | — | | (65) | |
Total cash costs net of by-product revenue adjusted for non-controlling interests and non-gold producing companies | 237 | | 2,143 | |
Gold produced – oz (000)(2) | 365 | | 2,107 | |
Total cash costs per unit – $/oz(3) | 647 | | 1,017 | |
For the year ended 31 December 2020
Corporate and other
(in $ millions, except as otherwise noted) | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | Corporate (4) |
All-in sustaining costs | | | | | | | | | | | | | | | | | | | |
Cost of sales per segmental information(5) | | | | | | | | | | | | | | | | | | | (2) | |
By-product revenue | | | | | | | | | | | | | | | | | | | — | |
Cost of sales | | | | | | | | | | | | | | | | | | | (2) | |
Realised other commodity contracts | | | | | | | | | | | | | | | | | | | 5 | |
Amortisation of tangible, intangible and right of use assets | | | | | | | | | | | | | | | | | | | (2) | |
Adjusted for decommissioning and inventory amortisation | | | | | | | | | | | | | | | | | | | (1) | |
Corporate administration and marketing expenditure | | | | | | | | | | | | | | | | | | | 67 | |
Lease payment sustaining | | | | | | | | | | | | | | | | | | | 3 | |
Sustaining exploration and study costs | | | | | | | | | | | | | | | | | | | 1 | |
Total sustaining capital expenditure | | | | | | | | | | | | | | | | | | | 2 | |
All-in sustaining costs | | | | | | | | | | | | | | | | | | | 73 | |
Adjusted for non-controlling interests and non-gold producing companies(1) | | | | | | | | | | | | | | | | | | | — | |
All-in sustaining costs adjusted for non-controlling interests and non-gold producing companies | | | | | | | | | | | | | | | | | | | 73 | |
All-in sustaining costs | | | | | | | | | | | | | | | | | | | 73 | |
Non-sustaining project capital expenditure | | | | | | | | | | | | | | | | | | | — | |
Non-sustaining lease payments | | | | | | | | | | | | | | | | | | | — | |
Non-sustaining exploration and study costs | | | | | | | | | | | | | | | | | | | — | |
Care and maintenance | | | | | | | | | | | | | | | | | | | — | |
Closure and social responsibility costs not related to current operations | | | | | | | | | | | | | | | | | | | 9 | |
Other provisions | | | | | | | | | | | | | | | | | | | — | |
All-in costs | | | | | | | | | | | | | | | | | | | 82 | |
Adjusted for non-controlling interests and non-gold producing companies(1) | | | | | | | | | | | | | | | | | | | — | |
All-in costs adjusted for non-controlling interests and non-gold producing companies | | | | | | | | | | | | | | | | | | | 82 | |
Gold sold - oz (000)(2) | | | | | | | | | | | | | | | | | | | — | |
All-in sustaining cost per unit - $/oz(3) | | | | | | | | | | | | | | | | | | | — | |
All-in cost per unit - $/oz(3) | | | | | | | | | | | | | | | | | | | — | |
(1)Adjusting for non-controlling interest of items included in calculation, to disclose the attributable portions only.
(2)Attributable portion.
(3)In addition to the operational performances of the mines, “all-in sustaining cost per ounce”, “all-in cost per ounce” and “total cash costs per ounce” are affected by fluctuations in the currency exchange rate. AngloGold Ashanti reports “all-in sustaining cost per ounce” and “all-in cost per ounce” calculated to the nearest US dollar amount and gold sold in ounces. AngloGold Ashanti reports “total cash costs per ounce” calculated to the nearest US dollar amount and gold produced in ounces.
(4)Corporate includes non-gold producing subsidiaries.
(5)Refer to “Item 18: Financial Statements—Note 2—Segmental Information”.
(6)A new segment for Projects (previously reported under the Americas segment) has been introduced due to the implementation of the new Operating Model which comprises all the major non-sustaining capital projects with the potential to be developed into operating entities. Comparative information has been restated.
Rounding of figures may result in computational discrepancies.
For the year ended 31 December 2020
Corporate and other
(in $ millions, except as otherwise noted)
| | | | | | | | | | | | | | | | | | | | | | | |
| | | |
| | | | | | | | | | | | | | | Corporate (4) |
|
All-in sustainingTotal cash costs | | | | | | | | | | | | | | | | | | | |
Cost of sales per segmental information(5) | | (1 | ) |
By-product revenue | | — |
|
Amortisation of tangible and intangible assets | | (3 | ) |
Adjusted for decommissioning and inventory amortisation | | (1 | ) |
Lease payment sustaining | | 5 |
|
Corporate administration and marketing related to current operations | | 82 |
|
Inventory writedown to net realisable value and other stockpile adjustments | | — |
|
Sustaining exploration and study costs | | 1 |
|
Total sustaining capital expenditure | | — |
|
Amortisation relating to inventory | | — |
|
Realised other commodity contracts | | — |
|
All-in sustaining costs | | 83 |
|
Adjusted for non-controlling interests and non-gold producing companies(1)
| | — |
|
All-in sustaining costs adjusted for non-controlling interests and non-gold producing companies | | 82 |
|
All-in sustaining costs | | 83 |
|
Non-sustaining project capital expenditure | | — |
|
Lease payment non sustaining | | — |
|
Technology improvements | | — |
|
Non-sustaining exploration and study costs | | (1 | ) |
Care and maintenance | | — |
|
Corporate and social responsibility costs not related to current operations | | 7 |
|
Other provisions | | 2 |
|
All-in costs | | 91 |
|
Adjusted for non-controlling interests and non-gold producing companies(1)
| | — |
|
All-in costs adjusted for non-controlling interests and non-gold producing companies | | 90 |
|
Gold sold - oz (000)(2)
| | — |
|
All-in sustaining cost per unit - $/oz(3)
| | — |
|
All-in cost per unit - $/oz(3)
| | — |
|
| |
(1)
| Adjusting for non-controlling interest of items included in calculation, to disclose the attributable portions only. Other consists of heap leach inventory. |
| |
(2)
| Attributable portion (excluding pre-production ounces). |
| |
(3)
| In addition to the operational performances of the mines, all-in sustaining cost per ounce, all-in cost per ounce and total cash costs per ounce are affected by fluctuations in the currency exchange rate. AngloGold Ashanti reports all-in sustaining cost per ounce and all-in cost per ounce calculated to the nearest US dollar amount and gold sold in ounces. AngloGold Ashanti reports total cash costs per ounce calculated to the nearest US dollar amount and gold produced in ounces. |
| |
(4)
| Corporate includes non-gold producing subsidiaries. |
| |
(5)
| Refer to “Item 18: Financial Statements - Note 2 - Segmental Information”. |
Rounding of figures may result in computational differences.
For the year ended 31 December 2019
Corporate and other
(in $ millions, except as otherwise noted)
|
| | | |
| | Corporate(4)
|
| | | | | | | | | | | (2) | |
Total cash costsBy-product revenue | | | | | | | | | | | | | | | | | | | — | |
Cost of sales per segmental information(5)Inventory change | | (1 | ) | | | | | | | | | | | | | | | | — | |
By-product revenueAmortisation of tangible assets | | — |
| | | | | | | | | | | | | | | | — | |
Inventory changeAmortisation of right of use assets | | 4 |
| | | | | | | | | | | | | | | | — | |
Amortisation of intangible assets | | — |
| | | | | | | | | | | | | | | | (2) | |
Amortisation of tangible and intangible assets | | (3 | ) |
Rehabilitation and other non-cash costs | | — |
| | | | | | | | | | | | | | | | — | |
Retrenchment costs | | — |
| | | | | | | | | | | | | | | | — | |
Total cash costs net of by-product revenue | | 1 |
| | | | | | | | | | | | | | | | (4) | |
Adjusted for non-controlling interests, non-gold producing companies and other(1) | | — |
| | | | | | | | | | | | | | | | — | |
Total cash costs net of by-product revenue adjusted for non-controlling interests and non-gold producing companies | | 1 |
| | | | | | | | | | | | | | | | (4) | |
Gold produced – oz (000)(2) | | — |
| | | | | | | | | | | | | | | | — | |
Total cash costs per unit – $/oz(3) | | — |
|
For the year ended 31 December 2019
Operations in Continental Africa (DRC, Ghana, Guinea, Mali and Tanzania)
(in $ millions, except as otherwise noted)
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| DRC | | Mali | | Joint | | Ghana | | Guinea | | Tanzania | | Continental Africa other |
| | Subsidiaries |
|
| Kibali |
| | Morila |
| | Sadiola |
| | Ventures |
| | Iduapriem |
| | Obuasi |
| | Siguiri |
| | Geita |
| | |
All-in sustaining costs | | | | | | | | | | | | | | | | | | | |
Cost of sales per segmental information(5) | 338 |
| | 36 |
| | 54 |
| | 428 |
| | 288 |
| | — |
| | 315 |
| | 571 |
| | (1 | ) | | 1,173 |
|
By-product revenue | (1 | ) | | — |
| | — |
| | (1 | ) | | (1 | ) | | — |
| | — |
| | (1 | ) | | — |
| | (2 | ) |
Amortisation of tangible and intangible assets | (130 | ) | | (3 | ) | | (4 | ) | | (137 | ) | | (58 | ) | | — |
| | (38 | ) | | (133 | ) | | (1 | ) | | (230 | ) |
Adjusted for decommissioning and inventory amortisation | 1 |
| | 1 |
| | — |
| | 2 |
| | 1 |
| | — |
| | — |
| | 3 |
| | 1 |
| | 4 |
|
Lease payment sustaining | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | 19 |
| | — |
| | 19 |
|
Corporate administration and marketing related to current operations | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
Inventory writedown to net realisable value and other stockpile adjustments | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
Sustaining exploration and study costs | — |
| | — |
| | — |
| | — |
| | 3 |
| | — |
| | 3 |
| | 6 |
| | (1 | ) | | 12 |
|
Total sustaining capital expenditure | 46 |
| | — |
| | — |
| | 46 |
| | 16 |
| | — |
| | 15 |
| | 75 |
| | — |
| | 107 |
|
Amortisation relating to inventory | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
Realised other commodity contracts | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
All-in sustaining costs | 254 |
| | 34 |
| | 50 |
| | 338 |
| | 249 |
| | — |
| | 295 |
| | 540 |
| | (1 | ) | | 1,083 |
|
Adjusted for non-controlling interests and non -gold producing companies(1) | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | (44 | ) | | — |
| | — |
| | (44 | ) |
All-in sustaining costs adjusted for non-controlling interests and non-gold producing companies | 254 |
| | 34 |
| | 50 |
| | 338 |
| | 249 |
| | — |
| | 251 |
| | 540 |
| | (1 | ) | | 1,039 |
|
All-in sustaining costs | 254 |
| | 34 |
| | 50 |
| | 338 |
| | 249 |
| | — |
| | 295 |
| | 540 |
| | (1 | ) | | 1,083 |
|
Non-sustaining project capital expenditure | 5 |
| | — |
| | — |
| | 5 |
| | — |
| | 246 |
| | 6 |
| | — |
| | — |
| | 252 |
|
Lease payment non sustaining | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | 1 |
| | — |
| | 1 |
|
Technology improvements | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
Non-sustaining exploration and study costs | 5 |
| | — |
| | — |
| | 4 |
| | 1 |
| | — |
| | 4 |
| | 4 |
| | 1 |
| | 10 |
|
Care and maintenance costs | — |
| | — |
| | — |
| | — |
| | — |
| | 48 |
| | — |
| | — |
| | (1 | ) | | 47 |
|
Corporate and social responsibility costs not related to current operations | 1 |
| | — |
| | — |
| | — |
| | 2 |
| | — |
| | 9 |
| | — |
| | — |
| | 11 |
|
Other provisions | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
All-in costs | 265 |
| | 34 |
| | 49 |
| | 347 |
| | 252 |
| | 294 |
| | 314 |
| | 545 |
| | (1 | ) | | 1,404 |
|
Adjusted for non-controlling interests and non-gold producing companies(1) | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | (47 | ) | | — |
| | — |
| | (47 | ) |
All-in costs adjusted for non-controlling interests and non-gold producing companies | 265 |
| | 34 |
| | 49 |
| | 347 |
| | 252 |
| | 294 |
| | 267 |
| | 545 |
| | (1 | ) | | 1,357 |
|
Gold sold – oz (000)(2) | 362 |
| | 28 |
| | 52 |
| | 442 |
| | 280 |
| | — |
| | 213 |
| | 604 |
| | — |
| | 1,096 |
|
All-in sustaining cost per unit – $/oz(3) | 704 |
| | 1,237 |
| | 956 |
| | 767 |
| | 890 |
| | — |
| | 1,176 |
| | 894 |
| | — |
| | 947 |
|
All-in cost per unit – $/oz(3) | 734 |
| | 1,237 |
| | 930 |
| | 785 |
| | 900 |
| | — |
| | 1,252 |
| | 903 |
| | — |
| | 1,237 |
|
For the year ended 31 December 2019
Operations in Continental Africa (DRC, Ghana, Guinea, Mali and Tanzania)
(in $ millions, except as otherwise noted)
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| DRC | | Mali | | Joint | | Ghana | | Guinea | | Tanzania | | Continental Africa other |
| | Subsidiaries |
|
| Kibali |
| | Morila |
| | Sadiola |
| | Ventures | | Iduapriem |
| | Obuasi |
| | Siguiri |
| | Geita |
| | |
Total cash costs | | | | | | | | | | | | | | | | | | | |
Cost of sales per segmental information(5) | 338 |
| | 36 |
| | 54 |
| | 428 |
| | 288 |
| | — |
| | 315 |
| | 571 |
| | (1 | ) | | 1,173 |
|
By-product revenue | (1 | ) | | — |
| | — |
| | (1 | ) | | (1 | ) | | — |
| | — |
| | (1 | ) | | — |
| | (2 | ) |
Inventory change | 4 |
| | (1 | ) | | — |
| | 3 |
| | (5 | ) | | — |
| | 1 |
| | (9 | ) | | 1 |
| | (12 | ) |
Amortisation of intangible assets | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
Amortisation of tangible and intangible assets | (130 | ) | | (3 | ) | | (4 | ) | | (137 | ) | | (58 | ) | | — |
| | (38 | ) | | (133 | ) | | (1 | ) | | (230 | ) |
Rehabilitation and other non-cash costs | (1 | ) | | 1 |
| | — |
| | (1 | ) | | — |
| | — |
| | (5 | ) | | (8 | ) | | (2 | ) | | (14 | ) |
Retrenchment costs | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
Total cash costs net of by-product revenue | 210 |
| | 33 |
| | 50 |
| | 292 |
| | 224 |
| | — |
| | 273 |
| | 420 |
| | (2 | ) | | 915 |
|
Adjusted for non-controlling interests, non-gold producing companies and other(1) | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | (41 | ) | | — |
| | — |
| | (41 | ) |
Total cash costs net of by-product revenue adjusted for non-controlling interests and non-gold producing companies | 210 |
| | 33 |
| | 50 |
| | 292 |
| | 224 |
| | — |
| | 232 |
| | 420 |
| | (2 | ) | | 874 |
|
Gold produced - oz (000) (2) | 366 |
| | 27 |
| | 51 |
| | 445 |
| | 275 |
| | — |
| — |
| 213 |
| — |
| 604 |
| — |
| — |
| | 1,091 |
|
Total cash costs per unit - $/oz(3) | 572 |
| | 1,205 |
| | 966 |
| | 657 |
| | 815 |
| | — |
| | 1,091 |
| | 695 |
| | — |
| | 801 |
|
For the year ended 31 December 2019
Operations in Australia and the Americas (Argentina and Brazil)
(in $ millions, except as otherwise noted)
|
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| Australia | | Total Australia |
| | Argentina | | Brazil | | Americas other |
| | Total Americas |
|
Sunrise Dam |
| | Tropicana |
| | Australia other |
| | | Cerro Vanguardia |
| | AngloGold Ashanti Mineração |
| | Serra Grande |
| | |
All-in sustaining costs | | | | | | | | | | | | | | | | | |
Cost of sales per segmental information(5) | 318 |
| | 297 |
| | 17 |
| | 632 |
| | 274 |
| | 417 |
| | 130 |
| | 1 |
| | 822 |
|
By-product revenue | — |
| | (2 | ) | | — |
| | (3 | ) | | (61 | ) | | (20 | ) | | — |
| | (1 | ) | | (81 | ) |
Amortisation of tangible and intangible assets | (56 | ) | | (111 | ) | | (7 | ) | | (173 | ) | | (40 | ) | | (103 | ) | | (34 | ) | | — |
| | (177 | ) |
Adjusted for decommissioning and inventory amortisation | 2 |
| | — |
| | — |
| | 2 |
| | (3 | ) | | (3 | ) | | — |
| | 2 |
| | (5 | ) |
Lease payment sustaining | 8 |
| | 4 |
| | 8 |
| | 20 |
| | — |
| | 7 |
| | — |
| | — |
| | 7 |
|
Corporate administration and marketing related to current operations | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
Inventory writedown to net realisable value and other stockpile adjustments | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
Sustaining exploration and study costs | 4 |
| | — |
| | — |
| | 4 |
| | 1 |
| | 8 |
| | 5 |
| | — |
| | 14 |
|
Total sustaining capital expenditure | 43 |
| | 83 |
| | — |
| | 126 |
| | 33 |
| | 91 |
| | 34 |
| | — |
| | 157 |
|
Amortisation relating to inventory | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
Realised other commodity contracts | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
All-in sustaining costs | 319 |
| | 271 |
| | 18 |
| | 609 |
| | 204 |
| | 397 |
| | 136 |
| | 2 |
| | 737 |
|
Adjusted for non-controlling interests and non -gold producing companies(1) | — |
| | — |
| | — |
| | — |
| | (15 | ) | | — |
| | — |
| | — |
| | (15 | ) |
All-in sustaining costs adjusted for non-controlling interests and non-gold producing companies | 319 |
| | 271 |
| | 18 |
| | 609 |
| | 189 |
| | 397 |
| | 136 |
| | 2 |
| | 722 |
|
All-in sustaining costs | 319 |
| | 271 |
| | 18 |
| | 609 |
| | 204 |
| | 397 |
| | 136 |
| | 2 |
| | 737 |
|
Non-sustaining project capital expenditure | — |
| | 23 |
| | — |
| | 23 |
| | — |
| | — |
| | — |
| | 38 |
| | 38 |
|
Lease payment non sustaining | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
Technology improvements | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
Non-sustaining exploration and study costs | 5 |
| | 4 |
| | 18 |
| | 27 |
| | 1 |
| | 3 |
| | 1 |
| | 44 |
| | 49 |
|
Care and maintenance | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
Corporate and social responsibility costs not related to current operations | — |
| | — |
| | — |
| | — |
| | — |
| | 17 |
| | 3 |
| | — |
| | 20 |
|
Other provisions | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
All-in costs | 324 |
| | 298 |
| | 36 |
| | 659 |
| | 205 |
| | 418 |
| | 140 |
| | 83 |
| | 844 |
|
Adjusted for non-controlling interests and non -gold producing companies(1) | — |
| | — |
| | — |
| | — |
| | (15 | ) | | — |
| | — |
| | — |
| | (15 | ) |
All-in costs adjusted for non-controlling interests and non-gold producing companies | 324 |
| | 298 |
| | 36 |
| | 659 |
| | 190 |
| | 418 |
| | 140 |
| | 83 |
| | 829 |
|
Gold sold – oz (000)(2) | 256 |
| | 358 |
| | — |
| | 614 |
| | 219 |
| | 358 |
| | 122 |
| | — |
| | 700 |
|
All-in sustaining cost per unit – $/oz(3) | 1,246 |
| | 757 |
| | — |
| | 990 |
| | 859 |
| | 1,107 |
| | 1,105 |
| | — |
| | 1,032 |
|
All-in cost per unit – $/oz(3) | 1,266 |
| | 830 |
| | — |
| | 1,072 |
| | 863 |
| | 1,164 |
| | 1,141 |
| | — |
| | 1,183 |
|
For the year ended 31 December 2019
Operations in Australia and the Americas (Argentina and Brazil)
(in $ millions, except as otherwise noted)
|
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| Australia | | Total Australia |
| | Argentina | | Brazil | | Americas other |
| | Total Americas |
|
| Sunrise Dam |
| | Tropicana |
| | Australia other |
| | | Cerro Vanguardia |
| | AngloGold Ashanti Mineração |
| | Serra Grande |
| | |
Total cash costs | | | | | | | | | | | | | | | | | |
Cost of sales per segmental information(5) | 318 |
| | 297 |
| | 17 |
| | 632 |
| | 274 |
| | 417 |
| | 131 |
| | 1 |
| | 822 |
|
By-product revenue | — |
| | (3 | ) | | — |
| | (3 | ) | | (61 | ) | | (20 | ) | | — |
| | (1 | ) | | (81 | ) |
Inventory change | (1 | ) | | (1 | ) | | — |
| | (2 | ) | | 3 |
| | (1 | ) | | — |
| | — |
| | 2 |
|
Amortisation of intangible assets | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
Amortisation of tangible and intangible assets | (56 | ) | | (111 | ) | | (7 | ) | | (173 | ) | | (40 | ) | | (103 | ) | | (34 | ) | | — |
| | (177 | ) |
Rehabilitation and other non-cash costs | (3 | ) | | (1 | ) | | (1 | ) | | (5 | ) | | (11 | ) | | (12 | ) | | (10 | ) | | — |
| | (33 | ) |
Retrenchment costs | — |
| | — |
| | — |
| | (1 | ) | | (1 | ) | | (2 | ) | | — |
| | (1 | ) | | (3 | ) |
Total cash costs net of by-product revenue | 258 |
| | 181 |
| | 9 |
| | 448 |
| | 164 |
| | 279 |
| | 87 |
| | (2 | ) | | 530 |
|
Adjusted for non-controlling interests, non-gold producing companies and other(1) | — |
| | — |
| | — |
| | — |
| | (12 | ) | | — |
| | — |
| | — |
| | (12 | ) |
Total cash costs net of by-product revenue adjusted for non-controlling interests and non-gold producing companies | 258 |
| | 181 |
| | 9 |
| | 448 |
| | 152 |
| | 279 |
| | 87 |
| | (2 | ) | | 518 |
|
Gold produced – oz (000) (2) | 254 |
| | 360 |
| | — |
| | 614 |
| | 225 |
| | 362 |
| | 123 |
| | — |
| | 710 |
|
Total cash costs per unit – $/oz(3) | 1,014 |
| | 504 |
| | — |
| | 730 |
| | 673 |
| | 782 |
| | 707 |
| | — |
| | 736 |
|
For the year ended 31 December 2019
AngloGold Ashanti operations – Total
(from continuing operations - in $ millions, except as otherwise noted)
|
| | | | |
| JOINT VENTURES |
| SUBSIDIARIES |
|
All-in sustaining costs | | |
Cost of sales per segmental information(5) | 428 |
| 2,626 |
|
By-product revenue | (1 | ) | (86 | ) |
Amortisation of tangible and intangible assets | (137 | ) | (583 | ) |
Adjusted for decommissioning and inventory amortisation | 2 |
| 1 |
|
Lease payment sustaining | — |
| 51 |
|
Corporate administration and marketing related to current operations | — |
| 82 |
|
Inventory write-down to net realisable value and other stockpile adjustments | — |
| — |
|
Sustaining exploration and study costs | — |
| 31 |
|
Total sustaining capital expenditure | 46 |
| 390 |
|
Amortisation relating to inventory | — |
| — |
|
Realised other commodity contracts | — |
| — |
|
All-in sustaining costs | 338 |
| 2,512 |
|
Adjusted for non-controlling interests and non-gold producing companies(1) | — |
| (60 | ) |
All-in sustaining costs adjusted for non-controlling interests and non-gold producing companies | 338 |
| 2,452 |
|
All-in sustaining costs | 338 |
| 2,512 |
|
Non-sustaining project capital expenditure | 5 |
| 313 |
|
Lease payment non sustaining | — |
| 1 |
|
Technology improvements | — |
| — |
|
Non-sustaining exploration and study costs | 4 |
| 85 |
|
Care and maintenance costs | — |
| 47 |
|
Corporate and social responsibility costs not related to current operations | — |
| 38 |
|
Other provisions | — |
| 2 |
|
All-in costs | 347 |
| 2,998 |
|
Adjusted for non-controlling interests and non-gold producing companies(1) | — |
| (62 | ) |
All-in costs adjusted for non-controlling interests and non-gold producing companies | 347 |
| 2,936 |
|
Gold sold – oz (000)(2) | 442 |
| 2,410 |
|
All-in sustaining cost per unit – $/oz(3) | 767 |
| 1,017 |
|
All-in cost per unit – $/oz(3) | 785 |
| 1,218 |
|
For the year ended 31 December 2019
AngloGold Ashanti operations – Total
(from continuing operations - in $ millions, except as otherwise noted)
|
| | | | |
| JOINT VENTURES |
| SUBSIDIARIES |
|
Total cash costs | | |
Cost of sales per segmental information(5) | 428 |
| 2,626 |
|
By-product revenue | (1 | ) | (86 | ) |
Inventory change | 3 |
| (5 | ) |
Amortisation of intangible assets | — |
| — |
|
Amortisation of tangible and intangible assets | (137 | ) | (583 | ) |
Rehabilitation and other non-cash costs | (1 | ) | (53 | ) |
Retrenchment costs | — |
| (4 | ) |
Total cash costs net of by-product revenue | 292 |
| 1,895 |
|
Adjusted for non-controlling interests, non-gold producing companies and other(1) | — |
| (53 | ) |
Total cash costs net of by-product revenue adjusted for non-controlling interests and non-gold producing companies | 292 |
| 1,841 |
|
Gold produced – oz (000)(2) | 445 |
| 2,415 |
|
Total cash costs (adjusted) per unit – $/oz(3) | 657 |
| 763 |
|
For the year ended 31 December 2018
Corporate and other
(in $ millions, except as otherwise noted)
| | | | | | | | | | | | | | | — | |
| | | |
| | Corporate (4)
|
|
All-in sustaining costs | | |
Cost of sales per segmental information(5)
| | (2 | ) |
By-product revenue | | (1 | ) |
Amortisation of tangible and intangible assets | | (3 | ) |
Adjusted for decommissioning and inventory amortisation | | — |
|
Lease payment sustaining | | — |
|
Corporate administration and marketing related to current operations | | 76 |
|
Inventory writedown to net realisable value and other stockpile adjustments | | — |
|
Sustaining exploration and study costs | | 1 |
|
Total sustaining capital expenditure | | 3 |
|
Amortisation relating to inventory | | — |
|
Realised other commodity contracts | | — |
|
All-in sustaining costs | | 72 |
|
Adjusted for non-controlling interests and non -gold producing companies(1)
| | — |
|
All-in sustaining costs adjusted for non-controlling interests and non-gold producing companies | | 73 |
|
All-in sustaining costs | | 72 |
|
Non-sustaining project capital expenditure | | (1 | ) |
Lease payment non sustaining | | — |
|
Technology improvements | | — |
|
Non-sustaining exploration and study costs | | 1 |
|
Care and maintenance | | — |
|
Corporate and social responsibility costs not related to current operations | | 6 |
|
Other provisions | | (1 | ) |
All-in costs | | 79 |
|
Adjusted for non-controlling interests and non -gold producing companies(1)
| | — |
|
All-in costs adjusted for non-controlling interests and non-gold producing companies | | 79 |
|
Gold sold - oz (000)(2)
| | — |
|
All-in sustaining cost per unit - $/oz(3)
| | — |
|
All-in cost per unit - $/oz(3)
| | — |
|
| |
(1)
| Adjusting for non-controlling interest of items included in calculation, to disclose the attributable portions only. Other consists of heap leach inventory. |
| |
(3)
| In addition to the operational performances of the mines, all-in sustaining cost per ounce, all-in cost per ounce and total cash costs per ounce are affected by fluctuations in the currency exchange rate. AngloGold Ashanti reports all-in sustaining cost per ounce and all-in cost per ounce calculated to the nearest US dollar amount and gold sold in ounces. AngloGold Ashanti reports total cash costs per ounce calculated to the nearest US dollar amount and gold produced in ounces. |
| |
(4)
| Corporate includes non-gold producing subsidiaries. |
| |
(5)
| Refer to “Item 18: Financial Statements - Note 2 - Segmental Information”. |
(1)Adjusting for non-controlling interest of items included in calculation, to disclose the attributable portions only.
(2)Attributable portion.
(3)In addition to the operational performances of the mines, “all-in sustaining cost per ounce”, “all-in cost per ounce” and “total cash costs per ounce” are affected by fluctuations in the currency exchange rate. AngloGold Ashanti reports “all-in sustaining cost per ounce” and “all-in cost per ounce” calculated to the nearest US dollar amount and gold sold in ounces. AngloGold Ashanti reports “total cash costs per ounce” calculated to the nearest US dollar amount and gold produced in ounces.
(4)Corporate includes non-gold producing subsidiaries.
(5)Refer to “Item 18: Financial Statements—Note 2—Segmental Information”.
(6)A new segment for Projects (previously reported under the Americas segment) has been introduced due to the implementation of the new Operating Model which comprises all the major non-sustaining capital projects with the potential to be developed into operating entities. Comparative information has been restated.
Rounding of figures may result in computational discrepancies.
For the year ended 31 December 20182020
Corporate and otherOperations in South Africa (Discontinued operations)
(in $ millions, except as otherwise noted)
| | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | Mponeng | West Wits Operations | Surface Operations | South Africa other | Total South Africa (Operations) |
All-in sustaining costs | | | | | | | | | | | |
Cost of sales per segmental information(5) | | | | | | | 158 | | 158 | | 124 | | 4 | | 287 | |
By-product revenue | | | | | | | (1) | | — | | — | | — | | (1) | |
Cost of sales | | | | | | | 157 | | 158 | | 124 | | 4 | | 286 | |
Realised other commodity contracts | | | | | | | — | | — | | — | | — | | — | |
Amortisation of tangible, intangible and right of use assets | | | | | | | — | | — | | — | | — | | — | |
Adjusted for decommissioning and inventory amortisation | | | | | | | — | | — | | — | | — | | — | |
Corporate administration and marketing expenditure | | | | | | | — | | — | | — | | — | | — | |
Lease payment sustaining | | | | | | | — | | — | | — | | — | | — | |
Sustaining exploration and study costs | | | | | | | — | | — | | — | | — | | — | |
Total sustaining capital expenditure | | | | | | | 27 | | 27 | | 7 | | 1 | | 35 | |
All-in Sustaining costs | | | | | | | 184 | | 185 | | 131 | | 5 | | 321 | |
Adjusted for non-controlling interests and non gold producing companies (1) | | | | | | | — | | — | | — | | — | | — | |
All-in Sustaining costs adjusted for non-controlling interests and non-gold producing companies | | | | | | | 184 | | 185 | | 131 | | 5 | | 321 | |
All-in Sustaining costs | | | | | | | 184 | | 185 | | 131 | | 5 | | 321 | |
Non-Sustaining project capital expenditure | | | | | | | — | | — | | — | | — | | — | |
Non-sustaining lease payments | | | | | | | — | | — | | — | | — | | — | |
Non-sustaining exploration and study costs | | | | | | | — | | — | | — | | — | | — | |
Care and maintenance | | | | | | | — | | — | | — | | 17 | | 17 | |
Closure and social responsibility costs not related to current operations | | | | | | | — | | — | | — | | — | | — | |
Other provisions | | | | | | | — | | — | | — | | — | | — | |
All-in costs | | | | | | | 184 | | 185 | | 131 | | 22 | | 338 | |
Adjusted for non-controlling interests and non gold producing companies (1) | | | | | | | — | | — | | — | | — | | — | |
All-in costs adjusted for non-controlling interests and non-gold producing companies | | | | | | | 184 | | 185 | | 131 | | 22 | | 338 | |
Gold sold - oz (000) | | | | | | | 135 | | 135 | | 109 | | — | | 247 | |
All-in sustaining cost per unit $/oz | | | | | | | 1,365 | | 1,365 | | 1,201 | | — | | 1,296 | |
All-in cost per unit $/oz | | | | | | | 1,366 | | 1,366 | | 1,201 | | — | | 1,367 | |
|
| | | |
| | |
|
Total cash costs | | |
Cost of sales per segmental information(5)
| | (2 | ) |
By-product revenue | | (1 | ) |
Inventory change | | (1 | ) |
Amortisation of intangible assets | | (6 | ) |
Amortisation of tangible assets | | 3 |
|
Rehabilitation and other non-cash costs | | — |
|
Retrenchment costs | | (1 | ) |
Total cash costs net of by-product revenue | | (7 | ) |
Adjusted for non-controlling interests, non-gold producing companies and other(1)
| | (1 | ) |
Total cash costs net of by-product revenue adjusted for non-controlling interests and non-gold producing companies | | (7 | ) |
Gold produced – oz (000)(2)
| | — |
|
Total cash costs per unit – $/oz(3)
| | — |
|
For the year ended 31 December 20182020
Operations in ContinentalSouth Africa (DRC, Ghana, Guinea, Mali and Tanzania)(Discontinued operations)
(in $ millions, except as otherwise noted)
| | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | Mponeng | West Wits Operations | Surface Operations | South Africa other | Total South Africa (Operations) |
Total cash costs | | | | | | | | | | | |
Cost of sales per segmental information(5) | | | | | | | 158 | | 158 | | 124 | | 4 | | 287 | |
By-product revenue | | | | | | | (1) | | (1) | | — | | — | | (1) | |
Inventory change | | | | | | | (1) | | (1) | | (2) | | (4) | | (7) | |
Amortisation of tangible assets | | | | | | | — | | — | | — | | — | | — | |
Amortisation of right of use assets | | | | | | | — | | — | | — | | — | | — | |
Amortisation of intangible assets | | | | | | | — | | — | | — | | — | | — | |
Rehabilitation and other non-cash costs | | | | | | | — | | — | | — | | — | | — | |
Retrenchment costs | | | | | | | (1) | | (1) | | — | | — | | (2) | |
Total cash costs net of by-product revenue | | | | | | | 155 | | 155 | | 122 | | — | | 277 | |
Adjusted for non-controlling interests, non-gold producing companies | | | | | | | — | | — | | — | | — | | — | |
Total cash costs net of by-product revenue adjusted for non-controlling interests and non-gold producing companies | | | | | | | 155 | | 155 | | 122 | | — | | 277 | |
Gold produced – oz (000)(2) | | | | | | | 134 | | 134 | | 107 | | — | | 241 | |
Total cash costs per unit – $/oz(3) | | | | | | | 1,164 | | 1,164 | | 1,131 | | — | | 1,149 | |
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
| DRC | | Mali | Joint | | Ghana | | Guinea | Tanzania | | Continental Africa other |
| | Subsidiaries |
|
| Kibali |
| | Morila |
| | Sadiola |
| Ventures | | Iduapriem |
| | Obuasi |
| | Siguiri |
| Geita |
| | |
All-in sustaining costs | | | | | | | | | | | | | | | | | |
Cost of sales per segmental information(5) | 373 |
| | 42 |
| | 65 |
| 480 |
| | 233 |
| | (6 | ) | | 286 |
| 612 |
| | 2 |
| | 1,127 |
|
By-product revenue | (1 | ) | | — |
| | — |
| (1 | ) | | — |
| | — |
| | — |
| (2 | ) | | — |
| | (2 | ) |
Amortisation of tangible and intangible assets | (149 | ) | | (7 | ) | | (9 | ) | (165 | ) | | (29 | ) | | — |
| | (38 | ) | (144 | ) | | (3 | ) | | (214 | ) |
Adjusted for decommissioning and inventory amortisation | 1 |
| | 3 |
| | — |
| 4 |
| | — |
| | — |
| | 2 |
| 2 |
| | — |
| | 4 |
|
Lease payment sustaining | — |
| | — |
| | — |
| — |
| | — |
| | — |
| | — |
| — |
| | — |
| | — |
|
Corporate administration and marketing related to current operations | — |
| | — |
| | — |
| — |
| | — |
| | — |
| | — |
| — |
| | — |
| | — |
|
Inventory writedown to net realisable value and other stockpile adjustments | — |
| | — |
| | — |
| — |
| | — |
| | — |
| | — |
| — |
| | — |
| | — |
|
Sustaining exploration and study costs | — |
| | — |
| | — |
| — |
| | 1 |
| | — |
| | 7 |
| 8 |
| | — |
| | 16 |
|
Total sustaining capital expenditure | 54 |
| | 2 |
| | — |
| 56 |
| | 43 |
| | — |
| | 11 |
| 59 |
| | — |
| | 113 |
|
Amortisation relating to inventory | — |
| | — |
| | — |
| — |
| | — |
| | — |
| | — |
| — |
| | — |
| | — |
|
Realised other commodity contracts | — |
| | — |
| | — |
| — |
| | — |
| | — |
| | — |
| — |
| | — |
| | — |
|
All-in sustaining costs | 278 |
| | 40 |
| | 56 |
| 374 |
| | 248 |
| | (6 | ) | | 267 |
| 535 |
| | — |
| | 1,044 |
|
Adjusted for non-controlling interests and non -gold producing companies(1) | — |
| | — |
| | — |
| — |
| | — |
| | — |
| | (40 | ) | — |
| | — |
| | (40 | ) |
All-in sustaining costs adjusted for non-controlling interests and non-gold producing companies | 278 |
| | 40 |
| | 56 |
| 374 |
| | 248 |
| | (6 | ) | | 227 |
| 535 |
| | — |
| | 1,004 |
|
All-in sustaining costs | 278 |
| | 40 |
| | 56 |
| 374 |
| | 248 |
| | (6 | ) | | 267 |
| 535 |
| | — |
| | 1,044 |
|
Non-sustaining project capital expenditure | 10 |
| | — |
| | 1 |
| 11 |
| | — |
| | 48 |
| | 85 |
| — |
| | — |
| | 133 |
|
Lease payment non sustaining | — |
| | — |
| | — |
| — |
| | — |
| | — |
| | — |
| — |
| | — |
| | — |
|
Technology improvements | — |
| | — |
| | — |
| — |
| | — |
| | — |
| | — |
| — |
| | — |
| | — |
|
Non-sustaining exploration and study costs | 1 |
| | — |
| | — |
| 1 |
| | — |
| | 1 |
| | 10 |
| — |
| | — |
| | 11 |
|
Care and maintenance costs | — |
| | — |
| | — |
| — |
| | — |
| | 39 |
| | — |
| — |
| | — |
| | 39 |
|
Corporate and social responsibility costs not related to current operations | — |
| | — |
| | — |
| — |
| | — |
| | — |
| | — |
| — |
| | — |
| | — |
|
Other provisions | — |
| | — |
| | — |
| — |
| | — |
| | — |
| | — |
| — |
| | — |
| | — |
|
All-in costs | 289 |
| | 40 |
| | 57 |
| 386 |
| | 248 |
| | 82 |
| | 362 |
| 535 |
| | — |
| | 1,227 |
|
Adjusted for non-controlling interests and non -gold producing companies(1) | — |
| | — |
| | — |
| — |
| | — |
| | — |
| | (54 | ) | — |
| | — |
| | (54 | ) |
All-in costs adjusted for non-controlling interests and non-gold producing companies | 289 |
| | 40 |
| | 57 |
| 386 |
| | 248 |
| | 82 |
| | 308 |
| 535 |
| | — |
| | 1,173 |
|
Gold sold – oz (000)(2) | 370 |
| | 30 |
| | 58 |
| 459 |
| | 254 |
| | — |
| | 244 |
| 568 |
| | — |
| | 1,066 |
|
All-in sustaining cost per unit – $/oz(3) | 752 |
| | 1,321 |
| | 990 |
| 820 |
| | 977 |
| | — |
| | 930 |
| 940 |
| | — |
| | 941 |
|
All-in cost per unit – $/oz(3) | 782 |
| | 1,321 |
| | 1,005 |
| 846 |
| | 977 |
| | — |
| | 1,261 |
| 940 |
| | — |
| | 1,099 |
|
For the year ended 31 December 20182020
Operations in Continental Africa (DRC, Ghana, Guinea, Mali and Tanzania)
(in $ millions, except as otherwise noted) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| AFRICA | AFRICA |
| Kibali | Other | Joint Ventures | Iduapriem | Obuasi Restated | Siguiri | Geita | Africa Other | Subsidiaries Restated |
All-in sustaining costs | | | | | | | | | |
Cost of sales per segmental information(5) | 340 | | — | | 340 | | 280 | | 164 | | 377 | | 542 | | (1) | | 1,362 | |
By-product revenue | (1) | | — | | (1) | | (1) | | — | | — | | (2) | | — | | (3) | |
Cost of sales | 339 | | — | | 339 | | 279 | | 164 | | 377 | | 540 | | (1) | | 1,359 | |
Realised other commodity contracts | — | | — | | — | | — | | — | | — | | — | | — | | — | |
Amortisation of tangible, intangible and right of use assets | (104) | | — | | (104) | | (74) | | (11) | | (41) | | (124) | | — | | (250) | |
Adjusted for decommissioning and inventory amortisation | 1 | | — | | 1 | | 1 | | — | | — | | 4 | | — | | 5 | |
Corporate administration and marketing expenditure | — | | — | | — | | — | | — | | — | | — | | — | | — | |
Lease payment sustaining | 9 | | — | | 9 | | — | | — | | — | | 17 | | — | | 17 | |
Sustaining exploration and study costs | — | | — | | — | | 3 | | — | | 2 | | 5 | | — | | 10 | |
Total sustaining capital expenditure | 52 | | — | | 52 | | 60 | | 7 | | 15 | | 80 | | 1 | | 163 | |
All-in sustaining costs | 296 | | — | | 297 | | 269 | | 161 | | 353 | | 522 | | — | | 1,304 | |
Adjusted for non-controlling interests and non -gold producing companies(1) | — | | — | | — | | — | | — | | (53) | | — | | — | | (53) | |
All-in sustaining costs adjusted for non-controlling interests and non-gold producing companies | 296 | | — | | 297 | | 269 | | 161 | | 300 | | 522 | | — | | 1,251 | |
All-in sustaining costs | 296 | | — | | 297 | | 269 | | 161 | | 353 | | 522 | | — | | 1,304 | |
Non-sustaining project capital expenditure | — | | — | | — | | — | | 199 | | 15 | | 7 | | — | | 220 | |
Non-sustaining lease payments | — | | — | | — | | — | | — | | — | | 2 | | — | | 2 | |
Non-sustaining exploration and study costs | — | | — | | — | | 2 | | 2 | | 5 | | 2 | | — | | 11 | |
Care and maintenance | — | | — | | — | | — | | — | | — | | — | | — | | — | |
Closure and social responsibility costs not related to current operations | 2 | | 3 | | 4 | | — | | 10 | | — | | — | | — | | 10 | |
Other provisions | — | | — | | — | | — | | — | | — | | — | | — | | — | |
All-in costs | 298 | | 3 | | 301 | | 271 | | 371 | | 373 | | 533 | | — | | 1,546 | |
Adjusted for non-controlling interests and non-gold producing companies(1) | — | | — | | — | | — | | — | | (56) | | — | | — | | (56) | |
All-in costs adjusted for non-controlling interests and non-gold producing companies | 298 | | 3 | | 301 | | 271 | | 371 | | 317 | | 533 | | — | | 1,490 | |
Gold sold – oz (000)(2) | 365 | | — | | 365 | | 274 | | 120 | | 215 | | 639 | | — | | 1,249 | |
All-in sustaining cost per unit – $/oz(3) | 809 | | — | | 810 | | 985 | | 1,332 | | 1,397 | | 814 | | — | | 1,002 | |
All-in cost per unit – $/oz(3) | 817 | | — | | 824 | | 992 | | 3,078 | | 1,476 | | 831 | | — | | 1,193 | |
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| DRC | | Mali | | Joint | | Ghana | | Guinea | | Tanzania | | Continental Africa other |
| | Subsidiaries |
|
| Kibali |
| | Morila |
| | Sadiola |
| | Ventures | | Iduapriem |
| | Obuasi |
| | Siguiri |
| | Geita |
| | |
Total cash costs | | | | | | | | | | | | | | | | | | | |
Cost of sales per segmental information(5) | 373 |
| | 42 |
| | 65 |
| | 480 |
| | 233 |
| | (6 | ) | | 286 |
| | 612 |
| | 2 |
| | 1,127 |
|
By-product revenue | (1 | ) | | — |
| | — |
| | (1 | ) | | — |
| | — |
| | — |
| | (2 | ) | | — |
| | (2 | ) |
Inventory change | (3 | ) | | — |
| | 1 |
| | (2 | ) | | — |
| | — |
| | (3 | ) | | (2 | ) | | — |
| | (5 | ) |
Amortisation of intangible assets | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
Amortisation of tangible assets | (149 | ) | | (7 | ) | | (9 | ) | | (165 | ) | | (29 | ) | | — |
| | (38 | ) | | (144 | ) | | (3 | ) | | (214 | ) |
Rehabilitation and other non-cash costs | (1 | ) | | (1 | ) | | — |
| | (2 | ) | | — |
| | 6 |
| | (5 | ) | | (10 | ) | | — |
| | (8 | ) |
Retrenchment costs | — |
| | — |
| | (2 | ) | | (2 | ) | | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
Total cash costs net of by-product revenue | 219 |
| | 34 |
| | 55 |
| | 308 |
| | 204 |
| | — |
| | 240 |
| | 454 |
| | — |
| | 898 |
|
Adjusted for non-controlling interests, non-gold producing companies and other(1) | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | (36 | ) | | — |
| | — |
| | (36 | ) |
Total cash costs net of by-product revenue adjusted for non-controlling interests and non-gold producing companies | 219 |
| | 34 |
| | 55 |
| | 308 |
| | 204 |
| | — |
| | 204 |
| | 454 |
| | — |
| | 862 |
|
Gold produced - oz (000) (2) | 363 |
| | 30 |
| | 59 |
| | 452 |
| | 254 |
| | — |
| | 242 |
| | 564 |
| | — |
| | 1,060 |
|
Total cash costs per unit - $/oz(3) | 600 |
| | 1,145 |
| | 938 |
| | 680 |
| | 804 |
| | — |
| | 844 |
| | 804 |
| | — |
| | 813 |
|
For the year ended 31 December 20182020
Operations in Australia and the Americas (Argentina and Brazil)
(in $ millions, except as otherwise noted)
|
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| Australia | | Total Australia |
| | Argentina | | Brazil | | Americas other |
| | Total Americas |
|
Sunrise Dam |
| | Tropicana |
| | Australia other |
| | | Cerro Vanguardia |
| | AngloGold Ashanti Mineração |
| | Serra Grande |
| | |
All-in sustaining costs | | | | | | | | | | | | | | | | | |
Cost of sales per segmental information(5) | 310 |
| | 293 |
| | 18 |
| | 622 |
| | 325 |
| | 382 |
| | 129 |
| | 2 |
| | 838 |
|
By-product revenue | — |
| | (2 | ) | | — |
| | (2 | ) | | (111 | ) | | (17 | ) | | — |
| | — |
| | (128 | ) |
Amortisation of tangible and intangible assets | (51 | ) | | (92 | ) | | (6 | ) | | (149 | ) | | (50 | ) | | (99 | ) | | (42 | ) | | — |
| | (192 | ) |
Adjusted for decommissioning and inventory amortisation | 1 |
| | 1 |
| | — |
| | 2 |
| | (3 | ) | | (6 | ) | | (2 | ) | | (1 | ) | | (11 | ) |
Lease payment sustaining | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
Corporate administration and marketing related to current operations | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
Inventory writedown to net realisable value and other stockpile adjustments | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
Sustaining exploration and study costs | 7 |
| | 5 |
| | — |
| | 12 |
| | 2 |
| | 4 |
| | 4 |
| | — |
| | 10 |
|
Total sustaining capital expenditure | 79 |
| | 74 |
| | 2 |
| | 154 |
| | 36 |
| | 96 |
| | 35 |
| | 9 |
| | 176 |
|
Amortisation relating to inventory | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
Realised other commodity contracts | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | (5 | ) | | (5 | ) |
All-in sustaining costs | 346 |
| | 279 |
| | 15 |
| | 639 |
| | 199 |
| | 360 |
| | 124 |
| | 5 |
| | 688 |
|
Adjusted for non-controlling interests and non -gold producing companies(1) | — |
| | — |
| | — |
| | — |
| | (15 | ) | | — |
| | — |
| | (9 | ) | | (24 | ) |
All-in sustaining costs adjusted for non-controlling interests and non-gold producing companies | 346 |
| | 279 |
| | 15 |
| | 639 |
| | 184 |
| | 360 |
| | 124 |
| | (4 | ) | | 664 |
|
All-in sustaining costs | 346 |
| | 279 |
| | 15 |
| | 639 |
| | 199 |
| | 360 |
| | 124 |
| | 5 |
| | 688 |
|
Non-sustaining project capital expenditure | — |
| | 2 |
| | — |
| | 2 |
| | — |
| | — |
| | — |
| | — |
| | — |
|
Lease payment non sustaining | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
Technology improvements | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
Non-sustaining exploration and study costs | — |
| | — |
| | 18 |
| | 18 |
| | — |
| | 2 |
| | — |
| | 34 |
| | 36 |
|
Care and maintenance | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
Corporate and social responsibility costs not related to current operations | — |
| | — |
| | — |
| | — |
| | 2 |
| | 12 |
| | 3 |
| | (1 | ) | | 16 |
|
Other provisions | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
All-in costs | 346 |
| | 281 |
| | 32 |
| | 659 |
| | 201 |
| | 374 |
| | 127 |
| | 38 |
| | 740 |
|
Adjusted for non-controlling interests and non -gold producing companies(1) | — |
| | — |
| | — |
| | — |
| | (15 | ) | | — |
| | — |
| | — |
| | (15 | ) |
All-in costs adjusted for non-controlling interests and non-gold producing companies | 346 |
| | 281 |
| | 33 |
| | 659 |
| | 186 |
| | 374 |
| | 127 |
| | 38 |
| | 725 |
|
Gold sold – oz (000)(2) | 283 |
| | 332 |
| | — |
| | 615 |
| | 282 |
| | 370 |
| | 131 |
| | — |
| | 783 |
|
All-in sustaining cost per unit – $/oz(3) | 1,223 |
| | 843 |
| | — |
| | 1,038 |
| | 652 |
| | 973 |
| | 945 |
| | — |
| | 855 |
|
All-in cost per unit – $/oz(3) | 1,223 |
| | 848 |
| | — |
| | 1,070 |
| | 656 |
| | 1,015 |
| | 965 |
| | — |
| | 932 |
|
For the year ended 31 December 2018
Operations in Australia and the Americas (Argentina and Brazil)
(in $ millions, except as otherwise noted)
|
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| Australia | | Total Australia |
| | Argentina | | Brazil | | Americas other |
| | Total Americas |
|
| Sunrise Dam |
| | Tropicana |
| | Australia other |
| | | Cerro Vanguardia |
| | AngloGold Ashanti Mineração |
| | Serra Grande |
| | |
Total cash costs | | | | | | | | | | | | | | | | | |
Cost of sales per segmental information(5) | 310 |
| | 293 |
| | 19 |
| | 622 |
| | 325 |
| | 382 |
| | 129 |
| | 2 |
| | 838 |
|
By-product revenue | — |
| | (2 | ) | | — |
| | (2 | ) | | (111 | ) | | (17 | ) | | — |
| | — |
| | (128 | ) |
Inventory change | 7 |
| | 5 |
| | — |
| | 12 |
| | (7 | ) | | (6 | ) | | (3 | ) | | — |
| | (16 | ) |
Amortisation of intangible assets | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
Amortisation of tangible assets | (51 | ) | | (92 | ) | | (6 | ) | | (149 | ) | | (50 | ) | | (99 | ) | | (42 | ) | | (1 | ) | | (192 | ) |
Rehabilitation and other non-cash costs | — |
| | (5 | ) | | (1 | ) | | (6 | ) | | (10 | ) | | 4 |
| | 2 |
| | — |
| | (4 | ) |
Retrenchment costs | — |
| | — |
| | — |
| | — |
| | (2 | ) | | (1 | ) | | — |
| | — |
| | (3 | ) |
Total cash costs net of by-product revenue | 266 |
| | 199 |
| | 12 |
| | 477 |
| | 145 |
| | 263 |
| | 86 |
| | 1 |
| | 495 |
|
Adjusted for non-controlling interests, non-gold producing companies and other(1) | — |
| | — |
| | — |
| | — |
| | (11 | ) | | — |
| | — |
| | — |
| | (11 | ) |
Total cash costs net of by-product revenue adjusted for non-controlling interests and non-gold producing companies | 266 |
| | 199 |
| | 12 |
| | 477 |
| | 134 |
| | 263 |
| | 86 |
| | 1 |
| | 484 |
|
Gold produced – oz (000) (2) | 289 |
| | 336 |
| | — |
| | 625 |
| | 282 |
| | 364 |
| | 130 |
| | — |
| | 776 |
|
Total cash costs per unit – $/oz(3) | 920 |
| | 594 |
| | — |
| | 762 |
| | 476 |
| | 723 |
| | 660 |
| | — |
| | 624 |
|
For the year ended 31 December 2018
AngloGold Ashanti operations – Total
(from continuing operations - in $ millions, except as otherwise noted)
|
| | | | |
| JOINT VENTURES |
| SUBSIDIARIES |
|
All-in sustaining costs | | |
Cost of sales per segmental information(5) | 480 |
| 2,584 |
|
By-product revenue | (1 | ) | (133 | ) |
Amortisation of tangible and intangible assets | (165 | ) | (558 | ) |
Adjusted for decommissioning and inventory amortisation | 4 |
| (5 | ) |
Lease payment sustaining | — |
| — |
|
Corporate administration and marketing related to current operations | — |
| 76 |
|
Inventory writedown to net realisable value and other stockpile adjustments | — |
| — |
|
Sustaining exploration and study costs | — |
| 38 |
|
Total sustaining capital expenditure | 56 |
| 445 |
|
Amortisation relating to inventory | — |
| — |
|
Realised other commodity contracts | — |
| (5 | ) |
All-in sustaining costs | 374 |
| 2,443 |
|
Adjusted for non-controlling interests and non-gold producing companies(1) | — |
| (64 | ) |
All-in sustaining costs adjusted for non-controlling interests and non-gold producing companies | 374 |
| 2,379 |
|
All-in sustaining costs | 374 |
| 2,443 |
|
Non-sustaining project capital expenditure | 11 |
| 133 |
|
Lease payment non sustaining | — |
| — |
|
Technology improvements | — |
| — |
|
Non-sustaining exploration and study costs | 1 |
| 65 |
|
Care and maintenance costs | — |
| 39 |
|
Corporate and social responsibility costs not related to current operations | — |
| 22 |
|
Other provisions | — |
| (1 | ) |
All-in costs | 386 |
| 2,702 |
|
Adjusted for non-controlling interests and non-gold producing companies(1) | — |
| (69 | ) |
All-in costs adjusted for non-controlling interests and non-gold producing companies | 386 |
| 2,634 |
|
Gold sold – oz (000)(2) | 459 |
| 2,463 |
|
All-in sustaining cost per unit – $/oz(3) | 820 |
| 970 |
|
All-in cost per unit – $/oz(3) | 846 |
| 1,075 |
|
For the year ended 31 December 2018
AngloGold Ashanti operations – Total
(from continuing operations - in $ millions, except as otherwise noted)
|
| | | | |
| JOINT VENTURES |
| SUBSIDIARIES |
|
Total cash costs | | |
Cost of sales per segmental information(5) | 480 |
| 2,584 |
|
By-product revenue | (1 | ) | (133 | ) |
Inventory change | (2 | ) | (9 | ) |
Amortisation of intangible assets | — |
| (5 | ) |
Amortisation of tangible assets | (165 | ) | (553 | ) |
Rehabilitation and other non-cash costs | (2 | ) | (17 | ) |
Retrenchment costs | (2 | ) | (4 | ) |
Total cash costs net of by-product revenue | 308 |
| 1,863 |
|
Adjusted for non-controlling interests, non-gold producing companies and other(1) | — |
| (47 | ) |
Total cash costs net of by product revenue adjusted for non-controlling interests and non-gold producing companies | 308 |
| 1,816 |
|
Gold produced – oz (000)(2) | 452 |
| 2,460 |
|
Total cash costs (adjusted) per unit – $/oz(3) | 680 |
| 743 |
|
For the year ended 31 December 2017
Corporate and other
(in $ millions, except as otherwise noted)
|
| | | |
| | Corporate (4)
|
|
All-in sustaining costs | | |
Cost of sales per segmental information(5)
| | (2 | ) |
By-product revenue | | — |
|
Amortisation of tangible and intangible assets | | (3 | ) |
Adjusted for decommissioning and inventory amortisation | | (2 | ) |
Lease payment sustaining | | — |
|
Corporate administration and marketing related to current operations | | 64 |
|
Inventory writedown to net realisable value and other stockpile adjustments | | 1 |
|
Sustaining exploration and study costs | | (12 | ) |
Total sustaining capital expenditure | | 2 |
|
Amortisation relating to inventory | | — |
|
Realised other commodity contracts | | — |
|
All-in sustaining costs | | 46 |
|
Adjusted for non-controlling interests and non -gold producing companies(1)
| | 4 |
|
All-in sustaining costs adjusted for non-controlling interests and non-gold producing companies | | 53 |
|
All-in sustaining costs | | 46 |
|
Non-sustaining project capital expenditure | | — |
|
Lease payment non sustaining | | — |
|
Technology improvements | | — |
|
Non-sustaining exploration and study costs | | 14 |
|
Care and maintenance | | — |
|
Corporate and social responsibility costs not related to current operations | | 8 |
|
Other provisions | | 3 |
|
All-in costs | | 68 |
|
Adjusted for non-controlling interests and non -gold producing companies(1)
| | 4 |
|
All-in costs adjusted for non-controlling interests and non-gold producing companies | | 73 |
|
Gold sold - oz (000)(2)
| | — |
|
All-in sustaining cost per unit – $/oz(3)
| | — |
|
All-in cost per unit – $/oz(3)
| | — |
|
| |
(1)
| Adjusting for non-controlling interest of items included in calculation, to disclose the attributable portions only. Other consists of heap leach inventory. |
| |
(3)
| In addition to the operational performances of the mines, all-in sustaining cost per ounce, all-in cost per ounce, total cash costs per ounce per ounce are affected by fluctuations in the currency exchange rate. AngloGold Ashanti reports all-in sustaining cost per ounce and all-in cost per ounce calculated to the nearest US dollar amount and gold sold in ounces. AngloGold Ashanti reports total cash costs per ounce calculated to the nearest US dollar amount and gold produced in ounces. |
| |
(4)
| Corporate includes non-gold producing subsidiaries. |
| |
(5)
| Refer to “Item 18: Financial Statements - Note 2 - Segmental Information”. |
Rounding of figures may result in computational discrepancies.
For the year ended 31 December 2017
Corporate and other
(in $ millions, except as otherwise noted)
|
| | | |
| | Corporate (4)
|
|
Total cash costs | | |
Cost of sales per segmental information(5)
| | (2 | ) |
By-product revenue | | — |
|
Inventory change | | 1 |
|
Amortisation of intangible assets | | (1 | ) |
Amortisation of tangible assets | | (3 | ) |
Rehabilitation and other non-cash costs | | 1 |
|
Retrenchment costs | | — |
|
Total cash costs net of by-product revenue | | (6 | ) |
Adjusted for non-controlling interests, non-gold producing companies and other(1)
| | 4 |
|
Total cash costs net of by-product revenue adjusted for non-controlling interests and non-gold producing companies | | (1 | ) |
Gold produced - oz (000) (2)
| | — |
|
Total cash costs (adjusted) per unit – $/oz(3)
| | — |
|
For the year ended 31 December 2017
Operations in Continental Africa (DRC, Ghana, Guinea, Mali and Tanzania)
(in $ millions, except as otherwise noted)
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| DRC | | Mali | Joint | | Ghana | | Guinea | | Tanzania | | Continental Africa other |
| | Subsidiaries |
|
| Kibali |
| | Morila |
| | Sadiola |
| Ventures | | Iduapriem |
| | Obuasi |
| | Siguiri |
| | Geita |
| | |
All-in sustaining costs | | | | | | | | | | | | | | | | | | |
Cost of sales per segmental information(5) | 340 |
| | 34 |
| | 67 |
| 441 |
| | 210 |
| | (6 | ) | | 344 |
| | 520 |
| | 3 |
| | 1,071 |
|
By-product revenue | (1 | ) | | — |
| | — |
| (1 | ) | | — |
| | — |
| | — |
| | (1 | ) | | — |
| | (2 | ) |
Amortisation of tangible and intangible assets | (120 | ) | | (6 | ) | | (10 | ) | (136 | ) | | (28 | ) | | — |
| | (57 | ) | | (197 | ) | | (3 | ) | | (285 | ) |
Adjusted for decommissioning and inventory amortisation | — |
| | 3 |
| | — |
| 3 |
| | 1 |
| | — |
| | 1 |
| | 2 |
| | — |
| | 4 |
|
Lease payment sustaining | — |
| | — |
| | — |
| — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
Corporate administration and marketing related to current operations | — |
| | — |
| | — |
| — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
Inventory writedown to net realisable value and other stockpile adjustments | — |
| | — |
| | — |
| — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
Sustaining exploration and study costs | — |
| | — |
| | 1 |
| 1 |
| | — |
| | — |
| | 8 |
| | 17 |
| | — |
| | 25 |
|
Total sustaining capital expenditure | 77 |
| | 2 |
| | 6 |
| 85 |
| | 51 |
| | — |
| | 15 |
| | 156 |
| | 1 |
| | 223 |
|
Amortisation relating to inventory | — |
| | — |
| | — |
| — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
Realised other commodity contracts | — |
| | — |
| | — |
| — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
All-in sustaining costs | 296 |
| | 33 |
| | 64 |
| 393 |
| | 234 |
| | (6 | ) | | 311 |
| | 497 |
| | 2 |
| | 1,037 |
|
Adjusted for non-controlling interests and non -gold producing companies(1) | — |
| | — |
| | — |
| — |
| | — |
| | — |
| | (47 | ) | | — |
| | — |
| | (47 | ) |
All-in sustaining costs adjusted for non-controlling interests and non-gold producing companies | 296 |
| | 33 |
| | 64 |
| 393 |
| | 234 |
| | (6 | ) | | 264 |
| | 497 |
| | 2 |
| | 990 |
|
All-in sustaining costs | 296 |
| | 33 |
| | 64 |
| 393 |
| | 234 |
| | (6 | ) | | 311 |
| | 497 |
| | 2 |
| | 1,037 |
|
Non-sustaining project capital expenditure | 34 |
| | — |
| | 1 |
| 35 |
| | — |
| | — |
| | 67 |
| | — |
| | — |
| | 67 |
|
Lease payment non sustaining | — |
| | — |
| | — |
| — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
Technology improvements | — |
| | — |
| | — |
| — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
Non-sustaining exploration and study costs | 1 |
| | — |
| | — |
| 1 |
| | — |
| | 1 |
| | — |
| | — |
| | — |
| | 1 |
|
Care and maintenance costs | — |
| | — |
| | — |
| — |
| | — |
| | 62 |
| | — |
| | — |
| | — |
| | 62 |
|
Corporate and social responsibility costs not related to current operations | — |
| | — |
| | — |
| — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
Other provisions | — |
| | — |
| | — |
| — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
All-in costs | 331 |
| | 33 |
| | 65 |
| 429 |
| | 234 |
| | 57 |
| | 378 |
| | 497 |
| | 2 |
| | 1,167 |
|
Adjusted for non-controlling interests and non -gold producing companies(1) | — |
| | — |
| | — |
| — |
| | — |
| | — |
| | (57 | ) | | — |
| | — |
| | (57 | ) |
All-in costs adjusted for non-controlling interests and non-gold producing companies | 331 |
| | 33 |
| | 65 |
| 429 |
| | 234 |
| | 57 |
| | 321 |
| | 497 |
| | 2 |
| | 1,110 |
|
Gold sold - oz (000)(2) | 272 |
| | 27 |
| | 63 |
| 362 |
| | 227 |
| | 3 |
| | 332 |
| | 528 |
| | — |
| | 1,090 |
|
All-in sustaining cost per unit – $/oz(3) | 1,090 |
| | 1,218 |
| | 1,019 |
| 1,087 |
| | 1,033 |
| | — |
| | 796 |
| | 941 |
| | — |
| | 909 |
|
All-in cost per unit – $/oz(3) | 1,216 |
| | 1,218 |
| | 1,044 |
| 1,186 |
| | 1,033 |
| | — |
| | 967 |
| | 941 |
| | — |
| | 1,019 |
|
For the year ended 31 December 2017
Operations in Continental Africa (DRC, Ghana, Guinea, Mali and Tanzania)
(in $ millions, except as otherwise noted)
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| DRC | | Mali | | Joint | | Ghana | | Guinea | | Tanzania | | Continental Africa other |
| | Subsidiaries |
|
| Kibali |
| | Morila |
| | Sadiola |
| | Ventures | | Iduapriem |
| | Obuasi |
| | Siguiri |
| | Geita |
| | |
Total cash costs | | | | | | | | | | | | | | | | | | | |
Cost of sales per segmental information(5) | 340 |
| | 34 |
| | 67 |
| | 441 |
| | 210 |
| | (6 | ) | | 344 |
| | 520 |
| | 3 |
| | 1,071 |
|
By-product revenue | (1 | ) | | — |
| | — |
| | (1 | ) | | — |
| | — |
| | — |
| | (1 | ) | | — |
| | (2 | ) |
Inventory change | (4 | ) | | — |
| | 1 |
| | (3 | ) | | — |
| | — |
| | (7 | ) | | 13 |
| | 1 |
| | 6 |
|
Amortisation of intangible assets | — |
| | — |
| | — |
| | — |
| | (1 | ) | | — |
| | — |
| | — |
| | (2 | ) | | (3 | ) |
Amortisation of tangible assets | (120 | ) | | (6 | ) | | (10 | ) | | (136 | ) | | (28 | ) | | — |
| | (57 | ) | | (197 | ) | | (1 | ) | | (282 | ) |
Rehabilitation and other non-cash costs | (5 | ) | | (1 | ) | | — |
| | (6 | ) | | 6 |
| | 7 |
| | (5 | ) | | (7 | ) | | 2 |
| | 2 |
|
Retrenchment costs | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
Total cash costs net of by-product revenue | 210 |
| | 27 |
| | 58 |
| | 295 |
| | 187 |
| | — |
| | 275 |
| | 328 |
| | 4 |
| | 793 |
|
Adjusted for non-controlling interests, non-gold producing companies and other(1) | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | (41 | ) | | — |
| | — |
| | (41 | ) |
Total cash costs net of by-product revenue adjusted for non-controlling interests and non-gold producing companies | 210 |
| | 27 |
| | 58 |
| | 295 |
| | 187 |
| | — |
| | 234 |
| | 328 |
| | 4 |
| | 752 |
|
Gold produced - oz (000) (2) | 268 |
| | 28 |
| | 63 |
| | 360 |
| | 228 |
| | 3 |
| | 323 |
| | 539 |
| | — |
| | 1,093 |
|
Total cash costs per unit - $/oz(3) | 784 |
| | 974 |
| | 900 |
| | 819 |
| | 823 |
| | — |
| | 725 |
| | 608 |
| | — |
| | 688 |
|
For the year ended 31 December 2017
Operations in Australia and the Americas (Argentina and Brazil)
(in $ millions, except as otherwise noted)
|
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| Australia | | TOTAL AUSTRALIA |
| | Argentina | | Brazil | | Americas other |
| | Total Americas |
|
| Sunrise Dam |
| | Tropicana |
| | Australia other |
| | | Cerro Vanguardia |
| | AngloGold Ashanti Mineração |
| | Serra Grande |
| | |
All-in sustaining costs | | | | | | | | | | | | | | | | | |
Cost of sales per segmental information(5) | 260 |
| | 276 |
| | 15 |
| | 551 |
| | 385 |
| | 447 |
| | 153 |
| | 3 |
| | 987 |
|
By-product revenue | — |
| | (2 | ) | | — |
| | (2 | ) | | (117 | ) | | (18 | ) | | — |
| | — |
| | (135 | ) |
Amortisation of tangible and intangible assets | (34 | ) | | (89 | ) | | (7 | ) | | (130 | ) | | (83 | ) | | (140 | ) | | (50 | ) | | — |
| | (273 | ) |
Adjusted for decommissioning and inventory amortisation | — |
| | 1 |
| | — |
| | 1 |
| | 1 |
| | (1 | ) | | — |
| | — |
| | — |
|
Lease payment sustaining | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
Corporate administration and marketing related to current operations | — |
| | — |
| | — |
| | — |
| | — |
| | 1 |
| | — |
| | — |
| | 1 |
|
Inventory writedown to net realisable value and other stockpile adjustments | — |
| | — |
| | 1 |
| | 1 |
| | — |
| | — |
| | — |
| | — |
| | — |
|
Sustaining exploration and study costs | 2 |
| | 7 |
| | 5 |
| | 14 |
| | 3 |
| | 8 |
| | 6 |
| | 7 |
| | 24 |
|
Total sustaining capital expenditure | 62 |
| | 91 |
| | — |
| | 153 |
| | 56 |
| | 134 |
| | 38 |
| | 4 |
| | 232 |
|
Amortisation relating to inventory | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
Realised other commodity contracts | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
All-in sustaining costs | 290 |
| | 284 |
| | 14 |
| | 588 |
| | 245 |
| | 431 |
| | 147 |
| | 14 |
| | 836 |
|
Adjusted for non-controlling interests and non -gold producing companies(1) | — |
| | — |
| | 8 |
| | 8 |
| | (18 | ) | | — |
| | — |
| | (11 | ) | | (29 | ) |
All-in sustaining costs adjusted for non-controlling interests and non-gold producing companies | 290 |
| | 284 |
| | 22 |
| | 596 |
| | 227 |
| | 431 |
| | 147 |
| | 3 |
| | 807 |
|
All-in sustaining costs | 290 |
| | 284 |
| | 14 |
| | 588 |
| | 245 |
| | 431 |
| | 147 |
| | 14 |
| | 836 |
|
Non-sustaining project capital expenditure | — |
| | — |
| | — |
| | — |
| | — |
| | 2 |
| | — |
| | — |
| | 2 |
|
Lease payment non sustaining | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
Technology improvements | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
Non-sustaining exploration and study costs | — |
| | — |
| | 10 |
| | 10 |
| | 2 |
| | 7 |
| | — |
| | 28 |
| | 37 |
|
Care and maintenance | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
Corporate and social responsibility costs not related to current operations | — |
| | — |
| | — |
| | — |
| | — |
| | 12 |
| | 2 |
| | 1 |
| | 15 |
|
Other provisions | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
All-in costs | 290 |
| | 284 |
| | 24 |
| | 598 |
| | 247 |
| | 452 |
| | 149 |
| | 42 |
| | 890 |
|
Adjusted for non-controlling interests and non -gold producing companies(1) | — |
| | — |
| | 8 |
| | 8 |
| | (19 | ) | | — |
| | — |
| | (1 | ) | | (19 | ) |
All-in costs adjusted for non-controlling interests and non-gold producing companies | 290 |
| | 284 |
| | 32 |
| | 606 |
| | 228 |
| | 452 |
| | 149 |
| | 42 |
| | 871 |
|
Gold sold - oz (000)(2) | 241 |
| | 321 |
| | — |
| | 562 |
| | 293 |
| | 428 |
| | 133 |
| | — |
| | 854 |
|
All-in sustaining cost per unit - $/oz(3) | 1,203 |
| | 885 |
| | — |
| | 1,062 |
| | 772 |
| | 1,006 |
| | 1,103 |
| | — |
| | 943 |
|
All-in cost per unit - $/oz(3) | 1,203 |
| | 885 |
| | — |
| | 1,080 |
| | 780 |
| | 1,055 |
| | 1,119 |
| | — |
| | 1,018 |
|
For the year ended 31 December 2017
Operations in Australia and the Americas (Argentina and Brazil)
(in $ millions, except as otherwise noted)
|
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| Australia | | TOTAL AUSTRALIA |
| | Argentina | | Brazil | | Americas other |
| | Total America |
|
| Sunrise Dam |
| | Tropicana |
| | Australia other |
| | | Cerro Vanguardia |
| | AngloGold Ashanti Mineração |
| | Serra Grande |
| | |
Total cash costs | | | | | | | | | | | | | | | | | |
Cost of sales per segmental information(5) | 260 |
| | 276 |
| | 15 |
| | 551 |
| | 385 |
| | 447 |
| | 153 |
| | 3 |
| | 987 |
|
By-product revenue | — |
| | (2 | ) | | — |
| | (2 | ) | | (117 | ) | | (18 | ) | | — |
| | — |
| | (135 | ) |
Inventory change | (2 | ) | | (2 | ) | | — |
| | (4 | ) | | (12 | ) | | (3 | ) | | — |
| | — |
| | (15 | ) |
Amortisation of intangible assets | — |
| | — |
| | — |
| | — |
| | — |
| | (1 | ) | | — |
| | — |
| | (1 | ) |
Amortisation of tangible assets | (34 | ) | | (89 | ) | | (7 | ) | | (130 | ) | | (83 | ) | | (139 | ) | | (50 | ) | | — |
| | (272 | ) |
Rehabilitation and other non-cash costs | (5 | ) | | (2 | ) | | (2 | ) | | (9 | ) | | (11 | ) | | — |
| | — |
| | — |
| | (11 | ) |
Retrenchment costs | — |
| | — |
| | — |
| | — |
| | (2 | ) | | (3 | ) | | (1 | ) | | — |
| | (5 | ) |
Total cash costs net of by-product revenue | 219 |
| | 181 |
| | 6 |
| | 406 |
| | 160 |
| | 284 |
| | 101 |
| | 3 |
| | 548 |
|
Adjusted for non-controlling interests, non-gold producing companies and other(1) | — |
| | — |
| | 8 |
| | 8 |
| | (12 | ) | | — |
| | — |
| | — |
| | (12 | ) |
Total cash costs net of by-product revenue adjusted for non-controlling interests and non-gold producing companies | 219 |
| | 181 |
| | 14 |
| | 414 |
| | 148 |
| | 284 |
| | 101 |
| | 3 |
| | 536 |
|
Gold produced - oz (000) (2) | 238 |
| | 322 |
| | — |
| | 559 |
| | 283 |
| | 424 |
| | 133 |
| | — |
| | 840 |
|
Total cash costs per unit - $/oz(3) | 919 |
| | 564 |
| | — |
| | 743 |
| | 522 |
| | 671 |
| | 764 |
| | — |
| | 638 |
|
For the year ended 31 December 2017
AngloGold Ashanti operations – Total
(from continuing operations - in $ millions, except as otherwise noted)
|
| | | | |
| JOINT VENTURES |
| SUBSIDIARIES |
|
All-in sustaining costs | | |
Cost of sales per segmental information(5) | 441 |
| 2,607 |
|
By-product revenue | (1 | ) | (139 | ) |
Amortisation of tangible and intangible assets | (136 | ) | (691 | ) |
Adjusted for decommissioning and inventory amortisation | 3 |
| 4 |
|
Lease payment sustaining | — |
| — |
|
Corporate administration and marketing related to current operations | — |
| 64 |
|
Inventory writedown to net realisable value and other stockpile adjustments | — |
| 2 |
|
Sustaining exploration and study costs | 1 |
| 51 |
|
Total sustaining capital expenditure | 85 |
| 610 |
|
Amortisation relating to inventory | — |
| — |
|
Realised other commodity contracts | — |
| — |
|
All-in sustaining costs | 393 |
| 2,508 |
|
Adjusted for non-controlling interests and non-gold producing companies(1) | — |
| (63 | ) |
All-in sustaining costs adjusted for non-controlling interests and non-gold producing companies | 393 |
| 2,445 |
|
All-in sustaining costs | 393 |
| 2,508 |
|
Non-sustaining project capital expenditure | 35 |
| 69 |
|
Lease payment non sustaining | — |
| — |
|
Technology improvements | — |
| — |
|
Non-sustaining exploration and study costs | 1 |
| 62 |
|
Care and maintenance costs | — |
| 62 |
|
Care and maintenance costs, Corporate and social responsibility costs not related to current operations | — |
| 23 |
|
Other provisions | — |
| 3 |
|
All-in costs | 429 |
| 2,724 |
|
Adjusted for non-controlling interests and non-gold producing companies(1) | — |
| (63 | ) |
All-in costs adjusted for non-controlling interests and non-gold producing companies | 429 |
| 2,660 |
|
Gold sold - oz (000)(2) | 362 |
| 2,506 |
|
All-in sustaining cost per unit - $/oz(3) | 1,087 |
| 975 |
|
All-in cost per unit - $/oz(3) | 1,186 |
| 1,062 |
|
For the year ended 31 December 2017
AngloGold Ashanti operations - Total
(from continuing operations - in $ millions, except as otherwise noted)
|
| | | | |
| JOINT VENTURES |
| SUBSIDIARIES |
|
Total cash costs | | |
Cost of sales per segmental information(5) | 441 |
| 2,607 |
|
By-product revenue | (1 | ) | (139 | ) |
Inventory change | (3 | ) | (13 | ) |
Amortisation of intangible assets | — |
| (5 | ) |
Amortisation of tangible assets | (136 | ) | (686 | ) |
Rehabilitation and other non-cash costs | (6 | ) | (16 | ) |
Retrenchment costs | — |
| (6 | ) |
Total cash costs net of by-product revenue | 295 |
| 1,742 |
|
Adjusted for non-controlling interests, non-gold producing companies and other(1) | — |
| (41 | ) |
Total cash costs net of by-product revenue adjusted for non-controlling interests and non-gold producing companies | 295 |
| 1,701 |
|
Gold produced - oz (000)(2) | 360 |
| 2,492 |
|
Total cash costs (adjusted) per unit - $/oz(3) | 819 |
| 683 |
|
Tables provided for information purposes for reconciliation of Non-GAAP to GAAP metrics (South African operations)
For the year ended 31 December 2019
Operations in South Africa
(in $ millions, except as otherwise noted)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| AFRICA | AFRICA |
| Kibali | Other | Joint Ventures | Iduapriem | Obuasi Restated | Siguiri | Geita | Africa other | Subsidiaries Restated |
Total cash costs | | | | | | | | | |
Cost of sales per segmental information(5) | 340 | | — | | 340 | | 280 | | 164 | | 377 | | 542 | | (1) | | 1,362 | |
By-product revenue | (1) | | — | | (1) | | (1) | | — | | — | | (2) | | — | | (3) | |
Inventory change | (1) | | — | | (1) | | 1 | | 16 | | (1) | | (12) | | — | | 3 | |
Amortisation of tangible assets | (101) | | — | | (101) | | (74) | | (11) | | (40) | | (108) | | — | | (232) | |
Amortisation of right of use assets | (3) | | — | | (3) | | — | | — | | (1) | | (16) | | — | | (17) | |
Amortisation of intangible assets | — | | — | | — | | — | | — | | — | | — | | — | | — | |
Rehabilitation and other non-cash costs | (4) | | — | | (4) | | (6) | | (2) | | (9) | | (5) | | — | | (22) | |
Retrenchment costs | — | | — | | — | | — | | — | | — | | — | | — | | — | |
Total cash costs net of by-product revenue | 230 | | — | | 230 | | 200 | | 166 | | 326 | | 399 | | (1) | | 1,092 | |
Adjusted for non-controlling interests non-gold producing companies and other(1) | — | | — | | — | | — | | — | | (49) | | — | | — | | (49) | |
Total cash costs adjusted for non-controlling interests and non-gold producing companies and other | 230 | | — | | 230 | | 200 | | 166 | | 277 | | 399 | | (1) | | 1,043 | |
Gold produced - oz (000)(2) | 364 | | — | | 364 | | 275 | | 127 | | 215 | | 623 | | — | | 1,239 | |
Total cash costs per unit - $/oz(3) | 629 | 0 | 629 | 731 | 1307 | 1293 | 641 | 0 | 841 |
|
| | | | | | | | | | | | | | | | | | | | | | | |
| Kopanang |
| | Moab Khotsong | | Vaal River Operations |
| | Mponeng |
| | West Wits Operations |
| | Surface Operations |
| | South Africa other |
| | Total South Africa (Operations) |
Total cash costs | | | | | | | | | | | | | | | |
Cost of sales per segmental information(3) | — |
| | — |
| | — |
| | 287 |
| | 287 |
| | 189 |
| | 3 |
| | 479 |
|
By-product revenue | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | (1 | ) |
Inventory change | — |
| | — |
| | — |
| | 3 |
| | 3 |
| | (1 | ) | | — |
| | 2 |
|
Amortisation of intangible assets | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
Amortisation of tangible and intangible assets | — |
| | — |
| | — |
| | (47 | ) | | (47 | ) | | (13 | ) | | (1 | ) | | (61 | ) |
Rehabilitation and other non-cash costs | — |
| | — |
| | — |
| | (2 | ) | | (2 | ) | | (2 | ) | | (2 | ) | | (6 | ) |
Retrenchment costs | — |
| | — |
| | — |
| | (2 | ) | | (2 | ) | | — |
| | — |
| | (2 | ) |
Total cash costs net of by-product revenue | — |
| | — |
| | — |
| | 239 |
| | 239 |
| | 173 |
| | — |
| | 411 |
|
Gold produced - oz (000)(1) | — |
| | — |
| | — |
| | 244 |
| | 244 |
| | 175 |
| | — |
| | 419 |
|
Total cash costs per unit - $/oz(2) | — |
| | — |
| | — |
| | 976 |
| | 976 |
| | 987 |
| | — |
| | 981 |
|
| |
(1)
| Attributable portion (excluding pre-production ounces). |
| |
(2)
| In addition to the operational performances of the mines, all-in sustaining cost per ounce, all-in cost per ounce and total cash costs per ounce are affected by fluctuations in the currency exchange rate. AngloGold Ashanti reports all-in sustaining cost per ounce and all-in cost per ounce calculated to the nearest US dollar amount and gold sold in ounces. AngloGold Ashanti reports total cash costs per ounce calculated to the nearest US dollar amount and gold produced in ounces. |
| |
(3)
| Refer Item 18: Note 2 - Segmental Information. |
Rounding of figures may result in computational differences.
For the year ended 31 December 20192020
Operations in South AfricaAustralia, America and Projects
(in $ millions, except as otherwise noted) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| AUSTRALIA | AMERICAS | PROJECTS (6) Restated |
Sunrise Dam | Tropicana | Australia other | Total Australia | Cerro Vanguardia | AngloGold Ashanti Mineração | Serra Grande | Americas other Restated | Total Americas |
All-in sustaining costs | | | | | | | | | | |
Cost of sales per segmental information(5) | 342 | | 338 | | 25 | | 705 | | 269 | | 391 | | 102 | | 2 | | 764 | | — | |
By-product revenue | (1) | | (2) | | — | | (3) | | (82) | | (17) | | — | | — | | (99) | | — | |
Cost of sales | 341 | | 336 | | 25 | | 702 | | 187 | | 374 | | 102 | | 2 | | 665 | | — | |
Realised other commodity contracts | — | | — | | — | | — | | — | | — | | — | | — | | — | | — | |
Amortisation of tangible, intangible and right of use assets | (64) | | (94) | | (2) | | (160) | | (26) | | (109) | | (27) | | (1) | | (163) | | — | |
Adjusted for decommissioning and inventory amortisation | 2 | | 1 | | — | | 3 | | (7) | | 3 | | — | | — | | (4) | | — | |
Corporate administration and marketing expenditure | — | | — | | — | | — | | — | | — | | — | | — | | — | | — | |
Lease payment sustaining | 11 | | 10 | | 1 | | 22 | | — | | 8 | | 2 | | — | | 10 | | — | |
Sustaining exploration and study costs | — | | 1 | | — | | 1 | | 2 | | 2 | | — | | — | | 4 | | — | |
Total sustaining capital expenditure | 50 | | 64 | | — | | 114 | | 31 | | 103 | | 33 | | — | | 167 | | — | |
All-in sustaining costs | 340 | | 318 | | 24 | | 682 | | 187 | | 381 | | 110 | | 1 | | 679 | | — | |
Adjusted for non-controlling interests and non -gold producing companies(1) | — | | — | | — | | — | | (14) | | — | | — | | — | | (14) | | — | |
All-in sustaining costs adjusted for non-controlling interests and non-gold producing companies | 340 | | 318 | | 24 | | 682 | | 173 | | 381 | | 110 | | 1 | | 665 | | — | |
All-in sustaining costs | 340 | | 318 | | 24 | | 682 | | 187 | | 381 | | 110 | | 1 | | 679 | | — | |
Non-sustaining project capital expenditure | 3 | | 25 | | — | | 28 | | — | | — | | — | | — | | — | | 49 | |
Non-sustaining lease payments | — | | — | | — | | — | | — | | — | | — | | — | | — | | — | |
Non-sustaining exploration and study costs | 22 | | 5 | | 17 | | 44 | | 1 | | 6 | | 3 | | — | | 10 | | 47 | |
Care and maintenance | — | | — | | — | | — | | — | | — | | — | | — | | — | | — | |
Closure and social responsibility costs not related to current operations | — | | — | | — | | — | | — | | 8 | | 2 | | — | | 10 | | — | |
Other provisions | — | | — | | — | | — | | — | | — | | — | | — | | — | | — | |
All-in costs | 365 | | 348 | | 41 | | 754 | | 188 | | 395 | | 115 | | 1 | | 699 | | 96 | |
Adjusted for non-controlling interests and non -gold producing companies(1) | — | | — | | — | | — | | (14) | | — | | — | | — | | (14) | | — | |
All-in costs adjusted for non-controlling interests and non-gold producing companies | 365 | | 348 | | 41 | | 754 | | 174 | | 395 | | 115 | | 1 | | 685 | | 96 | |
Gold sold – oz (000)(2) | 258 | | 299 | | — | | 557 | | 186 | | 364 | | 114 | | — | | 664 | | — | |
All-in sustaining cost per unit – $/oz(3) | 1,320 | | 1,061 | | — | | 1,225 | | 931 | | 1,050 | | 953 | | — | | 1,003 | | — | |
All-in cost per unit – $/oz(3) | 1,417 | | 1,164 | | — | | 1,356 | | 934 | | 1,091 | | 997 | | — | | 1,032 | | — | |
For the year ended 31 December 2020
Operations in Australia, America and Projects
(in $ millions, except as otherwise noted) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| AUSTRALIA | AMERICAS | | |
| Sunrise Dam | Tropicana | Australia other | Total Australia | Cerro Vanguardia | AngloGold Ashanti Mineração | Serra Grande | Americas other | Total Americas | |
Total cash costs | | | | | | | | | | | |
Cost of sales per segmental information(5) | 342 | | 338 | | 25 | | 705 | | 269 | | 391 | | 102 | | 2 | | 764 | | | |
By-product revenue | (1) | | (2) | | — | | (3) | | (82) | | (17) | | — | | — | | (99) | | | |
Inventory change | (1) | | (1) | | — | | (2) | | (16) | | 1 | | — | | — | | (16) | | | |
Amortisation of tangible assets | (54) | | (86) | | — | | (141) | | (26) | | (100) | | (25) | | — | | (151) | | | |
Amortisation of right of use assets | (10) | | (8) | | (1) | | (18) | | — | | (8) | | (2) | | (1) | | (11) | | | |
Amortisation of intangible assets | — | | — | | (1) | | (1) | | — | | (1) | | — | | — | | (1) | | | |
Rehabilitation and other non-cash costs | (2) | | (1) | | (1) | | (4) | | (13) | | 4 | | 3 | | (1) | | (6) | | | |
Retrenchment costs | — | | — | | — | | — | | — | | (1) | | — | | — | | (2) | | | |
Total cash costs net of by-product revenue | 274 | | 240 | | 22 | | 536 | | 132 | | 269 | | 77 | | — | | 478 | | | |
Adjusted for non-controlling interests, non-gold producing companies and other(1) | — | | — | | — | | — | | (10) | | — | | — | | — | | (10) | | | |
Total cash costs net of by-product revenue adjusted for non-controlling interests and non-gold producing companies | 274 | | 240 | | 22 | | 536 | | 122 | | 269 | | 77 | | — | | 468 | | | |
Gold produced – oz (000)(2) | 256 | | 298 | | — | | 554 | | 173 | | 362 | | 114 | | — | | 649 | | | |
Total cash costs per unit – $/oz(3) | 1,069 | | 807 | | — | | 968 | | 699 | | 747 | | 665 | | — | | 721 | | | |
For the year ended 31 December 2020
AngloGold Ashanti operations – Total
(in $ millions, except as otherwise noted) | | | | | | | | |
| JOINT VENTURES | SUBSIDIARIES EXCLUDING DISCONTINUED OPERATIONS RESTATED |
All-in sustaining costs | | |
Cost of sales per segmental information(5) | 340 | | 2,829 | |
By-product revenue | (1) | | (105) | |
Cost of sales | 339 | | 2,724 | |
Realised other commodity contracts | — | | 5 | |
Amortisation of tangible, intangible and right of use assets | (104) | | (575) | |
Adjusted for decommissioning and inventory amortisation | 1 | | 4 | |
Corporate administration and marketing expenditure | — | | 67 | |
Lease payment sustaining | 9 | | 52 | |
Sustaining exploration and study costs | — | | 15 | |
Total sustaining capital expenditure | 52 | | 445 | |
All-in sustaining costs | 297 | | 2,740 | |
Adjusted for non-controlling interests and non-gold producing companies(1) | — | | (67) | |
All-in sustaining costs adjusted for non-controlling interests and non-gold producing companies | 297 | | 2,672 | |
All-in sustaining costs | 297 | | 2,740 | |
Non-sustaining project capital expenditure | — | | 298 | |
Non-sustaining lease payments | — | | 2 | |
Non-sustaining exploration and study costs | — | | 112 | |
Care and maintenance | — | | — | |
Closure and social responsibility costs not related to current operations | 4 | | 29 | |
Other provisions | — | | — | |
All-in costs | 301 | | 3,179 | |
Adjusted for non-controlling interests and non-gold producing companies(1) | — | | (70) | |
All-in costs adjusted for non-controlling interests and non-gold producing companies | 301 | | 3,109 | |
Gold sold – oz (000)(2) | 365 | | 2,470 | |
All-in sustaining cost per unit – $/oz(3) | 810 | | 1,082 | |
All-in cost per unit – $/oz(3) | 824 | | 1,259 | |
For the year ended 31 December 2020
AngloGold Ashanti operations – Total
(in $ millions, except as otherwise noted)
| | | | | | | | |
| JOINT VENTURES | SUBSIDIARIES EXCLUDING DISCONTINUED OPERATIONS RESTATED |
Total cash costs | | |
Cost of sales per segmental information(5) | 340 | | 2,829 | |
By-product revenue | (1) | | (105) | |
Inventory change | (1) | | (16) | |
Amortisation of tangible assets | (101) | | (526) | |
Amortisation of right of use assets | (3) | | (47) | |
Amortisation of intangible assets | — | | (3) | |
Rehabilitation and other non-cash costs | (4) | | (32) | |
Retrenchment costs | — | | (2) | |
Total cash costs net of by-product revenue | 230 | | 2,101 | |
Adjusted for non-controlling interests and non-gold producing companies(1) | — | | (59) | |
Total cash costs net of by-product revenue adjusted for non-controlling interests and non-gold producing companies | 230 | | 2,042 | |
Gold produced – oz (000)(2) | 364 | | 2,442 | |
Total cash costs (adjusted) per unit – $/oz(3) | 629 | | 836 | |
|
| | | | | | | | | | | | | | | | |
| | Mponeng |
| | | West Wits Operations |
| | Surface Operations |
| | South Africa other |
| | Total South Africa (Operations) |
|
All-in sustaining costs | | | | | | | | | | | |
Cost of sales per segmental information(3) | | 287 |
| | | 287 |
| | 189 |
| | 3 |
| | 479 |
|
By-product revenue | | — |
| | | — |
| | — |
| | — |
| | (1 | ) |
Amortisation of tangible and intangible assets | | (47 | ) | | | (47 | ) | | (13 | ) | | (1 | ) | | (61 | ) |
Adjusted for decommissioning and inventory amortisation | | — |
| | | — |
| | — |
| | — |
| | 1 |
|
Corporate administration and marketing related to current operations | | — |
| | | — |
| | — |
| | — |
| | — |
|
Inventory writedown to net realisable value and other stockpile adjustments | | — |
| | | — |
| | (3 | ) | | (3 | ) | | (6 | ) |
Sustaining exploration and study costs | | — |
| | | — |
| | — |
| | — |
| | — |
|
Total sustaining capital expenditure | | 47 |
| | | 47 |
| | 7 |
| | 3 |
| | 57 |
|
Realised other commodity contracts | | — |
| | | — |
| | — |
| | — |
| | — |
|
All-in sustaining costs | | 287 |
| | | 287 |
| | 180 |
| | 2 |
| | 469 |
|
All-in sustaining costs | | 287 |
| | | 289 |
| | 180 |
| | 2 |
| | 469 |
|
Non-sustaining project capital expenditure | | 2 |
| | | — |
| | — |
| | — |
| | 2 |
|
Lease Payment non-sustaining | | | | | — |
| | — |
| | — |
| | |
Technology improvements | | — |
| | | — |
| | — |
| | — |
| | — |
|
Non-sustaining exploration and study costs | | — |
| | | — |
| | — |
| | — |
| | — |
|
Care and maintenance | | — |
| | | — |
| | — |
| | 42 |
| | 42 |
|
Corporate and social responsibility costs not related to current operations | | — |
| | | — |
| | — |
| | — |
| | — |
|
Other provisions | | — |
| | | — |
| | — |
| | — |
| | — |
|
All-in costs | | 289 |
|
| | 289 |
|
| 180 |
|
| 44 |
|
| 513 |
|
Gold sold - oz (000)(1) | | 242 |
| | | 242 |
| | 172 |
| | — |
| | 414 |
|
All-in sustaining cost (excluding stockpile write-offs) per unit - $/oz(2) | | 1,186 |
| | | 1,187 |
| | 1,043 |
| | — |
| | 1,132 |
|
All-in cost per unit (excluding stockpile write-offs) - $/oz(2) | | 1,197 |
| | | 1,198 |
| | 1,043 |
| | — |
| | 1,240 |
|
| |
(1)
| Attributable portion (excluding pre-production ounces). |
| |
(2)
| In addition to the operational performances of the mines, all-in sustaining cost per ounce, all-in cost per ounce and total cash costs per ounce are affected by fluctuations in the currency exchange rate. AngloGold Ashanti reports all-in sustaining cost per ounce and all-in cost per ounce calculated to the nearest US dollar amount and gold sold in ounces. AngloGold Ashanti reports total cash costs per ounce calculated to the nearest US dollar amount and gold produced in ounces. |
| |
(3)
| Refer Item 18: Note 2 - Segmental Information. |
Rounding of figures may result in computational differences.
For the year ended 31 December 2018
Operations in South Africa
(in $ millions, except as otherwise noted)
|
| | | | | | | | | | | | | | | | | | | | | | | |
| Kopanang |
| | Moab Khotsong |
| | Vaal River Operations |
| | Mponeng |
| | West Wits Operations |
| | Surface Operations | | South Africa other | | Total South Africa (Operations) |
|
All-in sustaining costs | | | | | | | | | | | | | | | |
Cost of sales per segmental information(3) | 29 |
| | 48 |
| | 77 |
| | 320 |
| | 320 |
| | 193 |
| | — |
| | 590 |
|
By-product revenue | (2 | ) | | (4 | ) | | (6 | ) | | — |
| | — |
| | — |
| | — |
| | (6 | ) |
Amortisation of tangible and intangible assets | — |
| | — |
| | — |
| | (57 | ) | | (57 | ) | | (15 | ) | | — |
| | (72 | ) |
Adjusted for decommissioning and inventory amortisation | — |
| | — |
| | — |
| | — |
| | — |
| | (3 | ) | | — |
| | (3 | ) |
Inventory writedown to net realisable value and other stockpile adjustments | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | 1 |
| | 1 |
|
Total sustaining capital expenditure | — |
| | 7 |
| | 7 |
| | 49 |
| | 49 |
| | 12 |
| | — |
| | 68 |
|
Realised other commodity contracts | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
All-in sustaining costs | 27 |
| | 51 |
| | 78 |
| | 312 |
| | 312 |
| | 187 |
| | 1 |
| | 578 |
|
All-in sustaining costs | 27 |
| | 51 |
| | 78 |
| | 312 |
| | 312 |
| | 187 |
| | 1 |
| | 578 |
|
Non-sustaining project capital expenditure | — |
| | — |
| | — |
| | 5 |
| | 5 |
| | — |
| | — |
| | 5 |
|
Technology improvements | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | 4 |
| | 4 |
|
Care and maintenance | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | 35 |
| | 35 |
|
All-in costs | 27 |
| | 51 |
| | 78 |
| | 317 |
| | 317 |
| | 187 |
| | 40 |
| | 622 |
|
Gold sold - oz (000)(1) | 13 |
| | 41 |
| | 53 |
| | 265 |
| | 265 |
| | 171 |
| | — |
| | 490 |
|
All-in sustaining cost (excluding stockpile write-offs) per unit - $/oz(2) | 2,115 |
| | 1,247 |
| | 1,452 |
| | 1,177 |
| | 1,177 |
| | 1,094 |
| | — |
| | 1,178 |
|
All-in cost per unit (excluding stockpile write-offs) - $/oz(2) | 2,115 |
| | 1,247 |
| | 1,452 |
| | 1,196 |
| | 1,196 |
| | 1,094 |
| | — |
| | 1,268 |
|
| |
(1)
| Attributable portion (excluding pre-production ounces). |
| |
(2)
| In addition to the operational performances of the mines, all-in sustaining cost per ounce, all-in cost per ounce and total cash costs per ounce are affected by fluctuations in the currency exchange rate. AngloGold Ashanti reports all-in sustaining cost per ounce and all-in cost per ounce calculated to the nearest US dollar amount and gold sold in ounces. AngloGold Ashanti reports total cash costs per ounce calculated to the nearest US dollar amount and gold produced in ounces. |
| |
(3)
| Refer Item 18: Note 2 - Segmental Information. |
5B. LIQUIDITY AND CAPITAL RESOURCES
Rounding of figures may result in computational differences.
For the year ended 31 December 2018
Operations in South Africa
(in $ millions, except as otherwise noted)
|
| | | | | | | | | | | | | | | | | | | | | | | |
| Kopanang |
| | Moab Khotsong |
| | Vaal River Operations |
| | Mponeng |
| | West Wits Operations | | Surface Operations |
| | South Africa other |
| | Total South Africa (Operations) |
|
Total cash costs | | | | | | | | | | | | | | | |
Cost of sales per segmental information(3) | 29 |
| | 48 |
| | 77 |
| | 320 |
| | 320 |
| | 193 |
| | — |
| | 590 |
|
By-product revenue | (2 | ) | | (4 | ) | | (6 | ) | | — |
| | — |
| | — |
| | — |
| | (6 | ) |
Inventory change | — |
| | (1 | ) | | (1 | ) | | — |
| | — |
| | (4 | ) | | — |
| | (5 | ) |
Amortisation of intangible assets | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
Amortisation of tangible and intangible assets | — |
| | — |
| | — |
| | (57 | ) | ) | (57 | ) | | (15 | ) | | — |
| | (72 | ) |
Rehabilitation and other non-cash costs | (2 | ) | | (1 | ) | | (3 | ) | | (4 | ) | ) | (4 | ) | | 2 |
| | 2 |
| | (3 | ) |
Retrenchment costs | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
Total cash costs net of by-product revenue | 25 |
| | 42 |
| | 67 |
| | 259 |
| | 259 |
| | 176 |
| | 2 |
| | 504 |
|
Gold produced - oz (000)(1) | 12 |
| | 39 |
| | 51 |
| | 265 |
| | 265 |
| | 171 |
| | — |
| | 487 |
|
Total cash costs per unit - $/oz(2) | 2,002 |
| | 1,083 |
| | 1,304 |
| | 977 |
| | 983 |
| | 1,030 |
| | — |
| | 1,033 |
|
| |
(1)
| Attributable portion (excluding pre-production ounces). |
| |
(2)
| In addition to the operational performances of the mines, all-in sustaining cost per ounce, all-in cost per ounce and total cash costs per ounce are affected by fluctuations in the currency exchange rate. AngloGold Ashanti reports all-in sustaining cost per ounce and all-in cost per ounce calculated to the nearest US dollar amount and gold sold in ounces. AngloGold Ashanti reports total cash costs per ounce calculated to the nearest US dollar amount and gold produced in ounces. |
| |
(3)
| Refer Item 18: Note 2 - Segmental Information. |
Rounding of figures may result in computational differences.
For the year ended 31 December 2017
Operations in South Africa
(in $ millions, except as otherwise noted)
|
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| Kopanang |
| | Moab Khotsong |
| | Vaal River Operations |
| | Mponeng |
| | Tau Tona |
| | West Wits Operations |
| | Surface Operations |
| | South Africa other |
| | Total South Africa (Operations) |
|
All-in sustaining costs | | | | | | | | | | | | | | | | | |
Cost of sales per segmental information(3) | 152 |
| | 284 |
| | 435 |
| | 284 |
| | 207 |
| | 491 |
| | 204 |
| | (1 | ) | | 1,129 |
|
By-product revenue | (5 | ) | | (9 | ) | | (14 | ) | | (1 | ) | | — |
| | (1 | ) | | (1 | ) | | — |
| | (15 | ) |
Amortisation of tangible and intangible assets | (9 | ) | | (41 | ) | | (50 | ) | | (53 | ) | | (14 | ) | | (67 | ) | | (14 | ) | | (1 | ) | | (133 | ) |
Adjusted for decommissioning and inventory amortisation | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | (2 | ) | | 2 |
| | — |
|
Corporate administration and marketing related to current operations | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
Inventory writedown to net realisable value and other stockpile adjustments | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | 2 |
| | 2 |
|
Sustaining exploration and study costs | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
Total sustaining capital expenditure | 8 |
| | 42 |
| | 50 |
| | 52 |
| | 12 |
| | 64 |
| | 13 |
| | 3 |
| | 130 |
|
All-in sustaining costs | 146 |
| | 276 |
| | 421 |
| | 282 |
| | 205 |
| | 487 |
| | 200 |
| | 5 |
| | 1,113 |
|
All-in sustaining costs | 146 |
| | 276 |
| | 421 |
| | 282 |
| | 205 |
| | 487 |
| | 200 |
| | 5 |
| | 1,113 |
|
Non-sustaining project capital expenditure | — |
| | — |
| | — |
| | 20 |
| | — |
| | 20 |
| | — |
| | — |
| | 20 |
|
Technology improvements | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | 9 |
| | 9 |
|
Non-sustaining exploration and study costs | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
Care and maintenance | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
Corporate and social responsibility costs not related to current operations | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
All-in costs | 146 |
| | 276 |
| | 421 |
| | 302 |
| | 205 |
| | 507 |
| | 200 |
| | 14 |
| | 1,142 |
|
Gold sold - oz (000)(1) | 91 |
| | 294 |
| | 385 |
| | 224 |
| | 91 |
| | 316 |
| | 192 |
| | — |
| | 892 |
|
All-in sustaining cost (excluding stockpile write-offs) per unit - $/oz(2) | 1,593 |
| | 938 |
| | 1,094 |
| | 1,259 |
| | 2,242 |
| | 1,544 |
| | 1,045 |
| | — |
| | 1,245 |
|
All-in cost per unit (excluding stockpile write-offs) - $/oz(2) | 1,593 |
| | 939 |
| | 1,094 |
| | 1,349 |
| | 2,242 |
| | 1,607 |
| | 1,045 |
| | — |
| | 1,278 |
|
| |
(1)
| Attributable portion (excluding pre-production ounces). |
| |
(2)
| In addition to the operational performances of the mines, all-in sustaining cost per ounce, all-in cost per ounce and total cash costs per ounce are affected by fluctuations in the currency exchange rate. AngloGold Ashanti reports all-in sustaining cost per ounce and all-in cost per ounce calculated to the nearest US dollar amount and gold sold in ounces. AngloGold Ashanti reports total cash costs per ounce calculated to the nearest US dollar amount and gold produced in ounces. |
| |
(3)
| Refer Item 18: Note 2 - Segmental Information. |
Rounding of figures may result in computational discrepancies.
For the year ended 31 December 2017
Operations in South Africa
(in $ millions, except as otherwise noted)
|
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| Kopanang |
| | Moab Khotsong |
| | Vaal River Operations |
| | Mponeng |
| | Tau Tona |
| | West Wits Operations |
| | Surface Operations |
| | South Africa other |
| | Total South Africa (Operations) |
|
Total cash costs | | | | | | | | | | | | | | | | | |
Cost of sales per segmental information(3) | 152 |
| | 284 |
| | 435 |
| | 284 |
| | 207 |
| | 491 |
| | 204 |
| | (1 | ) | | 1,129 |
|
By-product revenue | (5 | ) | | (9 | ) | | (14 | ) | | (1 | ) | | — |
| | (1 | ) | | (1 | ) | | — |
| | (15 | ) |
Inventory change | — |
| | — |
| | 1 |
| | — |
| | — |
| | — |
| | (2 | ) | | — |
| | (2 | ) |
Amortisation of intangible assets | — |
| | (1 | ) | | (1 | ) | | (1 | ) | | — |
| | (1 | ) | | — |
| | — |
| | (2 | ) |
Amortisation of tangible assets | (9 | ) | | (40 | ) | | (49 | ) | | (52 | ) | | (14 | ) | | (67 | ) | | (14 | ) | | (1 | ) | | (131 | ) |
Rehabilitation and other non-cash costs | 3 |
| | (5 | ) | | (3 | ) | | (3 | ) | | (6 | ) | | (9 | ) | | (1 | ) | | — |
| | (12 | ) |
Retrenchment costs | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | — |
|
Total cash costs net of by-product revenue | 140 |
| | 229 |
| | 369 |
| | 227 |
| | 186 |
| | 413 |
| | 186 |
| | (2 | ) | | 967 |
|
Gold produced - oz (000) (1) | 91 |
| | 294 |
| | 386 |
| | 224 |
| | 91 |
| | 315 |
| | 192 |
| | — |
| | 892 |
|
Total cash costs per unit - $/oz(2) | 1,534 |
| | 779 |
| | 958 |
| | 1,014 |
| | 2,044 |
| | 1,311 |
| | 969 |
| | — |
| | 1,085 |
|
| |
(1)
| Attributable portion (excluding pre-production ounces). |
| |
(2)
| In addition to the operational performances of the mines, all-in sustaining cost per ounce, all-in cost per ounce and total cash costs per ounce are affected by fluctuations in the currency exchange rate. AngloGold Ashanti reports all-in sustaining cost per ounce and all-in cost per ounce calculated to the nearest US dollar amount and gold sold in ounces. AngloGold Ashanti reports total cash costs per ounce calculated to the nearest US dollar amount and gold produced in ounces. |
| |
(3)
| Refer Item 18: Note 2 - Segmental Information. |
Rounding of figures may result in computational differences.
| |
5B. | LIQUIDITY AND CAPITAL RESOURCES |
In the board’s opinion, AngloGold Ashanti’s working capital is sufficient to meet the company’sCompany’s present requirements.
Comparison of cash flows in 2022 with 2021
Cash flows from operating activities
Comparison of operating activities in 2019 with 2018
Cash flows from operating activities were $958increased by $536 million, or 42 percent, from $1,268 million in 2019, $1022021 to $1,804 million or 12 percent, higher than the 2018 amount of $856 million.in 2022. The increase in cash flows generated by operationsfrom operating activities was mainly due to an increase in revenuedividends received from gold sales due tojoint ventures, an increase in thereceipts from customers as a result of an increase in gold price received partiallyproduction, as well as lower taxation paid due to lower profit before taxation in Australia, Brazil, Argentina and Tanzania. This increase was partly offset by an increase in payments to suppliers and employees as a result of higher production costs, and a decrease in dividends received from joint ventures.unfavourable working capital movements.
Net cash outflow from operating working capital items amounted to $165$137 million in 2019,2022, compared with an outflowinflow of $122$53 million in 2018.2021. The outflow from operating working capital in 2022 mainly related to an increase in inventories and an increase in trade, other receivables and other assets, partly offset by an increase in trade, other payables and provisions.
Comparison of operating activities in 2018 with 2017
Cash flows from operating activities were $856also impacted by movements in the lock-up of value added tax (“VAT”) at Geita in Tanzania as well as foreign exchange controls and export duties at Cerro Vanguardia in Argentina. In Tanzania, net overdue recoverable VAT input credit refunds (after discounting provisions) increased by $11 million, or eight percent, from $142 million in 2018, $572021 to $153 million in 2022, as a result of new claims submitted to the Tanzania Revenue Authority (“TRA”) during 2022 and despite offsetting verified VAT claims of $45 million against corporate tax payments in 2022. AngloGold Ashanti expects to continue offsetting verified VAT claims against corporate taxes. See “Item 4B: Business Overview—The Regulatory Environment Enabling AngloGold Ashanti to Mine—Africa—Tanzania”. In Argentina, the net export duty receivables (after discounting provisions) decreased by $10 million, or six53 percent, lower thanfrom $19 million at 31 December 2021 to $9 million at 31 December 2022. In addition, Cerro Vanguardia’s cash balance decreased by $23 million (equivalent), or 17 percent, from $139 million (equivalent) at 31 December 2021 to $116 million (equivalent) at 31 December 2022. While the 2017 amountapprovals of $913the Argentinean Central Bank to purchase US dollars to distribute offshore dividends to AngloGold Ashanti are pending, the cash remains fully available for Cerro Vanguardia’s operational and exploration requirements. See “Item 4B: Business Overview—The Regulatory Environment Enabling AngloGold Ashanti to Mine—Americas—Argentina”.
Dividends received from joint ventures increased by $463 million, or 200 percent, from $231 million in 2021 to $694 million in 2022. In this connection, cash flows from operating activities were impacted by the level of cash repatriation from, and movements in the VAT lock-up at, the Kibali joint venture in the DRC. During 2022, AngloGold Ashanti’s cumulative cash receipts from the Kibali joint venture, in the form of dividends from Kibali (Jersey) Limited, amounted to $694 million. Kibali (Jersey) Limited received such cash from Kibali Goldmines S.A. in the form of loan repayments (net of bank fees) (AngloGold Ashanti’s attributable share: $658 million) and dividends (net of withholding taxes) (AngloGold Ashanti’s attributable share: $36 million). AngloGold Ashanti’s attributable share of the outstanding cash balances awaiting repatriation from the DRC decreased by $459 million, or 92 percent, from $499 million at 31 December 2021 to $40 million at 31 December 2022. The cash is fully available for the operational requirements of Kibali Goldmines S.A. In addition, Kibali Goldmines S.A. is due certain refunds of VAT which, to date, remain outstanding. During 2022, AngloGold Ashanti did not recover any VAT offsets and refunds from its operations in the DRC. AngloGold Ashanti’s attributable share of the net recoverable VAT balance (including recoverable fuel duty and after discounting provisions) owed to AngloGold Ashanti by the DRC government increased by $13 million, or 18 percent, from $73 million at 31 December 2021 to $86 million at 31 December 2022. See “Item 4B: Business Overview—The Regulatory Environment Enabling AngloGold Ashanti to Mine—Africa—Democratic Republic of the Congo (DRC)”.
Net taxation paid decreased by $182 million, or 58 percent, from $316 million in 2021 to $134 million in 2022. The decrease in cash flows generated by operationsnet taxation paid was mainly due to a decreaselower profit before taxation in revenue from gold sales due to a decrease in gold sold partially offset by an increase in the gold price received.Australia, Brazil, Argentina and Tanzania.
Net cash outflow from operating working capital items amounted to $122 million in 2018, compared with an outflow of $137 million in 2017.
Cash flows from investing activities
Comparison of investing activities in 2019 with 2018
Cash flows from investing activities amounted to a net outflow of $683$1,461 million in 2019, $1222022, $521 million, or 2255 percent, higher than 2018an outflow of $561 million.$940 million in 2021. The increase in outflow from investing activities was largely due to an increasethe acquisition of assets of $517 million during 2022 and movements in capital expenditure by $128 million, or 22 percent, from $575 million in 2018 to $703 million in 2019. The capital expenditure increase was largely due to increased expenditure of $198 million on the Obuasi redevelopment projectcash restricted for use, partly offset by lower project capital expenditure at Siquirihigher interest received in Argentina due to higher cash and cash equivalent balances in 2022. The acquisition of $78 million with commissioningassets mainly consists of the CIL combination plantCompany’s acquisition of Corvus Gold Inc. (“Corvus Gold”) and Coeur Sterling, Inc. (“Coeur Sterling”) during 2019.
Comparison2022. On 18 January 2022, the Company completed its acquisition of investing activities in 2018 with 2017
Cashflows from investing activitiesall of the outstanding stock of Corvus Gold (not already owned by AngloGold Ashanti). The cash consideration paid, including transaction costs, amounted to a net outflow$365 million. On 4 November 2022, the Company completed its acquisition of $561 million in 2018, $150 million or 21 percent, lower than 2017 outflowall of $711the outstanding stock of Coeur Sterling, Inc. (a subsidiary of Coeur Mining, Inc.). The cash consideration paid, including transaction costs, amounted to $152 million. The decrease included $98 million decrease stay-in-business capital at Geita with higher underground ore reserve development taking place during 2017 and the production stage entered during 2018, a decrease in investments in associates and joint ventures of $21 million and loans repaid by associates and joint ventures of $22 million.
Cash flows from financing activities
Comparison of financing activities in 2019 with 2018
Cash flows from financing activities in the year ended 31 December 20192022 amounted to a net outflow of $177$323 million, which is a change of $216$133 million from an outflow of $393$456 million in the year ended 31 December 2018. Proceeds2021. The decrease in outflow was mainly due to lower net repayment of borrowings, finance costs and dividends paid, partly offset by an increase in repayment of lease liabilities.
Cash inflows from proceeds from borrowings in 2019 decreased by $585$556 million from $753$822 million in 20182021 to $168$266 million in 2019. This decrease included a $212022. In 2021, AngloGold Ashanti Holdings plc issued, at the end of October 2021, the $750 million drawdown2028 notes (as defined below). In 2022, AngloGold Ashanti drew the remaining undrawn commitments under the $150 million 2021 Geita RCF (as defined below), fully drew on the $65 million 2022 Siguiri RCF (as defined below) and partially drew on the $1.4 billion syndicated revolving credit facility, $130 million in proceeds from the local borrowings facilities in South Africa and proceeds from other small loans amounting to $17 million.2022 multi-currency RCF (as defined below).
Cash outflows from repayment of borrowings decreased by $844$636 million from $967 during$820 million in 2021 to $184 million in 2022. In 2021, AngloGold Ashanti Holdings plc repurchased the year ended 31 December$750 million 2022 notes (as defined below) by way of a tender offer in October 2021 followed by a redemption in November 2021. In 2022, AngloGold Ashanti repaid $95 million under, and cancelled, the $1.4 billion 2018 to $123multi-currency RCF (as defined below) and repaid $35 million duringunder, and cancelled, the year ended 31 December 2019. This decrease included the repayment of $122$65 million of the local borrowing facilities in South Africa and $1 million relating to other loans.2016 Siguiri RCF (as defined below).
Finance costs paid increaseddecreased by $7$11 million from $130$120 million in 20182021 to $137$109 million in 2019.2022. The increasedecrease was mainly due to a combination of increased borrowings and lease liabilities and fluctuatinglower interest rates for Geita of $10 million, Siguiri of $6 million and Argentina of $2 million partially offset by decreased borrowings and fluctuating interest rates for Australia of $9 million, AngloGold Ashanti Holdings plc of $5 million, Corporate (non-gold producing subsidiaries) of $2 million and finance costs paid on leases for Australia of $6 million, Geita of $1 million, Brazil of $1 millionthe 2028 notes issued in 2021, compared to the 2022 notes which were repurchased and Corporate of $1 million.redeemed in 2021.
Bond settlement premium, RCF and bond transactionOther borrowing costs decreased by $10$24 million to nil in 2019 from $10$35 million in 2018.2021 to $11 million in 2022. The decrease was dueother borrowing costs paid in 2021 were for the underwriting fees for the issuance of the 2028 notes as well as the tender offer premium and redemption premium costs of the 2022 notes. The other borrowing costs paid in 2022 mainly related to the absence of new transaction costs of the new $1.4 billion 2022 multi-currency RCF.
Dividends paid decreased by $37 million from $240 million in 2019.
2021 to $203 million in 2022. Dividends paid to non-controlling interests increased by $4$6 million from $39$16 million in 20182021 to $43$22 million in 2019 and2022. These dividends were all paid by our non-wholly owned subsidiaries.subsidiaries CVSA and Siguiri to their respective non-AGA related shareholders. During 2019,2022, the companyCompany declared and paid a dividend of $27$181 million to its shareholders, compared to $24$224 million in 2018.2021.
Comparison of cash flows in 2021 with 2020
Cash flows from operating activities
Cash flows from operating activities from continuing operations decreased by $315 million, or 20 percent, from $1,583 million in 2020 to $1,268 million in 2021. The decrease in cash flows from continuing operations was mainly due to a decrease in receipts from customers as a result of a decrease in gold production and an increase in payments to suppliers and employees as a result of higher production costs. This decrease was partly offset by lower taxation paid due to lower profit before tax, an increase in dividends received from joint ventures and favourable working capital movements.
Net cash inflow from operating working capital items amounted to $53 million in 2021, compared with an outflow of $238 million in 2020. The inflow from operating working capital in 2021 mainly related to a decrease in inventories and an increase in trade, other payables and provisions, partly offset by a decrease in trade, other receivables and other assets.
Cash flows from operating activities were also impacted by movements in the lock-up of value added tax (“VAT”) at Geita in Tanzania as well as foreign exchange controls and export duties at Cerro Vanguardia in Argentina. In Tanzania, net overdue recoverable VAT input credit refunds (after discounting provisions) increased by $3 million, or two percent, from $139 million in 2020 to $142 million in 2021, as a result of new claims submitted to the Tanzania Revenue Authority (“TRA”) during 2021 and despite offsetting verified VAT claims of $54 million against corporate tax payments in 2021. See “Item 4B: Business Overview—The Regulatory Environment Enabling AngloGold Ashanti to Mine—Africa—Tanzania”. In Argentina, the net export duty receivables (after discounting provisions) decreased by $4 million, or 17 percent, from $23 million at 31 December 2020 to $19 million at 31 December 2021. In addition, Cerro Vanguardia’s cash balance increased by $2 million (equivalent), or one percent, from $137 million (equivalent) at 31 December 2020 to $139 million (equivalent) at 31 December 2021. While the approval of the Argentinean Central Bank to purchase US dollars to distribute an offshore dividend to AngloGold Ashanti is pending, the cash remains fully available for Cerro Vanguardia’s operational requirements. See “Item 4B: Business Overview—The Regulatory Environment Enabling AngloGold Ashanti to Mine—Americas—Argentina”.
Dividends received from joint ventures increased by $83 million, or 56 percent, from $148 million in 2020 to $231 million in 2021. In this connection, cash flows from operating activities were impacted by the level of cash repatriation from, and movements in the VAT lock-up at, the Kibali joint venture in the DRC. During 2021, AngloGold Ashanti’s cumulative cash receipts from the Kibali joint venture, in the form of dividends from Kibali (Jersey) Limited, amounted to $231 million. Kibali (Jersey) Limited received such cash from Kibali Goldmines S.A. in the form of loan repayments (net of bank fees) (AngloGold Ashanti’s attributable share: $150 million) and dividends (net of withholding taxes) (AngloGold Ashanti’s attributable share: $81 million). AngloGold Ashanti’s
attributable share of the outstanding cash balances awaiting repatriation from the DRC increased by $75 million, or 18 percent, from $424 million at 31 December 2020 to $499 million at 31 December 2021. The cash is fully available for the operational requirements of Kibali Goldmines S.A. In addition, Kibali Goldmines S.A. is due certain refunds of VAT which, to date, remain outstanding. During 2021, AngloGold Ashanti did not recover any VAT offsets and refunds from its operations in the DRC. AngloGold Ashanti’s attributable share of the net recoverable VAT balance (including recoverable fuel duty and after discounting provisions) owed to AngloGold Ashanti by the DRC government increased by $4 million, or six percent, from $69 million at 31 December 2020 to $73 million at 31 December 2021. See “Item 4B: Business Overview—The Regulatory Environment Enabling AngloGold Ashanti to Mine—Africa—Democratic Republic of the Congo (DRC)”.
Net taxation paid decreased by $115 million, or 27 percent, from $431 million in 2020 to $316 million in 2021. The decrease in net taxation paid was mainly due to lower profit before taxation in Ghana, Australia, Brazil, Argentina and Tanzania.
Cash flows from operating activities from discontinued operations were nil in 2021, compared to a net cash inflow of $109 million in 2020.
Cash flows from investing activities
Cash flows from investing activities from continuing operations amounted to a net outflow of $940 million in 2021, $454 million, or 93 percent, higher than 2020 outflow of $486 million. The increase in outflow from continuing operations was largely due to higher capital expenditure of $288 million, or 39 percent, from $739 million in 2020 to $1,027 million in 2021, mainly due to increased conversion of Mineral Reserve, waste stripping at open pit mines and improved rates of underground development, and the transition of our TSFs in Brazil to dry-stacked structures to comply with new legal requirements, as well as proceeds from the disposals in 2020 of the South African assets of $200 million and certain joint ventures (Sadiola and Morila) of $26 million not being repeated in 2021. The increase in outflows was partly offset by the disposal of certain assets in Brazil and higher interest receipts in Argentina due to higher cash and cash equivalent balances in 2021.
Cash flows from investing activities from discontinued operations were nil in 2021, compared to a net cash outflow of $31 million in 2020.
Cash flows from financing activities in 2018 with 2017
Cash flows from financing activities from continuing operations in the year ended 31 December 20182021 amounted to a net outflow of $393$456 million, which is a change of $245$127 million from an outflow of $148$329 million in the year ended 31 December 2017. 2020. The increase in outflow was mainly due to an increase in dividends paid, partly offset by lower net repayment of borrowings.
Cash inflows from proceeds from borrowings decreased by $62$1,404 million from $815$2,226 million in 20172020 to $753$822 million in 2018. This decrease included a $45 million drawdown2021. In 2020, AngloGold Ashanti fully drew on the $1.0$1.4 billion syndicated revolving credit facility, $1582018 multi-currency RCF in March 2020 and AngloGold Ashanti Holdings plc issued, at the start of October 2020, the $700 million drawdown on2030 notes (as defined below). In 2021, AngloGold Ashanti Holdings plc issued, at the A$500end of October 2021, the $750 million syndicated revolving credit facility, $407 million in proceeds from the local borrowings facilities in South Africa and proceeds from other small loans amounting to $143 million.2028 notes.
Cash outflows from repayment of borrowings increaseddecreased by $200$1,490 million from $767 during$2,310 million in 2020 to $820 million in 2021. In 2020, AngloGold Ashanti Holdings plc repaid, at maturity in April 2020, the year ended 31 December 2017 to $967$700 million during2020 notes (as defined below) and AngloGold Ashanti repaid the year ended 31 December 2018. This increase includedfully drawn $1.4 billion 2018 multi-currency RCF in October 2020. In 2021, AngloGold Ashanti Holdings plc repurchased the repayment$750 million 2022 notes by way of $80 million of the $1.0 billion syndicated revolving credit facility, $571 million of the local borrowing facilitiesa tender offer in South Africa, $315 million of the A$500 million syndicated revolving credit facility and $1 million relating to other loans.October 2021 followed by a redemption in November 2021.
Finance costs paid decreasedincreased by $8$2 million from $138$118 million in 20172020 to $130$120 million in 2018.2021. The decreaseincrease was mainly due to a combination of decreased borrowingslower interest capitalised against the Obuasi redevelopment project and fluctuating interest rates for Corporate (non-gold producing subsidiaries) of $3 million, Australia of $3 million, AngloGold Ashanti Holdings plc of $1 million and Córrego do Sítio of $1 million.higher lease liabilities.
Bond settlement premium, RCF and bond transactionOther borrowing costs increased by $10$2 million to $10from $33 million in 2018 from nil2020 to $35 million in 2017.2021. The increase was due to transactionother borrowing costs paid in 2020 included the costs of AngloGold Ashanti’s $1.0 billion standby credit facility and the underwriting fees for the new $1.4 billion multi-currency RCF.issuance of the 2030 notes. The other borrowing costs paid in 2021 were for the underwriting fees for the issuance of the 2028 notes as well as the tender offer premium and redemption premium costs of the 2022 notes.
Dividends paid increased by $193 million from $47 million in 2020 to $240 million in 2021. Dividends paid to non-controlling interests decreasedincreased by $19$7 million from $58$9 million in 20172020 to $39$16 million in 2018 and2021. These dividends were all paid by our non-wholly owned subsidiaries.subsidiaries CVSA and Siguiri to their respective non-AGA related shareholders. During 2018,2021, the companyCompany declared and paid a dividend of $24$224 million to its shareholders, compared to $39$38 million in 2017.2020.
Cash flows from financing activities from discontinued operations were nil in 2020 and 2021.
Liquidity
Sources of liquidity
To service the capital commitments and other operational requirements, AngloGold Ashanti is dependent on existing cash resources, cash generated from operations and borrowings (in the form of bonds and credit facilities).
AngloGold Ashanti intends to finance its capital expenditure, capital lease obligations, other purchase obligations, environmental rehabilitation expenditures and debt repayment requirements in 2023 from cash on hand, cash flow from operations, existing credit facilities and, potentially, if deemed appropriate, long-term debt financing and the issuance of equity and equity-linked instruments. As part of the management of liquidity, funding and interest rate risk the Group regularly evaluates market conditions and may enter into transactions, from time to time, to repurchase outstanding debt, pursuant to open market purchases, privately negotiated transactions, tender offers or other means.
Cash and cash equivalents
AngloGold Ashanti’s cash and cash equivalents decreased by $48 million, or four percent, from $1.154 billion at 31 December 2021 to $1.106 billion at 31 December 2022. At 31 December 2022, 78 percent of the Company’s cash and cash equivalents were held in US dollars, three percent in Australian dollars, eight percent in South African rands, ten percent in Argentinean pesos and one percent in other currencies. Amounts are converted to US dollars at exchange rates as of 31 December 2022.
Cash generated from operations
Cash generated from operations is subject to operational, market and other risks. Distributions from operations may be subject to foreign investment, exchange control laws and regulations and the quantity of foreign exchange available in offshore countries. For example, in accordance with the rules and regulations of the Central Bank of Argentina, cash generated by our Argentinean operations is held in Argentinean peso and is subject to monetary and exchange policy controls. In addition, distributions from joint ventures are subject to relevant board approvals. AngloGold Ashanti’s revenues are derived primarily from the sale of gold produced at its mines. Cash flows from operating activities are therefore the function of gold produced that is sold at a specific price. The market price of gold can fluctuate widely, which impacts the profitability of the company’sCompany’s operations and the cash flows generated by these operations.
AngloGold Ashanti’s cashBorrowings
The credit facilities contain financial covenants and cash equivalents increasedother similar undertakings. To the extent that external borrowings are required, the Company’s covenant performance indicates that existing financing facilities will be available to $456 million at 31 December 2019 compared with $329 million at 31 December 2018. In accordance with South African Reserve Bank regulations, cash generated by South African operations is held in South African rands and is therefore subject to exchange controls. At 31 December 2019, 80 percentmeet the above commitments. To the extent that any of the company’s cash and cash equivalents were heldfinancing facilities mature in US dollars, six percentthe near future, the Company believes that sufficient measures are in Australian dollars, three percentplace to ensure that these facilities can be refinanced.
A full analysis of the borrowings as presented on the statement of financial position is included in South African rands and 11 percent in other currencies.“Item 18: Financial Statements—Note 24—Borrowings”.
Bonds
During April 2010, AngloGold Ashanti Holdings plc issued two rated bonds, fully and unconditionally guaranteed by AngloGold Ashanti Limited. The issuance consisted of a 10-year ($700 million) bond with a semi-annual coupon of 5.375% per annum (the “2020 notes”) was repaid at maturity in April 2020 and ais no longer outstanding. The 30-year ($300 million) bond with a semi-annual coupon of 6.50% per annum. Unless the company redeems the bonds earlier, the bondsannum (the “2040 notes”) will mature on 15 April 2040, unless the Company redeems the bond earlier. See also “Item 10C: Material Contracts—Notes—2020 Notes and 15 April 2040 respectively.Notes”.
During July 2012, AngloGold Ashanti Holdings plc issued a 10-year $750 million rated bond. Semi-annual coupons are paid at 5.125% per annum. The bonds are dollar based and unless the company redeems the bonds earlier, they are repayable on 1 August 2022. The bonds arebond, fully and unconditionally guaranteed by AngloGold Ashanti Limited. The 10-year ($750 million) bond with a semi-annual coupon of 5.125% per annum (the “2022 notes”) was repurchased in part in October 2021 with the remainder redeemed in November 2021 and is no longer outstanding. See also “Item 10C: Material Contracts—Notes—2022 Notes”.
During July 2015,October 2020, AngloGold Ashanti Limited, as borrower, entered intoHoldings plc issued a five-year unsecured syndicated revolving credit facility (ZAR RCF 1.4 billion)rated bond, fully and unconditionally guaranteed by AngloGold Ashanti Limited. The 10-year ($700 million) bond with a semi-annual coupon of R1.4 billion about $100 million3.750% per annum (the “2030 notes”) will mature on 1 October 2030, unless the Company redeems the bond earlier. See also “Item 10C: Material Contracts—Notes—2030 Notes”.
During October 2021, AngloGold Ashanti Holdings plc issued a rated bond, fully and unconditionally guaranteed by AngloGold Ashanti Limited. The 7-year ($750 million) bond with Nedbank Limited, as facility agent, who in conjunction with ABSA Bank Limited constitutea semi-annual coupon of 3.375% per annum (the “2028 notes”) will mature on 1 November 2028, unless the lenders. Amounts may be repaid and re-borrowed underCompany redeems the facility during its five-year term and the facility bears interest at JIBAR plus 1.65% per annum. This ZAR RCF 1.4 billion facility, as well as the ZAR RCF 1 billion and ZAR RCF 2.5 billionbond earlier. See also “Item 10C: Material Contracts—Notes—2028 Notes”.
Credit facilities (see below), will be used to fund the working capital and development costs associated with the group's operations within South Africa without eroding the group's headroom under its other facilities and exposing the group to foreign exchange gains/losses each quarter. This facility was cancelled in February 2020.
During August 2016, Geita Gold Mining Limited and Société AngloGold Ashanti de Guinée S.A., as borrowers, entered into a three-year unsecured revolving credit facilities of $100 million with Nedbank Limited, as lender. Interest is currently charged at a margin of between 6.2% and 8% above LIBOR. In January 2019, $35 million of this facility was combined with the Geita RCF (see below). The remaining portion of $65 million was renewed for a further three years in February 2019 and matures in February 2022. As of 19 March 2020, this facility is fully drawn.
During November 2017, AngloGold Ashanti Limited, as borrower, entered into a three-year unsecured revolving credit facility (ZAR RCF 1 billion) of R1 billion (about $71 million) with The Standard Bank of South Africa Limited, as facility agent and lender, which was subsequently extended by two years. Amounts may be repaid and re-borrowed under the facility during its term and the facility bears interest at JIBAR plus 1.3% per annum. The facility matures in November 2022. As of 19 March 2020, this facility is fully drawn.
During December 2017, AngloGold Ashanti Limited, as borrower, entered into a three-year unsecured syndicated revolving credit facility (ZAR RCF 2.5 billion) of R2.5 billion (about $179 million) with Nedbank Limited and ABSA Bank Limited, as lenders, which was subsequently extended by two years. Amounts may be repaid and re-borrowed under the facility during its term and the facility bears interest at JIBAR plus 1.8% per annum. The facility matures in December 2022.As of 19 March 2020, ZAR 450 million was drawn under this revolving facility.
During April 2018, Geita Gold Mining Limited, as borrower, entered into a three-year unsecured multi-currency revolving credit facility of $115$65 million with Nedbank Limited, as underwriterlender (the “2016 Siguiri RCF”). In February 2019, the 2016 Siguiri RCF was renewed for a further three years. The interest rate charged was LIBOR plus 8.50%. In April 2022, the 2016 Siguiri RCF, which was due to mature in May 2022, was extended for a further three months and agent,the interest rate was amended to a fixed rate plus 8.50%. On 3 August 2022, the 2016 Siguiri RCF was repaid and certain financial institutions party thereto, as original banks (Geita RCF). The agreement has been amended and restated in January 2019. Facility A is a US dollar based facility with interest charged at a margin of 6.7% above LIBOR and facility B is a Tanzanian shilling facility capped at the equivalent of $45 million with interest charged at a margin of 5% plus a reference rate as determined by the lending agent. The facility matures in April 2021.As of 19 March 2020, the equivalent of $110 million was drawn under this revolving facility.cancelled.
During October 2018, AngloGold Ashanti Holdings plc and AngloGold Ashanti Australia Limited, as borrowers, entered into a five-year unsecured multi-currency syndicated revolving credit facility of $1.4 billion ($1.4 billion RCF)(the “2018 multi-currency RCF”) with the Bank of Nova Scotia, as facility agent, and certain financial institutions party thereto, as lenders. The loan consistsconsisted of (i) a US dollar based facility with interest charged at a margin of 1.45% above LIBOR and (ii) an Australian dollar based facility capped at A$500 million with interest charged at a margin of 1.45% above BBSY. The applicable margin was subject to a ratings grid. In this regard, the interest margin reduced if the Group’s credit rating improved from its current BB+/Baa3 status and increased if its credit rating worsened. The A$500 million portion of the 2018 multi-currency RCF was used to fund the working capital and development costs associated with the Group’s mining operations within Australia without eroding the Group’s headroom under its other facilities and exposing the Group to foreign exchange gains/losses each quarter. On 9 June 2022, the 2018 multi-currency RCF was repaid and cancelled.
During December 2021, Geita Gold Mining Limited, as borrower, entered into a three-year unsecured multi-currency revolving credit facility of $150 million with Nedbank Limited, as underwriter and agent, and certain financial institutions party thereto, as original banks (the “2021 Geita RCF”). The 2021 Geita RCF consisted of a Tanzanian shilling component capped at the equivalent of $87 million bearing interest at 12.5% and a US dollar component bearing interest at LIBOR plus 6.7%. On 27 February 2023, the 2021 Geita RCF was amended to, among other matters, increase its size to $277 million and change the reference rate to Term SOFR. The amended 2021 Geita RCF consists of a Tanzanian shilling component capped at the equivalent of $148 million bearing interest at 12.5% and a US dollar component of $129 million bearing interest at Term SOFR plus 6.7%. The 2021 Geita RCF will mature during August 2024 or December 2024 depending on the fulfilment of certain conditions in the facility agreement. As of 31 December 2022, the 2021 Geita RCF was fully drawn at $150 million.
AngloGold Ashanti Limited, as borrower, seeks to renew its corporate overnight facility of ZAR 150 million (the “RMB corporate overnight facility”) with FirstRand Bank Limited on an annual basis. During October 2021, the RMB corporate overnight facility was reduced from ZAR 500 million to ZAR 150 million. As of 31 December 2022, the ZAR 150 million RMB corporate overnight facility was undrawn.
On 9 June 2022, AngloGold Ashanti Holdings plc and AngloGold Ashanti Australia Limited, as borrowers, entered into a new five-year unsecured multi-currency syndicated revolving credit facility of $1.4 billion (the “2022 multi-currency RCF”) with the Bank of Nova Scotia, as facility agent, and certain financial institutions party thereto, as lenders. The 2022 multi-currency RCF refinanced the 2018 multi-currency RCF. The loan consists of (i) a US dollar based facility with interest charged at a margin of 1.45% above Compounded SOFR adjusted for CAS and (ii) an Australian dollar based facility capped at A$500 million with interest charged at a margin of 1.45% above BBSY. The applicable margin is subject to a ratings grid. In this regard, the interest margin will reduce shouldif the group’sGroup’s credit rating improveimproves from its current BB+/Baa3 status and shouldwill increase if its credit rating worsens. The A$500 million portion of this facilitythe 2022 multi-currency RCF will be used to fund the working capital and development costs associated with the group'sGroup’s mining operations within Australia without eroding the group'sGroup’s headroom under its other facilities and exposing the groupGroup to foreign exchange gains/losses each quarter. ThisThe 2022 multi-currency RCF will mature on 9 June 2027, with the option, upon application, to be extended by two years. As of 31 December 2022, the equivalent of $1,362 million was undrawn under the 2022 multi-currency RCF (with the equivalent of $37 million being drawn under the AUD portion). See also “Item 10C: Material Contracts—Multi-currency Revolving Credit Facility”.
On 13 October 2022, Société AngloGold Ashanti de Guinée S.A., as borrower, entered into a three-year unsecured revolving credit facility matures inof $65 million with Nedbank Limited, as lender (the “2022 Siguiri RCF”). The current interest rate charged is Term SOFR plus 8%. The Siguiri RCF will mature on 13 October 2023 and replaced the $1 billion RCF and A$500 million RCF, which were available until July 2019 and were cancelled during October 2018.As of 19 March 2020, the equivalent of $945 million was drawn under this Revolving Credit Facility.
A full analysis of the borrowings as presented on the statement of financial position is included in “Item 18: Financial Statements-Note 26-Borrowings”.
Amounts are converted to US dollars at exchange rates as2025. As of 31 December 2019.2022, the 2022 Siguiri RCF was fully drawn.
Environmental obligations
Pursuant to environmental regulations in the countries in which AngloGold Ashanti intendsoperates, in connection with plans for the eventual end-of-life of our mines, AngloGold Ashanti is obligated to finance its capital expenditure and debt repayment requirementsrehabilitate the lands where such mines are located. In most cases, AngloGold Ashanti is required to provide financial guarantees for such work, including reclamation bonds or letters of credit issued by third party entities, independent trust funds or cash reserves maintained by the operation, to the respective environmental protection agency, or such other government department with responsibility for environmental oversight in 2020 from cash on hand, cash flow from operations, existing credit facilities and, potentially, if deemed appropriate, long-term debt financing, the issuance of equity and equity-linked instruments. As partrespective country, to cover all or a portion of the management of liquidity, funding and interest rate riskestimated environmental rehabilitation obligations.
In most cases, the group regularly evaluates market conditions and may enter into transactions, from time to time, to repurchase outstanding debt, pursuant to open market purchases, tender offers or other means. On 18 March 2020, the company drew $900 million under the $1.4 billion RCF to fund the repaymentenvironmental obligations expire on completion of the 5.375% notes maturing on 15 April 2020 ($700 million) andrehabilitation although, in some cases, AngloGold Ashanti may be required to support short-term liquidity inpost bonds for potential events or conditions that could arise after the eventrehabilitation has been completed. In Australia, since 2014, AngloGold Ashanti has paid into a Mine Rehabilitation Fund an amount of continuing disruptions in the global financial markets asA$11 million for a result
current carrying value of the recent outbreakliability of COVID-19. On 27 March 2020, the company drew downA$107 million. At Iduapriem, AngloGold Ashanti has provided a bond comprising a cash component of $12 million with a further $450bond guarantee amounting to $14 million onissued by ABSA Bank Ghana Limited and Standard Chartered Bank Ghana Ltd for a current carrying value of the remainderliability of its $1.4billion RCF.$46 million. At Obuasi, AngloGold Ashanti has provided a bond comprising a cash component of $22 million with a further bank guarantee amounting to $30 million issued by Stanbic Bank Ghana Limited and Standard Chartered Bank Ghana PLC for a current carrying value of the liability of $171 million. In some circumstances, the Company may be required to post further bonds in due course which will have a consequential income statement charge for the fees charged by the providers of the reclamation bonds.
Current borrowings
AngloGold Ashanti’s current borrowings increaseddecreased by $595$33 million to $734from $51 million at 31 December 2019 from $1392021 to $18 million at 31 December 2018. The increase in current borrowings is largely due to the allocation to current borrowings of the 5.375% notes maturing on 15 April 2020.2022. See “Item“Item 18: Financial Statements-Note 26-Borrowings”Statements—Note 24—Borrowings”.
Non-current borrowings
AngloGold Ashanti’s non-current borrowings decreasedincreased by $612$107 million to $1,299from $1,858 million at 31 December 2019 compared2021 to $1,911$1,965 million at 31 December 2018.2022. See “Item“Item 18: Financial Statements-Note 26-Borrowings”Statements—Note 24—Borrowings”.
As at 31 December 2019,2022, AngloGold Ashanti’s total non-current borrowings, including the short-term portion maturing within 2019,2022, was made up as follows:
|
| | | | |
| $ (million) |
|
Unsecured borrowings | 2,0331,983 |
|
Total borrowings | 2,033 |
|
Total borrowings | 1,983 | |
Less: Short-term maturities (current borrowings) | 73418 |
|
Total non-current borrowings | 1,2991,965 |
|
Amounts falling due are scheduled as follows: |
| | | | |
| $ (million) |
|
Within one year | 73418 |
|
Between one and two years | 110149 |
|
Between two and five years | 898102 |
|
After five years | 2911,714 |
|
Total | 2,0331,983 |
|
At 31 December 2019,2022, the currencies in which the borrowings were denominated were as follows: |
| | | | |
| $ (million) |
|
United States dollarsdollar | 1,8931,858 |
|
Australian dollarsdollar | 2137 |
|
South African rand | 72— |
|
Tanzanian shillingsshilling | 4788 |
|
Brazilian real | — |
|
Total | 2,0331,983 |
|
At 31 December 2019,2022, AngloGold Ashanti had the following undrawn amounts available under its borrowing facilities:
|
| | | | |
| $ (million) |
|
Syndicated revolving credit facility (R2.5 billion) - SA rand | 179 |
|
Syndicated revolving credit facility (R1.4 billion) - SA rand | 100 |
|
FirstRand Bank Limited (R750corporate overnight facility (R150 million) -– SA rand | 549 |
|
Revolving credit facility (R1billion) - SA rand | — |
|
Multi-currency syndicated revolving credit facility ($1.4 billion) -– US dollar / Australian dollar | 1,3791,362 |
|
RevolvingGeita revolving credit facility ($115150 million) -– US dollar / Tanzanian shilling (1) | 40— |
|
Siguiri revolving credit facility ($65 million) – US dollar | — | |
Total undrawn facilities | 1,7521,371 |
|
(1) On 27 February 2023, the size of the 2021 Geita RCF was increased from $150 million to $277 million.
AngloGold Ashanti had no other committed lines of credit as of 31 December 2019.
2022.
As of 31 December 2019,2022, the companyCompany was in compliance with all debt covenants and provisions related to potential defaults.
See “Item“Item 18: Financial Statements-Note 36-CapitalStatements—Note 34—Capital Management” and “Item“Item 10C: Material Contracts”.
At 31 December 2019,2022, lease liabilities were as follows:
|
| | | | |
| $ (million) |
|
Non-current | 126102 |
|
Current | 4584 |
|
Total | 171186 |
|
AngloGold Ashanti, through its executive committee, reviews its short-, medium- and long-term funding, treasury and liquidity requirements and positions monthly.
Supplemental parent guarantor and subsidiary issuer financial information
AngloGold Ashanti Holdings plc (the “Issuer”), a direct wholly-owned subsidiary of AngloGold Ashanti Limited (the “Guarantor”), has issued three series of outstanding debt securities which are each fully and unconditionally guaranteed by the Guarantor (the “guaranteed debt securities”). The Audit Committee also reviews theseIssuer is a company incorporated under the laws of the Isle of Man that holds certain of AngloGold Ashanti’s operations and assets located outside of South Africa. The guaranteed debt securities outstanding as of 31 December 2022 consisted of:
•a $300 million 30-year bond, with a maturity date of 15 April 2040 and a fixed coupon of 6.500% payable semi-annually (the “2040 notes”);
•a $750 million 7-year bond, with a maturity date of 1 November 2028 and a fixed coupon of 3.375% payable semi-annually (the “2028 notes”); and
•a $700 million 10-year bond, with a maturity date of 1 October 2030 and a fixed coupon of 3.750% payable semi-annually (the “2030 notes”).
The Guarantor fully and unconditionally guarantees the payment of the principal of, premium, if any, and interest on each of the guaranteed debt securities, including any additional amounts, when and as any such payments become due, whether at maturity, upon redemption or declaration of acceleration, or otherwise. The Guarantor has obtained the approval of the South African Reserve Bank (SARB) to provide each of the guarantees. Each guarantee constitutes unsecured and unsubordinated debt of the Guarantor and ranks equally with all of its other unsecured and unsubordinated debt from time to time outstanding. Each guarantee is or will be effectively subordinated to any of the Guarantor’s existing and future secured debt, to the extent of the value of the assets securing such debt, and structurally subordinated to all of the existing and future liabilities (including trade payables) of each of the Guarantor’s subsidiaries (other than the Issuer). As at 31 December 2022, all of the debt of the Guarantor was unsecured. Under the terms of each full and unconditional guarantee, holders of the guaranteed debt securities will not be required to exercise their remedies against the Issuer before they proceed directly against the Guarantor.
The following summarised financial information reflects, on a quarterlycombined basis, the assets, liabilities, and results of operations of the Issuer and the Guarantor (collectively, the “Obligor Group”). Intercompany balances and transactions within the Obligor Group have been eliminated. Amounts attributable to the Obligor Group’s investment in consolidated subsidiaries that have not issued or guaranteed the guaranteed debt securities (the “Non-Obligor Subsidiaries”) have been excluded. The Obligor Group’s amounts due from, amounts due to and transactions with Non-Obligor Subsidiaries have been separately disclosed, if considered to be material. The summarised financial information below should be read in conjunction with AngloGold Ashanti’s consolidated financial statements for the year ended and as at 31 December 2022, see “Item 18: Financial Statements”.
Income statement information
| | | | | | |
| Obligor Group(1) |
$ (million) | Year ended 31 December 2022 | |
| | |
Revenues from Non-Obligor Subsidiaries | 1 | | |
Revenues from Investments | 18 | | |
Net intergroup dividends, interest, royalties and fees with Non-Obligor Subsidiaries | 1 | | |
Loss for the period from continuing operations | (141) | | |
Loss for the period | (141) | | |
(1) Gross profit is not disclosed for the Obligor Group. The Guarantor changed the nature of its meetings.main operating activities from mining operations to investment holding in 2021 and has no costs and expenses applicable to revenue. As a result cost of sales and gross profit are no longer presented. The principal activity of the Issuer is to act as a holding company for certain of AngloGold Ashanti’s operations and assets located outside of South Africa.
Statement of financial position information
| | | | | | |
| Obligor Group |
$ (million) | Year ended 31 December 2022 | |
| | |
ASSETS | | |
Receivables due from Non-Obligor Subsidiaries | 1,640 | | |
Other current assets | 604 | | |
Total current assets | 2,244 | | |
| | |
Non-current assets | 36 | | |
| | |
LIABILITIES | | |
Payables due to Non-Obligor Subsidiaries | 276 | | |
Other current liabilities | 198 | | |
Total current liabilities | 474 | | |
| | |
Non-current liabilities | 1,806 | | |
Contractual commitments and contingencies
For a detailed discussion of commitments and contingencies, see “Item 18: Financial Statements-Note 34-ContractualStatements—Note 32—Contractual Commitments and Contingencies”.
As at 31 December 2019,2022, capital commitments can be summarised over the periods shown below as follows:
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Expiration per period |
Commitment | Total amount | | Less than 1 year | | 1 – 3 years | | 4 – 5 years | | Over 5 years |
(in millions) | $ | | $ | | $ | | $ | | $ |
Capital expenditure (contracted and not yet contracted)(1) | 437 | | | 398 | | | 39 | | | — | | | — | |
Other commercial commitments(2) | 1,011 | | | 436 | | | 447 | | | 128 | | | — | |
Total | 1,448 | | | 834 | | | 486 | | | 128 | | | — | |
(1) There were no commitments through contractual arrangements with equity-accounted joint ventures.
(2) Excludes commitments through contractual arrangements with equity-accounted joint ventures.
To service the above capital commitments and other operational requirements, the Group is dependent on existing cash resources, cash generated from operations and borrowings (in the form of bonds and credit facilities).
|
| | | | | | | | | | | | | | | |
| Expiration per period |
Commitment | Total amount |
| | Less than 1 year |
| | 1 – 3 years |
| | 4 – 5 years |
| | Over 5 years |
|
(in millions) | $ |
| | $ |
| | $ |
| | $ |
| | $ |
|
Capital expenditure (contracted and not yet contracted)(1) | 587 |
| | 405 |
| | 182 |
| | — |
| | — |
|
Other commercial commitments(2) | 1,085 |
| | 506 |
| 535 |
| 535 |
| | 28 |
| | 16 |
|
Total | 1,672 |
| | 911 |
| | 717 |
| | 28 |
| | 16 |
|
| |
(1)
| Including commitments through contractual arrangements with equity accounted joint ventures of $2 million. |
| |
(2)
| Excludes commitments through contractual arrangements with equity accounted joint ventures. |
Contractual obligations
As at 31 December 2022, AngloGold Ashanti had the following known contractual obligations:
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Total | | Less than 1 year | | 1 – 3 years | | 4 – 5 years | | More than 5 years |
(in millions) | $ | | $ | | $ | | $ | | $ |
Long-term debt obligations including interest(1) | 2,775 | | | 102 | | | 392 | | | 183 | | | 2,098 | |
Capital lease obligations | 203 | | | 79 | | | 100 | | | 22 | | | 2 | |
Purchase obligations | | | | | | | | | |
- Contracted capital expenditure(2) | 178 | | | 178 | | | | | | | |
- Other purchase obligations(3) | 1,011 | | | 436 | | | 447 | | | 128 | | | — | |
Environmental rehabilitation costs(4) | 734 | | | 61 | | | 109 | | | 83 | | | 481 | |
Provision for silicosis(5) | 43 | | | 12 | | | 13 | | | 15 | | | 3 | |
Pensions and other post-retirement medical obligations(6) | 71 | | | 8 | | | 18 | | | 16 | | | 29 | |
Total | 5,015 | | | 876 | | | 1,079 | | | 447 | | | 2,613 | |
(1) Interest calculations are at the rate existing at the year end. Actual rates are set at floating rates for some of the borrowings (Refer to “Item 18: Financial Statements—Note 24—Borrowings”).
(2) Represents contracted capital expenditure for which contractual obligations exist.
(3) Other purchase obligations represent contractual obligations for mining contract services, purchase of power, supplies, consumables, inventories, explosives and activated carbon.
(4) Pursuant to environmental requirements, AngloGold Ashanti is obligated to close its operations and reclaim and rehabilitate the lands upon which it conducted its mining and gold recovery operations. The present value of estimated closure costs at existing operating mines as well as mines in various stages of closure are reflected in this table. Costs are calculated using undiscounted real cash flows, not nominal cash flows. The amount will change from year to year depending on rehabilitation work undertaken, changes in design and methodology, and new occurrences. For more information on AngloGold Ashanti’s environmental rehabilitation obligations, see “Item 4B: Business Overview—Mine Site Rehabilitation and Closure” and “Item 4B: Business Overview—Sustainability and Environmental, Social and Governance (“ESG”) Matters”. Amounts stated include a total estimated liability of $17 million in respect of equity-accounted joint ventures.
(5) In South Africa, AngloGold Ashanti has been subject to numerous claims, including class action litigation with respect to alleged occupational lung diseases. The settlement agreement in relation to the silicosis and tuberculosis class action came into effect in December 2019, following the approval of the settlement by the High Court in Johannesburg in July 2019. As a result, a trust (Tshiamiso Trust) was established for a minimum of 13 years responsible for making payments to eligible beneficiaries. The amount of monetary compensation will vary depending on the nature and seriousness of the disease. See “Item 3D: Risk Factors—The prevalence of occupational health diseases and other diseases and the potential costs and liabilities related thereto may have an adverse effect on the business and results of operations of AngloGold Ashanti”, “Item 4B: Business Overview—Sustainability and Environmental, Social and Governance (“ESG”) Matters” and “Item 18: Financial Statements—Note 1.2—Statement of Compliance—Significant Accounting Judgements and Estimates—Provision for silicosis”.
(6) Represents payments for unfunded plans or plans with insufficient funding. A $12 million reimbursive asset relating to annuities purchase to fund the asset has been separately recognised.
Off-balance sheet arrangements
AngloGold Ashanti does not engage in off-balance sheet financing activities, and does not have any off-balance sheet debt obligations, special purpose entities or unconsolidated associates. The most significant off-balance sheet item are the unaccrued future rehabilitation obligations.
Recent developments
Recent developments disclosed in “Item“Item 18: Financial Statements-Note 37-Subsequent events”Statements—Note 35—Subsequent Events” include the following details:
Sale of South African assets:Dividend declaration - On 1222 February 2020, AngloGold Ashanti announced that it has reached an agreement to sell its remaining South African producing assets and related liabilities to Harmony Gold Mining Company Limited. Consideration for the transaction is in cash and deferred payments with expected proceeds of around $300m, subject to subsequent performance, and with additional proceeds if the West Wits assets are developed below current infrastructure.
Dividend declaration: On 21 February 2020,2023, the directors of AngloGold Ashanti declared a gross cash dividend per ordinary share of 165322 South African cents (assuming an exchange rate of ZAR15/ZAR 17.53/$, the gross dividend payable per ADS is equivalent to 1118 US cents). which was approximately $75 million.
COVID-19 pandemic: AtAngloGold Ashanti and Gold Fields Propose Joint Arrangement in Ghana - Gold Fields and AngloGold Ashanti (the “Parties”) have agreed the datekey terms of approvala proposed joint venture in Ghana between Gold Fields’ Tarkwa and AngloGold Ashanti’s neighbouring Iduapriem Mines (the “Proposed Joint Venture”). The Tarkwa Mine is held by Gold Fields Ghana, in which Gold Fields currently owns a 90% share and the Government of these consolidated annual financial statements,Ghana (the “GoG”) holds 10%. The Iduapriem Mine is currently 100% owned by AngloGold Ashanti. Both mines are located near the SARS-CoV-2 virus responsibletown of Tarkwa in the country’s Western Region. The Parties have agreed in principle on the key terms of the Proposed Joint Venture and will engage with the GoG and other key stakeholders, including relevant regulators, with a view to implementing the Proposed Joint Venture as soon as practically possible. The Parties have agreed to mutual exclusivity during this engagement. It is intended that the Proposed Joint Venture will be an incorporated joint venture, constituted within Gold Fields Ghana and operated by Gold Fields.
AngloGold Ashanti will contribute its 100% interest in the Iduapriem Mine to Gold Fields Ghana in return for COVID-19 continuesa shareholding in that company. Excluding the interest to spread across the globe, contributing to a sharp decline in global financial markets and a significant decrease in global economic activity. On 11 March 2020, the COVID-19 outbreak was declared a global pandemicbe held by the World Health OrganizationGoG, Gold Fields will have an interest of 66.7%, or two-thirds, and has since then resulted in numerous governments and companies, including
AngloGold Ashanti introducing a varietywill have an interest of measures to contain the spread of the virus. To date, we have taken a number of proactive steps to protect our employees, our host communities and business, in line with the company’s values, guidelines and advice provided by the WHO and with the requirements of the countries in which we operate. Cases of the outbreak have been reported in all of the jurisdictions in which we operate, and it may lead to a prolonged restriction on the movement of people and continued requirement for people to self-isolate33.3%, or be quarantined.
Any self-imposed or government-mandated temporary lockdowns may disrupt the company’s activities and operations and even lead to a full or partial temporary suspension of the company’s mining operations in those jurisdictions. On 21 March 2020, following the Argentinian government’s decision to impose a nationwide lockdown (quarantine) until 31 March 2020, including temporary travel restrictions, border closings and suspension of most industries, Cerro Vanguardia S.A. (CVSA) was required to temporarily suspend mining activities.
On 23 March 2020, the South African government announced a 21-day nationwide lockdown, effective from midnight on 26 March 2020, resultingone-third, in the temporary suspension of mining activities ofProposed Joint Venture. There can be no certainty that the company’s South African operations particularly Mponeng, and the partial suspension of mining activities at Mine Waste Solutions (MWS) and Surface Operations.
On 26 March 2020, the State of Goiás, in Brazil, extendedParties will enter into a set of restrictions on the operation of non-essential business, to include mining. These restrictions are set to run through 4 April 2020. Mineração Serra Grande (MSG) S.A. will temporarily suspend its operations.
The current impact of all of the suspended operations is expected to be about 30,000oz to 40,000oz, or less than 2% of annual production. In these countries, the suspension of mining activities will continue for the period during which the respective restrictions remain in force.
While minimal operational disruptions have occurred at the company’s other operations to date, the company may experience temporary disruptions in supply chain and logistics across its operations in the coming months should the pandemic be prolonged. Such disruptions, which include restrictions in travel and border access, may impact the company’s ability to source and transport goods and services required to operate mines and to transport gold doré to refineries. Furthermore, should COVID-19 spread among the company’s workforce, it may lead to a full or partial temporary suspension of the company’s operating mines in those affected areas.
Given the uncertaintiesdefinitive agreement with respect to future developments, including duration, severitythe Proposed Joint Venture or about the timing, terms and scopeconditions of any such definitive agreement. Implementation of the COVID-19 pandemicProposed Joint Venture is subject to, among other matters, reaching agreement with the GoG regarding the Proposed Joint Venture, conclusion of confirmatory due diligence and the necessary government responses to limiting its spread, the board has decided to withdraw its market guidance for 2020 published as part of its preliminary condensed consolidated financial results on 21 February 2020, at this time.securing all requisite regulatory approvals.
In anticipation of a prolonged negative impact from the COVID-19 pandemic, on 18 March 2020, the company accelerated a drawdown of $900million on its $1.4billion Multi-currency RCF to redeem the $700million 5.375% bonds maturing on 15 April 2020 and to have sufficient cash available to manage ongoing working capital requirements. The company drew down a further $450million on the remainder of its $1.4billion Multi-currency RCF which was received on 27th March 2020. After the drawdowns, the company’s cash on hand exceeds $1.8billion (excluding cash lock-up positions at Kibali and Sadiola, where AngloGold Ashanti’s combined share totals $300million).
Management will continue to take a prudent and proactive approach to managing the group’s liquidity, which may include procuring additional credit facilities or debt over and above its current facilities.
Related party transactions
For a detailed discussion of related party transactions, see “Item“Item 7B: Related Party Transactions”.
Recently adopted accounting policies and pending adoption of new accounting standards
AngloGold Ashanti adopted the amendment to IAS 16 “Property, Plant and Equipment—Proceeds before Intended Use” on 1 January 2022. The amendment prohibits deducting from the cost of an item of property, plant and equipment any proceeds from selling items produced while bringing that asset to the location and condition necessary for it to be capable of operating in the manner intended by management. Instead, an entity recognises the proceeds from selling such items, and the cost of producing those items, in profit or loss. The cost allocation requires significant judgement in terms of this amendment. In accordance with the transitional provisions of IAS 16 an entity applies the amendments retrospectively to items of property, plant and equipment made available for use on or after the beginning of the earliest period presented when the entity first applies the amendment.
The adoption of the amendment on 1 January 2022 resulted in a retrospective increase in property, plant and equipment and a decrease in accumulated losses of $33 million as of 31 December 2020. There was no impact on the 2021 results as no revenue was capitalised in 2021. The effects of the 2020 restatement are included in the accumulated losses opening balance of the 2021 financial reporting period. The impact arises from the reclassification of revenue, cost of sales, and tangible assets and the resulting amortisation recalculation, resulting exclusively from the redevelopment of the Obuasi mine. No other operation was impacted by the adoption of the amendment.
AngloGold Ashanti’s accounting policies are described in “Item“Item 18: Financial Statements-Note 1-Accounting Policies”Statements—Note 1—Statement of Compliance—Accounting Standards, Interpretations and Amendments to Published Accounting Standards”.
Critical accounting policies
AngloGold Ashanti’s accounting policies are described in “Item 18: Financial Statements-Note 1-Accounting Policies”Statements—Note 1.2—Statement of Compliance—Significant Accounting Judgements and Estimates”.
Use of estimates and making of assumptions
The preparation of the company’sCompany’s financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the year. The following are considered to be the accounting policies that are most critical to the company’s results of operations, financial condition and cash flows.
Use of estimates and making of assumptions
The more significant areas requiring the use of management estimates and assumptions relate to OreMineral Reserve that are the basis of future cash flow estimates and unit-of-production depreciation, depletion and amortisation calculations; environmental, reclamation, rehabilitation and closure obligations; asset impairments/reversals (including impairments of goodwill); production start dates; and write-downswrite downs of inventory to net realisable value. Other estimates include employee benefit liabilities and unrecognised tax positions.
The complex or subjective judgements that have the most significant effect on amounts recognised and the sources of estimation uncertainty where there is a significant risk of material adjustment to the carrying amounts of assets or liabilities in the next reporting period are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. On an ongoing basis, management evaluates its estimates and assumptions; however, actual amounts could differ significantly due to the ultimate conclusion of uncertainties.
Ore Reserve and life-of-mines
AngloGold Ashanti estimates on an annual basis its Ore Reserve at its mining operations. There are a number of uncertainties inherent in estimating quantities of Ore Reserve, including many factors beyond the company’s control. Estimates of Ore Reserve are based upon engineering evaluations of assay values derived from samplings of drill holes and other openings. Additionally, declines in the market price of gold may render certain Ore Reserve containing relatively lower grades of mineralisation uneconomic to mine. Further, availability of permits, changes in operating and capital costs, and other factors could materially and adversely affect the Ore Reserve. The company uses its estimates of Ore Reserve to determine the unit basis for mine depreciation and closure rates, and to evaluate mine asset impairments. Changes in estimates of Ore Reserve could significantly affect these items. At least annually, the company reviews mining schedules, production levels and asset lives in the company’s life-of-mine planning for all of the company’s operating and development properties. Significant changes in the life-of-mine plans may occur as a result of mining experience, new ore discoveries, changes in mining methods and rates, process changes, investment in new equipment and technology and gold prices. Based on the life-of-mine analysis the company reviews itsAshanti’s significant accounting estimates and adjusts depreciation, amortisation, reclamation costs and evaluation of each mine for impairment where necessary. Accordingly, this analysis and the estimates made therein have a significant impact on the company’s results of operations and financial condition.
Contingencies
Accounting for contingencies requires the recording of an estimated loss for a loss contingency when information available indicates that it is probable that an asset has been impaired or a liability has been incurred, and the amount of the loss can be reasonably estimated. Accounting for contingencies such as legal and income tax matters requires the use of judgements to determine the amount to be recorded in the financial statements. By their nature, contingencies will only be resolved when one or more future events occur or fail to occur, and typically, those events will occur a number of years into the future. The company assesses such contingent liabilities, which inherently involves the exercise of significant management judgement and estimates are described in “Item 18: Financial Statements—Note 1.2—Statement of the outcome of future events.Compliance—Significant Accounting Judgements and Estimates”.
Provision for environmental rehabilitation
AngloGold Ashanti’s mining and exploration activities are subject to various laws and regulations governing the protection of the environment. The company recognises management’s best estimate for asset retirement obligations in the period in which they are incurred. Actual costs incurred in future periods could differ materially from the estimates. Additionally, future changes to environmental laws and regulations, life of mine estimates and discount rates could affect the carrying amount of this provision. Changes in Ore Reserve could similarly affect the useful lives of assets depreciated on a straight-line-basis, where those lives are limited to the life of mine.5C. RESEARCH AND DEVELOPMENT, PATENTS AND LICENSES, ETC.
Identification and classification of discontinued operations
When the company considers selling part of its operations, management judgement is applied regarding the classification of the assets or operations (disposal group) as held for sale and the classification of the disposal group as a discontinued operation. A discontinued operation is a component of an entity that either has been disposed of or is classified as held for sale, and represents
either a separate major line of business or a geographical area of operations and is part of a single coordinated plan to dispose of a separate major line of business or geographical area of operations. At 31 December 2019, the company assessed the IFRS 5 held for sale criteria and management concluded that the criteria to recognise the South African assets as held for sale were met. Accordingly, the South African assets and liabilities were transferred to held for sale, and the South African disposal group was recognised as a discontinued operation.
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5C. | RESEARCH AND DEVELOPMENT, PATENTS AND LICENSES, ETC. |
Research and development expenditure included in the income statement amounted to nil, $1 million during each of 2022, 2021 and $11 million during 2019, 2018 and 2017, respectively.2020.
5D. TREND INFORMATION
For a discussion of trends affecting AngloGold Ashanti’s business and operations, see “Item 5A: Operating Results Results—Key factors affecting results”.
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5E. | OFF-BALANCE SHEET ARRANGEMENTS |
AngloGold Ashanti does not engage in off-balance sheet financing activities, and does not have any off-balance sheet debt obligations, special purpose entities or unconsolidated associates. The most significant off-balance sheet item is the unaccrued future rehabilitation obligations.5E. CRITICAL ACCOUNTING ESTIMATES
See “Item 5F: Tabular Disclosure of Contractual Obligations”.Not applicable.
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5F. | TABULAR DISCLOSURE OF CONTRACTUAL OBLIGATIONS |
As at 31 December 2019 AngloGold Ashanti had the following known contractual obligations:
|
| | | | | | | | | | | | | | |
| Total |
| | Less than 1 year |
| | 1 – 3 years |
| | 4 – 5 years |
| | More than 5 years |
|
(in millions) | $ |
| | $ |
| | $ |
| | $ |
| | $ |
|
Long-term debt obligations including interest(1) | 2,601 |
| | 802 |
| | 1,136 |
| | 61 |
| | 602 |
|
Capital lease obligations | 198 |
| | 52 |
| | 63 |
| | 26 |
| | 57 |
|
Purchase obligations | | | | | | | | | |
- Contracted capital expenditure(2) | 161 |
| | 161 |
| | | | | | |
- Other purchase obligations(3) | 1,085 |
| | 506 |
| | 535 |
| | 28 |
| | 16 |
|
Environmental rehabilitation costs(4) | 835 |
| | 77 |
| | 80 |
| | 77 |
| | 601 |
|
Pensions and other post-retirement medical obligations(5) | 100 |
| | 10 |
| | 20 |
| | 20 |
| | 50 |
|
Total | 4,980 |
| | 1,608 |
| | 1,834 |
| | 212 |
| | 1,326 |
|
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(1)
| Interest calculations are at the rate existing at the year end. Actual rates are set at floating rates for some of the borrowings (Refer to “Item 18: Financial Statements-Note 26-Borrowings”). |
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(2)
| Represents contracted capital expenditure for which contractual obligations exist. Amounts stated include commitments of equity accounted joint ventures. |
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(3)
| Other purchase obligations represent contractual obligations for mining contract services, purchase of power, supplies, consumables, inventories, explosives and activated carbon. |
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(4)
| Operations of gold mining companies are subject to extensive environmental regulations in the various jurisdictions in which they operate. These regulations establish certain conditions on the conduct of operations by AngloGold Ashanti. Pursuant to environmental regulations, AngloGold Ashanti is also obligated to close its operations and reclaim and rehabilitate the lands upon which it conducted its mining and gold recovery operations. The present estimated closure costs at existing operating mines and mines in various stages of closure are reflected in this table. They are calculated using undiscounted real cash flows, not nominal cash flows. The amount will change from year to year depending on rehabilitation work undertaken, changes in design and methodology and new occurrences. For more information of environmental rehabilitation obligations, see "Item 4B: Business Overview-Mine Site Rehabilitation and Closure" and "Item 4B: Business Overview-Environmental, Health and Safety Matters”. Amounts stated include a total estimated liability of $54 million in respect of equity accounted joint ventures. |
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(5)
| Represents payments for unfunded plans or plans with insufficient funding. |
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ITEM 6: DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES
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6A. | DIRECTORS AND SENIOR MANAGEMENT |
6A. DIRECTORS AND SENIOR MANAGEMENT
Directors
As at 1910 March 2020,2023, AngloGold Ashanti has a unitary board comprising 12ten directors - 10eight independent non-executive directors and two executive directors. Certain information with respect to AngloGold Ashanti’s directors is set forth below:
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Name | | Age | | Position | | Year first appointed(1) |
Alberto Calderon | | 63 | | Executive director and Chief Executive Officer | | 2021 |
Gillian Doran | | 46 | | Executive director and Chief Financial Officer | | 2023 |
Maria Ramos | | 64 | | Independent non-executive director and chairperson | | 2019 |
Rhidwaan Gasant | | 63 | | Lead independent non-executive director | | 2010 |
Kojo Busia | | 60 | | Independent non-executive director | | 2020 |
Alan Ferguson | | 65 | | Independent non-executive director | | 2018 |
Albert Garner | | 67 | | Independent non-executive director | | 2015 |
Scott Lawson | | 61 | | Independent non-executive director | | 2021 |
Maria Richter | | 68 | | Independent non-executive director | | 2015 |
Jochen Tilk | | 59 | | Independent non-executive director | | 2019 |
(1) One-third of the directors (if their number is not a multiple of three, then the number nearest to but not less than one-third), must retire at each annual general meeting, according to those who have been longest in office or by lot but may be re-elected, if eligible. A director may not serve for a period of more than three years without retiring. Directors appointed since the previous annual general meeting must be approved by shareholders at the next annual general meeting (“AGM”). |
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Name | | Age | | Position | | Year first appointed(1) |
Kelvin Dushnisky | | 56 | | Executive director and chief executive officer | | 2018 |
Christine Ramon | | 52 | | Executive director and chief financial officer | | 2014 |
Sipho Pityana(2) | | 60 | | Independent non-executive director and chairman | | 2007 |
Alan Ferguson | | 62 | | Independent non-executive director | | 2018 |
Albert Garner | | 64 | | Independent non-executive director | | 2015 |
Rhidwaan Gasant | | 60 | | Lead independent non-executive director | | 2010 |
Nozipho January-Bardill | | 69 | | Independent non-executive director | | 2011 |
Nelisiwe Magubane | | 54 | | Independent non-executive director | | 2020 |
Maria Ramos | | 61 | | Independent non-executive director | | 2019 |
Maria Richter | | 65 | | Independent non-executive director | | 2015 |
Rodney J. Ruston | | 69 | | Independent non-executive director | | 2012 |
Jochen Tilk | | 56 | | Independent non-executive director | | 2019 |
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(1) Maria Ramos (64) |
Directors serve for a period of three years unless re-elected. At each annual general meeting, directors appointed since the previous annual general meeting are required to retire but are eligible for re-election. In addition, one-thirdMSc, BCom (Hons), Banker Diploma, Certified Associate of the directors (if their number is not a multipleInstitute of three, thenBankers (SA) |
Independent Non-Executive Director and Chairperson |
Appointed: 1 June 2019 and as chairperson of the number nearest to but not less than one third), must retire according to seniority or by lot but may be re-elected.board on 5 December 2020 |
(2)Appointed as Chairman with effect from 17 February 2014.
Board committee memberships: | | Nominations and Governance Committee (Chairperson) |
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Maria Ramos is an independent non-executive director of Standard Chartered Plc and serves on the board of Compagnie Financière Richemont SA. She served as Group chief executive officer of Absa Group (previously Barclays Africa Group Limited), retiring in 2019. Prior to that she was CEO of Transnet and served as Director General of South Africa’s National Treasury.
She recently served as independent non-executive director on the boards of the Public Investment Corporation and Saudi British Bank. She also co-chaired the United Nations Secretary General's Task Force on Digital Financing of the Sustainable Development Goals.
Ms. Ramos has in the past served as a non-executive and independent director on the boards of Sanlam Ltd, Remgro Ltd and SABMiller Plc. She was a member of the World Economic Forum's International Business Council and member of its executive committee and its chairperson for two years.
She is a member of the Group of Thirty and serves on the International Advisory Board of the Blavatnik School of Government, Oxford University.
Sipho Pityana (60) | | | | | | | | |
BARhidwaan Gasant (63) |
| | | | | | | | |
BCompt (Hons), MSc, Dtech (Honoris)CA (SA), ACIMA, CGMA, Executive Development Programme |
Lead Independent Non-Executive ChairmanDirector |
Appointed: A director on 13 February 2007 and Chairman of the Board on 17 February 201412 August 2010 |
Board committee memberships: | | • Audit and Risk Committee Nominations and Governance Committee (Chairman) |
| | • Remuneration and Human Resources Committee |
| | • Social, Ethics and Sustainability Committee |
Sipho M Pityana has extensive business experience having served in both an executive and non-executive capacity on several locally and internationally listed boardsRhidwaan Gasant was previously the CEO of companies as well as running his own companies, Izingwe Capital and Izingwe Holdings, which he chairs.Energy Africa Limited. He is currently the independent non-executive chairman of AngloGold AshantiGrowthpoint Properties Limited and the JSE-listed Redefine Properties. He also serves as a non-executive director onchairs the board audit committee of banking group, Absa. Sipho is also the President of Business Unity South Africa and the co-chair of the World Economic Forum Africa Stewardship board.MTN Nigeria Communications Plc.
Sipho is currently chairperson of the Council of the University of Cape Town. He also serves on President Ramaphosa’s Presidential Working Committee on Employment. He was one of the founding members of the governing body of the Commission for Conciliation, Mediation and Arbitration. He is the Leader of the Business delegation to the National Economic Development and Labour Council.
In addition to his private sector track record, Sipho has extensive public sector experience and international exposure. He was the first Director General of the Department of Labour in the former President Mandela’s government. As the Foreign Affairs Director General, he represented South Africa in various international fora including the United Nations, African Union and Commonwealth.
He was the founding Chairperson of the Council for the Advancement of the South African Constitution and former convener and founder of Save South Africa.
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Rhidwaan GasantKojo Busia (60) |
BCompt (Hons), CA (SA), ACIMA, Executive Development ProgrammePhD, MA, BA |
Lead Independent Non-Executive Director |
Appointed:12 1 August 20102020 |
Board committee memberships: | | AuditSocial, Ethics and RiskSustainability Committee (Chairman)
(Chairperson) Investment Committee Nominations and Governance Committee
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Kojo Busia has over 25 years of professional experience in African natural resources governance and management working at both bilateral and multilateral organisations. He recently held the position of Chief of the Natural Resources Management Section, Technology, Climate Change and Natural Resource Management Division, at the United Nations Economic Commission for Africa (UNECA).
Rhidwaan Gasant
He previously served as coordinator of the African Mineral Development Centre (AMDC) at the UNECA. Prior to heading the AMDC, Dr. Busia spent nearly a decade leading the African Peer Review Mechanism Support Section, Governance and Public Administration Division, also at the UNECA. In addition, Dr Busia has served on several advisory boards including the Responsible Mining Foundation Advisory Council, Advisory Director of Global Mining Sustainability, and Mining Indaba’s Sustainability Advisory Committee. He is a founding director of the Lead Independent Non-Executive Director. He was previously the Chief Executive Officer of Energy Africa Limited. He serves asResource Management, Environment and Climate Change Institute, a director and chairs the Audit and Risk Committees of international companiesthink-do-tank recently established in the MTN Group. His other directorships include those in the Rapid African Energy Holdings Group, a start up oil and gas exploration business focused on Africa, and Edcon Limited.Accra, Ghana.
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Alan Ferguson (62)(65) |
BSc (Accountancy and Business Economics);BSc; CA (Scotland) |
CA (Institute of Chartered Accountants of Scotland) |
Independent Non-Executive Director |
Appointed: 1 October 2018 |
Board committee memberships: | | Audit and Risk Committee (Chairperson) Remuneration and Human Resources Committee Nominations and Governance Committee |
Alan Ferguson is an Independent Non-Executive Director. As a chartered accountant, Mr. Ferguson is highly experienced in a range of finance roles. He was a former chief financial officer of a number of FTSE-listed entities, including Lonmin Plc. Since 2011 he has held non-executive directorships on a number of boards including current positions with Johnson Matthey, Croda International and Marshall Motors Holdings all basedwhere he chaired their audit committees and listed, inwas the United Kingdom.Senior Independent Director. He currently serves on the board of Harbour Energy, where he chairs the audit committee. In addition, Mr. Ferguson serves as a member of the Business Policy Panel of the Institute of Chartered Accountants of Scotland and is a member of the leadership team of the UK Audit Committee’s on all these boards.Committee Chair's Independent Forum.
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Albert Garner (64)(67) |
BSE Aerospace and Mechanical Sciences |
Independent Non-Executive Director |
Appointed: 1 January 2015 |
Board committee memberships: | | • Investment Committee
• Nominations Remuneration and Human Resources Committee
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Albert Garner is an Independent Non-Executive Director. He has extensive experience in capital markets, corporate finance and mergers and acquisitions having worked with Lazard Frères & Co., LLC for over 40 years in various leadership positions. He is one of the most senior bankers at Lazard,
currently leading their special committee practice and chairing their fairness opinion committee. He formerly led Lazard’s corporate finance practice. AlbertMr. Garner became a general partner in 1989 and is now Vice Chair -Investmentof Investment Banking. Over the past 10 years he has advised and acted as lead adviser to more than 50 companies and their boards of directors on transformative transactions.
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Nozipho January-Bardill (69)Maria Richter (68) |
BA, (English and Philosophy), MA (Applied Linguistics), Diploma Human Resources Management, Certificate in Education; Honoris Causa (Glasgow Caledonian)Juris Doctor |
Independent Non-Executive Director |
Appointed:1 October 2011January 2015 |
Board committee memberships: | | Social, Ethics and Sustainability Committee (Chairman)
Remuneration and Human Resources Committee |
Ambassador Nozipho January-Bardill has extensive experience in both the local and international public and private sectors. Besides AngloGold Ashanti, she also serves as an Independent Non-Executive Director on the boards of, Mercedes Benz South Africa and the MTN Foundation. Previously she served on the boards of Southern Life, Momentum Ltd, UCT and Credit Suisse Securities.
She is chairperson of the Council of the Nelson Mandela University and the UN Global Compact Local Network in South Africa. Prior to her appointment to the AGA board, Nozipho was the Executive Director of Corporate Services and Spokesperson of MTN Group and served on the boards of 5 MTN local operations in the MTN footprint including Côte d’Ivoire, Cameroon, Guinea (Conakry),
Guinea -Bissau and Congo - Brazzaville. Before then she was the South African Ambassador to Switzerland, Lichtenstein and the Holy See (Vatican) and the Deputy Director General of Human Capital Management and Head of the Foreign Service Institute in the South African Department of Foreign Affairs (now DIRCO). She has worked in leadership positions in the Parliament of South Africa and in a number of NGOs; and served 12 years as an expert on the United Nations Committee on the Elimination of Racial Discrimination. She was also an interim Chief of Staff and Senior Strategic Adviser of UN Women. Sustainable development, ethical governance, human and women’s rights in business and social justice are of central interest to her work and life.
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Nelisiwe Magubane (54) |
Pr.Eng, BSc, MBA |
Independent Non-Executive Director |
Appointed: 1 January 2020
| | |
Board committee memberships: | | Investment Committee |
| | Social, Ethics and Sustainability Committee |
Neli Magubane has extensive experience in the energy sector, having started her career in Eskom. After a stint in the private sector as a consulting electrical engineer, she joined the Department of Minerals and Energy as the chief director responsible for the restructuring of the electricity sector, planning and implementation of the electrification programme. She was later appointed as the Deputy Director General responsible for the development of the policies that govern electricity, nuclear and clean energy in South Africa.
In 2009, Neli was appointed as Director General of Energy, responsible for, amongst other things, the development of the integrated resource plan and improved access to electricity for over a million households in four years. She was responsible for the regulatory framework and policies that govern the liquid fuels and gas sectors. She was also responsible for oversight of the State-Owned Companies (SOC) that operate in the energy sector, namely CEF SOC LTD, NECSA SOC LTD, and the Regulatory Authorities that govern the energy sector. She established the Renewable Energy Independent Power Producer Program.
More recently, she has been appointed to the current board of Eskom Holdings SOC Limited as a non-executive director. Neli has been named one of the top 50 most influential figures in the Southern African Power sector by the ESI Africa Magazine. In 2019 she was awarded a Big 5 Energy Award by Africa Oil and Power Conference for outstanding contribution in shaping energy policy in Sub Saharan Africa. As an entrepreneur, she has established Matleng Energy Solutions, a 70% women-owned company that provides energy solutions.
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Maria Ramos (61) |
MSc (Economics); BCom (Economics); Banker Diploma, Certified Associate of the Institute of Bankers (South Africa) |
Independent Non-Executive Director |
Appointed: 1 June 2019
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Board committee memberships: | | Investment Committee |
| | Social, Ethics and Sustainability Committee |
Ms Ramos serves as a non- executive director on the boards of AngloGold Ashanti Ltd, Compagnie Financière Richemont SA, the Public Investment Corporation (PIC) and Saudi British Bank (SABB). She also Co-chairs the United Nations Secretary General’s Task Force on Digital Financing of the Sustainable Development Goals.
Between March 2009 and February 2019, Maria served as Chief Executive Officer of Absa Group leading the Group through a number of significant milestones including the acquisition of the Barclays Africa subsidiary banks; the sell-down by Barclays PLC and the setting a new strategy and refreshed brand for the bank. Before joining Absa (previously Barclays Africa Group Limited) as Group Chief Executive in March 2009, Ms Ramos served as the Chief Executive of Transnet Limited for five years. This followed an eight-year tenure as director general of South Africa’s National Treasury (formerly the Department of Finance) during which time she played a crucial role in transforming the Treasury into one of the most effective and efficient state departments in the post-apartheid administration.
An accomplished academic, who has taught at various institutions, Ms Ramos obtained an Institute of Bankers’ Diploma (CAIB) in 1983. She followed this with a Bachelor of Commerce from the University of the Witwatersrand (Wits) in 1986, a Bachelor of Commerce Honours in Economics (Wits) in 1987 and a Master of Science (Economics) from the University of London (SOAS) in 1992. She is also a recipient of honorary doctorates from the Stellenbosch and Free State universities.
Ms Ramos has in the past served as a non-executive and independent director on the boards of Sanlam Ltd, Remgro Ltd and SABMiller PLC. She was a member of the WEF’s International Business Council and member of its executive Committee for 12 years and its chairman between 2017 and 2019.
She is a member of the Group of Thirty and serves on the International Advisory Board of the Blavatnik School of Government, Oxford University.
Her contribution has been recognized through numerous awards including ranking in Fortune Magazine’s 50 most powerful women in business a number of years running; CNBC Africa Woman Leader of the Year (2011); Wits Business School’s Management Excellence Award (2010). She was named the Sunday Times Business Times Business Leader of the Year in 2005 and Businesswoman of the Year by the SA Businesswomen’s Association in 2001.
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Maria Richter (65) |
BA, Juris Doctor |
Independent Non-Executive Director |
Appointed: 1 January 2015
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Board committee memberships: | | • Audit and Risk Committee |
| | • Remuneration and Human Resources Committee (Chairman) |
| | • (Chairperson) Nominations and Governance Committee Social, Ethics and Sustainability Committee |
Maria Richter is an experienced non-executive director who has served on a diverse range of US and Internationalinternational company boards. She previously served on the board of Barclays International, and Barclays Bank plc (2017-2919) and National Grid plc ( 2003 -2014) where she was the chairperson of the finance committee and member of the audit and nominations committees. She currently sits on the boards of Rexel Group, France, a global leader in the professional distribution of energy products and services, and Bessemer Trust, a US wealth management company, and is a member of the audit and compensationnominations committees of Rexel and the remuneration committee of Bessemer Trust.
Maria’sDuring Ms. Richter’s professional career spanned 1980 to 2002 during which time she served in various positions at the former Dewey Ballantine, Prudential, Salomon Brothers Inc. and Morgan Stanley & Co.
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Rodney Ruston (69)Scott Lawson (61) |
BSc, Civil Engineering, MBA Business, BE (Mining) |
BSc, MBA |
Independent Non-Executive Director |
Appointed:1 January 2012December 2021 |
Board committee memberships: | | • Investment Committee (Chairman) |
| | • Audit Social, Ethics and RiskSustainability Committee |
Rodney Ruston is an Independent Non-Executive Director. HeScott Lawson has over 35 years of business experience during which he has led private and publicly-listed companies in the resources, oilmining industry and gasis an experienced global mining executive who has served in a broad range of roles. He is the former executive vice president and construction industries. His international experiencechief integration officer of Newmont Corporation. Prior to this Mr. Lawson served as theexecutive vice president and chief technology officer and other executive of a heavy construction and mining contractor coupledtechnical roles for Newmont Corporation.
Mr. Lawson spent 22 years with chiefRio Tinto in executive roles with operating resource companies providesRio Tinto Alcan, Rio Tinto Technology and Innovation and Rio Tinto Kennecott. He is the board with a broad based director, who can provide insightformer senior vice president, engineering services at Peabody Energy responsible for global engineering and advice on the full range of domestic and international activities in the AngloGold Ashanti business. Mr. Ruston is currently the chief executive of County International Limited., an Australian listed start-up company, which he joined in July 2012. He was previously Chief Executive Officer and President of North American Energy Partners Inc., a large Canadian mining and construction contracting company, which he took public with a listing on the NYSE and the TSX. Prior to that he was managing director of Ticor Limited, an Australian-based titanium producer with operations in Australia and South Africa.technical services support.
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Jochen Tilk (56)(59) |
Bachelors in Mining Engineering,, Masters in Mining Engineering |
Independent Non-Executive Director |
Appointed: 1 January 2019 |
Independent Non-Executive Director |
Appointed: 1 January 2019
|
Board committee memberships: | | • Investment Committee |
| | • (Chairperson) Social, Ethics and Sustainability Committee Nominations and Governance Committee Audit and Risk Committee |
Jochen Tilk is an Independent Non-Executive Director. He is the former Executive Chairexecutive chair of Nutrien Inc., a Canadian global supplier of agricultural products and services based in Saskatoon, Saskatchewan.services. He is the former Presidentpresident and Chief Executive OfficerCEO of Potash Corporation of Saskatchewan.Corporation. Mr. Tilk, previously spent 25 years with Inmet Mining Corporation, a Canadian-based, international metals company, with five of those years as the company’s president and chief executive officer. He is also a director
of Emera Inc., a publicly listed energy utility company and the Princess Margaret Cancer Foundation, a not-for-profit organization, which raises funds to support the Princess Margaret Cancer Centre.organization.
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Kelvin Dushnisky (56)Alberto Calderon (63) |
BSc (Hons), MSc andPhD, MPhil, MA, Juris Doctor, BA |
Chief Executive Officer and Executive Director |
Appointed: 1 September 20182021 |
Board committee memberships: | | None |
Kelvin DushniskyAlberto Calderon’s executive experience includes leadership roles across the mining, petroleum, and energy sectors. He served as the chief executive officer of Orica and was appointed as Chief Executive Officeralso an executive at BHP Group Plc. During his time with BHP Group Plc, Mr. Calderon held a number of key leadership positions, including group executive and chief executive aluminum, nickel and corporate development, group executive and chief commercial officer.
Mr. Calderon was also CEO of Cerrejón Coal Company, an Executive Director of AngloGold Ashanti on 1 September 2018.
Mr Dushnisky was previously Presidentintegrated thermal coal mine in Colombia, and a Director of Barrick Gold Corporation, a post held since 2015. He had direct responsibility for Barrick’s overall business, execution of its operating plans and strategic priorities, and oversight of Barrick’s activities across Australia, Africa, the Middle East, North America and South America. He also held responsibility for Barrick’s relationships with host governments, local communities and other external stakeholders.
Mr Dushnisky holds a B.Sc. (Hon.) degree from the University of Manitoba and M.Sc. and Juris Doctor degrees from the University of British Columbia. He is ChairCEO of the World Gold CouncilColombian oil company, Ecopetrol. Prior to this, Mr. Calderon held senior leadership positions in the International Monetary Fund and the Colombian government and has been a board member of the International Advisory Boarda range of the Shanghai Gold Exchange, the Accenture Global Mining Executive Council, memberprivate, public and principal business advisor to the Institute of Business Advisers Southern Africa and the Institute of Directors Southern Africa. He is a member of the Law Society of British Columbia and the Canadian Bar Association. Mr. Dushnisky represents AngloGold Ashanti at the International Council on Mining and Metals (ICMM). He is on the Senate and is a past member of the Board of Trustees of the University Health Network.non-government organisations.
|
| | | | | | | |
Christine Ramon (52)Gillian Doran (46) |
BCompt, BCompt (Hons), CA(SA), Senior Executive Programme (Harvard)Fellow Member of Association of Chartered Certified Accountants (FCCA) |
Chief Financial Officer and Executive Director |
Appointed: 1 October 2014January 2023 |
Board committee memberships: | | • Investment Committee |
Christine has held senior financial managementGillian Doran brings more than 25 years of experience in finance and executive positions in various companies, in particularcommercial roles across a number of industries, predominantly natural resources and also construction and manufacturing. Prior to joining the Company, Ms. Doran served as chief financial officer for Rio Tinto’s Global Aluminium division. Ms. Doran’s career at Rio Tinto spanned over 15 years in a number of senior finance roles within operations, regional business unit and Group headquarters. A seasoned international executive director of Sasol Limited from 2006 to 2013. Prior to this, she was chief executive officer of Johnnic Holdings Limited,leader having previously served as itsworked and lived in Europe, North America and Australia, Ms. Doran brings to AngloGold Ashanti deep experience in financial director. Christine has served on the boards of Transnet SOC Limited, Lafarge SA Limited,accounting, planning, performance management, investment, transformation and Johnnic Communications Limited. She is currently a non-executive director on the board of MTN Group Limited.strategy.
Christine served previously as a member of the Standing Advisory Committee to the International Accounting Standards Board and as Deputy Chair of the Financial Reporting Standards Council of South Africa. Christine is also the chairperson of the CFO Forum of South Africa and serves as a non-executive director of the International Federation of Accountants.
Board movements during 20192022 and subsequent to year endyear-end
The following changes to the board of directors took place during the period from 1 January 20192022 to 31 December 20192022 and subsequent to year-end:
•On 30 June 2022, Ms. Christine Ramon retired from the Company’s Board of Directors as an Executive Director.
•On 30 October 2022, Ms. Nelisiwe Magubane passed away. Ms. Magubane was a Non-Executive Director of the Company and a member of the Audit and Risk Committee and the Social, Ethics and Sustainability Committee.
•Effective 1 January 2023, Ms. Gillian Doran joined the Company’s Board of Directors as an Executive Director.
•On 22 February 2023, the below changes to the membership of certain board committees became effective, unless otherwise noted:
•Ms. Maria Richter Michael Kirkwoodstepped down from the Audit and David Hodgson retiredRisk Committee and was appointed as a member of the Social, Ethics and Sustainability Committee.
•Mr. Albert Garner was appointed as a member of the Audit and Risk Committee, subject to shareholder approval at the Annual General Meeting (AGM) on 92023 AGM (scheduled for 15 May 2019. Maria Richter being eligible2023).
•Mr. Scott Lawson was appointed as a member of the Audit and Risk Committee, subject to shareholder approval at the 2023 AGM (scheduled for re-election15 May 2023).
•Mr. Rhidwaan Gasant stepped down from the Investment Committee and was re-elected byappointed as a member of the shareholdersSocial, Ethics and Michael Kirkwood and David Hodgson elected not to stand for re-election, in accordance with board policies and guidelines.Sustainability Committee.
•Ms. Gillian Doran was appointed as a member of the Investment Committee.
•Ms. Maria Ramos stepped down from the Social, Ethics and Nelisiwe Magubane were appointed as Independent Non-Executive Directors with effect from 1 June 2019 and 1 January 2020, respectively.Sustainability Committee.
In terms of the company’sCompany’s Memorandum of Incorporation (MoI), one thirdone-third of the directors are required to retire at each AGM and if they are eligible and available for re-election, will be put forward for re-election by the shareholders. The board has determined that the directors to retire at the next AGM are Sipho Pityana, AlbertMessrs. Ferguson, Garner Nozipho January-Bardill and Rodney Ruston. Messrs Pityana and GarnerGasant, who are eligible and have offered themselves for re-election. Mrs January-Bardill and Mr Ruston have elected not to stand for re-election in accordance with board policies and guidelines.
EXECUTIVE COMMITTEE
AngloGold Ashanti’s executive management team (Executive Committee)(the “Executive Committee”) currently comprises nineeight members of whom two are executive directors. This committeeThe Executive Committee oversees the day-to-day management of the group’sGroup’s activities and is supported by country and regional management teams as well as by groupGroup corporate functions.
In addition to Kelvin DushniskyMr. Alberto Calderon and Christine Ramon,Ms. Gillian Doran, the following people are members of the Executive Committee:
Lisa Ali (55)
BSc (Hons) in Chemistry, Analytical Chemistry, Biochemistry; Executive MBA
Chief People Officer
Lisa Ali was appointed as Chief People Officer of the Company and a member of the Executive Committee with effect from 1 April 2022. In this role, Ms. Ali is responsible for Group human resources.
Ms. Ali has over 30 years of experience, most of which has been in extractive industries. Since 2020, Ms. Ali has served as Chief People and Sustainability Officer at Newcrest Mining Limited. Prior to joining Newcrest, Ms. Ali was Head of Transformation at Trinidad Petroleum Holdings Ltd. and its subsidiary companies, and has held several senior positions at BP International PLC.
Stewart Bailey (45)(49)
Executive Vice President -Chief Sustainability and Corporate Affairs and Sustainability
Officer
Stewart Bailey was formerly Senior Vice President of Investor Relations & Group Communications, has been appointed as Executive Vice President: Corporate Affairs in 2019. HisBailey’s portfolio includes stakeholder relations and the broader ambit of sustainability policy and oversight. He leads a strong team of specialists covering each ofcommunity and government relations, communications and investors relations, reporting and environment. Throughout 13 years with AngloGold Ashanti, based both in the core sustainability disciplines. HisUS and South Africa, he has built an in-depth knowledge of the Company, its operations and many of its stakeholders, close cooperation with the sustainability team over several years and ongoing work in integrating environmental, social and governance reporting into the broader business, provide a strong foundation for this role.
stakeholders. Mr. Bailey, previouslyformerly Senior Vice President of Investor Relations and Group Communications, was appointed to his current role in 2019. In his previous role, Mr. Bailey covered debt and equity investors in the US, South Africa, the UK, Europe and Asia. He is also a key member of AngloGold Ashanti’s capital markets team, which has successfully completed debt issues of more than $3 billion since 2010. He also held line responsibility for AngloGold Ashanti’sAshanti's corporate communications programme, which included engagement with financial news media in South Africa, the US and the UK. He is a former financial journalist with Bloomberg LP in New York and Johannesburg.
Pierre Chenard (59)Terry Briggs (50)
BCL, LLB - McGill University; admitted attorneyBSc (Hons) in Geology; MEng
Chief Development Officer
Terry Briggs was appointed as Chief Development Officer of the Company and a member of the Executive Committee with effect from 1 April 2022. His portfolio at AngloGold Ashanti includes Corporate Strategy and Business Planning, Business Development and greenfields exploration.
Mr. Briggs has 25 years of experience, spanning site-based technical and management roles at several underground and open pit base and precious metal operations at all stages of development from start-up to closure, as well as regional and corporate leadership roles. Since 2008, Mr. Briggs worked at Newmont Corporation where, most recently, he served as Vice President -Planning. Prior to serving in this role, Mr. Briggs held various leadership roles in Technical Services, Corporate Development and StrategyFinance at Newmont Corporation.
Pierre is responsible for Corporate DevelopmentMr. Briggs has represented on various geology and Strategy. Pierre previously served as Senior Vice President, Business Development of Rio Tinto Aluminiummining industry bodies and was its General Counsel from 2007 to 2019. He is a seasoned corporate development and legal professional who has worked within the mining and metals industries since 1988. Pierre has conducted business in over 40 countries globally, with involvement in or leadership of acquisitions, divestments, capital markets transactions, project finance, joint venture agreements, and strategy formulation.
Graham Ehm (63)
BSc Hons, MAusIMM, MAICD
Executive Vice President - Group Planning and Technical
Graham Ehm, who has multi-commodity experience, has held senior leadership positions in AngloGold Ashanti in Tanzania and Australia. In his role as Executive Vice President - Group Planning and Technical, he is responsible for business planning and portfolio optimisation, capital investment optimisation, monitoring governance of projects, studies and mineral resources and ore reserves reportingauthored several publications on engineering, geology and exploration. He is also accountable for non-managed joint ventures, such as Kibali. In 2014, he was also assigned accountability for the closure and redevelopment planning for the Obuasi Gold Mine. He now leads the Obuasi Redevelopment Project.
Ludwig Eybers (52)(56)
BSc, (Mining Engineering), Post graduate qualifications with Darden Business School, USA
Chief Operating Officer - International
Ludwig Eybers has over 3033 years international mining experience. He joined AngloGold Ashanti in 2011 as Senior Vice President, Namibia and Mining Task Force, based in Perth Australia. In 2013, he relocated to AngloGold Ashanti in South Africa to take-up the position of Senior Vice President, Continental Africa Region. He was subsequently promoted to Chief Operations Officer-InternationalOfficer- International in 2017. HeMr. Eybers is currently responsible for overall strategic and operational responsibilities for production at the company’sCompany's mining operations for the International Region.operations.
Marcelo Godoy (51)
Sicelo Ntuli (42)PhD Strategic Mine Planning, Masters Geostatistics
BSc Eng. (Electrical), MBA
Chief OperatingTechnology Officer - Africa
Sicelo NtuliMarcelo Godoy has over 2025 years workof experience in the mining industry and has held various senior roles in Operations, Engineering, Business Strategy and Investor Relations. In 2011, he was appointed Managing Director of Iduapriem Mine and played a key role in the turnaround of the mine’s operating performance and reduction of costs. Mr. Ntuli was promoted topreviously Senior Vice President, Continental Africa Region in 2016Exploration at Newmont Corporation where he led the transitiondevelopment of Geita from open pit to underground operations, amongst other achievements. He was subsequently promoted to rolenumerous innovation programs, including a world-class orebody risk management system that delivered a step change in the reliability of Chief Operating Officer Africa, including South African operations in 2019.production forecasts. Mr. NtuliGodoy is also a Harvard Business School alumnus.
Maria Sanz Perez (54)
BCom LLB, HDip Tax, Advanced Management Programme (Harvard), Admitted Attorney
Executive Vice President - General Counsel, Compliance and Company Secretary
Maria Sanz Perez partners with the company’s business leaders to ensure AngloGold Ashanti complies with legal requirements across the group. Her other responsibilities include compliance, company secretarial functions and integrated reporting. She is also accountable for the legal and commercial aspects of global procurement. Ms. Sanz Perez has been with the group since 2011 and has worked in similar positions for leading South African companies in her career including Investec, Sappi and Afrox.
Ms. Sanz Perez has given 6 months notice of the intention to resign, effective 26 March 2020, to pursue other business interests. The exact departure date is still to be agreed.
Tirelo Sibisi (50)
BSSc, Advanced HR Executive Development Programme, Post Graduate Diploma in Business Management and an MBA
Executive Vice President - Group Human Resources
In her role as Executive Vice President - Group Human Resources, Tirelo Sibisi is responsible for Group Human Resources, which entails attracting, retaining and developing a highly engaged, diverse and productive workforce. She has more than 20 years’ experiencerecognised leader in the field of human resources both localmine planning under uncertainty and Internationally, having beena champion of diversity and inclusion. Prior to joining Newmont, he was Mining Sector Leader for Golder Associates in South America and a Director at Golder's Global Board of Directors. During his tenure at Golder Associates, Mr. Godoy managed major mining feasibility studies and reserve compliance audits for the Group executiveworld’s top producers of base Metals, iron ore and gold.
He brings to AngloGold Ashanti experience in resource modelling, mine planning and project development, as well as a track record in leading technical teams and introducing technology to drive sustainable competitive advantage.
Lizelle Marwick (45)
B.Proc, LLB, LLM
Chief Legal Officer
Lizelle Marwick was appointed as Executive Vice President: General Counsel and Compliance on 1 July 2020, after previously serving as Senior Vice President: Deputy General Counsel. She joined the Company in 2011 establishing and heading up the legal function for human resourcesthe Africa operations. She is familiar with all aspects of the organisation and well versed on multi-jurisdictional legal work covering a wide range of subjects, with extensive experience in governance, corporate social investmenttransactions and government negotiations. Prior to joining AngloGold Ashanti, Ms. Marwick practiced law at PPC Cement.
Ms. Sibisi's experience includes 10 yearsBowman Gilfillan in South Africa and Herbert Smith in the information technology sector at IBM (SouthUnited Kingdom. She is admitted as an attorney in South Africa and Europe)a solicitor in England and 7 years at Telkom, making her a well-rounded human resources generalist with strengths in talent management, succession planning, organisational transformationWales.
Executive Committee movements during 2022 and diversity management, union negotiationssubsequent to year-end
The following movements to the Executive Committee took place during the period from 1 January 2022 to 31 December 2022 and executive compensation. She served on the Boardsubsequent to year-end:
•Ms. Lisa Ali was appointed as Chief People Officer of the Institute of People Management in SA as a Non- Executive DirectorCompany and was a member of the RemunerationExecutive Committee with effect from 1 April 2022. Ms. Ali replaced Ms. Italia Boninelli, who served as Interim Group Human Resources Executive Consultant and prescribed officer with effect from 1 April 2021 until 31 March 2022.
•Mr. Terry Briggs was appointed as Chief Development Officer of the Company and a member of the Executive Committee with effect from 1 April 2022. Mr. Briggs replaced Mr. Vaughan Chamberlain, who was appointed as Interim Chief Development Officer of the Company and an interim member of the Executive Committee with effect from 1 October 2021 until 31 March 2022.
•Ms. Christine Ramon took early retirement from her role as Chief Financial Officer and a member of the Executive Committee of the Company effective 30 June 2022.
•Mr. Ian Kramer was appointed Interim Chief Financial Officer of the Company and an interim member of the Executive Committee with effect from 1 July 2022. He resumed his role as Senior Vice President: Group Finance Committee. She currently sits on the Board of AngloGold Ashanti in Ghana.
COMPETENT PERSONS
As part of its suite of annual reports, AngloGold Ashanti produces a Mineral Resource and Ore Reserve Statement and all the information in this report that relates to Exploration Results, Mineral Resource and Ore Reserve is based on information compiled by the Competent Persons.
During the past decade, the company has developed and implemented a system of internal and external reviews aimed at providing assurance in respect of Ore Reserve and Mineral Resource estimates. A documented chain of responsibility existswith effect from 1 January 2023, stepping down from the Competent Persons atExecutive Committee.
•Ms. Gillian Doran was appointed as Chief Financial Officer and a member of the operations toCompany's Executive Committee with effect from 1 January 2023.
MINERAL RESOURCE AND MINERAL RESERVE LEADERSHIP TEAM
Tarryn Flitton (44)
MEng (Mining), BSc (Hons) (Geology), RM SME, Pr.Sci.Nat (SACNASP), FGSSA
Tarryn Flitton is the Company’s Mineral Resource and Ore Reserve Steering Committee. Accordingly, the ChairmanChairperson of the AngloGold Ashanti Mineral Resource and OreMineral Reserve Steering Committee, Mr Vaughan Chamberlain, assumes responsibility for theLeadership Team. Mrs. Flitton has 21 years’ experience in mining with ten years directly leading and managing Mineral Resource and OreMineral Reserve processes forreporting. Mrs. Flitton joined AngloGold Ashanti and is satisfied that the Competent Persons have fulfilled their responsibilities.
Vaughan Chamberlain (57)
MSc (Mining Engineering), BSc (Hons) (Geology), FAusIMM
Vaughan Chamberlain holds a BSc (Hons) degree in Geology from the University of Natal and a MSc in Mining Engineering from the University of the Witwatersrand. He started his career with Anglo American Corporation in 1987 as a geologist at Western Deep Levels East Mine (now TauTona mine). He joined AngloGold in 19982001 and currently holds the position of Senior Vice President: Strategic Technical GroupResource and Reserve and is Chairmanthe Chairperson of the AngloGold AshantiCompany’s Mineral Resource and OreMineral Reserve Steering Committee.Leadership Team.
6B. COMPENSATION
REMUNERATION AND HUMAN RESOURCES COMMITTEE
Remuneration and Human Resources Committee (Remco)(the “Remco”)
The Remco comprisesis composed of four non-executive directors. Its purpose is to discharge the responsibilities of the board relating to all compensation, including all salary and equity compensation of the company’sCompany’s executives. The Remco establishes and administers the company’sCompany’s executive remuneration and its broad objectives include;include: aligning executive remuneration with companyCompany performance and shareholder interests; setting remuneration standards aimed at attracting, motivating and retaining a competent executive team; linking individual executive pay with operational and companyCompany performance aligned to strategic objectives; and evaluating the compensation of executives including approval of salary, equity and incentive based awards.
With respect to its mandate on human resources, the committeeRemco has oversight to all strategic aspects of people development and human resource issues. The committeeRemco also considers and makes recommendations to shareholders on non-executive director’s fees.
The performance of the executive team, including the executive directors, is considered relative to the prevailing business climate and market conditions, as well as to annual evaluations of the achievement of key performance objectives. Bonuses paid to the executives are a reflection of performance of each of the executives and the companyCompany as a whole.
In 2019,2022, the committeeRemco was composed of the following members:
Members
Michael J. Kirkwood (former Chairperson, resigned effective 9 May 2019);
Maria Richter (appointed Chairperson effective 9 May 2019);(Chairperson)
Sipho Pityana;
Nozipho January-Bardill;
Alan Ferguson
Albert Garner
Rhidwaan Gasant
The meetings of the committeeRemco are attended by the Chief Executive Officer and Chief FinancialPeople Officer, and Executive Vice President: Group Human Resources, except when they are conflicted or have a personal financial interest, such as when their own remuneration or benefits are being discussed.
Remuneration policy
Our remuneration policy is designed to allow AngloGold Ashanti to compete in a global market where we strive to retain and remunerate our employees using fair, robust and appropriate remuneration and to reward our employees for their contributions. Cost management and shareholder value remain fundamental drivers of our policy.
Linking pay and performance for our executives is important and by having a large portion of executive pay defined as at riskat-risk pay, the policy ensures that executive compensation is aligned with the overall performance of the company,Company, the regions in which it operates and its business units. The executives have an overriding focus on social sustainability including safety, and a large percentage of variable pay is directly linked to keeping our employees safe.
Total reward
When determining remuneration AngloGold Ashanti considers all elements of short-term and long-term fixed and variable pay and ensures that it is consistent with the overall strategic direction of the companyCompany and each employee’s individual performance.
For a description of share-based compensation and awards (including cash awards) see “Item“Item 6E: Share Ownership”.
Our executive directors do not receive payment of directors’ fees or committee fees.
Benchmarking
Our executive employees and non-executive directorsdirector’s remuneration is evaluated against a global group of comparator companies. AngloGold Ashanti’s size and complexity as well as each individual executive’s role is reviewed against our peer group and benchmarked based on guaranteed and variable pay. Performance (Company and individual) is a key factor influencing the remuneration of the executive employees.
Our 2018 bespoke benchmark survey was completed by Mercer and market data was aged to be time relevant as the survey is conducted biennially.
Our salary benchmarks are targeted at the market median of a global market in our industry. Where there is a shortage of specialist and/or key technically skilled employees, we may offer a salary that may beis higher than the benchmark salary.
Each executive’s role is individually sized to ensure the best match possible. The comparison is done for the same or similar roles irrespective of location of work (including a review of purchasing power parity between countries).work. Each component of remuneration (base salary, short-term incentives, long-term incentives co-investment plan
and employee benefits and allowances) is analysed and compared with our global peer group’s market range and the overall package is reviewed accordingly. The last allocation regarding the long-term incentive and the co-investment plan participation was done in 2017 and 2018, respectively. Our new incentive scheme, the Deferred Share Plan (DSP)(the “DSP”), was implemented in January 2018. For a description of the DSP, see “Item“Item 6E: Share Ownership-AngloGold Ashanti share incentive scheme-DeferredOwnership—AngloGold Deferred Share Plan (DSP)”.
Retirement benefits/pension
Retirement benefits are granted to all executives. All new executives and employees including executives, receive retirement benefits under defined contribution plans. Contributions vary based on the employee’s retirement plan. See “Item 18: Financial Statements—Note 8—Employee Benefits” and“Item 18: Financial Statements-Note 10-Employee Benefits” and “Item 18: Financial Statements-Note 28-ProvisionStatements—Note 26—Provision for Pension and Post-Retirement Benefits”.
EXECUTIVE DIRECTORS'DIRECTORS’ AND EXECUTIVE MANAGEMENT REMUNERATION
See "ItemFor the amounts paid and benefits granted to executive directors and executive management in 2022, see “Item 18: Financial Statements-Note 33-Related Parties-DirectorsStatements—Note 31—Related Parties—Directors and other key management personnel-Executivepersonnel—Executive Directors’ and Prescribed Officers’ remuneration"remuneration”.
For details of the share-based awards and rights to subscribe for ordinary shares in the Company granted to, and exercised by executive directors and executive management team members, see “Item 6E: Share Ownership—AngloGold Deferred Share Plan (“DSP”) and “Item 6E: Share Ownership—Participation by Executive Directors, Executive Management Team Members and Other Managers in the AngloGold Share Incentive Scheme”.
NON-EXECUTIVE DIRECTORS' COMPENSATIONDIRECTORS’ FEES AND ALLOWANCES
The compensationfees of non-executive directors isare fixed by shareholders at the annual general meeting. In addition to their compensation, the non-executive directors receive fees for their participation on board committees and allowances for travelling internationally to attend board meetings. Non-executive directors do not receive further payments from the companyCompany and are precluded from participation in the company’sCompany’s share incentive scheme.
NON-EXECUTIVE DIRECTORS’ REMUNERATION
See "Item For amounts paid to non-executive directors in 2022, see “Item 18: Financial Statements-Note 33-Related Parties-DirectorsStatements—Note 31—Related Parties—Directors and other key management personnel-Non-Executive Director remuneration"personnel—Non-Executive Directors’ fees and allowances”.
6C. BOARD PRACTICES
The Board of Directors
The companyCompany is governed by a unitary board of directors, the composition of which promotes the balance of authority and precludes any one director from dominating decision-making. Our board membership at year-end comprised 11nine directors, nineeight independent non-executive directors and twoone executive directors. On 1 January 2020,director. Subsequent to year-end, an additional non-executiveexecutive director joined the board increasing the number of directors to 12, 10 independent non-executive directors and two executive directors.Company’s board.
The board is supported by its committees and has delegated certain functions to these committees without abdicating any of its own responsibilities. This process of formal delegation involves approved and documented terms of reference, which are reviewed annually.
See “Item 6A: “DirectorsDirectors and Senior Management” for information about the composition of the Boardboard and directors’ term of office and year of appointment.
Appointment and rotation of directors
Several factors, including the requirements of relevant legislation, best practice recommendations, qualifications and skills of a prospective board member and the requirements of the Director’s Fit and Proper Standards of the company,Company, as well as regional demographics, are considered in appointing board members. New directors are appointed pursuant to the recommendations of the Nominations and Governance Committee, which conducts a rigorous assessment of the credentials of each candidate. Newly appointed directors are elected at the next annual general meeting following their appointment and to stand for approval by shareholders.
At the next AGM, Ms. Gillian Doran will be named for election by shareholders as a director of AngloGold Ashanti.
In terms of the company’s Memorandum of Incorporation (MoI), one thirdCompany’s MoI, one-third of the directors are required to retire at each Annual General Meeting (AGM)AGM and if they are eligible and available for re-election, will be put forward for re-election by the shareholders. The board has determined that the directors to retire at the next AGM are Sipho PityanaMessrs. Ferguson, Garner and Albert Garner who areGasant, and being eligible, andsuch directors have offered themselves for re-election, and Nozipho January-Bardill and Rodney Ruston who have elected not to stand for re-election, in accordance with board policies and guidelines.re-election.
The company’sCompany’s MoI does not set a mandatory retirement age for non-executive directors. However, in accordance with recommendations of King IV, - any independent non-executive director serving more than nine years should be subjected to a rigorous review of his or her independence and performance by the board.
Service contracts
Non-Executive Directors
Non-executive directors receive fees for their services as directors which are approved by shareholders at annual general meetings.AGMs. Non-executive directors do not participate in the company’sCompany’s share incentive scheme.
Non-executive directors do not hold service contracts with the company.Company.
Executive Committee
All members of the Executive Management team have permanent employment contracts which entitle them to standard group benefits as defined by their specific region and participation in the company’s Deferred Share Plan (DSP).Company’s DSP. Interim appointments (interim Chief Financial Officer and interim Chief Development Officer) include an allowance aligned to the Company’s acting allowance policy to recognise the additional responsibilities associated with these roles.
South African-based executives are paid a portion of their remuneration offshore, which is detailed under a separate contract. This reflects global roles and responsibilities and takes account of offshore business requirements.
The executive contracts are reviewed annually and include a change of control provision. The change of control is subject to the following triggers:
•The acquisition of all or part of AngloGold Ashanti; or
•A number of shareholders holding less than thirty-five percent of the company’sCompany’s issued share capital consorting to gain a majority of the board and make management decisions; and
•The contracts of Executive Committeeexecutive committee members are either terminated or their role and employment conditions are curtailed.
In the event of a change of control becoming effective, thean executive will in certain circumstances be subject to both the notice period andreceive the change of control contract terms.terms at the end of the relevant notice period in line with their contractual agreement. The notice periodand change of control periods applied per category of executive and the change of control periods(excluding interim appointments) as at 31 December 20192022 were as follows:
| | | | | | | | |
| | |
Executive Committee member | | |
Executive committee member | Notice period | Change of control |
Chief Executive Officer | 12 months | 12 months |
Chief Financial Officer | 6 months | 6 months |
Other Executive Management team members | 6 months | 6 months |
Key activities of the board and committees during 20192022
The activities of the board and committees during 20192022 were aimed at promoting the economic stability of the business. This entailed ensuring that its operations were conducted with due regard to the expectations and needs of stakeholders, the safety and health of employees and communities, and the development of systems to ensure proper access to and dissemination of credible information.
Board and committee meeting attendance
The compositionDirectors’ attendance at board and committee meetings during 2022 was as follows:
| | | | | | | | | | | | | | | | | | | | |
| Board (3) | Audit and Risk | Investment | Remuneration and Human Resources | Social, Ethics and Sustainability | Nominations and Governance (4) |
Number of meetings in 2022 | 9 | 7 | 7 | 9 | 5 | 7 |
MDC Ramos | 9 | n/a | n/a | n/a | 5 | 6 |
KOF Busia | 9 | n/a | 7 | n/a | 5 | 6 |
A Calderon | 9 | n/a | n/a | n/a | n/a | n/a |
AM Ferguson | 9 | 7 | n/a | 9 | n/a | 7 |
AH Garner | 9 | n/a | 6 | 9 | n/a | n/a |
R Gasant | 9 | 7 | 7 | 9 | n/a | 7 |
SP Lawson | 9 | n/a | 7 | n/a | 5 | n/a |
NVB Magubane (1) | 6 | 4 | n/a | n/a | 4 | n/a |
KC Ramon (2) | 4 | n/a | 5 | n/a | n/a | n/a |
MC Richter | 9 | 7 | n/a | 9 | n/a | 6 |
JE Tilk | 9 | 7 | 7 | n/a | 5 | 6 |
(1) NVB Magubane passed away on 30 October 2022.
(2) KC Ramon retired from the Board effective 30 June 2022.
(3) During 2022, the Board held six scheduled Board meetings and three special Board meetings.
(4) Members of the boardNominations and Governance Committee participated in an additional meeting in respect of the recruitment of the CFO.
(5) All committees at the date of this report and attendance atheld four scheduled meetings during 2019 are disclosed in the table below:
year.
|
| | | | | | | | | | | | | | | | |
| Board |
| | Audit and Risk | | Investment | | Remuneration and Human Resources | | Social, Ethics and Sustainability | | Nomination | | Special Committee(5) | | NED search(5) |
Number of meetings in 2019 | 7 |
| | 5 | | 4 | | 4 | | 5 | | 2 | | 2 | | 2 |
SM Pityana | 7 |
| | n/a | | n/a | | 4 | | 5 | | 2 | | 2 | | 2 |
KPM Dushnisky | 7 |
| | n/a | | n/a | | n/a | | n/a | | n/a | | 2 | | n/a |
AM Ferguson | 7 |
| | 5 | | n/a | | 4 | | n/a | | n/a | | 2 | | n/a |
AH Garner | 7 |
| | n/a | | 4 | | n/a | | n/a | | 2 | | 2 | | n/a |
R Gasant (1) | 7 |
| | 5 | | 4 | | n/a | | n/a | | 1 | | n/a | | n/a |
DL Hodgson(2) | 2 |
| | n/a | | 1 | | n/a | | 2 | | n/a | | n/a | | n/a |
NP January-Bardill | 7 |
| | n/a | | n/a | | 4 | | 5 | | n/a | | n/a | | n/a |
MJ Kirkwood(3) | 2 |
| | 2 | | n/a | | 1 | | n/a | | 1 | | n/a | | n/a |
KC Ramon | 7 |
| | n/a | | 4 | | n/a | | n/a | | n/a | | n/a | | n/a |
MDC Ramos (4) | 4 |
| | n/a | | 2 | | n/a | | 2 | | n/a | | 2 | | 1 |
MC Richter | 7 |
| | 5 | | n/a | | 4 | | n/a | | 2 | | n/a | | 2 |
RJ Ruston | 7 |
| | 5 | | 4 | | n/a | | n/a | | n/a | | n/a | | n/a |
JE Tilk | 6 |
| | n/a | | 4 | | n/a | | 5 | | n/a | | n/a | | 1 |
| |
(1)
| R Gasant was appointed to the Nominations Committee with effect from 9 August 2019. |
| |
(2)
| DL Hodgson retired at the AGM held on 9 May 2019. |
| |
(3)
| MJ Kirkwood retired at the AGM held on 9 May 2019. |
| |
(4)
| MDC Ramos was appointed with effect from 1 June 2019
|
| |
(5)
| Two special purpose committees were established by the board during 2019, the Special Board Committee and the NED Search Committee. |
Audit and Risk Committee
The Audit and Risk Committee comprises sixthree (pending shareholder approval at the 2023 AGM of the appointment of two additional non-executive directors to the Audit and Risk Committee) independent non-executive directors who collectively possess the skills and knowledge to oversee and assess the strategies and processes developed and implemented by management to manage the business within a continually evolving mining environment.
The Audit and Risk Committee’s duties as required by section 94(2)94(7) of the South AfricanSA Companies Act, King IV and JSE Listing Requirements are set out in its board-approved terms of reference which is reviewed and updated annually. These duties were discharged as follows:
•reviewed the quarterly market updates and the half year results;
•confirmed the integrity of the group’sGroup’s Integrated Report, Annual Financial Statements and the Form 20-F;
•reviewed the expertise, experience and performance of the finance function and Chief Financial Officer;
•assessed the scope and effectiveness of the systems to identify, manage and monitor financial and non-financial risks;
•reviewed the procedures for detecting, monitoring and managing the risk of fraud;
•reviewed the scope, resources, results and effectiveness of the internal audit department;
•approved the internal audit plan and subsequent changes to the approved plan;
•ensured that a combined assurance model is applied to provide a co-ordinatedcoordinated approach to all assurance activities;
•nominated the appointment of independent external auditors by the shareholders;
•reviewed and approved the terms of engagement as contained in the engagement letter of the external auditors;
•approved the remuneration of the external auditors;
•pre-approved all non-audit services in line with a revised formal policy on non-audit services;
•assessed the external auditors’ independence;
annually consider•considered the suitability, after assessing the information provided by the audit firm in terms of section 22.15(h) of the JSE Listings Requirements, for appointment of the audit firm and the designated individual partner;
•assessed the effectiveness of the group’sGroup’s external audit function;
approved the appointment of the external auditors to provide independent limited assurance on certain sustainability indicators as included in the Sustainable Development Report;
•reviewed developments in reporting standards, corporate governance and best practice;
•monitored the governance of information technology (IT) and the effectiveness of the group’sGroup’s information systems; and
•reviewed the adequacy and effectiveness of the group’sGroup’s compliance function; andfunction.
evaluated the effectiveness of the committee through a self-assessment.
Proceedings and Performance Review
The Audit and Risk Committee formally met fiveseven times in 2019.2022.
The current members of the Audit and Risk Committee are:
|
| | | | |
Audit and Risk Committee Members (1) | R GasantAM Ferguson (Chairman and independent NED) |
RJ RustonR Gasant (Independent NED) |
MDC RichterJE Tilk (Independent NED) |
AM Ferguson (Independent NED) |
Number of meetings held from January to December 2019 2022 | FiveSeven |
| |
NED - Non-Executive Director
(1) The appointments of Mr Albert Garner and Mr Scott Lawson as members of the Audit and Risk Committee on 22 February 2023 is subject to shareholder approval at the annual general meeting on 15 May 2023.
The Chief Financial Officer,Officer; Senior Vice President: Finance, Group General Counsel and Company Secretary,Finance; Chief Legal Officer; Senior Vice President: Group Internal Audit; Vice President: Group Tax; Group Risk Manager; Chief Information Officer;Senior Vice President: Digital Technology; Vice President: Group Compliance Officer,Compliance; the external auditors, as well as other assurance providers regularly attend committee meetings in an ex officio capacity and provide responses to questions raised by committee members during meetings. The full Audit and Risk Committee meets separately during closed sessions with management (including the Chief Executive Officer), internal audit and external audit at every scheduled quarterly meeting.
The effectiveness of the board and its committees, including the Audit and Risk Committee, is assessed at least every two years, and every alternate year there is an opportunity for consideration, reflection and discussion by the board of its effectiveness through the completionperformance and that of an independent external evaluation process, during which results were discussed, actions taken and processes put in place to address areas identified for refinement.its committees.
Remuneration and Human Resources Committee (“Remco”)
The Remuneration and Human Resources CommitteeRemco activities are governed by the Terms of Reference (these were reviewed and approved by the board in February 2020)May 2022). The purpose of the CommitteeRemco is to assist the Board in discharging its oversight responsibilities relating to all compensation, including annual base salary, annual incentive compensation, employment, severance pay and ongoing perquisites or special benefit items and equity compensation of the Company’s executives, including the Chief Executive Officer, as well as retention strategies, design and application of material compensation programmes and share ownership guidelines.
With respect to its mandate on human resources, the CommitteeRemco has strategic oversight of matters relating to the development of the Company’s human resources with the main objective of creating a competitive human resource for the Group.
The CommitteeRemco operates in an independent role, operating as an overseer with accountability to the Board. This is accomplished by:
•Determining specific remuneration packages for the Executive Committee (the “ExCom”) members, and reviewing these annually. The broad framework and cost of executive remuneration shall be a matter for the Board on the recommendation and advice of the Remco;
•Reviewing and approving corporate goals and objectives relevant to the compensation of the Chief Executive Officer;ExCom members;
•Evaluating the performance of the Chief Executive OfficerExCom (excluding executive directors) in light of these goals and objectives annually and setting compensation based on such evaluation;evaluations;
•Ensuring that the mix of fixed and variable pay, in base pay, shares and other elements of compensation for each ExCom member meets the company’sCompany’s requirements and strategic objectives;
Linking individual pay with operational•Determining any long-term incentive component of each ExCom member’s compensation based on awards given to such member in past years and companythe Company’s performance against set targets;
•Considering other matters relating to the remuneration of or terms of employment applicable to ExCom members that may be referred to the Remco by the Board;
•On an annual basis, or at intervals that the Remco may deem necessary, considering the results of independent research into executive remuneration trends, to assist the Remco in relation to strategic objectives;its decision-making regarding executive remuneration;
•Ensuring that all benefits, including retirement benefits and other financial arrangements are justified and correctly valued and reviewed annually;
•Considering the sentimentspayment of performance linked non-pensionable bonuses to ExCom members, and viewssetting the criteria for, and relative value of such payments;
•Satisfying itself as to the accuracy of recorded performance measures that govern the vesting of share awards and incentives;
•On an annual basis, approving the granting of share options or performance shares to qualifying employees of the company’s investors;Company;
•Regularly reviewing incentive schemes to ensure continued contribution to shareholder value and ensureensuring that these are administered in terms of the rules;rules of the relevant incentive scheme;
Regularly reviewing human resources strategy aimed at•As and when required, considering proposed amendments to the rules of the incentive schemes and making recommendations for their approval by shareholders;
•Reviewing the executive director’s termination payments and ensuring the supply and retention of sufficient skilled resources to achieve the company’s objectives;
Ensure that they are included in the remuneration policy together with any obligations arising from such contracts which would give rise to termination payments; and
•Appointing an independent remuneration advisor to provide consultation to the executive directors, who make recommendations to the Board and implementation report is put to a non-binding advisory vote atshareholders on the general meetingremuneration of non-executive directors, taking into consideration market trends on non-executive directors’ remuneration, the views and sentiments of shareholders once every year; and
Review the outcomefinancial position of the implementation of the remuneration policy to ensure that the set objectives are being achieved and fairness is addressed.Company.
The current members of the CommitteeRemco are:
|
| | | | |
Remuneration and Human Resource Committee Members | MDCMC Richter (Chairperson and independent NED) |
NP January-BardillR Gasant (Independent NED) |
SM Pityana (Board Chairman) |
AM Ferguson (Independent NED) |
A Garner (Independent NED) |
Number of meetings held from January to December 2019 2022 | FourNine |
Other individuals who regularly attended meetings (attended by invitation or if needed to contribute pertinent insights and information) | KPM DushniskyA Calderon (CEO) |
TR Sibisi (EVP: Group Human Resources)KC Ramon (former CFO) (1) |
P WolstenholmeI Kramer (Interim CFO) |
L Ali (Chief People Officer) |
A Sidat representing PwCDeloitte (Independent Advisoradvisor to the Committee)Remco) |
SD Van RensburgEM Mabuza (VP: Group RemunerationPerformance and Reward ) |
CM van Dyk (Remuneration and Benefits and Secretary to the Committee)Consultant) |
NED – Non-Executive Director(1) Ms. Christine Ramon ceased to serve as CFO and executive director of the Company at the end of June 2022.
Remuneration Consultants
WhereWhen appropriate, the CommitteeRemco obtains advice from independent remuneration consultants. TheThese consultants are employed directly by the CommitteeRemco and engage directly with them to ensure independence.
The Committee hasWith the appointment of PwC as the independent auditors the Remco was required to tender for new advisors. In May 2022, Deloitte was appointed to replace PwC to provide specialist, independent remuneration advice on all forms of executive and non-executive pay.
Mercer performs an independent bespoke executive survey and its advice is primarily around salary benchmarking for both executive and non-executive pay.
6D. EMPLOYEES
The average number of attributable employees (including contractors) in the AngloGold Ashanti groupGroup over the last three financial years was: | | | | | | | | | | | | | | | | | |
| 2022 | | 2021 | | 2020 |
Africa | 19,807 | | | 17,260 | | | 16,829 | |
Australia | 1,532 | | | 1,332 | | | 1,230 | |
Americas | 9,498 | | | 9,972 | | | 8,789 | |
Other, including corporate and non-gold producing subsidiaries | 1,757 | | | 1,997 | | | 1,807 | |
South Africa - discontinued operations (1) | — | | | — | | | 8,297 | |
Total* | 32,594 | | | 30,561 | | | 36,952 | |
* The number of contractors employed on average during 2022 was 18,599. |
| | | | | | | | |
| 2019 |
| | 2018 |
| | 2017 |
|
Continental Africa | 15,786 |
| | 14,833 |
| | 13,593 |
|
South Africa | 7,870 |
| | 18,803 |
| | 26,245 |
|
Australia | 1,140 |
| | 1,051 |
| | 974 |
|
Americas | 8,114 |
| | 7,973 |
| | 8,511 |
|
Other, including corporate and non-gold producing subsidiaries | 1,353 |
| | 1,589 |
| | 2,157 |
|
Total* | 34,263 |
| | 44,249 |
| | 51,480 |
|
| |
* | The number of contractors employed on average during 2019 was 14,389. |
(1) In 2020, represents the monthly average number of employees for the nine months as discontinued operations before completion of sale on 30 September 2020.
Labour relations and collective bargaining
AtThe AngloGold Ashanti allapproach to employee relations is predicated on a relationship-based model. We strive to establish constructive relations with our employees haveand their union representatives based on our Company values and our determination to embed interest-based collective bargaining. Working closely with our sites we are also at the forefront of ensuring that we comply with local legislation and regulatory obligations.
A global Employee Relations Standard governs employee and labour relations. The standard enables an approach to employee relations that is based on effective mechanisms for communication and participation, through direct and thoughtful engagement with employees, and where applicable, their representatives, such as trade unions.
Employees at most of our operations are unionised except those in Australia, Colombia and the United States. Although these employees are not unionised, the Company ensures sound employee relations through compliance with labour legislation in these countries, fair company policies and procedures and promoting healthy relationships through effective line management practices. The right to freedom of association and collective bargaining is not at risk at any of our operations.
Where our employees are unionised, we seek to build and maintain positive relations with representative unions as part of our overall stakeholder management philosophy. The table below shows the percentage of unionised employees covered by collective bargaining agreements by country:
| | | | | |
Employees covered by collective bargaining agreements |
Argentina | 90 percent |
Brazil | 100 percent |
Ghana | 86 percent |
Guinea | 94 percent |
Tanzania | 86 percent |
No wage agreements in Africa were due or made during the reporting period. Biannual collective bargaining and negotiations are expected to commence towards the second quarter of 2023.
In Africa, there were no labour incidents which we recognise and apply according toresulted in stopping of operations in 2022, with the applicable laws and regulations in eachexception of one incident at the end of the jurisdictions in which we operate. Only our Australiansecond quarter of 2022 when community unrest affected operations do not have collective bargaining, as this is not recognised in Australia.at the Siguiri mine. The unrest was related to unemployment and demands for the mine to employ members of the community. The incident was resolved by the Siguiri mine.
In the South African region, in 2018 we concluded wage negotiations and signed a three-year wage agreement withBrazil, all employee representatives (unions). The region has reduced its footprint, now with fewer employees compared to the previous year, as an ongoing restructuring and divestment process has resulted in a reduction in the number of mines in the portfolio.
The focus in 2019 was on stabilising and consolidating the remaining business units in South Africa. This necessitated extensive consultation with our stakeholders, especially unions and regulators, and we were able to minimise job losses and maintain strong engagement with employees as confirmed in the results of the 2019 Employee Engagement Survey.
In Continental Africa - labour relations remained stable across the region.
In Guinea, at Siguiri, 2019 started with the obligatory biennial requirement to organize and conduct employee representatives’ elections (union elections). The workforce had then been informed of the renewal of the union delegation 45 days before the expiry of their term in accordance with the applicable legislation. The elections were successfully conducted on 8 February 2019. The elections were free and fair leading to the results being accepted by all contestants. Management and the union successfully concluded 2019 wage negotiations, reaching an unprecedented agreement for no salary increases for 2019 and 2020. However, management agreed to a one-off cash payment equivalent of 5% of the annual basic salary.
In Mali, the Sadiola labour relations climate continued to be troubled by the ongoing uncertainty relating to the decision to place the mine in restricted exploitation, and to then suspend exploitation activities. Employee morale was low and a number of industrial actions were experienced during the year.
In Ghana, at Iduapriem, salary adjustment framework agreed with the Ghana Mineworkers Union (GMWU) in mid-2018, was successfully applied for 2019 wage/salary adjustment for bargaining unit employees.
In Tanzania, the third collective bargaining agreement 2019 between Geita and the union (TAMICO) was signed on 19 November 2019. It marked another milestone towards building a long-term relationship based on cooperation between employer and employees.
Geita operates with two trade unions, TAMICO and NUMET. Memberships status for TAMICO stands at 56%, while the minority trade union NUMET commands a 3% membership in the bargaining unit (Paterson grades A-C4). The remaining 41% are non-members but still enjoy services of the two trade unions mentioned above.
In the Americas region, Brazil signed all 3three collective agreements (Nova Lima,Lima/Sabará, Santa Bárbara and Crixás). However it faced some challenges in relation to the Santa Bárbara collective agreement, specifically were signed with the union representatives,unions and ended up executingimplemented effective August 2022. The country has experienced a higher inflation rate of 10.12 percent (Aug/21 – Jul/22) mostly generated by the agreement directlypolitical uncertainty and expectations around the Presidential campaign and the October electoral process. Despite this context, there was no operational impact or attempt to strike, unlike in 2021.
In Argentina, CVSA completed the annual salary negotiation, aligned with country inflation, with a final increase of 100.2 percent for 12 months (May 22 to April 23). The percentage of fulfilment of the 2022 objectives was also agreed with the employees' council. CVSA,unions.
Full time employees receive a number of benefits not afforded to contractor employees. These include retirement, accommodation for selective employees, production and safety related bonus schemes, and reasonable and fair conditions of services in Argentina, completed the 2019 salaries negotiation in January 2020 (when inflation was known and final % increase for 2019 was agreed) and after three prior adjustments made in April, July and October 2019 (% increases).addition to resultant benefits emanating from collective bargaining.
The minimum notice period regarding operational changes varies from country to country. The Company does, however, comply with all relevant legislation.
6E. SHARE OWNERSHIP
DIRECTORS’ AND PRESCRIBED OFFICERS’ INTERESTS IN ORDINARY SHARES
The interests of directors and prescribed officers in the ordinary shares of the companyCompany at 31 December 2019,2022, which individually did not exceed one percent of the company’sCompany’s issued ordinary share capital are included in the annual financial statements,statements; see "Item“Item 18: Financial Statements—Note 33-Related Parties-Directors’31—Related Parties—Directors’ and Prescribed Officers’ interests in AngloGold Ashanti shares"shares”.
A register detailing Directors and Prescribed Officers’ interests in contracts is available for inspection at the company’sCompany’s registered and corporate office. See "Item “Item 10H: Documents on Display"Display”.
CHANGE IN DIRECTOR’SDIRECTORS’ AND PRESCRIBED OFFICER’SOFFICERS’ INTERESTS IN ANGLOGOLD ASHANTI SHARES SINCE 31 DECEMBER 20192022
Refer "Itemto “Item 18: Note 33 - 31—Related Parties - Parties—Directors’ and Prescribed Officers’ interests in AngloGold Ashanti shares"shares”.
SHARE OWNERSHIP OF EXECUTIVE OFFICERS/EXECUTIVE MANAGEMENT
To the best of its knowledge, AngloGold Ashanti believes that AngloGold Ashantiits ordinary shares held by executive officers, in aggregate, do not exceed one percent of the company'sCompany’s issued ordinary share capital.
MINIMUM SHAREHOLDING REQUIREMENT FOR EXECUTIVESEXECUTIVE MANAGEMENT
With effect from March 2013, a minimum shareholding requirement (MSR) was introduced for the executive management team (including executive directors). All executive management team members (including executive directors) are required to have a minimum shareholding in the Company as per the table below.
The MSR was extended to include a 12-month post-termination holding, effective 1 January 2022:
| | | | | | | | | | | | | | | | |
Role | Within three years of appointment/from introduction of MSR (1 January 2020) | Within six years of appointment/from introduction of MSR (1 January 2020) | | | Holding requirement | 12-month Post-Termination Holding (1 January 2022) |
CEO | 150% of net annual base salary | 300% of net annual base salary | | | Throughout employment as a director or prescribed officer | The post-termination MSR will be the requirement based on the MSR policy at the time of termination. Should the executive depart (or no longer serve as director or prescribed officer) before they have achieved the MSR, all vested shares allocated effective 1 January 2022 onwards from the Company’s share incentive will be held for a one-year post-termination period. The holding will be up to their required MSR. |
CFO | 125% of net annual base salary | 250% of net annual base salary | | |
Executive Management Team | 100% of net annual base salary | 200% of net base salary | | |
The following count towards an individual MSR: •Shares purchased on the market, either directly or indirectly •Vested shares from AngloGold Ashanti’s share incentive schemes Accumulation of the post-termination holding commences on 1 January 2022, Executives have five years from introduction or appointment to accumulate holding. |
The table below summarises each executive director and executive committee member’s accomplishment of the MSR:
| | | | | | | | | | | | | | |
Executive | Six-year target achievement date
| MSR holding as at 31 December 2022 as a percentage of net base pay | Three-year MSR target achievement percentage | Six-year MSR target achievement percentage |
Executive directors | | | | |
A Calderon | September 2027 | 38% | 150% | 300% |
Prescribed officers | | | | |
L Ali (1) | April 2028 | 56% | 100% | 200% |
SD Bailey | January 2025 | 298% | 100% | 200% |
TJ Briggs (1) | April 2028 | 0% | 100% | 200% |
L Eybers | March 2023 | 491% | 100% | 200% |
MC Godoy | October 2027 | 206% | 100% | 200% |
I Kramer (2) | July 2028 | 4% | 100% | 200% |
L Marwick | July 2026 | 144% | 100% | 200% |
| | | | | | | | | | | | | | |
(1) Appointed prescribed officer with effect from 1 April 2022 and the 3-year MSR achievement is due in April 2025 |
(2) Appointed prescribed officer with effect from 1 July 2022 to 31 December 2022. The MSR holding is not required subsequent to the appointment period. |
MINIMUM SHAREHOLDING REQUIREMENT FOR NON-EXECUTIVE DIRECTORS (“NEDs”)
During February 2022, the board approved an MSR for NEDs. In terms of the policy, NEDs are required to acquire and hold an MSR in AngloGold Ashanti shares, equivalent to 150 percent of their annual base fee within four years of the effective date of the policy for existing NEDs and from the effective date of appointment for new NEDs.
| | | | | | | | | | | | | | |
| Four-year target achievement date | MSR holding as at 31 December 2022 as a percentage of annual base fee | Two-year MSR target achievement percentage | Four-year MSR target achievement percentage |
Non-Executive Directors | | | | |
MDC Ramos (Chairperson) | February 2026 | 0% | 75% | 150% |
R Gasant (Lead independent director) | February 2026 | 0% | 75% | 150% |
KOF Busia | February 2026 | 36% | 75% | 150% |
AM Ferguson | February 2026 | 90% | 75% | 150% |
AH Garner | February 2026 | 404% | 75% | 150% |
SP Lawson | February 2026 | 51% | 75% | 150% |
MC Richter | February 2026 | 203% | 75% | 150% |
JE Tilk | February 2026 | 50% | 75% | 150% |
ANGLOGOLD DEFERRED SHARE PLAN (DSP)
On 16 May 2017, the shareholders approved the introduction of the DSP. The DSP became effective 1 January 2018 and was designed to better align the interests of Company management with those of shareholders by rewarding decision-making that promotes the long-term health of the business by increasing the maximum vesting period of shares from two to five years, and introducing a claw-back provision, reducing the impact of uncontrollable factors, like gold price and currency fluctuations, in determining remuneration, providing better incentive for prudent, value-adding capital allocation, capping the number of shares that can be issued under the DSP in any given year to one percent of total shares in issue, and providing greater incentives for excellence in the broad area of sustainability, which covers the safety, environmental, health, governance, community relations and human capital disciplines.
The scope of participation in the DSP includes Executive Directors, members of the Executive Committee and senior management employees of the Company and its subsidiaries. The intention of the incentive scheme is to ensure that the medium- to long-term interests of the executives and senior management employees are aligned with the shareholders’ interests, providing rewards to the executives and senior management employees and wealth creation opportunities to the shareholders when the strategic performance drivers are achieved.
Non-Executive Directors are not eligible to participate in the DSP.
DSP awards are payable in cash and where applicable (depending on stratum level), the balance will be delivered in one of two compensation components, either deferred cash or deferred shares, vesting equally over a period of two to five years. For each member of the Executive Management Team, the deferred portion is paid entirely in deferred shares vesting over a five-year period. Deferred shares have a right to receive dividend equivalents during the deferral period.
The total incentive is determined based on a combination of Company and individual performance measures, which are defined annually with weightings applied to each measure. Each metric is weighted and has a threshold, target and stretch achievement level related to the Company budget and the desired stretch targets for the year. Below-threshold achievement results in no payment. At the end of each financial year, the Company’s and the CEO and CFO's performance is assessed by the Remco and the board and the performance of the other members of the executive management team is assessed by the Remco against the defined metrics to determine the quantum of the cash portion and the quantum of the deferred portion as a percentage of base salary based on on-target achievement:
| | | | | | | | | | | |
| Cash | Shares | Total Incentive |
Level | On-Target Achievement |
CEO | 100.00% | 200.00% | 300.00% % % |
CFO | 85.00% % | 185.00% % | 270.00% % % |
Executive Management Team | 75.00% % | 174.00% % | 249.00% % % |
CEO means Chief Executive Officer.
CFO means Chief Financial Officer.
The graphs below illustrate the threshold, on-target and stretch for the DSP scheme and performance measure weightings (Company and individual) as a percentage of base salary:
One set of performance metrics is used to determine the cash portion and deferred portion. Future vesting of the deferred portion is subject to continued employment with the exception of the ExCom members who have post-termination vesting for good-leavers. Individual KPIs account for 20 percent of the performance scorecard in the DSP incentive scheme and Company performance accounts for the remaining 80 percent. Company metrics are relative total shareholder return, absolute total shareholder return, normalized cash return on equity, production, all-in sustaining costs, total cash costs, mineral reserve additions pre-depletion, mineral resource additions pre-depletion, safety, health, environment and community metrics and people metrics.
Company and individual performance measures are assessed over each financial year, with the exception of certain Company measures that are measured over a trailing three-year basis. The first allocation under the DSP was made in February 2019 in respect of the 2018 performance year. For further information about the DSP, see “Exhibit 19.4.1.3”.
The DSP was amended and restated by the board of directors on 20 February 2023 to reflect our current practice by adding flexibility to grant sign-on awards to new employees of AngloGold Ashanti and to compensate them for incentive awards that they have forfeited from their previous employer.
The Committee approved the 2022 DSP metrics Company performance achievement of 94.86 percent. This was an important year for the Company and the following results, among others, demonstrate re-alignment of the strategic priorities and focused delivery.
Key highlights include:
•Incorporating a diverse new executive team and making significant changes at the senior vice president and critical skills level in the areas of Supply, Projects, Digital Technology and Operations
•Achieving an unprecedented safety performance which positions the Company well below the industry average in key metrics and demonstrates significant progress in resetting the safety culture
•Surpassing the production budget for the first time since 2017 and delivering Obuasi targets
•Reducing real cash costs which were less than one percent above the top end of guidance, rising by six percent year on year, which was roughly half the inflation rate experienced for the Company’s basket of goods and services
•Consolidating Nevada as a multi-decade, cost-competitive new growth project
The table below summarises AngloGold Ashanti’s remuneration metrics, their weightings, and performance against these metrics applicable to the DSP during 2022:
| | | | | | | | | | | | | | | | | | | | |
DSP performance measure | Weighting | Threshold measures | Target measures | Stretch measures | 2022 achievement % |
Financial measures | Relative total shareholder return (measured in US$) | 12.50% | Median TSR of comparators | Halfway between median and upper quartile | Upper quartile TSR of comparators | 0.00% |
| Absolute total shareholder return (measured in US$) | 7.50% | USD COE (6%) | USD COE + 2% (8%) | USD COE + 6% (12%) | 11.25% |
| Normalised cash return on equity (nCROE) | 15.00% | USD COE (6%) | USD COE + 9% (15%) | USD COE + 18% (24%) | 22.50% |
| Production | 15.00% | 2,550 oz (000) | 2,734 oz (000) | 2,837 oz (000) | 15.60% |
| Total cash cost | 10.00% | $1,015 / oz | $963 / oz | $915 / oz | 0.00% |
| All-in sustaining costs | 5.00% | $1,425 / oz | $1,355 / oz | $1,285 / oz | 4.00% |
Future optionality | Mineral Reserve additions (pre-depletion, asset sales, mergers and acquisitions) | 5.50% | Plus 1.6 Moz | Plus 3.2 Moz | Plus 4.8 Moz | 5.98% |
| Mineral Resources (pre-depletion, asset sales, mergers and acquisitions) | 5.50% | Plus 4.2 Moz | Plus 8.3 Moz | Plus 12.5 Moz | 4.10% |
Safety | All injury frequency rate (AIFR) – one year | 8.00% | ≥2.5% performance improvement (2.07) | ≥5% performance improvement (2.01) | ≥7.5% performance improvement (1.96) | 11.24% |
| Major hazard control compliance | | 95% critical control compliance | 99% critical control compliance | 99.5% critical control compliance | |
Health, Environmental and Community | Health (2.5%): Reduction in workforce exposed to high respirable crystalline silica dust | 12.00% | 4% reduction | 7% reduction | 13% reduction | 17.33% |
| Environment (7.5%): Greenhouse gas emissions management | | 110% of budgeted carbon emission intensity (37.91) | 100% of budgeted carbon emission intensity (34.46) | 95% of budgeted carbon emission intensity (32.74) | |
| Community (2%): Business disruptions as a result of community unrest | | 2 | 1 | 0 | |
People | Gender diversity | 4.00% | 21% female representation | 23% female representation | 25% female representation | 2.86% |
| Key staff retention | | 85% pa | 90% pa | 95% pa | |
| Total | 100% | | | | 94.86% |
Relative TSR measures the Company’s share price performance compared to the peer group on a relative basis. It is measured on a three-year trailing average. A total of seven peers (Agnico Eagle Ltd, Barrick Gold Corp, Gold ETF, Gold Fields Ltd, Kinross Gold Corp, Newcrest Mining Ltd and Newmont Mining Corp) are measured and numerically ranked; the positioning of AngloGold Ashanti in the ranking determines the bonus achievement.
Based on the criteria below for 2022, AngloGold Ashanti was ranked seventh and was therefore positioned below the median at a growth percentage of 13.00 percent; therefore, the achievement was calculated at below threshold (0 percent).
Criteria table for relative TSR
| | | | | | | | |
Threshold achievement (50%) | 33.93% | Median |
Target achievement (100%) | 49.05% | Halfway between median and upper quartile |
Stretch achievements (150%) | 64.17% | Upper quartile |
Absolute TSR measures the Company’s share price performance on a three-year trailing average and compares it to a percentage increase relating to US cost of equity (US COE). The stretch target is achieved if US COE plus 6 percent is exceeded based on this calculation. Currently the US COE is 6 percent, resulting in the stretch target being 12 percent.
Criteria table for absolute TSR
| | | | | | | | |
Threshold achievement (50%) | US cost of equity (COE) | 6.00% |
Target achievement (100%) | COE + 2% | 8.00% |
Stretch achievements (150%) | COE + 6% | 12.00% |
The Company’s growth percentage of 13.00 percent places them above the US COE plus 6 percent (12 percent); therefore, the achievement is on stretch (11.25 percent). Refer to the TSR ranking table above.
Additional details regarding the award outcomes for the CEO and CFO under the DSP for 2022 are provided below.
CEO: Key Objectives and Achievements for 2022: | | | | | | | | |
Scorecard | Weighting | Comments |
Health, safety, environment and community •Safety – 12.5% •Health, environment and community – 12.5% •Results aligned to Company DSP outcome
| 25% | AngloGold Ashanti’s safety performance improved year-on-year •Total recordable injury frequency rate improved 41% to a record 1.26 in 2022 – less than half the 2021 ICMM member average of 2.90 •Lost-time injury frequency rate fell 40% to 0.65 year-on-year •Visible leadership on Major Hazard Critical Controls programme •Set new Scope 1 and 2 greenhouse gas reduction targets for 2030, including detailed programme of projects and capital estimates |
Financial and production •Achievement of budget production oz’s and cash cost / oz •Significantly advance Project Full Potential: Identify the full potential of 5-6 operations and the measures to close the gap during following 24 months •Build major projects for the company’s long- term future inclusive of significant progress made on: ▪Obuasi – 5% ▪Colombia project – 5% ▪Nevada project – 5% •Support the move of major capital projects through development phases | 55% | Exceeded budgeted production for first time since 2017. Achieved real cash cost reduction of 6% in volatile, inflationary environment, closing the gap vs. peer group, where costs increased above inflation: •Improvement projects helped offset significant exogenous factors, including flooding in Brazil and Covid impact on labour in Australia •Siguiri management intervention helped exceed planned production amid challenging operating conditions •Obuasi production met market expectations
Initiated Full Asset Potential Programme: •Six sites underwent FP programme; potential cost reductions identified •Workbooks in place to realise efficiencies over c.24 months
Growth Projects: •Quebradona Optimised Feasibility Study progressed; Environmental Impact assessment is in progress •North Bullfrog feasibility study expected now in first half of 2023; Feasibility study for Silicon rescheduled to include Merlin and other orebodies |
Individual KPIs •Embed Operating Model changes •Effective stakeholder management through: | 20% | •Implemented new Operating Model; achieved planned personnel efficiencies in corporate functions and business units, with commensurate cost benefits |
▪Good corporate governance and risk management | | Corporate governance - simplified Delegation of Authority framework and implemented review of Group policies and standards |
▪Effective relationships with shareholders and investors | | •Worked to develop relationship with shareholders and analysts through industry conferences, roadshows and roundtable meetings. Improved market understanding of overall strategy and Full Asset Potential process, aided by engagement during results reporting and set-piece engagements |
▪Good relations with governments in operating countries | | •Government relations strengthened - increased personal interactions with key officials, including high-level meetings with governments of Ghana and Tanzania to strengthen relationships and discuss issues of mutual interest |
▪Effective regular communication with board, executive committee, operations, projects and employees | | •Employee townhalls, site visits and visible leadership on mental wellbeing and sexual harassment prevention campaigns. Culture survey results and subsequent workshops and feedback sessions have effectively boosted employee morale and engagement |
| | •Implemented an integrated new ExCom and significant changes at senior management level to ensure robust capability to deliver the business plan |
| | •Global implementation of the anti-discrimination and sexual harassment standards |
Total | 100% | |
| | | | | | | | |
CEO: Performance incentive outcome 2022 | |
2022 DSP performance outcome | Weighting | DSP award outcome |
Financial performance targets | | |
Relative total shareholder return | 12.50% | 0.00% |
Absolute total shareholder return | 7.50% | 11.25% |
Normalised cash return on equity (nCROE) | 15.00% | 22.50% |
Production | 15.00% | 15.60% |
Total Cash Costs | 10.00% | 0.00% |
All-in sustaining costs | 5.00% | 4.00% |
Mineral Reserve pre-depletion | 5.50% | 5.98% |
Mineral Resource additions pre-depletion | 5.50% | 4.10% |
Safety | 8.00% | 11.24% |
Health, Environment and Community | 12.00% | 17.33% |
Core value: People | 4.00% | 2.86% |
Total % for Company performance: | 100.0% | 94.86% |
| | . |
| | | | | | | | |
Organisational performance weighting: | | 80.00% |
| | = |
A - Organisational performance weighted outcome: | | 75.89% |
Individual performance results | | |
Actual individual targets and strategic objectives are not disclosed in order to maintain commercial confidentiality in competitive markets | | |
Individual performance weighting: | | 20.00% |
| | X |
Performance rating award correlation: | | 150.00% |
| | = |
B - DSP opportunity based on individual performance: | | 30.00% |
Total % of DSP pay opportunity (A+B) | | 105.89% |
| | x |
On-target total cash bonus opportunity (as % of base pay) | | 100.00% |
On-target total deferred share award opportunity (as % of base pay) | | 200.00% |
| | = |
Final cash bonus result (as % of base pay) | | 105.89% |
Final deferred share result (as % of base pay) | | 211.78% |
Base pay as at 31 December 2022 (all offshore payments converted to ZAR at exchange rate of ZAR16.3655: USD1) | | x |
| | 26,184,800 |
| | = |
Annual cash portion of DSP: | | 27,726,561 |
Annual deferred share portion of DSP (to vest over five years): | | 55,453,122 |
Total 2022 deferred share plan award: | | 83,179,683 |
CFO: Key Objectives and Achievements for 2022:
| | | | | | | | |
Scorecard | Weighting | Comments |
Leadership and stakeholder engagement | 5% | •Maintained effective relationships with equity and debt investors, banks, ratings agencies, auditors and joint venture partners •Continued to provide input at relevant stakeholders’ forums on financial, tax and regulatory matters |
Liquidity, credit ratings and balance sheet management | 15% | •Refinanced $1.4bn multi-currency RCF by mid-June 2022 at favourable terms, for a five-year tenure with two one-year extensions •Proactively engaged the ratings agencies on the Company’s strategy, operational performance, and cost initiatives. AngloGold Ashanti’s credit ratings were maintained by all three credit ratings agencies |
Cost discipline and cash preservation measures | 50% | •Production and cost guidance remained on track for the year in the first half of 2022 •Maintained focus on optimising corporate costs, as well as non-essential expenditure •Proactively managed supply chain risks across the business amidst challenging market conditions resulting from COVID-19-related impacts and the Russia/Ukraine war
|
| | •Adequate levels of consumables and spares (3-6 months) have been maintained across the operations to maintain business continuity. Targeted supply chain savings remained on track despite inflationary pressures due to stocking and pricing strategies and ensured that the full asset potential programme was adequately supported |
Governance and risk management | 15% | •Ensured that a strong culture of compliance and consistency of accounting practices prevailed through regular interaction with business units •Ensured a strong focus on the Tanzanian tax matters and that there is appropriate disclosure of all tax exposures •Assessed oil hedging at various intervals earlier in the year |
Implementation of the Operating Model | 15% | •The approved Operating Model structures for the Finance and Supply functions were embedded well before the end of June 2022; appropriate transition plans developed identified risks •Ensured that the business process optimisation initiatives had been progressed and that projects have been put in place to address the recommendations |
Total | 100% | |
| | | | | | | | |
CEO: Performance incentive outcome 2022 | |
2022 DSP performance outcome | Weighting | DSP award outcome |
Financial performance targets | | |
Relative total shareholder return | 12.50% | 0.00% |
Absolute total shareholder return | 7.50% | 11.25% |
Normalised cash return on equity (nCROE) | 15.00% | 22.50% |
Production | 15.00% | 15.60% |
Total Cash Costs | 10.00% | 0.00% |
All-in sustaining costs | 5.00% | 4.00% |
Mineral Reserve pre-depletion | 5.50% | 5.98% |
Mineral Resource additions pre-depletion | 5.50% | 4.10% |
Safety | 8.00% | 11.24% |
Health, Environment and Community | 12.00% | 17.33% |
Core value: People | 4.00% | 2.86% |
Total % for Company performance: | 100.0% | 94.86% |
| | |
Organisational performance weighting: | | 80.00% |
| | = |
A - Organisational performance weighted outcome: | | 75.89% |
Individual performance results | | |
Actual individual targets and strategic objectives are not disclosed in order to maintain commercial confidentiality in competitive markets | | |
Individual performance weighting: | | 20.00% |
| | X |
Performance rating award correlation: | | 112.50% |
| | = |
B - DSP opportunity based on individual performance: | | 22.50% |
Total % of DSP pay opportunity (A+B) | | 98.39% |
| | x |
On-target total cash bonus opportunity (as % of base pay) | | 85.00% |
On-target total deferred share award opportunity (as % of base pay) | | 185.00% |
| | = |
Final cash bonus result (as % of base pay) | | 83.63% |
Final deferred share result (as % of base pay) | | 0.00%(1) |
Base pay for six months as at 30 June 2022 (all offshore payments converted to ZAR at exchange rate of ZAR16.3655: USD1) | | x |
| | 5,441,578 |
| | = |
Annual cash portion of DSP: | | 4,550,781 |
Annual deferred share portion of DSP (to vest over five years): | | — |
Total 2022 deferred share plan award: | | 4,550,781 |
(1) Deferred share award was not payable because of the CFO’s termination of service.
PARTICIPATION BY EXECUTIVE DIRECTORS, EXECUTIVE MANAGEMENT TEAM MEMBERS AND OTHER MANAGERS IN THE ANGLOGOLD SHARE INCENTIVE SCHEME
For details of the share-based awards and rights to subscribe for ordinary shares in the Company granted to, and exercised by, executive directors, executive management team members and other managers on an aggregate basis during the year to 31 December 2022 and subsequent to year end up to 10 March 2023, see “Item 18: Financial Statements—Note 31—Related Parties—Directors and other key management personnel”.
PARTICIPATION BY EMPLOYEES IN THE ANGLOGOLD SHARE INCENTIVE SCHEME
For details of the share-based awards and rights to subscribe for ordinary shares in the Company granted to, and exercised by, employees on an aggregate basis during the year to 31 December 2022, see “Item 18: Financial Statements—Note 9—Share- Based Payments”.
ITEM 7: MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS
Overview
Description of AngloGold Ashanti’s share capital
AngloGold Ashanti’s share capital consists of one class of stock:
•Ordinary shares, par value 25 South African cents each (the “ordinary shares”);
The authorised and issued share capital of AngloGold at 31 December 2022 is set out below:
| | | | | | | | | | | | | | |
Title of class (1) | | Authorised | | Issued |
Ordinary shares | | 600,000,000 | | | 418,600,473 | |
(1) During December 2021, the A and B redeemable preference shares were redeemed and the preference share certificates cancelled. All redeemable preference shares were removed from the authorised share capital at the AGM held on 16 May 2022.
All the issued ordinary shares are fully paid and are not subject to further calls or assessment by AngloGold Ashanti.
The following are the movements in the ordinary issued share capital at 31 December:
Ordinary shares | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Number of Shares | | Rand | | Number of Shares | | Rand | | Number of Shares | | Rand |
| | | 2022 | | 2021 | | 2020 |
At 1 January | | | 417,501,452 | | | 104,375,363 | | | 416,890,087 | | | 104,222,522 | | | 415,301,215 | | | 103,825,304 | |
Issued during the year: | | | | | | | | | | | | | |
Exercise of options by participants in the AngloGold Share Incentive Scheme | | | 1,099,021 | | | 274,755 | | | 611,365 | | | 152,841 | | | 1,588,872 | | | 397,218 | |
31 December | | | 418,600,473 | | | 104,650,118 | | | 417,501,452 | | | 104,375,363 | | | 416,890,087 | | | 104,222,522 | |
| | | | | | | | | | | | | |
During the period from 1 January 2023 to and including 10 March 2023, 246,930 ordinary shares were issued at an average issue price of R270.27 per share, resulting in 418,847,403 ordinary shares being in issue at 10 March 2023.
7A. MAJOR SHAREHOLDERS
According to information available to the directors, the following are the only shareholders or their associates holding, directly or indirectly, in excess of five percent of the ordinary issued share capital of the Company: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Ordinary shares held at | | 31 December 2022 | 31 December 2021 | | 31 December 2020 | |
Shareholder* | | Number of Shares | | Percent Voting Rights | Number of Shares | | Percent Voting Rights | | Number of Shares | | Percent Voting Rights | |
Public Investment Corporation of South Africa | | 51,477,205 | | | 12.30 | | 44,332,506 | | | 10.62 | | | 39,846,637 | | | 9.56 | | |
BlackRock Inc. | | 29,536,274 | | | 7.06 | | 27,155,066 | | | 6.50 | | | 27,956,084 | | | 6.71 | | |
Van Eck Associates Corporation | | 23,602,172 | | | 5.64 | | n/a | | n/a | | 26,488,311 | | | 6.35 | | |
Coronation Holdings | | n/a | | n/a | 37,322,250 | | | 8.94 | | | n/a | | n/a | |
* Shares may not necessarily reflect the beneficial shareholder.
At 31 December 2022, a total of 125,736,908 shares (or 30 percent of issued ordinary share capital) were held by The Bank of New York Mellon, as Depositary for the Company’s American Depositary Receipt programme. Each American Depositary Share (ADS) is equivalent to one ordinary share. At 31 December 2022, the number of persons who were registered holders of ADSs was reported at 1,928. AngloGold Ashanti is aware that many ADSs are held of record by brokers and other nominees, and accordingly the above numbers are not necessarily representative of the actual number of persons who are beneficial holders of ADSs or the number of ADSs beneficially held by these persons.
All ordinary shareholders have the same voting rights.
As at 31 December 2022, there were 25,543holders on record of AngloGold Ashanti ordinary shares. Of these holders 478 had registered addresses in the United States and held a total of 179,898,324 ordinary shares, or 42.98 percent of the total outstanding ordinary shares. In addition, certain accounts on record with registered addresses outside the United States, hold AngloGold Ashanti ordinary shares, in whole or in part, beneficially for United States persons.
At 10 March 2023, a total of 124,073,857 ADSs or 29.62 percent of total issued ordinary share capital were issued and outstanding and held on record by 1,914 registered holders.
Insofar as is known to AngloGold Ashanti, there was no person who, directly or indirectly, jointly or severally, exercised or could exercise control over AngloGold Ashanti, nor is AngloGold Ashanti aware of any arrangements which might result in a change in control of AngloGold Ashanti.
7B. RELATED PARTY TRANSACTIONS
The Company had the following transactions with related parties during the year ended 31 December: | | | | | |
| 2022 |
| Purchases from related party |
(in million) | $ |
Purchases of goods and services from related parties | |
Rand Refinery (Pty) Limited | 14 | |
| |
| |
Amounts due to joint ventures and associates arising from purchases of goods and services are unsecured and non-interest bearing.
As at 31 December 2022, there are no outstanding balances arising from loans owed to or by related parties.
7C. INTERESTS OF EXPERTS AND COUNSEL
Not applicable.
ITEM 8: FINANCIAL INFORMATION
8A. CONSOLIDATED FINANCIAL STATEMENTS AND OTHER FINANCIAL INFORMATION
See “Item 18: Financial Statements”.
LEGAL PROCEEDINGS
There is no material proceeding in which a director, officer or affiliate of AngloGold Ashanti is either a party adverse or has a material interest adverse to the Company.
In addition to the proceedings described below, the Company becomes involved, from time to time, in various claims, legal proceedings and complaints incidental to the ordinary course of its business.
TAX MATTERS
•The State of Minas Gerais v. Mineração Serra Grande S.A. (MSG): In Brazil, MSG received a tax assessment in October 2003 from the State of Minas Gerais related to VAT on gold bullion transfers. The tax administrators rejected MSG’s appeal against the assessment, which amounted to approximately $9.6 million. MSG appealed the dismissal of the case to the State Court of Minas Gerais. Any possible payment by MSG would be set off by an indemnity from Kinross Gold Corporation (Kinross) of $5 million provided for as part of the company’s acquisition of Kinross’ interest in MSG in 2012. The matter is currently pending in the State Court of Minas Gerais.
•Brazilian tax authorities v. AngloGold Ashanti Córrego do Sítio Mineração SA and Mineração Serra Grande S.A. (MSG): AngloGold Ashanti’s subsidiaries in Brazil, including AGA Mineração (formerly AngloGold Ashanti Brasil Mineração Ltda) and MSG, are involved in various disputes with the Brazilian tax authorities. These disputes date back as far as 2007 and involve federal tax assessments including income tax, royalties, social contributions, VAT and annual property tax. Collectively, the total possible amount involved across all tax disputes in Brazil is approximately $46.5 million, which include VAT claims and social security payments of $36 million.
•Colombian Tax Office (DIAN) v. AngloGold Ashanti Colombia S.A.S. (AGAC) and Gramalote Colombia Limited (Gramalote): Since 2013, AGAC received various notices from the DIAN that it disagreed with the company’s tax treatment of exploration expenditure in its 2010, 2011, 2013 and 2014 income tax returns and its 2011 equity tax return. However, AGAC believes that the DIAN has applied the tax legislation incorrectly and subsequently filed lawsuits before the Administrative Court of Cundinamarca (the trial court for tax litigation) challenging each of the DIAN’s rulings in respect of those tax returns. In 2018, the Administrative Court of Cundinamarca denied AGAC’s arguments with respect to the 2010 and 2011 tax litigation. AGAC subsequently appealed these judgments to the Council of State of Colombia (the highest court for tax matters). In November and December 2022, the Council of State ruled against AGAC upon appeal. The Council of State ordered AGAC to pay $34 million of additional taxes (which includes interest) in respect of the 2010 and 2011 tax returns, but it fully waived any related penalties (which were originally assessed in the amount of $47 million). In December 2022, a tax reform was adopted in Colombia, enacting changes which may lead to a reduction of interest charged on outstanding tax obligations in certain circumstances. In February 2023, AGAC paid $25 million of additional taxes (which includes interest) in respect of the 2011 income and equity tax returns, after taking into account a reduction of $6 million in interest under the tax reform. Following this payment, the 2011 tax litigation was fully settled. AGAC is still awaiting the final decision under the new tax reform in respect of the 2010 tax litigation. AGAC’s other lawsuits with respect to its 2013 and 2014 tax returns are still pending before the Administrative Court of Cundinamarca and the company has disclosed a contingent liability of $5.0 million in respect thereof (mainly covering related penalties).
Since 2019, Gramalote also received various notices from the DIAN that it disagreed with its 2013 and 2014 income tax returns on the same basis as the abovementioned AGAC returns, calculating additional taxes as well as penalties and interest. However, Gramalote also believes that the DIAN has applied the tax legislation incorrectly and subsequently filed lawsuits before the Administrative Court of Cundinamarca challenging each of the DIAN’s rulings in respect of those tax returns. Gramalote’s lawsuits with respect to its 2013 and 2014 tax returns are still pending before the Administrative Court of Cundinamarca. The company has disclosed a contingent liability of $3.0 million in relation to Gramalote’s 2013 and 2014 tax returns (mainly covering related penalties).
The total amount claimed by the DIAN, related to the above tax matters that remain outstanding amounted to $8.1 million of which $8.0 million related to penalties as of 31 December 2022. Following a judgment of the Council of State in July 2019 holding that duplicate penalties may not be charged, the company expects that certain penalties will likely be waived, reducing the overall exposure to $0.1 million in respect of those tax matters. In addition, from 2017 onwards, the deduction of exploration costs is prohibited following a change in Colombian tax legislation. As a result, exploration costs have been treated in accordance with the amended tax legislation subsequent to that date.
•Argentina Tax Authority (AFIP) v. Cerro Vanguardia S.A. (CVSA): In July 2013, CVSA received a notification from the AFIP requesting corrections to the 2007, 2008 and 2009 income tax returns of about $0.9 million relating to the non-deduction of tax losses previously claimed on hedge contracts. The AFIP is of the view that the financial derivatives could not be considered as hedge contracts, as hedge contract losses could only be offset against gains derived from the same kind of hedging contracts. Penalties and interest on the disputed amounts are estimated at a further $4.2 million. CVSA and AFIP have corresponded on this issue over the past several years, and the Argentinian tax authorities continue to assert their position regarding the use of the financial derivatives. CVSA filed an appeal with the Tax Court in June 2015, and the parties submitted their final reports in July 2017. The matter is pending with the Tax Court.
•Ghanaian tax authorities v. AngloGold Ashanti (Ghana) Limited (AGAG) withholding tax audits: AGAG received a final tax audit report from the Ghana Revenue Authority (GRA) in which the GRA demanded payment of $9.0 million in respect of withholding taxes on payments to non-resident persons. AGAG objected to the GRA’s assessment of withholding taxes on the basis that AGAG was duly exempted by the government of Ghana from withholding taxes on payments made to non-residents during the relevant periods in terms of the Deed of Warranty signed with the government of Ghana. In 2017, AGAG met with the Commissioner-General of the GRA and provided its position in writing together with the relevant supporting documents. AGAG has not yet received a response from the Commissioner-General. Due to the statute of limitations applicable to tax assessments in Ghana, the amount of the tax uncertainty is estimated at $6.0 million as at 31 December 2022.
COLOMBIA
•Santa María-Montecristo and La Colosa class action lawsuits: Class action lawsuits have been filed in relation to each of AngloGold Ashanti Colombia S.A.S.’s (AGAC) Santa María-Montecristo and La Colosa projects. Each of the two lawsuits aims to stop exploration and mining in certain restricted areas affected by the projects due to environmental concerns.
In respect of the Santa María-Montecristo class action lawsuit, in September 2011, the Administrative Court of Tolima granted one of the plaintiffs a preliminary injunction suspending AGAC’s mining concession contracts in relation to this project. AGAC has challenged this injunction, nevertheless, it remains in place during the course of the court proceedings. In May 2019, the Administrative Court of Tolima ruled that a technical study be prepared to define the places in which mining activities could be performed in the Combeima canyon without posing any threat to the water reservoirs of Ibagué, the capital of the Tolima department. In September 2020, the Council of State of Colombia (the highest court for administrative matters) on appeal overruled the decision of the Administrative Court of Tolima. The Council of State’s decision, which is final and not subject to further appeal, determined that AGAC, as concessionaire, has a right to develop the project if it can demonstrate to the mining and environmental authorities on the basis of technical studies that its mining exploration and, eventually, exploitation activities, will not impact the water resources of the Coello River basin and its tributaries. On 25 October 2022, AGAC returned the tenements involved in the Santa María-Montecristo project to the government of Colombia. This return is pending acceptance by the Colombian Mining Authority (Agencia Nacional de Minería) following which the Administrative Court of Tolima still needs to dismiss the case. Until such time, the injunction remains in place.
The consolidated La Colosa class action lawsuit originally consisted of four separate class actions. In relation to this project, in October 2016, Tolima’s Administrative Court ordered that a technical study be prepared by a panel of seven experts (selected by the plaintiff, AGAC, universities, the Colombian government and an NGO) to determine whether the La Colosa project presents a “threat” to the environment during its exploration phase. In December 2017, Ibagué’s Third Administrative Court ordered that another technical study, similar to the one described in the October 2016 order, be prepared for the La Colosa project. AGAC appealed both orders. In September 2018, Tolima’s Administrative Court consolidated all class actions in relation to the La Colosa project into one single class action lawsuit which is currently pending before the Council of State. The orders to prepare the technical studies have been temporarily suspended pending resolution by the Council of State. If AGAC’s appeal before the Council of State is not successful, the Company may have to perform one or more technical studies in relation to the La Colosa project. If the studies were to conclude that a “threat” exists, certain development activities at the La Colosa project may be suspended.
Further, while the plaintiffs in the La Colosa class action have petitioned the courts to cancel the mining concession contracts, the Company believes that the judiciary system in Colombia does not have the authority to order such cancellation. Such power, by law, vests solely in the Colombian government which, through the relevant Colombian mining authorities, has the discretion to declare concessions void if a concession holder breaches applicable environmental laws or regulations. The Colombian government, as the authority granting the mining concession contracts, is also a defendant in this class action lawsuit together with AGAC. AGAC continues to oppose, through a variety of integrated legal and political strategies, the class action lawsuit that was filed against it. However, if the plaintiffs prevail and AGAC is unable to perform its core concession contracts as a result of the judicial decision, the Company would be required to abandon the project.
•Cortolima’s injunction against AngloGold Ashanti Colombia S.A.S. (AGAC): In March 2013, Cortolima, a regional environmental authority in the Tolima department, issued a regulatory injunction against AGAC alleging, among other things, that in relation to certain of AGAC’s La Colosa mine design-related activities in the municipality of Piedras, AGAC engaged in drilling and other activities that could have negative effects on the environment. The injunction did not include any allegation that AGAC’s actions actually caused any environmental damages in Piedras. AGAC’s challenge of the injunction was unsuccessful before Cortolima. In August 2013, AGAC initiated legal proceedings before the Council of State of Colombia (the highest court for administrative matters) seeking annulment of the injunction as well as restoration of its rights to continue its activities in the area. In November 2019, the Council of State ruled that the competent judicial authority to decide on this matter is the Administrative Court of Tolima and referred the case to that court. In July 2020, the Twelfth Administrative Court of Tolima ruled that since the injunction is a preliminary and temporary measure imposed as part of the administrative approval process within Cortolima and not a final decision, it is not yet amenable to administrative judicial review. In July 2021, this decision was reversed on appeal by the Administrative Superior Court of Tolima in a ruling that such injunctions are amenable to administrative judicial review. The appellate court ordered the Twelfth Administrative Court of Tolima to review the matter and issue a decision thereon. Consequently, the Twelfth Administrative Court of Tolima admitted the case and a first hearing was held on 21 April 2022. Trial evidence was accepted. On 25 October 2022, another hearing was held to gather testimonies. The case remains pending. The Company expects that a final resolution of this
matter will include payment of a penalty by AGAC in an amount that is not expected to be material. While the injunction remains in place, AGAC is not able to engage in certain of its activities related to the La Colosa project.
•Piedras and Cajamarca popular consultations: In 2013, the local council of the city of Piedras, near the La Colosa project, organised a popular consultation to ban all mining activities in Piedras (Piedras popular consultation), the result of which was validated by the Administrative Court of Tolima as part of an administrative procedure. Although the Piedras popular consultation did not have an immediate impact on the La Colosa project (due to its distant location from the project), AGAC believes the Piedras popular consultation was in violation of national law in Colombia. In 2013, AGAC filed a ‘tutela’ action (a legal action alleging a violation of constitutional rights) with the Council of State of Colombia (the highest court for administrative issues). In 2014, AGAC’s ‘tutela’ action was dismissed by the Council of State for lack of standing on the grounds that AGAC did not have mining tenements in Piedras. In addition, in 2015, AGAC filed a request for annulment of the administrative acts adopted by the local authorities in furtherance of the results of the Piedras popular consultation, which was rejected by the Second Administrative Court of Ibagué. AGAC subsequently appealed this ruling. In July 2021, AGAC was notified that the Administrative Superior Court of Tolima ruled on appeal that, in light of the 2018 decision of the Constitutional Court of Colombia (the highest court for constitutional issues) holding that local municipalities or regions are not entitled to veto mining activities through popular consultations (as further described below), the results of the Piedras popular consultation, and the administrative acts adopted in furtherance thereof, were not enforceable. An extraordinary appeal against this ruling was submitted on 22 March 2022, which is pending. In addition, in September 2021, a third party filed a ‘tutela’ action with the Council of State arguing that the Administrative Superior Court of Tolima did not have the authority to determine that the results of the Piedras popular consultation, and the administrative acts adopted in furtherance thereof, were not enforceable. In December 2021, the Council of State dismissed this ‘tutela’ action for lack of standing.
In March 2017, the residents of the municipality of Cajamarca also voted in a popular consultation to disapprove mining projects in the municipality, including the La Colosa project (Cajamarca popular consultation). However, the Mining Minister of Colombia subsequently publicly confirmed that Cajamarca’s vote does not apply retroactively implying the Cajamarca popular consultation did not have an immediate impact on AGAC’s rights with respect to the La Colosa project. In April 2017, AGAC nevertheless suspended all exploration activities at the La Colosa project until there is more certainty about mining activity in Colombia. In October 2018, the Colombian Constitutional Court issued ruling SU-095-2018 stating that local municipalities or regions were not entitled to veto mining activities through popular consultations. The Constitutional Court also ordered the national legislative body, the Congress of Colombia, to enact a law within two years to ensure that local communities and groups are adequately consulted in the approval of mining activities in accordance with specific criteria set out in its ruling. Subsequently, a group of citizens submitted an annulment claim before the Administrative Court of Cundinamarca to cancel AGAC’s mining contract in Cajamarca on the grounds of the results of the Cajamarca popular consultation. After having admitted the annulment claim in December 2019, the Administrative Court of Cundinamarca dismissed the plaintiffs’ claim in May 2021 on procedural grounds. The plaintiffs subsequently appealed this decision and the appeal is currently pending before the Council of State.
•La Colosa Human Rights Litigation: In November 2014, the Personero (Ombudsman) of Ibagué, the capital of the Tolima department, filed a petition against the Colombian government before the Inter-American Commission on Human Rights (Commission), based in Washington, D.C., for alleged human rights violations protected by the American Convention on Human Rights (Convention) which has been ratified by Colombia along with many other Central and South American countries. The Commission has the power to refer a case to the Inter-American Court of Human Rights (Court) which is an autonomous judicial institution based in San José, Costa Rica whose purpose is the application and interpretation of the Convention. The petition alleges that the Colombian government denied justice to the Personero as a result of the failure of the Colombian judiciary to resolve the issues raised in two class actions filed by him before the local Colombian administrative courts within a reasonable period of time. Although AGAC is not a party to the suit, its outcome is nevertheless important to the development of the La Colosa project. The Commission currently has not accepted nor referred the case to the Court. If the case would be accepted or referred in the future, the Colombian government will have to defend itself against the lawsuit and will be bound by the findings of the Court. AGAC continues to regularly follow up with the Colombian government for updates.
•Paramo Delimitation: In November 2016, the Colombian government issued Resolution 1987/2016 delineating certain wetlands or moorlands as environmentally important protected areas, which designation includes certain areas in and around the La Colosa project. In these areas there are limitations, or in some instances outright bans, on mining and mining-related activities. These limitations and bans could potentially adversely impact the design, operations and production of the mining project at the La Colosa project. In June 2017, AGAC filed suit against the Colombian Ministry of the Environment in the Administrative Court of Cundinamarca to annul Resolution 1987/2016 on technical and other grounds. The lawsuit was admitted in April 2019. The Ministry of the Environment, as defendant in this action, is expected to file its response to the annulment claim.
•Zonte Metals: A Canadian junior mining company, Zonte Metals, filed applications for title to certain corridors, or small slivers of land, overlaying sections of the Gramalote project. The Secretary of Mines of Antioquia, the department in which the Gramalote project is located, denied the applications filed by Zonte Metals. However, Zonte Metals then filed a claim against the Colombian National Mining Agency (ANM) and the Antioquia Secretary of Mines before the Council of State of Colombia, by which it seeks to (i) revoke the resolution that denied its application and (ii) obtain the rights over the corridors requested in its application. The Council of State subsequently enjoined the Antioquia Secretary of Mines and Gramalote Colombia Limited (Gramalote) from progressing a pending application to integrate the disputed corridors with Gramalote’s tenement. The Antioquia Secretary of Mines has filed its response to the Zonte Metals claim, which includes arguments
aligned with the interests and position of Gramalote. In September 2017, the Council of State approved Gramalote’s request to be made an interested party to the lawsuit, but it rejected Gramalote’s request to join the Antioquia Secretary of Mines as a co-defendant in August 2019. In January 2019, the Council of State also re-affirmed that the Council of State is the competent judicial authority to hear the matter. The date for the first hearing is currently pending.
GHANA
•Pompora Treatment Plant Litigation: In April 2013, AngloGold Ashanti (Ghana) Limited (AGAG) received a summons from Abdul Waliyu and 152 others in which the plaintiffs allege that they were or are residents of the Obuasi municipality or its suburbs and that their health has been adversely affected by emissions and/or other environmental impacts arising in connection with the current and/or historical operations of the Pompora Treatment Plant (PTP), which was decommissioned in 2000. The plaintiffs’ alleged injuries include respiratory infections, skin diseases and certain cancers. The plaintiffs subsequently did not file their application for directions in time. In February 2014, executive members of the PTP (AGAG) Smoke Effect Association (PASEA), sued AGAG by themselves and on behalf of their members (undisclosed number) on grounds similar to those discussed above, as well as economic hardships resulting from the failure of their crops. This matter has been adjourned indefinitely. As plaintiffs in these matters have not actively pursued these legal proceedings, AGAG is taking steps to have these matters dismissed for want of prosecution.
•Ghana Mining Licenses Litigation: In January 2019, AGAG and AngloGold Ashanti (Iduapriem) Limited (AAIL), along with other Ghanaian mining companies, were served with writs by two members of the Ghanaian Parliament seeking to invoke the jurisdiction of the Ghanaian Supreme Court (highest court in Ghana) for a declaration that the mining companies were not entitled to carry out any exploitation of minerals otherwise allowed under their relevant mining leases unless the leases had been timely ratified by the Parliament of Ghana. In January 2019, the Ghanaian Attorney General filed its statement of case, agreeing with the position of the plaintiffs (that the mining leases required parliamentary ratification) and requesting that the Supreme Court order the mining companies to pay the Ghanaian government all revenue related to mining activities accrued during the time such mining leases were unratified. In April 2019, AGAG and AAIL, in coordination with the other mining companies, filed their statement of case. The Supreme Court has not yet set a date for the first hearing to commence the case.
GUINEA
•Government of Guinea (National Claim Commission) v. Société AngloGold Ashanti Goldfields de Guinée SA (SAG): A national claim recovery commission established by the government of Guinea has demanded that SAG pay $43 million in dividends and penalties that would allegedly have been owed to the government of Guinea for the accounting years 2004 - 2007. SAG opposes the claim. Even though both parties had originally decided to submit their dispute to an independent audit firm to be appointed by a common accord, the independent audit firm was never appointed. In December 2010, the national claim recovery commission was disbanded and the matter was turned over to the Inspector General of the Ministry of Finance of Guinea. This matter has been dormant since it was handed over to the Inspector General.
TANZANIA
•Geita Gold Mining Limited (GGM): In January 2007, Jackson Manyelo and other plaintiffs filed a suit against GGM in the Mwanza High Court alleging that they were affected by blasting activities in the Katoma area carried out by GGM and had suffered damages in the amount of TZS9.6 billion (approximately $6 million). In April 2015, the High Court issued a judgment in favour of GGM. In 2016, plaintiffs appealed to the Court of Appeal, where the matter is pending.
•Geita Gold Mining Limited (GGM) and Samax Resources Limited (Samax) v. Government of Tanzania: In July 2017, GGM and Samax filed a notice of arbitration against the government of Tanzania arising from the enactment by the government of certain legislation that purports to make a number of changes to the operating environment of Tanzania’s extractive industries, including mining. The notice of arbitration was submitted in accordance with Article 12 of the Agreement for the Development of a Gold Mine at Geita, Mwanza between the government of Tanzania and each of GGM and Samax (the MDA), and under the 1976 Arbitration Rules of the United Nations Commission on International Trade Law (UNCITRAL). The Arbitral Tribunal has been duly constituted. Since January 2019, at the request of the parties, the arbitral proceedings have been stayed several times in order to afford the parties the opportunity to achieve an amicable resolution of the dispute and as a result of the impact of the COVID-19 pandemic. In October 2022, the parties agreed to stay the arbitration proceedings for a further period of 12 months until 6 November 2023.
•Arbitration under the United Kingdom-Tanzania Bilateral Investment Treaty (UK-Tanzania BIT):Unrelated to the arbitration proceedings under the MDA described above, in September 2017, GGM and Samax, together with Cluff Oil Limited and Cluff Mineral Exploration Limited, notified the government of Tanzania in writing that the Tanzanian government’s conduct amounted to a breach of its commitments under the UK-Tanzania BIT. This notice triggered a ‘cooling-off’ period under the UK-Tanzania BIT, pursuant to which the parties had six months to achieve an amicable resolution to their dispute. Following the expiry of the ‘cooling off’ period in March 2018, GGM, Samax, Cluff Oil Limited and Cluff Mineral Exploration Limited are now entitled to submit their dispute with the government of Tanzania to ICSID arbitration in accordance with the terms of the UK-Tanzania BIT to the extent that they may deem this necessary.
BRAZIL
•Public Civil Action between Mineração Serra Grande S.A. (MSG) and the Goiás State Public Prosecutor's Office (Prosecutor): In August 2019, the Prosecutor filed a public civil action against MSG in the local court of Crixás (Court) arguing that the Serra Grande tailings dam should be deactivated and decommissioned due to its size and upstream construction method. The Prosecutor requested the Court to grant an injunction ordering MSG to, inter alia, completely deactivate the tailings dam by 15 September 2021 and decommission the tailings dam, including complete removal of tailings material, by 15 September 2022. Further, the Prosecutor requested that a daily penalty of approximately $245,000 be imposed for MSG’s failure to comply with such injunction. MSG submitted its defence in September 2019 and contends that it has not violated any Brazilian laws or regulations applicable to operations of the Serra Grande tailings dam. In February 2020, the Court granted an injunction in respect of a number of the requests made by the Prosecutor. In line with the legal requirements of ANM Resolution No. 13/19, the injunction ordered the deactivation of the Serra Grande tailings dam by 15 September 2021, but did not include requirements to decommission the tailings dam, or to conduct complete removal of tailings material, by 15 September 2022. MSG filed a motion for clarification in relation to certain items of the Court’s decision. In May 2020, the Court clarified that its injunction should be interpreted in line with the legal requirements of ANM Resolution No. 13/19. In June 2020, the Prosecutor presented further technical arguments in court, reiterating its request for an injunction ordering MSG to, inter alia, deactivate the tailings dam by September 2021 and to decommission the tailings dam, including complete removal of tailings material. Afterwards, MSG filed an interlocutory appeal against the preliminary injunction granted in February 2020 and a motion for further clarification. In August 2020, both MSG and the Prosecutor filed petitions informing the Court that the parties did not wish to produce oral evidence at a hearing. In May 2021, the Court upheld the preliminary injunction ordering the deactivation of the Serra Grande tailings dam by 15 September 2021 and its decommissioning by 15 September 2025, both of which are consistent with the deadlines established by existing legal and regulatory requirements. In June 2021, the Prosecutor appealed this decision. The Court of Appeals of Goiás tried the case on 4 August 2022 and has affirmed the first instance decision. On 3 November 2022, the Prosecutor appealed this decision to the Superior Court of Justice.
•Public Civil Action between AngloGold Ashanti Córrego do Sítio Mineração SA (AGA Mineração) and the Minas Gerais State Public Prosecutor's Office (Prosecutor): In March 2020, the Prosecutor filed a public civil action against AGA Mineração in the local court of Sabará (Court) alleging a violation of Minas Gerais Law No. 23.291/19, which was adopted in February 2019. Article 12 of this law prohibits the grant of an environmental license for construction, installation, expansion or raising of a tailings dam if the “dam break” studies identify communities that are located in the self-rescue zone. In February 2020, the state of Minas Gerais approved AGA Mineração’s permit to operate the Cuiabá tailings dam following the determination by the Minas Gerais’ Attorney’s Office that Law No. 23.291/19 does not apply to tailings dams already in operation. In its lawsuit, the Prosecutor requested the Court to grant an injunction ordering the suspension of AGA Mineração’s operational permit for the Cuiabá tailings dam on the grounds that it was issued in violation of this law. During the months of March through May 2020, all parties presented their arguments in court. In June 2020, the Court rejected the Prosecutor’s request to grant an injunction. In July 2020, the Court’s decision not to grant an injunction was upheld on appeal by the Court of Appeals of Minas Gerais. Subsequently, the Court issued an order proposing a conciliation hearing between the parties, to which none of the parties objected. On 28 January 2022, the parties filed a joint petition requesting the cancellation of the conciliation hearing and the suspension of the legal proceedings in view of negotiations between the parties to explore a possible settlement. On 2 June 2022, AGA Mineração and the Prosecutor entered into a settlement. Pursuant to the settlement, AGA Mineração will, among other measures, update the emergency action plan and decommission the Cuiabá tailings dam according to the schedule filed with the relevant mining and environmental agencies. AGA Mineração will also prepare a technical study to assess the potential evacuation of communities from the self-rescue zone during the decommission stages. The Court approved the settlement on 29 July 2022 and the public civil action was terminated.
DIVIDENDS
General
Dividends are proposed by and approved by the board of directors of AngloGold Ashanti (the “board”), based on the Company’s financial performance and compliance with applicable laws, including in respect of the solvency and liquidity test contemplated in the SA Companies Act. Dividends are recognised when declared by the Board. AngloGold Ashanti’s dividend policy allows the Board to declare a semi-annual dividend to be based on 20 percent of the free cash flow generated by the business for that financial year, before taking into account growth capital expenditure, subject to applicable laws required to be complied with before a dividend may be declared by the Board. The Board may exercise its discretion on an annual basis, taking into consideration the prevailing market conditions, balance sheet flexibility and future capital commitments of the Group.
As a company incorporated in accordance with and bound by the company laws of the Republic of South Africa with its primary listing on the Johannesburg Stock Exchange, AngloGold Ashanti is required to declare dividends in South African rands. Therefore, dividends are declared in South African rands and paid in Australian dollars, South African rands, British pounds and Ghanaian cedis. Dividends paid to registered holders of AngloGold Ashanti ADSs are paid in US dollars converted from South African rands by The Bank of New York Mellon, as Depositary, in accordance with the deposit agreement. Exchange rate fluctuations may therefore affect the value of the dividends received by registered shareholders and distributions paid by the relevant Depositary to investors holding AngloGold Ashanti securities. Moreover, fluctuations in the exchange rates of the US dollar may affect the US dollar price of the ADSs on the NYSE. For details on taxation and exchange controls applicable to holders of ordinary shares or ADSs, see “Item 10D: Exchange Controls”,“Item 10E: Taxation—South African Taxation—Taxation of dividends” and “Item 10E: Taxation—United States Taxation—Taxation of dividends”.
Dividends declared (in the ordinary course from trading and non-trading profits) to foreign shareholders are not subject to the approval by the South African Reserve Bank (SARB) in terms of South African foreign exchange control regulations. Dividends are freely transferable to foreign shareholders from both trading and non-trading profits earned in South Africa by publicly listed companies. Dividends in specie or special dividends may require SARB approval prior to declaration and payment to foreign shareholders.
Under South African law, the Company may declare and pay dividends from any reserves included in total shareholder’s equity (including share capital and share premium) calculated in accordance with International Financial Reporting Standards (IFRS), subject to the solvency and liquidity test.
Withholding tax
South Africa currently imposes a Dividend Withholding Tax on Companies (dividends tax) at a rate of 20 percent on the net amount of the dividend declared and paid by a resident company, other than a Headquarter Company.
The dividends tax is generally imposed on the beneficial owner of the dividends. The dividends paid to South African shareholders may be exempt from dividend withholding tax in terms of certain domestic exemptions, or may be reduced to a lower rate under an applicable double tax treaty, if the required declarations and undertakings are provided by the beneficial owner of the dividend. In the case of dividends paid to a US holder with respect to shares, the Convention Between the Government of the United States of America and the Republic of South Africa for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on Income and Capital Gains, signed 17 February 1997 (the “US/SA Double Taxation Treaty”) would generally limit the dividends tax rate to five percent of the gross amount of the dividends if a corporate US holder holds directly at least ten percent of the voting stock of AngloGold Ashanti. In all other cases, the maximum tax rate under the US/SA Double Taxation Treaty is 15 percent of the gross amount of the dividend. Different rules may apply if the beneficial owner of the dividends is a US resident who carries on business in South Africa through a permanent establishment situated in South Africa, or performs in South Africa independent personal services from a permanent establishment situated in South Africa, and the dividends are attributable to such permanent establishment.
8B. SIGNIFICANT CHANGES
Refer to “Item 18: Financial Statements—Note 35—Subsequent Events”.
ITEM 9: THE OFFER AND LISTING
9A. OFFER AND LISTING DETAILS
The principal trading markets for AngloGold Ashanti’s ordinary shares are the New York Stock Exchange (NYSE), in the form of ADSs, under the symbol “AU” and the JSE Limited, in the form of ordinary shares, under the symbol “ANG”. Each ADS represents one ordinary share.
9B. PLAN OF DISTRIBUTION
Not applicable.
9C. MARKETS
NATURE OF TRADING MARKET
The principal trading markets for AngloGold Ashanti’s ordinary shares are the NYSE, in the form of ADSs, under the symbol “AU” (each representing one ordinary share) and the JSE Limited, in the form of ordinary shares, under the symbol “ANG”.
AngloGold Ashanti’s ordinary shares are also listed on the Ghana Stock Exchange, as ordinary shares under the symbol “AGA” and in the form of Ghanaian Depositary Shares or GhDSs (each representing one one-hundredth of an ordinary share) under the symbol “AAD”, and the Australian Securities Exchange, in the form of CHESS Depositary Interests (each representing one-fifth of an ordinary share) under the symbol “AGG”. AngloGold Ashanti was approved for a secondary listing on A2X Markets (A2X) in South Africa and its shares were admitted to trading on A2X on 6 June 2022 under the symbol “ANG”.
9D. SELLING SHAREHOLDERS
Not applicable.
9E. DILUTION
Not applicable.
9F. EXPENSES OF THE ISSUE
Not applicable.
ITEM 10: ADDITIONAL INFORMATION
10A.SHARE CAPITAL
Not applicable.
10B.MEMORANDUM OF INCORPORATION
At the annual general meeting held on 16 May 2022, AngloGold Ashanti received approval from shareholders (by way of a special resolution) to amend the MoI as follows:
1.by the deletion of the phrase “Subject to 9.4.3, this” at the beginning of clause 1.3 and the replacement thereof with the word “This”;
2.by the deletion of clause 9 (Rights Attaching to Preference Shares) in its entirety; and
3.by the amendment of Schedule 1 (Authorised Shares) as follows:
3.1 by the deletion of paragraphs 2, 3 and 4 of Schedule 1 in their entirety; and
3.2 by the deletion of the table at the end of Schedule 1 in its entirety and the replacement thereof with the following new table:
| | | | | |
Share capital | South African Rands |
600,000,000 ordinary shares of R0.25 each | 150,000,000 |
The reason for these amendments is to comply with the provisions of the SA Companies Act and the JSE Listings Requirements and, following the recent redemption of all of the A redeemable preference shares and B redeemable preference shares of the Company, to remove all references in the MoI to the A redeemable preference shares, the B redeemable preference shares and the C redeemable preference shares, as well as all of the provisions relating to all such redeemable preference shares, and thereby to remove all such redeemable preference shares from the authorised share capital of the Company.
Registration
AngloGold Ashanti is incorporated under the company laws of the Republic of South Africa and is registered with the Companies and Intellectual Property Commission under registration number 1944/017354/06. The SA Companies Act has abolished the requirement for specific “object and purpose” provisions to be included in a memorandum of incorporation and although the MoI is silent on the matter, the company continues to carry on as its main business, gold exploration, the mining and production of gold, the manufacturing, marketing and selling of gold products and the development of markets for gold.
AngloGold Ashanti’s MoI is available for inspection as set out in “Item 10H: Documents on Display” and a summary of the pertinent provisions, including the rights of the holders of shares in AngloGold Ashanti, are set out below.
This summary does not contain all the information pertaining to the rights of holders of AngloGold Ashanti’s ordinary shares and is qualified in its entirety by reference to the laws of South Africa and AngloGold Ashanti’s governing corporate documents. As well as being governed by the provisions of the MoI, the rights of holders of AngloGold Ashanti’s ordinary shares are governed by the JSE Listings Requirements, the SA Companies Act and the Companies Regulations, 2011, promulgated under the SA Companies Act (the “Regulations”), which include the Takeover Regulations. Further, the rights of holders of AngloGold Ashanti ADSs are governed by the Deposit Agreement between AngloGold Ashanti and The Bank of New York Mellon. See “Item 10C: Material Contracts—The Deposit Agreement”.
The SA Companies Act provides that shares will no longer have a par or nominal value and hence no new shares having a nominal or par value may be authorised. However, any shares which have a nominal or par value authorised prior to 1 May 2011 (the effective date of the SA Companies Act) continue to have that nominal or par value and can be issued as such for so long as there are par value shares in the company’s authorised share capital. Should the company wish, it may also elect to convert its authorised par value shares to shares of no par value, subject to the relevant process and approvals contemplated in the SA Companies Act.
Directors
The management and control of any business of AngloGold Ashanti is vested in its board of directors (board). The authority of the board to manage and direct the business and affairs of the company is not limited, restricted or qualified by the MoI.
Appointment and Retirement of Directors
The shareholders of the Company have the power to elect the directors, and shareholders are also entitled to elect one or more alternate directors, in accordance with the provisions of the MoI and the SA Companies Act.
The board may appoint any person who satisfies the requirements for election as a director to fill any vacancy and serve as a director on a temporary basis until the vacancy is filled by election by shareholders entitled to exercise voting rights in such an election.
The MoI authorises the chairperson of the board, subject to the written approval of the majority of the directors, to appoint any person as a director provided that such appointment is approved by shareholders at the next shareholders’ meeting or annual general meeting.
At every annual general meeting one-third of the directors will retire by rotation, or if their number is not a multiple of three, then the number nearest to but not less than one third. The directors to retire at every annual general meeting will be those who have been the longest in office since their last election. Directors retiring by rotation are eligible for re-election. Directors who voluntarily decide not to make themselves available for re-election may be counted towards the one-third of directors required to retire at the relevant annual general meeting.
The MoI contains no provision for directors to hold qualification shares. The MoI does not impose an age limit for the retirement of directors.
Remuneration
In accordance with the SA Companies Act, the MoI provides that the directors are entitled to such remuneration for their services as directors as AngloGold Ashanti’s shareholders may approve by special resolution in a general meeting or annual general meeting within the previous two years of the date of payment of such remuneration. If a director is employed in any other capacity, or holds an executive office or performs services that, in the opinion of the board, are outside the scope of the ordinary duties of a director, he or she may be paid such additional remuneration as a disinterested quorum of directors may reasonably determine.
Interests of Directors and Restriction on Voting
Although the interests of directors are not dealt with in the MoI, the provisions of the SA Companies Act in this regard are unalterable and will automatically apply, together with the applicable common law rules. Under the SA Companies Act, the procedures to deal with the personal financial interests of directors also apply to prescribed officers (i.e., persons who exercise general executive control over and management of the whole, or a significant portion, of the business and activities of the company or regularly participate to a material degree in the exercise of general executive control over and management of the whole, or a significant portion, of the business and activities of the company, irrespective of the office held or function performed by such persons) and any person who is a member of a committee of the board of the company, whether or not that person is also a member of the company’s board. The SA Companies Act provides that a director or such other person with a personal financial interest must disclose this to the board and cannot vote on or, after having made the disclosures to the meeting as prescribed by the SA Companies Act, remain present during the meeting when the matter in which he/she has interest is being discussed but will be counted as present for the purposes of a quorum (but is not to be regarded as being present at the meeting for the purposes of determining whether a resolution has sufficient support to be adopted).
Share Rights, Preferences and Restrictions
Allotment and Issue of Ordinary Shares
Subject to the JSE Listings Requirements, the SA Companies Act and/or with approval of shareholders in a general meeting, unissued ordinary shares must be offered to existing ordinary shareholders, pro rata to their ordinary shareholdings, unless they are issued for the acquisition of assets. The shareholders in a general meeting may authorise the board to issue any unissued ordinary shares.
Dividends, Rights and Distributions
The ordinary shares participate fully in all dividends, other distributions and entitlements as and when declared by AngloGold Ashanti in respect of fully paid ordinary shares. Under South African law, AngloGold Ashanti may declare and pay distributions (as defined in the SA Companies Act, which includes dividends), subject to the Company satisfying the solvency and liquidity test as set out in section 4 of the SA Companies Act and the board passing a resolution acknowledging that such test has been applied and has reasonably concluded that the Company would satisfy such test immediately after completing the distribution. Dividends are payable to shareholders registered at a record date after the date of declaration of the dividend.
As a Company incorporated and registered in the Republic of South Africa with its primary listing on the Johannesburg Stock Exchange, AngloGold Ashanti is required to declare dividends in South African rands. Dividends are paid in South African rands, Australian dollars, Ghanaian cedis and British pounds. Registered holders of AngloGold Ashanti ADSs are paid dividends in US dollars by The Bank of New York Mellon as Depositary, in accordance with the Deposit Agreement. See “Item 10C: Material Contracts—The Deposit Agreement”.
Although not stated in the MoI, but subject to the JSE Listings Requirements and the SA Companies Act, any dividend may be paid and satisfied, either wholly or in part, by the distribution of specific assets, or in paid-up securities of AngloGold Ashanti or of any other Company, or in cash, or in any one or more of such ways as the directors may at the time of declaring the dividend determine and direct.
All dividends remaining unclaimed for a period of not less than three years from the date on which they became payable, may, by a resolution of the directors, become forfeited for the benefit of the Company.
Voting Rights
Each ordinary share confers the right to vote at all general meetings. Each holder present in person or by proxy or, in the case of a corporate entity, represented, has one vote on a show of hands. If a poll is held, holders present or any duly appointed proxy will have one vote for each ordinary share held. A holder of ordinary shares is entitled to appoint a proxy to attend, speak and vote at any meeting on his or her behalf and the proxy need not be a shareholder. Holders of ADSs are not entitled to vote in person at meetings, but may vote by way of proxy through The Bank of New York Mellon as the ADS issuer. Holders of Australian Chess Depositary Interests (CDIs) and Ghanaian Depositary Shares (GhDSs) are not entitled to vote in person or by proxy at meetings, but may vote by instructing Chess Depository Nominees and NTHC Limited as Depositary, respectively, how to vote their shares.
There are no limitations on the right of non-South African registered shareholders to hold or exercise voting rights attaching to any of the ordinary shares.
The MoI specifies that the rights relating to any class of shares may be modified or abrogated with the sanction of a resolution passed as if it were a special resolution of the holders of shares in that class at a separate general meeting.
Increase and Reduction of Capital
The Company is authorised to issue the shares specified in the MoI and all such shares are required to be issued as fully paid up in accordance with the applicable approval and/or other requirements of the SA Companies Act and the JSE Listings Requirements.
The directors are authorised, subject to any requirements of the JSE Listings Requirements, the SA Companies Act, the Regulations and the MoI, to increase or decrease the number of authorised shares of any class of shares, reclassify any shares that have been authorised but not issued, classify any unclassified shares that have been authorised but not issued, and determine the preferences, rights, limitations or other terms of any class of authorised shares or amend any preferences, rights, limitations or other terms as determined. However, such capital amendments require an amendment to be made to the MoI. The SA Companies Act and the JSE Listings Requirements currently do not allow the MoI to be amended to give effect to such capital amendments without the approval of ordinary shareholders by special resolution.
Rights Upon Liquidation
In the event of the winding up of AngloGold Ashanti the ordinary shares confer the right to participate equally in any surplus arising from the liquidation of all assets of AngloGold Ashanti.
Shareholders’ Meetings
The directors may convene meetings of AngloGold Ashanti shareholders. Subject to the provisions of the SA Companies Act, the shareholders may requisition for the convening of a meeting.
Notice of each AngloGold Ashanti annual general meeting and general meeting of AngloGold Ashanti shareholders must be delivered at least 15 business days before that shareholders’ meeting is to begin. In accordance with the SA Companies Act, business days are calculated by excluding the first day, including the last day and excluding Saturdays, Sundays and any public holiday in the Republic of South Africa. In terms of the MoI, all shareholders are entitled to attend shareholders’ meetings at which they are entitled to vote.
The quorum of a shareholders’ meeting is sufficient persons present, in person or by proxy, at the meeting to exercise, in aggregate, at least 25 percent of all of the voting rights that are entitled to be exercised in respect of at least one matter to be decided at the meeting and a quorum must remain present for the continuation of that shareholders meeting, provided that at least three shareholders must be present and remain at the meeting. Such quorum requirement also applies for the consideration of any matter to be decided at the meeting. If the meeting is not quorate within 30 minutes after the appointed time for the meeting to begin (or such longer or shorter period as the chairperson may determine), it will be postponed, without motion, vote or further notice, for 1 week and the shareholders present, in person or by proxy, at the postponed meeting will constitute a quorum.
For an ordinary resolution to be approved by shareholders, it must be supported by more than 50 percent of the voting rights exercised on the resolution. For a special resolution to be approved by shareholders, it must be supported by at least 75 percent of the voting rights exercised on the resolution.
Disclosure of Interest in Shares
Under South African law, a person must notify AngloGold Ashanti within three business days after that person (i) acquires a beneficial interest in sufficient securities of a class of securities issued by AngloGold Ashanti such that, as a result of the acquisition, the person holds a beneficial interest in securities amounting to five percent, ten percent, fifteen percent or any further whole multiple of five percent of the issued securities of that class or (ii) disposes of any beneficial interest in sufficient securities of a class of securities issued by AngloGold Ashanti such that, as a result of the disposition, the person no longer holds a beneficial interest in securities amounting to a particular multiple of five percent of issued securities of that class. When AngloGold Ashanti has received the notice referred to above it must file a copy with the Takeover Regulation Panel and report the information to holders of the relevant class of securities unless the notice concerned is a disposition of less than one percent of the class of securities.
If the securities of AngloGold Ashanti are registered in the name of a person who is not the holder of the beneficial interest in all of the securities in AngloGold Ashanti held by that person, that registered holder of the securities must disclose the identity of the person on whose behalf that security is held and the identity of each person with a beneficial interest in securities so held, the number and the class of securities held for each such person with a beneficial interest and the extent of each such beneficial interest. This information must be disclosed in writing to the Company within five business days after the end of every month during which a change has occurred in the information or more promptly or frequently to the extent so provided by the requirements of a Central Securities Depository. A Company that knows or has reasonable cause to believe that any of its securities are held by one person for the beneficial interest of another may by notice in writing require either of those persons to confirm or deny that fact, provide particulars of the extent of the beneficial interest held during the three years preceding the date of the notice and disclose the identity of each person with a beneficial interest in the securities held by that person, which information must be provided within ten business days of the receipt of the notice.
AngloGold Ashanti is obligated to establish and maintain a register of the disclosures described above and to publish in its annual financial statements a list of the persons who hold beneficial interests equal to or in excess of five percent of the total number of ordinary shares issued by AngloGold Ashanti together with the extent of those beneficial interests.
Rights of Minority Shareholders
Majority shareholders of South African companies have no fiduciary obligations under South African common law to minority shareholders. However, under the SA Companies Act, a shareholder or director may, under certain circumstances, seek relief from a court if he has been unfairly prejudiced by any act or omission of the Company or a related person, by the conduct of the business of the Company or a related person in a particular manner, or the exercise of the powers of the directors of the Company or a related person in a particular manner. There may also be personal and derivative actions available to a shareholder of a Company.
Pursuant to the SA Companies Act, a shareholder may petition a South African court for relief from the actions or omissions or business conduct of the Company or the actions of the Company’s directors or officers that is oppressive or unfairly prejudicial to, or unfairly disregards the interest of the shareholder. In addition, a shareholder who voted against a resolution to amend the Company’s MoI, or to approve a fundamental transaction (and complied with other requirements set out in the SA Companies
Act) may exercise its appraisal right to demand that the Company pay to it the fair value for all the shares of the Company held by that shareholder.
Description of ADSs
The Bank of New York Mellon registers and delivers AngloGold Ashanti’s American Depositary Shares, or ADSs. Please see “Item 10C: Material Contracts—Description of AngloGold Ashanti ADSs”.
10C.MATERIAL CONTRACTS
Multi-currency Revolving Credit Facility
General
On 23 October 2018, AngloGold Ashanti Holdings plc (“AGAH”) and AngloGold Ashanti Australia Limited, as borrowers, entered into a five-year unsecured multi-currency syndicated revolving credit facility of $1.4 billion (the “2018 multi-currency RCF”) with the Bank of Nova Scotia, as facility agent, and certain financial institutions party thereto, as lenders. The loan consisted of (i) a US dollar based facility with interest charged at a margin of 1.45% above LIBOR and (ii) an Australian dollar based facility capped at A$500 million with interest charged at a margin of 1.45% above BBSY. The A$500 million portion of the 2018 multi-currency RCF was used to fund the working capital and development costs associated with the Group’s mining operations within Australia without eroding the group’s headroom under its other facilities and exposing the Group to foreign exchange gains/losses each quarter. On 9 June 2022, the 2018 multi-currency RCF was repaid and cancelled, and replaced with the 2022 multi-currency RCF (as defined below).
On 9 June 2022, AGAH and AngloGold Ashanti Australia Limited, as borrowers, entered into a new five-year unsecured multi-currency syndicated revolving credit facility of $1.4 billion (the “2022 multi-currency RCF”) maturing in June 2027, with the option of two one-year extensions on application. The 2022 multi-currency RCF was entered into with The Bank of Nova Scotia, as facility agent, and certain financial institutions party thereto, as lenders. The 2022 multi-currency RCF consists of (i) a US dollar based facility (base currency) and (ii) an Australian dollar based facility capped at A$500 million which will be used to fund the working capital and development costs associated with the group's mining operations within Australia (without eroding the group's headroom under its other facilities and exposing the group to foreign exchange gains/losses each quarter). The 2022 multi-currency RCF was entered into on substantially similar terms to the 2018 multi-currency RCF, save in respect of the basis for the US dollar interest rate which transitioned from LIBOR to Compounded SOFR. As of 10 March 2023, the equivalent of $37 million was drawn under the AUD portion of the 2022 multi-currency RCF.
Guarantees
The 2022 multi-currency RCF is guaranteed by AGAH and AngloGold Ashanti Australia Limited. The guarantees constitute unconditional obligations of the guarantors and rank at least pari passu with all other future unsecured obligations of the guarantors, except for obligations mandatorily preferred by law.
Security
Save as set out under the heading “—Guarantees” above, the obligations under the 2022 multi-currency RCF are unsecured.
Amount and repayment of borrowings
Loans under the 2022 multi-currency RCF must be for a minimum of $10 million, if the currency selected is the base currency (US dollar), or a minimum of A$10 million (or for the balance of the undrawn total commitments at the time of the drawing), if the currency selected is Australian dollars. No more than 14 loans may be outstanding at any time. Each loan must be repaid on the maturity date in the same currency as the maturing loan. All loans must be repaid in full on the final maturity date. The 2022 multi-currency RCF matures in June 2027, with the option of two one-year extensions on application.
Interest rates and fees
The interest rate under the 2022 multi-currency RCF is calculated based on Compounded SOFR in the case of loans drawn in US dollars and BBSY in the case of loans drawn in Australian dollars, in each case plus a margin. The initial margin is 1.45 percent per annum, but may vary between 0.90 percent and 2.15 percent per annum depending on the long-term debt rating of AGAH. The applicable margin is subject to a ratings grid. In this regard, the interest margin will reduce if the group's credit rating improves from its current BB+/Baa3 status and will increase if its credit rating worsens. Interest on each loan is payable on the last day of the relevant loan’s interest period and, if the interest period exceeds six months, on the dates falling at six-monthly intervals after the first day of the interest period.
The borrowers under the 2022 multi-currency RCF are required to pay a commitment fee in the base currency equal to 35 percent of the then applicable margin per annum on the undrawn and uncancelled amount of each lender’s commitment during the commitment period. The borrowers are also required to pay a utilisation fee of 0.10 percent per annum (if the aggregate outstanding loans are less than one third of the total commitments then in effect), 0.20 percent per annum (if the aggregate outstanding loans are equal to or greater than one third but less than two-thirds of the total commitments then in effect) or 0.40 percent per annum (if the aggregate outstanding loans are equal to or greater than two-thirds of the total commitments then in effect).
Financial covenant
The 2022 multi-currency RCF includes a financial maintenance covenant which requires that the ratio of Total Net Financial Indebtedness to EBITDA (as such terms are defined in the revolving credit agreement) does not at any time exceed 3.50 to 1.00, with the proviso that this ratio may exceed 3.50 to 1.00 once during the life of the revolving credit agreement, for one six-month period subject to certain criteria. Refer to “Item 18: Financial Statements—Note 34—Capital Management” for the formulae used in the revolving credit agreement to test compliance with the covenants.
Change of control
If a lender so requires, the commitment of such lender under the 2022 multi-currency RCF will be cancelled and the participation of such lender in all outstanding loans, together with accrued interest and all other amounts accrued, will become immediately due and payable in case any person or group of persons acting in concert becomes (directly or indirectly) the beneficial owner of more than 50 percent of the issued share capital of AngloGold Ashanti Limited or (as applicable) an eligible successor holding company of AGAH.
Undertakings
The 2022 multi-currency RCF contains a negative pledge covenant, including restrictions on the granting of security, a change of business of AngloGold Ashanti Limited and its subsidiaries, acquisitions or participations in joint ventures and mergers and disposals.
The 2022 multi-currency RCF also contains, among other things, the following affirmative covenants: mandatory periodic reporting of financial and other information, notice upon the occurrence of events of default and certain other events, compliance with environmental laws and other obligations requiring each of AGAH and its subsidiaries to maintain its corporate existence and qualifications to conduct its business as currently conducted in all applicable jurisdictions and to maintain insurance coverage. The covenants are subject to exceptions and materiality thresholds.
Events of default
The 2022 multi-currency RCF contains events of default including failure to make payment of amounts due, breach of obligations under the loan documents, defaults under other agreements evidencing indebtedness, certain bankruptcy events and a cessation of business and the occurrence of a material adverse change in the business and financial condition of the borrowers and guarantors under the revolving credit agreement, or AngloGold Ashanti and its subsidiaries as a whole, or in the ability of the borrowers and guarantors to perform their payment obligations under the loan documents. The occurrence of an event of default could result in the immediate and automatic cancellation of all commitments and the acceleration of all payment obligations under the 2022 multi-currency RCF and the other loan documents.
The above description is only a summary of certain provisions of the 2022 multi-currency RCF and is qualified in its entirety by reference to the provisions of the 2022 multi-currency RCF, a copy of which is attached hereto as Exhibit 19.4.4.1 and is incorporated herein by reference.
Notes
Each of the series of notes described below were issued under the indenture, dated as of 28 April 2010, among AngloGold Ashanti Holdings plc (“AGAH”), as issuer, AngloGold Ashanti Limited, as guarantor, and The Bank of New York Mellon, as trustee (the “Indenture”). The below descriptions are only a summary of certain provisions of those series of notes and are qualified in their entirety by reference to the provisions of the Indenture and such relevant series of notes, a copy of each – in respect of the outstanding series of notes – is attached hereto as Exhibits 19.2.1, 19.2.2, 19.2.3, 19.2.4 and 19.2.5 and is incorporated herein by reference.
2028 Notes
On 22 October 2021, AGAH issued $750 million 3.375 percent Notes due 2028 (the “2028 notes”). The interest on the 2028 notes is payable semi-annually on 1 May and 1 November of each year, commencing on 1 May 2022. AGAH may on any one or more occasions redeem all or part of the 2028 notes, at a redemption price equal to the greater of (1) 100 percent of the principal amount of the 2028 notes to be redeemed and (2) the sum of the present values of the remaining scheduled payments of principal and interest on the 2028 notes (excluding any portion of such payments of interest accrued or unpaid as of the date of redemption) discounted to the redemption date on a semiannual basis (assuming a 360-day year consisting of twelve 30-day months) at the treasury rate, plus 30 basis points, plus accrued and unpaid interest, if any, to the date of redemption. AGAH has agreed to pay certain additional amounts in respect of any withholdings or deductions for certain types of taxes in certain jurisdictions on payments to holders of the 2028 notes. The 2028 notes are unsecured and unsubordinated and are fully and unconditionally guaranteed by AngloGold Ashanti Limited.
AGAH has agreed to observe certain covenants with respect to the 2028 notes restricting, subject to certain limitations, the ability of AngloGold Ashanti Limited and AGAH to amalgamate, reconstruct, consolidate or merge with another company or other legal entity, and the ability of AngloGold Ashanti Limited and its restricted subsidiaries to pledge their assets to secure certain borrowings, create or incur liens on certain of their property or to engage in sale and leaseback transactions. In case of a change
of control of the guarantor and a downgrade, within a specified period, of the 2028 notes by three rating agencies, holders of the 2028 notes have the right to require the issuer to repurchase all or any part of their 2028 notes in cash for a value equal to 101 percent of the aggregate principal amount of 2028 notes repurchased, plus accrued and unpaid interest, if any, on the 2028 notes repurchased to the date of repurchase.
The offering of the 2028 notes was registered under the Securities Act. The 2028 notes were listed on the New York Stock Exchange.
2030 Notes
On 1 October 2020, AGAH issued $700 million 3.750 percent Notes due 2030 (the “2030 notes”). The interest on the 2030 notes is payable semi-annually on 1 April and 1 October of each year, commencing on 1 April 2021. AGAH may on any one or more occasions redeem all or part of the 2030 notes, at a redemption price equal to the greater of (1) 100 percent of the principal amount of the 2030 notes to be redeemed and (2) the sum of the present values of the remaining scheduled payments of principal and interest on the 2030 notes (excluding any portion of such payments of interest accrued or unpaid as of the date of redemption) discounted to the redemption date on a semiannual basis (assuming a 360-day year consisting of twelve 30-day months) at the treasury rate, plus 50 basis points, plus accrued and unpaid interest, if any, to the date of redemption. AGAH has agreed to pay certain additional amounts in respect of any withholdings or deductions for certain types of taxes in certain jurisdictions on payments to holders of the 2030 notes. The 2030 notes are unsecured and unsubordinated and are fully and unconditionally guaranteed by AngloGold Ashanti Limited.
AGAH has agreed to observe certain covenants with respect to the 2030 notes restricting, subject to certain limitations, the ability of AngloGold Ashanti Limited and AGAH to amalgamate, reconstruct, consolidate or merge with another company or other legal entity, and the ability of AngloGold Ashanti Limited and its restricted subsidiaries to pledge their assets to secure certain borrowings, create or incur liens on certain of their property or to engage in sale and leaseback transactions. In case of a change of control of the guarantor and a downgrade, within a specified period, of the 2030 notes by three rating agencies, holders of the 2030 notes have the right to require the issuer to repurchase all or any part of their 2030 notes in cash for a value equal to 101 percent of the aggregate principal amount of 2030 notes repurchased, plus accrued and unpaid interest, if any, on the 2030 notes repurchased to the date of repurchase.
The offering of the 2030 notes was registered under the Securities Act. The 2030 notes were listed on the New York Stock Exchange.
2022 Notes
On 30 July 2012, AGAH issued $750 million 5.125 percent Notes due 2022 (the “2022 notes”). The interest on the 2022 notes was payable semi-annually on 1 February and 1 August of each year, commencing on 1 February, 2013. AGAH was permitted on any one or more occasions to redeem all or part of the 2022 notes, at a redemption price equal to the greater of (1) 100 percent of the principal amount of the 2022 notes to be redeemed and (2) the sum of the present values of the remaining scheduled payments of principal and interest on the 2022 notes (excluding any portion of such payments of interest accrued or unpaid as of the date of redemption) discounted to the redemption date on a semiannual basis (assuming a 360-day year consisting of twelve 30-day months) at the treasury rate, plus 50 basis points, plus accrued and unpaid interest, if any, to the date of redemption. AGAH had agreed to pay certain additional amounts in respect of any withholdings or deductions for certain types of taxes in certain jurisdictions on payments to holders of the 2022 notes. The 2022 notes were unsecured and unsubordinated and were fully and unconditionally guaranteed by AngloGold Ashanti Limited.
AGAH had agreed to observe certain covenants with respect to the 2022 notes restricting, subject to certain limitations, the ability of AngloGold Ashanti Limited and AGAH to amalgamate, reconstruct, consolidate or merge with another company or other legal entity, and the ability of AngloGold Ashanti Limited and its restricted subsidiaries to pledge their assets to secure certain borrowings, create or incur liens on certain of their property or to engage in sale and leaseback transactions. In case of a change of control of the guarantor and a downgrade, within a specified period, of the 2022 notes below an investment grade rating by two rating agencies, holders of the 2022 notes had the right to require the issuer to repurchase all or any part of their 2022 notes in cash for a value equal to 101 percent of the aggregate principal amount of 2022 notes repurchased, plus accrued and unpaid interest, if any, on the 2022 notes repurchased to the date of purchase.
The offering of the 2022 notes was registered under the Securities Act. The 2022 notes were listed on the New York Stock Exchange.
The 2022 notes were redeemed in October and November 2021 and are no longer outstanding.
2020 Notes and 2040 Notes
On 28 April 2010, AGAH issued $700 million 5.375 percent Notes due 2020 (the “2020 notes”) and $300 million 6.500 percent Notes due 2040 (the “2040 notes” and together with the 2020 notes, the “2010 notes”). The interest on the 2010 notes is payable
semi-annually on 15 April and 15 October of each year, commencing on 15 October 2010. AGAH may on any one or more occasions redeem all or part of the 2010 notes, at a redemption price equal to the greater of (1) 100 percent of the principal amount of the 2010 notes to be redeemed and (2) the sum of the present values of the remaining scheduled payments of principal and interest on the 2010 notes (excluding any portion of such payments of interest accrued or unpaid as of the date of redemption) discounted to the redemption date on a semiannual basis (assuming a 360-day year consisting of twelve 30-day months) at the treasury rate, plus 25 basis points with respect to the 2020 notes and 30 basis points with respect to the 2040 notes, plus accrued and unpaid interest, if any, to the date of redemption. AGAH has agreed to pay certain additional amounts in respect of any withholdings or deductions for certain types of taxes in certain jurisdictions on payments to holders of the 2010 notes. The 2010 notes are unsecured and unsubordinated and are fully and unconditionally guaranteed by AngloGold Ashanti Limited.
AGAH has agreed to observe certain covenants with respect to the 2010 notes restricting, subject to certain limitations, the ability of AngloGold Ashanti Limited and AGAH to amalgamate, reconstruct, consolidate or merge with another company or other legal entity, and the ability of AngloGold Ashanti Limited and its restricted subsidiaries to pledge their assets to secure certain borrowings, create or incur liens on certain of their property or to engage in sale and leaseback transactions. In case of a change of control of the guarantor and a downgrade, within a specified period, of a series of 2010 notes below an investment grade rating by two rating agencies, holders of the 2010 notes have the right to require the issuer to repurchase all or any part of their 2010 notes in cash for a value equal to 101 percent of the aggregate principal amount of 2010 notes repurchased, plus accrued and unpaid interest, if any, on the 2010 notes repurchased to the date of purchase.
The offering of the 2010 notes was registered under the Securities Act. The 2010 notes were listed on the New York Stock Exchange. The 2020 notes were repaid at maturity on 15 April 2020 and are no longer outstanding.
For further information, see “Item 18: Financial Statements—Note 24—Borrowings”,“Item 5B: Liquidity and Capital Resources” and “Item 19: Exhibits to Form 20-F”.
Description of AngloGold Ashanti ADSs
The Bank of New York Mellon registers and delivers AngloGold Ashanti’s American Depositary Shares, or ADSs. Each ADS represents the ownership interest of one ordinary share of AngloGold Ashanti.
The Deposit Agreement
This section provides a summary description of AngloGold Ashanti’s ADSs.
AngloGold Ashanti has entered into an Amended and Restated Deposit Agreement dated 3 June 2008 with The Bank of New York Mellon as Depositary and the owners and beneficial owners of American Depositary Receipts (the “Deposit Agreement”).
The following is a summary of the material provisions of the Deposit Agreement. For more complete information, read the entire Deposit Agreement and the Form of American Depositary Receipt, which AngloGold Ashanti has filed with the SEC as an exhibit to AngloGold Ashanti’s registration statements on Form F-6 (Registration Nos. 333-133049 and 333-159248) on 27 May 2008 and 14 May 2009, respectively. A copy thereof is also attached hereto as Exhibit 19.2.6 and is incorporated herein by reference. See “Item 10H: Documents on Display”. Copies of the Deposit Agreement are also available for inspection at the Corporate Trust Office of The Bank of New York Mellon currently located at 240 Greenwich Street, New York, New York 10286.
Description of the ADSs
The Bank of New York Mellon, as Depositary, registers and delivers ADSs. Each ADS represents one ordinary share (or a right to receive one share) deposited with Standard Bank of South Africa Limited or HSBC Bank Australia Limited, each as a custodian for The Bank of New York Mellon, and both of which are referred to collectively as the “Custodian”. Each ADS also represents any other securities, cash or other property which may be held by The Bank of New York Mellon. The Bank of New York Mellon’s Corporate Trust Office at which the ADSs are administered is located at 240 Greenwich Street, New York, New York 10286. The Bank of New York Mellon’s principal executive office is also located at 240 Greenwich Street, New York, New York 10286.
ADSs may be held either (A) directly (i) by having an American Depositary Receipt, also referred to as an ADR, which is a certificate evidencing a specific number of ADSs, registered in the holder’s name, or (ii) by having ADSs registered in a holder’s name in the Direct Registration System, or (B) indirectly by holding a security entitlement in ADSs through a broker or other financial institution. If ADSs are held directly, such holders are ADS holders. This description applies to AngloGold Ashanti’s ADS holders. If ADSs are held indirectly, such holders must rely on the procedures of their broker or other financial institution to assert the rights of ADS registered holders described in this section. Such holders should consult with their broker or financial institution to find out what those procedures are.
The Direct Registration System, or DRS, is a system administered by DTC pursuant to which the Depositary may register the ownership of uncertificated ADSs, which ownership will be evidenced by periodic statements sent by the Depositary to the registered holders of uncertificated ADSs.
AngloGold Ashanti does not treat ADS holders as its shareholders and ADS holders do not have shareholder rights. South African law governs shareholder rights. The Bank of New York Mellon is the holder of the shares underlying the ADSs. Registered holders of ADSs have ADS holder rights. The Deposit Agreement sets out ADS holder rights as well as the rights and obligations of The Bank of New York Mellon. New York law governs the Deposit Agreement and the ADSs.
Dividends and Other Distributions
The Bank of New York Mellon has agreed to pay to holders of ADSs the cash dividends or other distributions it or a Custodian receives on AngloGold Ashanti ordinary shares or other deposited securities after deducting any fees and expenses and any applicable withholding taxes. Holders of ADSs will receive these distributions in proportion to the number of AngloGold Ashanti’s ordinary shares that their ADSs represent.
Cash
The Bank of New York Mellon will convert any cash dividend or other cash distribution (in South African rands) that AngloGold Ashanti pays on ordinary shares into US dollars (unless AngloGold Ashanti pays such dividend or cash distribution in US dollars) and distribute to registered holders of ADSs. If that is no longer possible or if any approval from any government is needed and cannot be obtained, The Bank of New York Mellon may distribute non-US currency only to those ADS holders to whom it is possible to make this type of distribution.
The Bank of New York Mellon may hold the non-US currency it cannot convert for the account of holders of ADSs who for one reason or the other have not been paid. It will not invest the non-US currency, and it will not be liable for interest on such amounts. Before making a distribution, any withholding taxes that must be paid will be deducted. See “—Payment of Taxes” below. The Bank of New York Mellon will distribute only whole US dollars and cents and will round fractional cents to the nearest whole cent. If the exchange rates fluctuate during a time when The Bank of New York Mellon cannot convert the non-US currency, holders of ADSs may lose some or all of the value of the distribution.
Ordinary Shares
The Bank of New York Mellon may distribute to holders of ADSs additional ADSs representing ordinary shares that AngloGold Ashanti distributes as a dividend or free distribution, if AngloGold Ashanti provides it promptly with satisfactory evidence that it is legal to do so. If The Bank of New York Mellon does not distribute additional ADSs, the outstanding ADSs will also represent the newly distributed AngloGold Ashanti ordinary shares. The Bank of New York Mellon will only distribute whole ADSs. It will sell AngloGold Ashanti ordinary shares that would require it to deliver a fraction of an ADS and distribute the net proceeds in the same way as it distributes cash. The Bank of New York Mellon may sell a portion of the distributed shares sufficient to pay its fees and expenses in connection with that distribution.
Rights to Subscribe for Additional Ordinary Shares
If AngloGold Ashanti offers holders of its ordinary shares any rights to subscribe for additional AngloGold Ashanti ordinary shares or any other rights, The Bank of New York Mellon, after consultation with AngloGold Ashanti, may make these rights available to holders of ADSs or sell the rights and distribute the proceeds in the same way as it distributes cash. If The Bank of New York Mellon cannot do either of these things for any reason, it may allow these rights to lapse. In that case, holders of ADSs will receive no value for them.
If The Bank of New York Mellon makes these types of subscription rights available to holders of ADS, upon instruction from holders of ADSs, it will exercise the rights and purchase AngloGold Ashanti’s ordinary shares on their behalf. The Bank of New York Mellon will then deposit the AngloGold Ashanti ordinary shares and deliver ADSs to the holders of ADSs. It will only exercise these rights if holders of ADSs pay it the exercise price and any other charges the rights require them to pay.
US securities laws may restrict the sale, deposit, cancellation and transfer of the ADSs issued after exercise of rights. For example, holders of ADSs may not be able to trade the ADSs freely in the United States. In this case, The Bank of New York Mellon may deliver ADSs which are “restricted securities” within the meaning of Rule 144 which will have the same provisions as the ADSs described here, except for the changes needed to put the restrictions in place.
Other Distributions
The Bank of New York Mellon will send to holders of ADSs any other distributions that AngloGold Ashanti makes on deposited securities by any means it thinks is legal, fair and practical. If it cannot make the distribution in that way, The Bank of New York Mellon may decide to sell what AngloGold Ashanti distributes, and then distribute the net proceeds in the same way as it distributes cash, or it may decide to hold what AngloGold Ashanti distributes, in which case the outstanding ADSs will also represent the newly distributed property. However, The Bank of New York Mellon is not required to distribute any securities (other than ADSs) to ADS holders unless it receives satisfactory evidence from AngloGold Ashanti that it is legal to make that distribution. The Bank of New York Mellon may sell a portion of the distributed securities or property sufficient to pay its fees and expenses in connection with that distribution.
The Bank of New York Mellon is not responsible if, based on available information, it decides that it is unlawful or impractical to make a distribution available to any ADS holders. AngloGold Ashanti has no obligation to register ADSs, AngloGold Ashanti ordinary shares, rights or other securities under the Securities Act. AngloGold Ashanti also has no obligation to take any other action to permit the distribution of ADSs, AngloGold Ashanti ordinary shares, or any other rights to ADS holders. This means that the holders of ADSs may not receive the distribution AngloGold Ashanti makes on its ordinary shares or any value for them if it is illegal or impracticable for AngloGold Ashanti to make them available to the holders of ADSs.
Deposit, Withdrawal and Cancellation
The Bank of New York Mellon will deliver ADSs if a holder of AngloGold Ashanti’s ordinary shares or its broker deposits AngloGold Ashanti’s ordinary shares or evidence of rights to receive ordinary shares with the Custodian. Upon payment of its fees and expenses and of any taxes or charges, such as stamp taxes or stock transfer taxes or fees, The Bank of New York Mellon will register the appropriate number of ADSs in the names such holder of AngloGold Ashanti ordinary shares requests and will deliver the ADSs at its Corporate Trust Office to the persons such holders request.
Holders of ADSs may turn in their ADSs at The Bank of New York Mellon’s Corporate Trust Office. Upon payment of its fees and expenses and of any taxes or charges, such as stamp taxes or stock transfer taxes or fees, The Bank of New York Mellon will deliver (1) the underlying ordinary shares to an account designated by the relevant holder of ADSs and (2) any other deposited securities underlying the ADSs at the office of the Custodian, or, at the request, risk and expense of ADS holders, The Bank of New York Mellon will deliver the deposited securities at its Corporate Trust Office.
Interchange Between Certificated ADSs and Uncertificated ADSs
ADS registered holders may surrender their ADS to The Bank of New York Mellon for the purpose of exchanging such ADS for uncertificated ADSs. The Bank of New York Mellon will cancel that ADS and will send to the ADS registered holder a statement confirming that the ADS registered holder is the registered holder of uncertificated ADSs. Alternatively, upon receipt by The Bank of New York Mellon of a proper instruction from a registered holder of uncertificated ADSs requesting the exchange of uncertificated ADSs for certificated ADSs, The Bank of New York Mellon will execute and deliver to the ADS registered holder an ADS evidencing those ADSs.
Voting Rights
ADS registered holders may instruct The Bank of New York Mellon to vote the number of deposited shares their ADSs represent. The Bank of New York Mellon will notify ADS registered holders of shareholders’ meetings and arrange to deliver AngloGold Ashanti’s voting materials to them if AngloGold Ashanti asks it to. Those materials will describe the matters to be voted on and explain how ADS registered holders may instruct The Bank of New York Mellon how to vote. For instructions to be valid, they must reach The Bank of New York Mellon by a date set by The Bank of New York Mellon.
Otherwise, ADS registered holders will not be able to exercise their right to vote unless they withdraw the shares. However, ADS registered holders may not know about the meeting sufficiently in advance to withdraw the shares.
The Bank of New York Mellon will try, as far as practicable, to vote or to have its agents vote the ordinary shares or other deposited securities as holders of ADSs instruct, but this is subject to South African law, the provisions of AngloGold Ashanti’s MoI and of the deposited securities and any applicable rule of the JSE. The Bank of New York Mellon will only vote or attempt to vote as such holders of ADSs instruct.
AngloGold Ashanti cannot assure the holders of ADSs that they will receive the voting materials in time for them to instruct The Bank of New York Mellon to vote their ordinary shares. In addition, The Bank of New York Mellon and its agents are not responsible for failing to carry out voting instructions or for the manner of carrying out voting instructions. This means that holders of ADSs may not be able to exercise their right to vote and there may be nothing they can do if their ordinary shares are not voted as they requested.
Fees and Expenses
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ADS holders must pay: | For: |
$5.00 (or less) per 100 ADSs | Each issuance of an ADS, including as a result of a distribution of AngloGold Ashanti ordinary shares or rights or other property
Each cancellation of an ADS, including if the Deposit Agreement terminates |
$0.02 (or less) per ADS | Any cash payment |
Registration or transfer fees | Transfer and registration of AngloGold Ashanti ordinary shares on the AngloGold Ashanti share register to or from the name of The Bank of New York Mellon or its agent when AngloGold Ashanti ordinary shares are deposited or withdrawn |
$0.02 (or less) per ADS per year | Depositary services |
Expenses of The Bank of New York Mellon | Conversion of non-US currency to US dollars
Cable, telex and facsimile transmission expenses
Servicing the deposited securities |
Taxes and other governmental charges that The Bank of New York Mellon or any Custodian has to pay on any ADS or AngloGold Ashanti ordinary share underlying an ADS; for example, stock transfer taxes, stamp duty or withholding taxes | As necessary
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A fee equivalent to the fee that would have been payable if the securities distributed had been ordinary shares deposited for issuance of ADSs | Distribution of securities distributed to holders of deposited securities that are distributed by The Bank of New York Mellon to ADS holders |
Payment of Taxes
Holders of ADSs will be responsible for any taxes or other governmental charges payable on their ADSs or on the deposited securities underlying their ADSs. The Bank of New York Mellon may refuse to transfer their ADSs or allow them to withdraw the deposited securities underlying their ADSs until such taxes or other charges are paid. It may apply payments owed to holders of ADSs or sell deposited securities underlying their ADSs to pay any taxes they owe, and they will remain liable for any deficiency. If The Bank of New York Mellon sells deposited securities, it will, if appropriate, reduce the number of ADSs to reflect the sale and pay to holders of ADSs any proceeds, or send to them any property remaining after it has paid the taxes.
Reclassifications | | | | | | | | | | | |
If AngloGold Ashanti: | | | Then: |
Reclassifies, splits up or consolidates any of the deposited securities;
| | | The cash, ordinary shares or other securities received by The Bank of New York Mellon will become deposited securities. Each ADS will automatically represent its equal share of the new deposited securities. |
Distributes securities on the ordinary shares that are not distributed to holders of ADSs; or
Recapitalises, reorganises, merges, liquidates, sells all or substantially all of AngloGold Ashanti’s assets, or takes any similar action. | | | The Bank of New York Mellon may, and will if AngloGold Ashanti asks it to, distribute some or all of the cash, AngloGold Ashanti ordinary shares or other securities it receives. It may also issue new ADSs or ask holders of ADSs to surrender their outstanding ADSs in exchange for new ADSs identifying the new deposited securities. |
Amendment and Termination
AngloGold Ashanti may, for any reason, agree with The Bank of New York Mellon to amend the Deposit Agreement and the ADSs without the consent of holders. If the amendment increases fees or charges (except for taxes and other governmental charges or registration fees, cable, telex or facsimile transmission costs, delivery costs or other such expenses) or if the amendment prejudices an important right of ADS holders, it will only become effective 30 days after The Bank of New York Mellon notifies holders of ADSs of the amendment. At the time an amendment becomes effective, holders of ADSs are considered, by continuing to hold their ADSs, to agree to the amendment and to be bound by the ADSs and the agreement as amended.
The Bank of New York Mellon may terminate the Deposit Agreement by mailing notice of termination to ADS holders at least 30 days prior to the date fixed in the notice if AngloGold Ashanti asks it to do so. The Bank of New York Mellon may also terminate the Deposit Agreement if The Bank of New York Mellon has told AngloGold Ashanti that it would like to resign and AngloGold Ashanti has not appointed a new Depositary bank within 90 days. In both cases, The Bank of New York Mellon must notify holders of AngloGold Ashanti ADSs at least 30 days before termination.
After termination, The Bank of New York Mellon and its agents will be required to do only the following under the Deposit Agreement: collect distributions on the deposited securities, sell rights, and, upon surrender of ADSs, deliver AngloGold Ashanti ordinary shares and other deposited securities. Four months after the date of termination or later, The Bank of New York Mellon may sell any remaining deposited securities by public or private sale and will hold the proceeds of the sale, as well as any other cash it is holding under the Deposit Agreement, for the pro rata benefit of the ADS holders who have not surrendered their ADSs. It will not invest the money and will have no liability for interest. The Bank of New York Mellon’s only obligations will be to account for the proceeds of the sale and other cash. After termination, AngloGold Ashanti’s only obligations will be with respect to indemnification of, and payment of certain amounts to, The Bank of New York Mellon.
Limitations on Obligations and Liability to ADS Holders
The Deposit Agreement expressly limits AngloGold Ashanti’s obligations and the obligations of The Bank of New York Mellon, and limits AngloGold Ashanti’s liability and the liability of The Bank of New York Mellon. AngloGold Ashanti and The Bank of New York Mellon:
•are only obligated to take the actions specifically set forth in the Deposit Agreement without negligence or bad faith;
•are not liable if either of AngloGold Ashanti or The Bank of New York Mellon is prevented or delayed by law or circumstances beyond their control from performing their obligations under the Deposit Agreement;
•are not liable if either of AngloGold Ashanti or The Bank of New York Mellon exercises discretion permitted under the Deposit Agreement;
•are not liable for the inability of any holder of ADSs to benefit from any distribution on deposited securities that is not made available to holders of ADSs under the terms of the Deposit Agreement, or for any special, consequential or punitive damages for any breach of the terms of the Deposit Agreement;
•have no obligation to become involved in a lawsuit or other proceeding related to the ADSs or the Deposit Agreement on behalf of the holders of ADSs or on behalf of any other party;
•may rely on advice of or information from legal counsel, accountants, and any persons presenting AngloGold Ashanti’s ordinary shares for deposit, any registered holder or any other person believed by AngloGold Ashanti in good faith to be competent to give such advice or information; and
•pursuant to the Deposit Agreement, agree to indemnify each other under certain circumstances.
Requirements for Depositary Action
Before The Bank of New York Mellon will issue, transfer or register the transfer of an ADS, make a distribution on an ADS, or allow withdrawal of AngloGold Ashanti ordinary shares, The Bank of New York Mellon may require:
•payment of stock transfer or other taxes or other governmental charges and transfer or registration fees charged by third parties for the transfer of any ordinary shares or other deposited securities;
•production of satisfactory proof of the identity and genuineness of any signature or other information it deems necessary; and
•compliance with regulations it may establish, from time to time, consistent with the Deposit Agreement, including presentation of transfer documents.
The Bank of New York Mellon may refuse to deliver, transfer or register transfers of ADSs generally when the books of The Bank of New York Mellon or AngloGold Ashanti are closed, or at any time if either AngloGold Ashanti or The Bank of New York Mellon thinks it advisable to do so.
Holders of ADSs have the right to cancel their ADSs and withdraw the underlying ordinary shares at any time except:
•when temporary delays arise because: (1) either AngloGold Ashanti or The Bank of New York Mellon have closed AngloGold Ashanti’s transfer books; (2) the transfer of the ordinary shares is blocked in connection with voting at a general meeting of shareholders; or (3) AngloGold Ashanti is paying a dividend on the ordinary shares;
•when ADS holders seeking to withdraw the ordinary shares are liable for unpaid fees, taxes and similar charges; or
•when it is necessary to prohibit withdrawals in order to comply with any laws or governmental regulations that apply to ADSs or to the withdrawal of the ordinary shares or other deposited securities.
This right of withdrawal may not be limited by any other provision of the Deposit Agreement.
Pre-release of ADSs
In certain circumstances, subject to the provisions of the Deposit Agreement, The Bank of New York Mellon may deliver ADSs before deposit of the underlying ordinary shares. This is called a pre-release of the ADSs.
The Bank of New York Mellon may also deliver AngloGold Ashanti ordinary shares upon cancellation of pre-released ADSs (even if the ADSs are cancelled before the pre-release transaction has been closed out). A pre-release is closed out as soon as the underlying AngloGold Ashanti ordinary shares are delivered to The Bank of New York Mellon. The Bank of New York Mellon may receive ADSs instead of ordinary shares to close out a pre-release.
The Bank of New York Mellon may pre-release ADSs only under the following conditions:
•before or at the time of the pre-release, the person to whom the pre-release is being made must represent to The Bank of New York Mellon in writing that it or its customer: (a) owns the ordinary shares or ADSs to be remitted, (b) assigns all beneficial rights, title and interest in such ADSs or ordinary shares, as the case may be, to The Bank of New York Mellon in its capacity as the Depositary and for the benefit of the ADS holders, and (c) will not take any action with respect to such ADSs or ordinary shares, as the case may be, that is consistent with the transfer of beneficial ownership (including, without the consent of The Bank of New York Mellon, disposing of such ADSs or ordinary shares, as the case may be) other than satisfaction of such pre-release;
•the pre-release must be fully collateralised with cash, US government securities, or other collateral that The Bank of New York Mellon considers appropriate; and
•The Bank of New York Mellon must be able to close out the pre-release on not more than five business days’ notice. Each pre-release will be subject to any further indemnities and credit regulations that The Bank of New York Mellon deems appropriate. The Bank of New York Mellon will normally limit the number of AngloGold Ashanti ordinary shares not deposited but represented by ADSs outstanding at any time as a result of pre-release so that they do not exceed 30 percent of the ordinary shares deposited, although The Bank of New York Mellon may disregard this limit from time to time, if it thinks it is appropriate to do so.
Direct Registration System
In the Deposit Agreement, all parties to the Deposit Agreement acknowledge that the DRS and Profile Modification System, or Profile, will apply to uncertificated ADSs upon acceptance thereof to DRS by The Depository Trust Company, also referred to as DTC. DRS is the system administered by DTC pursuant to which the Depositary may register the ownership of uncertificated ADSs, which ownership will be evidenced by periodic statements sent by the Depositary to the registered holders of uncertificated ADSs. Profile is a required feature of DRS which allows a DTC participant, claiming to act on behalf of a registered holder of ADSs, to direct the Depositary to register a transfer of those ADSs to DTC or its nominee and to deliver those ADSs to
the DTC account of that DTC participant without receipt by the Depositary of prior authorisation from the ADS registered holder to register that transfer.
In connection with and in accordance with the arrangements and procedures relating to DRS/Profile, the parties to the Deposit Agreement understand that The Bank of New York Mellon will not verify, determine or otherwise ascertain that the DTC participant which is claiming to be acting on behalf of an ADS holder in requesting registration of transfer and delivery described in the paragraph above has the actual authority to act on behalf of the ADS holder (notwithstanding any requirements under the Uniform Commercial Code). In the Deposit Agreement, the parties agree that The Bank of New York Mellon’s reliance on and compliance with instructions received by The Bank of New York Mellon through the DRS/Profile System and in accordance with the Deposit Agreement will not constitute negligence or bad faith on the part of The Bank of New York Mellon.
Shareholder Communications: Inspection of Register of Holders of ADSs
The Bank of New York Mellon will make available for inspection at its office all communications that it receives from AngloGold Ashanti as a holder of deposited securities that AngloGold Ashanti makes generally available to holders of deposited securities. The Bank of New York Mellon will send copies of those communications if requested by AngloGold Ashanti. ADS holders have a right to inspect the register of holders of ADSs, but not for the purpose of contacting those holders about a matter unrelated to AngloGold Ashanti’s business or the ADSs.
10D.Exchange controls
Exchange controls and other limitations affecting security holders
The following is a general outline of South African exchange controls and such outline may not apply to former residents of South Africa. Investors should consult a professional advisor as to the exchange control implications of their particular investments.
South African law provides for exchange control regulations, which restrict the export of capital from South Africa. Exchange controls are administered by the Financial Surveillance Department of the South African Reserve Bank (SARB), in terms of the Exchange Control Regulations, and regulate transactions involving South African residents and non-residents, with the exception of transactions between South African residents and residents of the Common Monetary Area, which comprises the Kingdoms of Lesotho and Eswatini (formerly Swaziland) and the Republic of Namibia. The purpose of exchange controls is to mitigate the decline of foreign capital reserves in South Africa.
The Government of South Africa has, however, committed itself to relaxing exchange controls gradually and significant relaxation has occurred in recent years.
The comments below relate, in general, to exchange controls in place at the date of this annual report.
Investments in South African companies
Acquisitions of shares or assets of South African companies by non-South African purchasers are generally subject to review and approval by the SARB, particularly where the consideration is payable in a form other than cash. In this regard, the SARB will give approval where it is persuaded, inter alia, that the consideration payable for the acquisition of the shares or assets is an arm’s-length consideration and that such acquisition offers benefits to South Africa. In addition, where shares in a South African company are acquired by a non-resident, the share certificates issued to the non-resident shareholder must be endorsed “non-resident” by the SARB (or an Authorised Dealer).
Dividends
Dividends declared to foreign stockholders in public companies listed on the Johannesburg Stock Exchange (JSE) are not subject to the approval of the SARB, provided that the shares in respect of which the dividends are declared have been endorsed “non-resident” by the SARB or an Authorised Dealer at the time of acquisition. Dividends are freely transferable to foreign stockholders from both trading and non-trading profits earned in South Africa by public listed companies.
Voting rights
There are no limitations imposed by South African law, including South African exchange controls, or by the Memorandum of Incorporation of AngloGold Ashanti on the rights of non-South African shareholders to vote their ordinary shares.
Overseas financing, interest and investments
Interest on foreign loans, if paid from cash generated from operations in South Africa, may be remittable abroad, provided that the loans and the payment of the relevant interest in respect of such loans have received prior SARB approval.
AngloGold Ashanti and its South African subsidiaries require SARB approval to raise debt from and repay debt to non-residents of the Common Monetary Area, mainly in respect of the terms of repayment applicable to such loans, as well as any guarantees that may be provided in respect of such loans, by AngloGold Ashanti or its South African subsidiaries.
Debt raised outside the Common Monetary Area by AngloGold Ashanti’s non-South African subsidiaries is not restricted under South African exchange control regulations and can be used for investment outside the Common Monetary Area, subject to the relevant conditions imposed by the SARB in connection with such investment, the establishing of such a non-South African subsidiary or in raising the debt by such subsidiary. For example, AngloGold Ashanti and its South African subsidiaries would require SARB approval in order for AngloGold Ashanti and/or its South African subsidiaries to provide guarantees for the obligations of any of its non-South African subsidiaries. In addition, funds obtained from non-residents of the Common Monetary Area and debt raised outside the Common Monetary Area by AngloGold Ashanti’s non-South African subsidiaries must be repaid or serviced by AngloGold Ashanti’s foreign subsidiaries unless otherwise approved by the SARB.
A listing by a South African company on any stock exchange other than the JSE in connection with raising capital requires permission from the SARB.
Under current exchange control regulations, offshore investments by AngloGold Ashanti and its subsidiaries require the approval of the SARB. Subject to such prior approval of the SARB, there is no limit on the amount of capital that may be invested offshore.
10E.Taxation
South African taxation
General
The following section provides a summary of the South African tax consequences consequent upon the ownership and disposition of shares by South African residents or ADSs by a US holder (as defined below) and is not intended to constitute tax advice. This summary is based upon current South African tax law and practice of the South African Revenue Service (SARS), the US/SA Double Taxation Treaty, and in part upon representations made by the Depositary, on the basis that it assumes that each obligation provided for in, or otherwise contemplated by, a Deposit Agreement and any related agreement will be performed in accordance with its respective terms.
The following summary of the South African tax considerations does not address the tax consequences to a US holder that is resident in South Africa for South African tax purposes, whose holding of shares or ADSs is effectively connected with a permanent establishment in South Africa through which such US holder carries on business activities or, in the case of an individual, with a fixed base situated therein, or who is otherwise not entitled to the full benefits under the US/SA Double Taxation Treaty. It should be appreciated that South Africa ratified the Multilateral Convention to Implement Tax Treaty-related measures to prevent Base Erosion and Profit Shifting (BEPS MLI) on 30 September 2022 and that one should thus read the applicable treaty, including the US/SA Double Taxation Treaty, in this context.
The statements of law set forth below are subject to any changes (which may be applied retroactively) in South African law or in the interpretation thereof by SARS, or in the US/SA Double Taxation Treaty, occurring after the date hereof. It should be expressly noted that South African tax law does not specifically address the treatment of ADSs. However, it is reasonable to assume (although no assurance can be made) that the tax treatment of US holders of shares is also applicable to US holders of ADSs.
Holders are strongly urged to consult their own tax advisors as to the consequences under South African, US federal, state and local, and other applicable laws, of the ownership and disposition of shares or ADSs.
Taxation of dividends
South Africa currently imposes a Dividend Withholding Tax on Companies (dividends tax) at a rate of 20 percent on the net amount of the dividend declared and paid by a resident company, other than a Headquarter Company.
The dividends tax is generally imposed on the beneficial owner of the dividends. The dividends tax is subject to domestic exemptions or relief in terms of an applicable double taxation treaty. The application of such domestic exemptions or relief in terms of an applicable double taxation treaty is subject to the making of certain declarations and undertakings by the beneficial owner of the dividends to the regulated intermediary making payment of the dividend. In terms of the latest amendments to the tax provisions, the declaration and undertaking entitling the beneficial owner to a reduced dividend withholding tax rate must be renewed every five years, subject to certain exemptions.
The dividends tax could be reduced to a lower rate under an applicable double tax treaty, if all requirements are met. In the case of dividends paid to a US holder with respect to shares, the US/SA Double Taxation Treaty would generally limit the dividends tax rate to five percent of the gross amount of the dividends if a corporate US holder holds directly at least ten percent of the voting stock of the Company, provided that the applicable declaration and undertaking are given by the beneficial owner that the reduced rate applies.
In all other cases, the maximum tax rate under the US/SA Double Taxation Treaty is 15 percent of the gross amount of the dividend.
Different rules may apply if the beneficial owner of the dividends is a US resident who carries on business in South Africa through a permanent establishment situated in South Africa, or performs in South Africa services from a permanent establishment situated in South Africa, and the dividends are attributable to such permanent establishment or fixed base.
Moreover, if the dividends tax rate is reduced under the auspices of an applicable double tax treaty, certain South African compliance requirements must be met in order to obtain the double tax treaty relief, including amongst others the completion of a declaration and undertaking by the beneficial owners in favour of the Company and/or the relevant regulated intermediary.
In terms of the latest tax provisions the declaration and undertaking need to be renewed at least every five years unless the regulated intermediary is subject to the provisions of inter alia the US Foreign Account Tax Compliance legislation.
A dividend is currently defined as any amount transferred or applied by a company that is a resident (including the Company) for the benefit or on behalf of any person in respect of any share in that company, whether that amount is transferred or applied by way of a distribution made by the company, or as consideration for the acquisition of any share in that company. The definition of
a dividend specifically excludes any amount transferred or applied by the Company that results in a reduction of so-called contributed tax capital (CTC) of the relevant class of shares, or constitutes shares in the Company or constitutes an acquisition by the Company of its own securities by way of a general repurchase of securities in terms of the JSE Listings Requirements. A distinction is thus made between a general repurchase of securities and a specific repurchase of securities. If the Company embarks upon a general repurchase of securities, the proceeds of such repurchase would not constitute a dividend, whereas, in the case of a specific repurchase of securities where the purchase price is not funded out of CTC of that class of shares, the proceeds would likely constitute a dividend.
The concept of CTC effectively means the sum of the stated capital or share capital and share premium of a company that existed on 1 January 2011, excluding any transfers from reserves to the share premium account or stated capital account, plus proceeds from the issue of any new shares by a company, less the amount of CTC that has been returned to shareholders. Any application of CTC is limited to the holders of a class of shares. In addition, a distribution of CTC attributable to a specific class must be made proportionately to the number of shares held by a shareholder in a specific class. The definition of CTC is subject to various provisos. Recently the definition of CTC was amended to make it clear that CTC can only be transferred to shareholders proportionally.
For dividends tax purposes a dividend is defined as any dividend as indicated above that is paid by a company that is a resident or paid by a foreign company if the share in respect of which that foreign dividend is paid is a listed share and to the extent that the foreign dividend does not constitute a distribution of an asset in kind.
Dividends are generally exempt from the payment of income tax, subject to various exclusions. If a dividend is not exempt from income tax it follows that dividends tax will not also be levied.
Taxation of capital gains on sale or other disposition
South African residents are taxed on their worldwide income, while non-residents are only taxed on South African sourced income (subject to the provisions of any relevant double taxation agreement).The general corporate income tax rate has recently been reduced to 27 percent.
Capital gains tax is not a separate tax to income tax; instead, a percentile of the taxpayer’s net capital gain (that is the taxable capital gain) is included in its taxable income on which it is taxed at the income tax rate.
Non-residents are only subject to the South African capital gains tax provisions in respect of the disposal of any immovable property (such as land and buildings or mining rights) or any interest or right of whatever nature to or in immovable property situated in South Africa, or any asset of a permanent establishment through which that non-resident is carrying on a trade in South Africa.In the instance of a shareholder holding shares in a South African company, the ‘interest in immovable property’ requirements are met if 80 percent or more of the market value of the shares is directly or indirectly attributable to South African immovable property held on capital account, and that shareholder (whether alone or together with any connected person in relation to that person), directly or indirectly, holds at least 20 percent of the equity shares of that South African company.
Gains realised on the sale of ordinary shares are deemed to be of a capital nature and subject to capital gains tax provided the ordinary shares have been held for a continuous period of at least three years. This deeming provision is applicable to all executives“equity shares” as defined in section 1 of the South African Income Tax Act, No. 58 of 1962 (the “SA Income Tax Act”), and may not extend to preference shares or ADSs where the preference shares or ADSs do not constitute “equity shares” as so defined.
The meaning of the word “resident” is different for individuals and corporations and is governed by the Act and by the Treaty. In the event of conflict, the Treaty, which contains a tie breaker clause or mechanism to determine residency if a holder is resident in both countries, will prevail. In terms of the Act and Treaty, a US resident holder of shares or ADSs will not be subject to capital gains tax on the disposal of securities held as capital assets unless the securities are linked to a permanent establishment conducted in South Africa or constitute an interest in immovable property as indicated below:above. In contrast, gains on the disposal of securities which are not capital in nature are usually subject to income tax. Any asset held as a long-term investment will be considered a capital asset and subject to capital gains tax on the disposal of such an asset. Any asset acquired for purposes of resale as part of a profit-making scheme will not be considered a capital asset and will be subject to income tax on the disposal of such an asset. However, even in the latter case, a US resident holder will not be subject to income tax, unless the US resident holder carries on business in South Africa through a permanent establishment situated therein.
Executive directors
Securities transfer tax (STT)
No securities transfer tax, or STT, is payable in South Africa with respect to the issue of a security, but STT is payable upon transfer, redemption or cancellation thereof.
STT on transfers of securities is charged at a rate of 0.25 percent on the ‘taxable amount’ in respect of the ‘transfer’ of every security issued by a company incorporated in South Africa, or a company incorporated outside South Africa, but listed on an exchange in South Africa, subject to certain exemptions.
The word ‘transfer’ is broadly defined and includes the transfer, sale, assignment or cession or disposal in any other manner of a security which results in a change in beneficial ownership.The cancellation or redemption of a security is also regarded as a ‘transfer’ unless the Company is being liquidated. However, the transfer of a security that does not result in a change in beneficial ownership is not regarded as a ‘transfer’ for STT purposes. A security is also defined as a depositary receipt in a company. Apart from STT thus being payable upon the conversion of ADSs to shares and vice versa, , STT could also be payable on the transfer of a depositary receipt issued by a company, including specifically the ADSs issued by the Company. Generally, the central securities Depositary that has been accepted as a participant in terms of the Financial Markets Act, is liable for the payment of the STT, on the basis that it is recoverable from the person to whom it is transferred.
STT is levied on the ‘taxable amount’ of a security.The taxable amount of a listed security is the greater of the consideration for the security declared by the transferee or the closing price of that security as traded on the stock exchange concerned. The person to whom the listed security is transferred is liable for payment of the STT, and such tax must be paid through the member or the participant holding the security in custody, or where the listed security is not held in custody, the company that issued the listed security. The tax so payable may be recovered from the person to whom the security is transferred. The tax must be paid by the fourteenth day of the month following the month during which the transfer occurred.
Withholding tax on interest
Generally, a 15 percent withholding tax may apply to the payments of interest.Under the US/SA Double Taxation Treaty, interest derived and beneficially owned by a resident of the United States will be taxable only in the United States (and therefore not subject to interest withholding tax in South Africa), subject to certain exclusions.
Value-Added Tax
The issue or transfer of shares is not a taxable supply for value-added tax (“VAT”) purposes.However, fees charged by independent service providers are subject to VAT at the standard rate of 15 percent.
United States Taxation
General
The following is a general summary of certain material US federal income tax consequences of the ownership and disposition of shares or ADSs to a US holder (as defined below) that holds its shares or ADSs as a capital asset.With respect to the following, references to shares includes references to ADSs unless the context indicates otherwise.This summary does not address any aspect of US federal gift or estate tax, or the state, local or non-US tax consequences to a US holder of shares. This summary is based on US tax laws including the Internal Revenue Code of 1986, as amended (the “Code”), Treasury regulations promulgated thereunder, rulings, judicial decisions, administrative pronouncements, and the US/SA Double Taxation Treaty, all as currently in effect as of the date of this annual report, and all of which are subject to change or changes in interpretation, possibly with retroactive effect. In addition, this summary is based in part upon the representations of the Depositary and the assumption that each obligation in the Deposit Agreement relating to the ADSs and any related agreement will be performed in accordance with its terms.
This summary does not address all aspects of US federal income taxation that may apply to holders that are subject to special tax rules, including US expatriates, non-resident aliens present in the United States for at least 183 days during the calendar year, insurance companies, tax-exempt entities, banks, certain financial institutions, persons subject to the alternative minimum tax, regulated investment companies, securities broker-dealers, traders in securities who elect to apply a mark-to-market method of accounting, investors that own (directly, indirectly or by attribution) ten percent or more of the outstanding share capital or voting stock of AngloGold Ashanti, partnerships or other entities treated as partnerships for US federal income tax purposes or persons holding shares through such entities, persons holding their shares as part of a straddle, hedging or conversion transaction, persons who acquired their shares pursuant to the exercise of employee stock options or otherwise as compensation, or persons whose functional currency is not the US dollar. Such holders may be subject to US federal income tax consequences different from those set forth below.
As used herein, the term “US holder” means a beneficial owner of shares that is: (a) a citizen or individual resident of the United States for US federal income tax purposes; (b) a corporation (or other entity taxable as a corporation for US federal income tax purposes) created or organised in or under the laws of the United States, any state thereof or the District of Columbia; (c) an estate the income of which is subject to US federal income taxation regardless of its source; or (d) a trust if (i) a court within the
United States can exercise primary supervision over the administration of the trust and one or more US persons are authorised to control all substantial decisions of the trust or (ii) it has a valid election in effect under applicable Treasury regulations to be treated as a United States person.
If a partnership (including for this purpose any entity treated as a partnership for US federal income tax purposes) holds shares, the tax treatment of a partner generally will depend upon the status of the partner and the activities of the partnership. If a US holder is a partner in a partnership that holds shares, the holder is urged to consult its own tax advisor regarding the specific tax consequences of the ownership and disposition of the shares.
US holders should consult their own tax advisors regarding the specific South African and US federal, state and local tax consequences of owning and disposing of shares in light of their particular circumstances as well as any consequences arising under the laws of any other taxing jurisdiction. In particular, US holders are urged to consult their own tax advisors regarding whether they are eligible for benefits under the US/SA Double Taxation Treaty.
For US federal income tax purposes, a US holder of ADSs should generally be treated as owning the underlying shares represented by those ADSs. Therefore, deposits or withdrawals by a US holder of shares for ADSs or of ADSs for shares will not be subject to US federal income tax. The following discussion (except where otherwise expressly noted) applies equally to US holders of shares and US holders of ADSs.
▪Taxation of dividends
The gross amount of any distribution (including the amount of any South African withholding tax thereon) paid to a US holder by AngloGold Ashanti generally will be taxable as dividend income to the US holder for US federal income tax purposes on the date the distribution is actually or constructively received by the US holder, in the case of shares, or by the Depositary, in the case of ADSs.Corporate US holders will not be eligible for the dividends received deduction in respect of dividends paid by AngloGold Ashanti. For foreign tax credit limitation purposes, dividends paid by AngloGold Ashanti will be income from sources outside the United States.
As noted above in “Taxation—South African taxation—Taxation of dividends”, the South African government has enacted a dividend withholding tax.As a result, US holders who are eligible for benefits under the current US/SA Double Taxation Treaty will be subject to a maximum withholding tax of 15 percent on the gross amount of dividend distributions paid by AngloGold Ashanti.
The amount of any distribution paid in foreign currency (including the amount of any South African withholding tax thereon) generally will be includible in the gross income of a US holder of shares in an amount equal to the US dollar value of the foreign currency calculated by reference to the spot rate in effect on the date of receipt by the US holder, in the case of shares, or by the Depositary, in the case of ADSs, regardless of whether the foreign currency is converted into US dollars on such date. If the foreign currency is converted into US dollars on the date of receipt, a US holder of shares generally should not be required to recognise foreign currency gain or loss in respect of the dividend. If the foreign currency received in the distribution is not converted into US dollars on the date of receipt, a US holder of shares generally will have a tax basis in the foreign currency equal to its US dollar value on the date of receipt. Any gain or loss recognised upon a subsequent conversion or other disposition of the foreign currency generally will be treated as US source ordinary income or loss. In the case of a US holder of ADSs, the amount of any distribution paid in a foreign currency generally will be converted into US dollars by the Depositary upon its receipt. Accordingly, a US holder of ADSs generally will not be required to recognise foreign currency gain or loss in respect of the distribution. Special rules govern and specific elections are available to accrual method taxpayers to determine the US dollar amount includible in income in the case of taxes withheld in a foreign currency. Accrual basis taxpayers are therefore urged to consult their own tax advisors regarding the requirements and elections applicable in this regard.
Subject to certain limitations, South African withholding taxes will be treated as foreign taxes eligible for credit against a US holder’s US federal income tax liability. The limitation on foreign taxes eligible for credit is calculated separately with respect to specific classes of income. Dividend income generally will constitute “passive category” income, or in the case of certain US holders, “general category” income. The use of foreign tax credits is subject to complex conditions and limitations. In lieu of a credit, a US holder who itemises deductions may elect to deduct all of such holder’s foreign taxes in the taxable year. A deduction does not reduce US tax on a dollar-for-dollar basis like a tax credit, but the deduction for foreign taxes is not subject to all the same limitations applicable to foreign tax credits. US holders are urged to consult their own tax advisors regarding the availability of foreign tax credits.
Certain US holders (including individuals) are eligible for reduced rates of US federal income tax in respect of “qualified dividend income” received. AngloGold Ashanti currently believes that dividends paid with respect to its shares should constitute qualified dividend income for US federal income tax purposes. Each individual US holder of AngloGold Ashanti shares is urged to consult his own tax advisor regarding the availability of the reduced dividend tax rate in light of his own particular situation.
The US Treasury has expressed concern that parties to whom ADSs are pre-released may be taking actions that are inconsistent with the claiming of foreign tax credits for US holders of ADSs. Such actions would also be inconsistent with the claiming of the reduced rate of tax described above, applicable to dividends received by certain non-corporate holders. Accordingly, the analysis of the creditability of South African withholding taxes or the availability of qualified dividend treatment could be affected by future actions that may be taken by the US Treasury with respect to ADSs.
•Taxation of dispositions
If a US holder is a resident of the United States for purposes of the US/SA Double Taxation Treaty, such holder will not be subject to South African tax on any capital gain if it sells or disposes of its shares. Special rules apply to individuals who are residents of more than one country.
Subject to the passive foreign investment company considerations discussed below, upon the sale, exchange or other disposition of shares, a US holder generally will recognise capital gain or loss for US federal income tax purposes in an amount equal to the difference between the US dollar value of the amount realised on the disposition and the holder’s tax basis, determined in US dollars, in the shares. Such gain or loss generally will be US source gain or loss, and will be treated as a long-term capital gain or loss if the holder’s holding period in the shares exceeds one year at the time of disposition. If the US holder is an individual, any capital gain generally will be subject to US federal income tax at preferential rates if specified minimum holding periods are met. The deductibility of capital losses is subject to limitations under the Code.
A US holder’s tax basis in a share will generally be its US dollar cost. The US dollar cost of a share purchased with foreign currency will generally be the US dollar value of the purchase price on the settlement date for the purchase (in the case of shares traded on an established securities market that are purchased by a cash basis US holder or an electing accrual basis US holder), or the date of purchase in all other cases. The amount realised on a sale or other disposition of shares for an amount in foreign currency will be the US dollar value of this amount on the settlement date for the sale or disposition (in the case of shares traded on an established securities market that are sold by a cash basis US holder or an electing accrual basis US holder), or the date of sale or disposition in all other cases. In addition, in such other cases, the US holder will recognise US source foreign currency gain or loss (taxable as ordinary income or loss) equal to the difference (if any) between the US dollar value of the amount received based on the exchange rates in effect on the date of sale or other disposition and the settlement date. If an accrual basis US holder makes either of the elections described above, it must be applied consistently from year to year and cannot be revoked without the consent of the Internal Revenue Services (IRS).
Foreign currency received on the sale or other disposition of a share will have a tax basis equal to its US dollar value on the settlement date. Any gain or loss recognised on a sale or other disposition of foreign currency (including its use to purchase shares or upon exchange for US dollars) will be US source ordinary income or loss.
▪Passive foreign investment company considerations
A foreign corporation will be classified a passive foreign investment company (PFIC) for any taxable year if at least 75 percent of its gross income consists of passive income (such as dividends, interest, rents or royalties (other than rents or royalties derived in the active conduct of a trade or business and received from an unrelated person), or gains on the disposition of certain minority interests), or at least 50 percent of the average value of its assets consists of assets that produce, or are held for the production of, passive income. AngloGold Ashanti believes that it was not treated as a PFIC for the taxable year ended 31 December 2022 or any prior taxable years and does not expect to become a PFIC in the foreseeable future. If AngloGold Ashanti were characterised as a PFIC for any taxable year, a US holder would suffer adverse tax consequences with respect to that taxable year and all future years during which it holds AngloGold Ashanti ordinary shares.
These consequences may include having gain realised on the disposition of shares treated as ordinary income rather than capital gain and being subject to punitive interest charges on the receipt of certain dividends and on the proceeds of the sale or other disposition of the shares. Furthermore, dividends paid by AngloGold Ashanti would not be “qualified dividend income” and would be taxed at the higher rates applicable to other items of ordinary income. US holders should consult their own tax advisors regarding the potential application of the PFIC rules to their ownership of the shares.
▪US information reporting and backup withholding
In general, dividend payments made to a US holder and proceeds paid from the sale, exchange, or other disposition of shares may be subject to information reporting to the IRS and possible backup withholding. US federal backup withholding generally is imposed at a current rate of 24 percent on specified payments including dividends and gross sale proceeds to persons who fail to furnish required information. Backup withholding will not apply to a US holder who furnishes a correct taxpayer identification number and makes any other required certification or who is otherwise exempt from backup withholding. US persons who are required to establish their exempt status generally must provide IRS Form W-9 (Request for Taxpayer Identification Number and Certification). Backup withholding is not an additional tax. Amounts withheld as backup withholding may be credited against a holder’s US federal income tax liability. A holder may obtain a refund of any excess amounts withheld under the backup withholding rules by filing the appropriate claim for refund with the IRS and furnishing any required information.
▪Information with respect to foreign financial assets
Individuals that own “specified foreign financial assets” with an aggregate value in excess of $50,000 are generally required to file information reports with respect to such assets with their U.S. federal income tax returns. Depending on the individual’s circumstances, higher threshold amounts may apply. “Specified foreign financial assets” include any financial accounts maintained by foreign financial institutions, as well as any of the following, but only if they are not held in accounts maintained by financial institutions: (i) stocks and securities issued by foreign persons, (ii) financial instruments and contracts held for investment that have foreign issuers or counterparties and (iii) interests in foreign entities. Therefore, the shares may be treated as specified foreign financial assets. In such cases, certain US holders may be subject to this information reporting regime and be required to file IRS Form 8938 listing these assets with their U.S. federal income tax returns. Failure to file information reports may subject a US holder to penalties. US holders are urged to consult their own tax advisors regarding their obligations to file information reports with respect to the shares.
10F. DIVIDENDS AND PAYING AGENTS
Not applicable.
10G. STATEMENT BY EXPERTS
Not applicable.
10H.Documents on Display
AngloGold Ashanti files annual reports on Form 20-F and reports on Form 6-K with the SEC. You may access this information at the SEC’s home page (http://www.sec.gov). Copies of the documents referred to herein may be inspected at AngloGold Ashanti’s offices by contacting AngloGold Ashanti at 112 Oxford Road, Houghton Estate, Johannesburg, 2198 (Private Bag X 20, Rosebank, 2196) South Africa, Attention: Company Secretary, telephone number: +27 11 637 6000.
No material on the AngloGold Ashanti website forms any part of, or is incorporated by reference into, this annual report on Form 20-F. References herein to the Company’s website shall not be deemed to cause such incorporation.
10I. SUBSIDIARY INFORMATION
Not applicable.
10J. Annual Report to Security Holders
AngloGold Ashanti intends to submit its annual report provided to security holders in electronic format as an exhibit to a current report on Form 6-K.
ITEM 11: QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
TREASURY POLICY
Risk management activities within the Group are the ultimate responsibility of the board. The Chief Financial Officer is responsible to the board for the design, implementation and monitoring of the risk management plan. The Audit and Risk Committee is responsible for overseeing risk management plans and systems, as well as financial risks which include a review of treasury activities and exposure to the Group’s counterparties.
Under the financial and risk management policy, hedges may be put in place once approved by the Board, using approved instruments over the Group’s planned gold production and resultant gold sales and currency exposures. The financial and risk management policy sets trading limits for the various levels of treasury management from dealer, through treasurer, executive management team and board members.
The financial risk management activities objectives of the Group are as follows:
•Safeguarding the Group’s core earnings stream from its major assets through the effective control and management of gold and other commodity price risk, foreign exchange risk and interest rate risk;
•Effective and efficient usage of credit facilities in both the short- and long-term through the adoption of reliable liquidity management planning and procedures;
•Ensuring that investment and hedging transactions are undertaken with creditworthy counterparts; and
•Ensuring that all contracts and agreements related to financial risk management activities are co-ordinated and consistent throughout the Group and comply where necessary with all relevant regulatory and statutory requirements.
Under the financial and risk management policy, treasury reports are produced at the following minimum intervals for review by management and the board of directors:
| | | | | | | | | | | |
• | Daily | | Treasury Manager |
• | Weekly | | Treasurer |
• | Monthly | | Treasurer |
• | Quarterly | | Audit and Risk Committee and Board of Directors |
The Treasury Risk Analyst is responsible for monitoring all reports for completeness and accuracy which are reviewed by the Treasurer.
At AngloGold Ashanti, all front office (dealing), middle office (risk reporting), back office (deal confirmations) and payment (treasury settlements) activities are segregated. All treasury transactions are captured on a third party developed treasury and risk management system that is widely used in corporate treasuries. The Group internal audit function conducts regular and ad hoc reviews of the activities of treasury and the Group’s treasury system.
Gold price and other commodities risk management activities
In the normal course of its operations, the Group is exposed to gold and other commodity price, currency, interest rate, equity price, liquidity and non-performance risk, which includes credit risk. The Group is also exposed to certain by-product commodity price risk. In order to manage these risks, the Group may enter into transactions which make use of derivatives. The Group has developed a risk management process to facilitate, control and monitor these risks.
Gold price risk arises from the risk of an adverse effect of current or future earnings resulting from fluctuations in the price of gold.
As at 31 December 2022, the Group had no commitments against future production potentially settled in cash.
In July 2022, AngloGold Ashanti entered into forward contracts for a total of 999,000 barrels of Brent Crude oil for the period January 2023 to December 2023 that will be cash settled on a monthly basis against the contract price. The average price achieved on the forward contracts is $89.20 per barrel of Brent Crude oil. At 31 December 2022, the mark-to-market value of these oil derivatives was an unrealised loss of $6 million.
Foreign exchange price risk protection agreements
The Group, from time to time, may enter into currency forward exchange and currency option contracts to hedge certain anticipated transactions denominated in foreign currencies. The objective of the Group’s foreign currency hedging activities is to protect the Group from the risk that the eventual cash flows resulting from transactions denominated in US dollars will be adversely affected by changes in exchange rates.
As at 31 December 2022 and 2021, the Group had no open forward exchange or currency option contracts in its currency hedge position.
Cash flows related to these instruments designated as qualifying hedges are reflected in the consolidated statement of cash flows in the same category as the cash flow from the items being hedged. Accordingly, cash flows relating to the settlement of forward sale commodity derivatives contracts hedging the forecasted sale of production into the spot market will be reflected upon settlement as a component of operating cash flows.
Interest rate and liquidity risk
Fluctuations in interest rates impact interest paid and received on the short-term cash investments and financing activities, giving rise to interest rate risk.
In the ordinary course of business, the Group receives cash from the proceeds of its gold sales and is required to fund its working capital requirements. This cash is managed to ensure that surplus funds are invested in a manner to achieve market related returns while minimising risks.
The Group is able to actively source financing at competitive rates. The counterparts are financial and banking institutions and their credit ratings are regularly monitored by the Group.
Cash and loans advanced maturity profile
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 2022 | 2021 |
Maturity date | Currency | Fixed rate investment amount (million) | | Effective rate % | | Floating rate investment amount (million) | | Effective rate % | Fixed rate investment amount (million) | | Effective rate % | | Floating rate investment amount (million) | | Effective rate % |
All less than one year | $ | 8 | | | — | | | 507 | | | 3.48 | | 1 | | | — | | | 301 | | | 0.10 | |
| ZAR | 1,471 | | | 6.87 | | | — | | | | 1,337 | | | 3.54 | | | — | | | |
| AUD | — | | | — | | | 49 | | | 1.07 | | — | | | — | | | 72 | | | — | |
| BRL | — | | | — | | | 52 | | | 11.57 | | — | | | — | | | 106 | | | 4.27 | |
| ARS | 18,178 | | | 66.50 | | | 2,362 | | | 65.50 | | 13,256 | | | 34.00 | | | — | | | |
| CAD | — | | | — | | | — | | | — | | — | | | — | | | 353 | | | 0.19 | |
| GBP | — | | | — | | | 2 | | | 1.54 | | — | | | — | | | — | | | — | |
Borrowings maturity profile | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Within one year | | Between One and two years | Between Two and five years | After five years | Total |
Currency | Borrowings amount (million) | | Effective rate % | | Borrowings amount (million) | | Effective rate % | Borrowings amount (million) | | Effective rate % | Borrowings amount (million) | | Effective rate % | Borrowings amount (million) |
$ | 16 | | | 5.5 | | | 63 | | | 11.9 | | 58 | | | 12.4 | | 1,721 | | | 4.1 | | 1,858 | |
| | | | | | | | | | | | | | |
AUD | — | | | — | | | — | | | — | | 54 | | | 4.5 | | — | | | — | | 54 | |
TZS | 3,586 | | | 12.5 | | | 201,542 | | | 12.5 | | — | | | — | | — | | | — | | 205,128 | |
The table above is based on the borrowings as at 31 December 2022 including borrowing cost and accrued interest but excludes any fair value adjustments.
Interest rate risk | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Fixed for less than one year | | Fixed for between one and three years | | Fixed for greater than three years | | |
Currency | | Borrowings amount (million) | | Effective rate % | | Borrowings amount (million) | | Effective rate % | | Borrowings amount (million) | | Effective rate % | | Total Borrowings amount (million) |
$ | | 16 | | | 5.5 | | | 128 | | | 12.1 | | | 1,714 | | | 4.1 | | | 1,858 | |
AUD | | — | | | — | | | — | | | — | | | 54 | | | 4.5 | | | 54 | |
| | | | | | | | | | | | | | |
TZS | | 3,586 | | | 12.5 | | | 201,542 | | | 12.5 | | — | | | — | | | 205,128 | |
The table above is based on the borrowings as at 31 December 2022 including borrowing cost and accrued interest but excludes any fair value adjustments.
Non-performance risk
Realisation of contracts is dependent upon counterparts’ performance. The group has not obtained collateral or other security to support the financial instruments subject to non-performance risk, but the credit standing of counterparts was monitored on a regular basis throughout the year. The group spreads its business over a number of financial and banking institutions to minimise the risk of potential non-performance. Furthermore, the approval process of counterparts and the limits applied to each counterpart were monitored by the board of directors. Where possible, ISDA netting agreements were put in place.
The combined maximum credit risk exposure at balance sheet date amounts to $1,210 million in 2022 for financial assets (2021: $1,300 million) and nil for financial guarantees (2021: nil). Credit risk exposure netted by open derivative positions with counterparts was nil (2021: nil). No set-off is applied to balance sheet amounts due to the different maturity profiles of assets and liabilities.
Fair value of financial instruments
The estimated fair values of financial instruments are determined at discrete points in time based on relevant market information. The estimated fair values of the Group’s financial instruments, as measured at 31 December, are as follows (assets (liabilities)):
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| | 2022 | | 2021 |
| | Carrying Amount | | Fair value | | Carrying Amount | | Fair value |
(millions) | | $ | | $ | | $ | | $ |
Cash and cash equivalents | | 1,108 | | | 1,108 | | | 1,154 | | | 1,154 | |
Restricted cash | | 60 | | | 60 | | | 58 | | | 58 | |
Deferred compensation asset | | 12 | | | 12 | | | 25 | | | 25 | |
Short-term borrowings | | (18) | | | (18) | | | (51) | | | (51) | |
Long-term borrowings | | (1,965) | | | (1,808) | | | (1,858) | | | (1,960) | |
| | | | | | | | |
Listed investments - FVTOCI | | 2 | | | 2 | | | 116 | | | 116 | |
Listed and unlisted investments | | 1 | | | 1 | | | 1 | | | 1 | |
The following methods and assumptions were used to estimate the fair value of each class of financial instrument:
Cash restricted for use, cash and cash equivalents
The carrying amounts approximate fair value.
Trade and other receivables and trade and other payables
The carrying amounts approximate fair value because of the short-term duration of these instruments, except for the deferred compensation asset which is carried at fair value in level 3 of the fair value hierarchy.
Other investments
Listed equity investments classified as FVTOCI and FVTPL are carried at fair value in level 1 of the fair value hierarchy.
Borrowings
The interest rate on borrowings is reset on a short-term floating rate basis, and accordingly the carrying amount is considered to approximate fair value.
Derivatives
The fair values of volatility-based instruments (i.e., options) are estimated based on market prices, volatilities, credit risk and interest rates for the periods under review.
Gain (loss) on non-hedge derivatives and other commodity contracts recognised
| | | | | | | | | | | |
| Year ended 31 December |
| 2022 | | 2021 |
(millions) | $ | | $ |
| | | |
Other commodity contracts | (6) | | | — | |
Foreign exchange risk
Foreign exchange risk arises on financial instruments that are denominated in a foreign currency.
The following table discloses the approximate foreign exchange risk sensitivities of borrowings at 31 December 2022 (actual changes in the timing and amount of the following variables may differ from the assumed changes below). | | | | | | | | | | | | | | |
| | 2022 |
| | Change in exchange rate | | Change in borrowings Total |
| | | | $M |
Debt | | | | |
| | | | |
TZS denominated (TZS/$) | | Spot (+TZS250) | | (9) | |
AUD denominated (AUD/$) | | Spot (+AUD0.1) | | (2) | |
| | |
| | | | | | | | | | | | | | |
| | 2022 |
| | Change in exchange rate | | Change in borrowings Total |
| | | | $M |
Debt | | | | |
TZS denominated (TZS/$) | | Spot (-TZS250) | | 11 | |
AUD denominated (AUD/$) | | Spot (-AUD0.1) | | 2 | |
| | | | |
ITEM 12: DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES
12A. DEBT SECURITIES
Not applicable
12B. WARRANTS AND RIGHTS
Not applicable
12C. OTHER SECURITIES
Not applicable
12D. AMERICAN DEPOSITARY SHARES
12D.3. DEPOSITARY FEES AND CHARGES
AngloGold Ashanti’s American Depositary Shares, or ADSs, each representing one of AngloGold Ashanti’s ordinary shares, are traded on the New York Stock Exchange under the symbol “AU”. The ADSs are evidenced by American Depositary Receipts, or ADRs, issued by The Bank of New York Mellon, as Depositary under the Amended and Restated Deposit Agreement dated as of 3 June 2008, among AngloGold Ashanti Limited, The Bank of New York Mellon and owners and beneficial owners from time to time of ADRs. ADS holders may have to pay the following service fees to the Depositary:
| | | | | | | | |
Service | Fees (USD) |
| |
Issuance of ADSs | Up to 5 cents per ADS | (1) |
Cancellation of ADSs | Up to 5 cents per ADS | (1) |
Distribution of cash dividends or other cash distributions | Up to 2 cents per ADS | (2) |
Distribution of securities pursuant to | | |
(i) stock dividends, free stock distributions or | | |
(ii) exercises of rights to purchase additional ADSs | Up to 5 cents per ADS | (2) |
ADR Depositary Services fee | Up to 2 cents per year | (2) |
(1)These fees are typically paid to the Depositary by the brokers on behalf of their clients receiving the newly-issued ADSs from the Depositary and by the brokers on behalf of their clients delivering the ADSs to the Depositary for cancellation. The brokers in turn charge these transaction fees to their clients.
(2)In practice, the Depositary has not collected these fees. If collected, such fees are offset against the related distribution made to the ADR holder.
In addition, ADS holders are responsible for certain fees and expenses incurred by the Depositary on their behalf including (1) taxes and other governmental charges, (2) such registration fees as may from time to time be in effect for the registration of transfers of ordinary shares generally on the share register and applicable to transfers of ordinary shares to the name of the Depositary or its nominee or the Custodian or its nominee on the making of deposits or withdrawals, and (3) such cable, telex and facsimile transmission expenses as are expressly incurred by the Depositary in the conversion of foreign currency.
Fees and other charges payable by the Depositary, any of the Depositary’s agents, including the Custodian, or the agents of the Depositary’s agents in connection with the servicing of Shares or other Deposited Securities, shall be collected at the sole discretion of the Depositary by billing such owners for such charge or by deducting such charge from one or more cash dividends or other cash distributions.
For further information, refer to “Item 10C: Material Contracts—The Deposit Agreement”.
12D.4. DEPOSITARY PAYMENTS FOR 2022
For the year ended 31 December 2022, The Bank of New York Mellon, as Depositary, reimbursed AngloGold Ashanti an amount of $934,248 (2021: $1,083,405) mainly for investor relations-related expenses.
PART II
ITEM 13: DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES
None.
ITEM 14: MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS
None.
ITEM 15: CONTROLS AND PROCEDURES
(a)Disclosure Controls and Procedures:As of 31 December 2022, (the “Evaluation Date”), the Company, under the supervision and with the participation of its management, including the chief executive officer and chief financial officer has evaluated the effectiveness of the Company’s disclosure controls and procedures (as defined in Rules 13a - 15(e) and 15d - 15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)). Based on such evaluation, the chief executive officer and chief financial officer have concluded that, as of the Evaluation Date, the Company’s disclosure controls and procedures are effective, and are reasonably designed to ensure that information required to be disclosed by the Company in reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the Securities and Exchange Commission. These disclosure controls and procedures include without limitation, controls and procedures designed to ensure that information required to be disclosed by the Company in reports that it files or submits under the Exchange Act is accumulated and communicated to the Company’s management, including its chief executive officer and chief financial officer, as appropriate to allow timely decisions regarding disclosure.
(b) Management’s Annual Report on Internal Control over Financial Reporting: Management is responsible for establishing and maintaining adequate internal control over financial reporting for the Company, as defined in the Exchange Act Rule 13a - 15(f) and 15d -15(f). The Company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of the Company’s financial statements for external purposes in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board.
The Company’s internal control over financial reporting includes those policies and procedures that:
•Pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect transactions and dispositions of the assets of the Company;
•Provide reasonable assurance that the transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorisations of management and the Directors of the Company; and
•Provide reasonable assurance regarding prevention or timely detection of unauthorised acquisition, use, or disposition of the Company’s assets that could have a material effect on the financial statements.
Because of inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Projections of any evaluation of effectiveness to future periods is subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with policies and procedures may deteriorate.
The Company’s management assessed the effectiveness of the Company’s internal control over financial reporting as of the Evaluation Date. In making this assessment, management used the criteria set forth by the Committee of Sponsoring Organisations of the Treadway Commission (COSO) in Internal Control - Integrated Framework and related illustrative documents released on 14 May 2013.Based on this assessment, and using those criteria, management concluded that the Company’s internal control over financial reporting was effective as of the Evaluation Date.
(c) Changes in Internal Control over Financial Reporting: The Company maintains a system of internal control over financial reporting that is designed to provide reasonable assurance that its books and records accurately reflect transactions and that established policies and procedures are followed.
There have been no changes in the Company’s internal control over financial reporting identified in connection with the evaluation required by paragraph (d) of Exchange Act Rule 13(a) - 15 during the year ended 31 December 2022 that have materially affected, or are reasonably likely to materially affect, the company’s internal control over financial reporting.
See also “Item 3D: Risk Factors—AngloGold Ashanti’s inability to maintain an effective system of internal control over financial reporting may have an adverse effect on investors’ confidence in the reliability of its financial statements.”
(d) Attestation Report of the Registered Public Accounting Firm: The Company’s independent registered accounting firm, Ernst & Young Inc., has issued an attestation report on the effectiveness of the Company’s internal control over financial reporting. This report appears below.
/s/ G A Doran
Gillian Ann Doran
Chief Financial Officer
/s/ A Calderon
Alberto Calderon
Chief Executive OfficerLEGAL PROCEEDINGS
Within three years of appointment (or for existing executive
There is no material proceeding in which a director, from introduction of this rule) executive director is to accumulate a MSRofficer or affiliate of AngloGold Ashanti sharesis either a party adverse or has a material interest adverse to the valueCompany.
In addition to the proceedings described below, the Company becomes involved, from time to time, in various claims, legal proceedings and complaints incidental to the ordinary course of 100 percentits business.
TAX MATTERS
•The State of netMinas Gerais v. Mineração Serra Grande S.A. (MSG): In Brazil, MSG received a tax assessment in October 2003 from the State of Minas Gerais related to VAT on gold bullion transfers. The tax administrators rejected MSG’s appeal against the assessment, which amounted to approximately $9.6 million. MSG appealed the dismissal of the case to the State Court of Minas Gerais. Any possible payment by MSG would be set off by an indemnity from Kinross Gold Corporation (Kinross) of $5 million provided for as part of the company’s acquisition of Kinross’ interest in MSG in 2012. The matter is currently pending in the State Court of Minas Gerais.
•Brazilian tax authorities v. AngloGold Ashanti Córrego do Sítio Mineração SA and Mineração Serra Grande S.A. (MSG): AngloGold Ashanti’s subsidiaries in Brazil, including AGA Mineração (formerly AngloGold Ashanti Brasil Mineração Ltda) and MSG, are involved in various disputes with the Brazilian tax authorities. These disputes date back as far as 2007 and involve federal tax assessments including income tax, royalties, social contributions, VAT and annual base salary;property tax. Collectively, the total possible amount involved across all tax disputes in Brazil is approximately $46.5 million, which include VAT claims and social security payments of $36 million.
At
•Colombian Tax Office (DIAN) v. AngloGold Ashanti Colombia S.A.S. (AGAC) and Gramalote Colombia Limited (Gramalote): Since 2013, AGAC received various notices from the endDIAN that it disagreed with the company’s tax treatment of sixexploration expenditure in its 2010, 2011, 2013 and 2014 income tax returns and its 2011 equity tax return. However, AGAC believes that the DIAN has applied the tax legislation incorrectly and subsequently filed lawsuits before the Administrative Court of Cundinamarca (the trial court for tax litigation) challenging each of the DIAN’s rulings in respect of those tax returns. In 2018, the Administrative Court of Cundinamarca denied AGAC’s arguments with respect to the 2010 and 2011 tax litigation. AGAC subsequently appealed these judgments to the Council of State of Colombia (the highest court for tax matters). In November and December 2022, the Council of State ruled against AGAC upon appeal. The Council of State ordered AGAC to pay $34 million of additional taxes (which includes interest) in respect of the 2010 and 2011 tax returns, but it fully waived any related penalties (which were originally assessed in the amount of $47 million). In December 2022, a tax reform was adopted in Colombia, enacting changes which may lead to a reduction of interest charged on outstanding tax obligations in certain circumstances. In February 2023, AGAC paid $25 million of additional taxes (which includes interest) in respect of the 2011 income and equity tax returns, after taking into account a reduction of $6 million in interest under the tax reform. Following this payment, the 2011 tax litigation was fully settled. AGAC is still awaiting the final decision under the new tax reform in respect of the 2010 tax litigation. AGAC’s other lawsuits with respect to its 2013 and 2014 tax returns are still pending before the Administrative Court of Cundinamarca and the company has disclosed a contingent liability of $5.0 million in respect thereof (mainly covering related penalties).
Since 2019, Gramalote also received various notices from the DIAN that it disagreed with its 2013 and 2014 income tax returns on the same basis as the abovementioned AGAC returns, calculating additional taxes as well as penalties and interest. However, Gramalote also believes that the DIAN has applied the tax legislation incorrectly and subsequently filed lawsuits before the Administrative Court of Cundinamarca challenging each of the DIAN’s rulings in respect of those tax returns. Gramalote’s lawsuits with respect to its 2013 and 2014 tax returns are still pending before the Administrative Court of Cundinamarca. The company has disclosed a contingent liability of $3.0 million in relation to Gramalote’s 2013 and 2014 tax returns (mainly covering related penalties).
The total amount claimed by the DIAN, related to the above tax matters that remain outstanding amounted to $8.1 million of which $8.0 million related to penalties as of 31 December 2022. Following a judgment of the Council of State in July 2019 holding that duplicate penalties may not be charged, the company expects that certain penalties will likely be waived, reducing the overall exposure to $0.1 million in respect of those tax matters. In addition, from 2017 onwards, the deduction of exploration costs is prohibited following a change in Colombian tax legislation. As a result, exploration costs have been treated in accordance with the amended tax legislation subsequent to that date.
•Argentina Tax Authority (AFIP) v. Cerro Vanguardia S.A. (CVSA): In July 2013, CVSA received a notification from the AFIP requesting corrections to the 2007, 2008 and 2009 income tax returns of about $0.9 million relating to the non-deduction of tax losses previously claimed on hedge contracts. The AFIP is of the view that the financial derivatives could not be considered as hedge contracts, as hedge contract losses could only be offset against gains derived from the same kind of hedging contracts. Penalties and interest on the disputed amounts are estimated at a further $4.2 million. CVSA and AFIP have corresponded on this issue over the past several years, executive directorand the Argentinian tax authorities continue to assert their position regarding the use of the financial derivatives. CVSA filed an appeal with the Tax Court in June 2015, and the parties submitted their final reports in July 2017. The matter is pending with the Tax Court.
•Ghanaian tax authorities v. AngloGold Ashanti (Ghana) Limited (AGAG) withholding tax audits: AGAG received a final tax audit report from the Ghana Revenue Authority (GRA) in which the GRA demanded payment of $9.0 million in respect of withholding taxes on payments to accumulatenon-resident persons. AGAG objected to the GRA’s assessment of withholding taxes on the basis that AGAG was duly exempted by the government of Ghana from withholding taxes on payments made to non-residents during the relevant periods in terms of the Deed of Warranty signed with the government of Ghana. In 2017, AGAG met with the Commissioner-General of the GRA and provided its position in writing together with the relevant supporting documents. AGAG has not yet received a MSRresponse from the Commissioner-General. Due to the statute of limitations applicable to tax assessments in Ghana, the amount of the tax uncertainty is estimated at $6.0 million as at 31 December 2022.
COLOMBIA
•Santa María-Montecristo and La Colosa class action lawsuits: Class action lawsuits have been filed in relation to each of AngloGold Ashanti sharesColombia S.A.S.’s (AGAC) Santa María-Montecristo and La Colosa projects. Each of the two lawsuits aims to stop exploration and mining in certain restricted areas affected by the projects due to environmental concerns.
In respect of the Santa María-Montecristo class action lawsuit, in September 2011, the Administrative Court of Tolima granted one of the plaintiffs a preliminary injunction suspending AGAC’s mining concession contracts in relation to this project. AGAC has challenged this injunction, nevertheless, it remains in place during the course of the court proceedings. In May 2019, the Administrative Court of Tolima ruled that a technical study be prepared to define the places in which mining activities could be performed in the Combeima canyon without posing any threat to the valuewater reservoirs of 200 percentIbagué, the capital of net annual base salary (additional 100 percent MSR)the Tolima department. In September 2020, the Council of State of Colombia (the highest court for administrative matters) on appeal overruled the decision of the Administrative Court of Tolima. The Council of State’s decision, which theyis final and not subject to further appeal, determined that AGAC, as concessionaire, has a right to develop the project if it can demonstrate to the mining and environmental authorities on the basis of technical studies that its mining exploration and, eventually, exploitation activities, will not impact the water resources of the Coello River basin and its tributaries. On 25 October 2022, AGAC returned the tenements involved in the Santa María-Montecristo project to the government of Colombia. This return is pending acceptance by the Colombian Mining Authority (Agencia Nacional de Minería) following which the Administrative Court of Tolima still needs to dismiss the case. Until such time, the injunction remains in place.
The consolidated La Colosa class action lawsuit originally consisted of four separate class actions. In relation to this project, in October 2016, Tolima’s Administrative Court ordered that a technical study be prepared by a panel of seven experts (selected by the plaintiff, AGAC, universities, the Colombian government and an NGO) to determine whether the La Colosa project presents a “threat” to the environment during its exploration phase. In December 2017, Ibagué’s Third Administrative Court ordered that another technical study, similar to the one described in the October 2016 order, be prepared for the La Colosa project. AGAC appealed both orders. In September 2018, Tolima’s Administrative Court consolidated all class actions in relation to the La Colosa project into one single class action lawsuit which is currently pending before the Council of State. The orders to prepare the technical studies have been temporarily suspended pending resolution by the Council of State. If AGAC’s appeal before the Council of State is not successful, the Company may have to perform one or more technical studies in relation to the La Colosa project. If the studies were to conclude that a “threat” exists, certain development activities at the La Colosa project may be suspended.
Further, while the plaintiffs in the La Colosa class action have petitioned the courts to cancel the mining concession contracts, the Company believes that the judiciary system in Colombia does not have the authority to order such cancellation. Such power, by law, vests solely in the Colombian government which, through the relevant Colombian mining authorities, has the discretion to declare concessions void if a concession holder breaches applicable environmental laws or regulations. The Colombian government, as the authority granting the mining concession contracts, is also a defendant in this class action lawsuit together with AGAC. AGAC continues to oppose, through a variety of integrated legal and political strategies, the class action lawsuit that was filed against it. However, if the plaintiffs prevail and AGAC is unable to perform its core concession contracts as a result of the judicial decision, the Company would be required to holdabandon the project.
•Cortolima’s injunction against AngloGold Ashanti Colombia S.A.S. (AGAC): In March 2013, Cortolima, a regional environmental authority in the Tolima department, issued a regulatory injunction against AGAC alleging, among other things, that in relation to certain of AGAC’s La Colosa mine design-related activities in the municipality of Piedras, AGAC engaged in drilling and other activities that could have negative effects on the environment. The injunction did not include any allegation that AGAC’s actions actually caused any environmental damages in Piedras. AGAC’s challenge of the injunction was unsuccessful before Cortolima. In August 2013, AGAC initiated legal proceedings before the Council of State of Colombia (the highest court for administrative matters) seeking annulment of the injunction as well as restoration of its rights to continue its activities in the area. In November 2019, the Council of State ruled that the competent judicial authority to decide on this matter is the Administrative Court of Tolima and referred the case to that court. In July 2020, the Twelfth Administrative Court of Tolima ruled that since the injunction is a preliminary and temporary measure imposed as part of the administrative approval process within Cortolima and not a final decision, it is not yet amenable to administrative judicial review. In July 2021, this decision was reversed on appeal by the Administrative Superior Court of Tolima in a ruling that such injunctions are amenable to administrative judicial review. The appellate court ordered the Twelfth Administrative Court of Tolima to review the matter and issue a decision thereon. Consequently, the Twelfth Administrative Court of Tolima admitted the case and a first hearing was held on 21 April 2022. Trial evidence was accepted. On 25 October 2022, another hearing was held to gather testimonies. The case remains pending. The Company expects that a final resolution of this
matter will include payment of a penalty by AGAC in an on-going basis.amount that is not expected to be material. While the injunction remains in place, AGAC is not able to engage in certain of its activities related to the La Colosa project.
Chief Financial Officer
Within three years•Piedras and Cajamarca popular consultations: In 2013, the local council of appointment (or for existing executive director,the city of Piedras, near the La Colosa project, organised a popular consultation to ban all mining activities in Piedras (Piedras popular consultation), the result of which was validated by the Administrative Court of Tolima as part of an administrative procedure. Although the Piedras popular consultation did not have an immediate impact on the La Colosa project (due to its distant location from the introductionproject), AGAC believes the Piedras popular consultation was in violation of national law in Colombia. In 2013, AGAC filed a ‘tutela’ action (a legal action alleging a violation of constitutional rights) with the Council of State of Colombia (the highest court for administrative issues). In 2014, AGAC’s ‘tutela’ action was dismissed by the Council of State for lack of standing on the grounds that AGAC did not have mining tenements in Piedras. In addition, in 2015, AGAC filed a request for annulment of the administrative acts adopted by the local authorities in furtherance of the results of the Piedras popular consultation, which was rejected by the Second Administrative Court of Ibagué. AGAC subsequently appealed this rule)ruling. In July 2021, AGAC was notified that the Administrative Superior Court of Tolima ruled on appeal that, in light of the 2018 decision of the Constitutional Court of Colombia (the highest court for constitutional issues) holding that local municipalities or regions are not entitled to veto mining activities through popular consultations (as further described below), executive directorthe results of the Piedras popular consultation, and the administrative acts adopted in furtherance thereof, were not enforceable. An extraordinary appeal against this ruling was submitted on 22 March 2022, which is pending. In addition, in September 2021, a third party filed a ‘tutela’ action with the Council of State arguing that the Administrative Superior Court of Tolima did not have the authority to accumulatedetermine that the results of the Piedras popular consultation, and the administrative acts adopted in furtherance thereof, were not enforceable. In December 2021, the Council of State dismissed this ‘tutela’ action for lack of standing.
In March 2017, the residents of the municipality of Cajamarca also voted in a MSRpopular consultation to disapprove mining projects in the municipality, including the La Colosa project (Cajamarca popular consultation). However, the Mining Minister of Colombia subsequently publicly confirmed that Cajamarca’s vote does not apply retroactively implying the Cajamarca popular consultation did not have an immediate impact on AGAC’s rights with respect to the La Colosa project. In April 2017, AGAC nevertheless suspended all exploration activities at the La Colosa project until there is more certainty about mining activity in Colombia. In October 2018, the Colombian Constitutional Court issued ruling SU-095-2018 stating that local municipalities or regions were not entitled to veto mining activities through popular consultations. The Constitutional Court also ordered the national legislative body, the Congress of Colombia, to enact a law within two years to ensure that local communities and groups are adequately consulted in the approval of mining activities in accordance with specific criteria set out in its ruling. Subsequently, a group of citizens submitted an annulment claim before the Administrative Court of Cundinamarca to cancel AGAC’s mining contract in Cajamarca on the grounds of the results of the Cajamarca popular consultation. After having admitted the annulment claim in December 2019, the Administrative Court of Cundinamarca dismissed the plaintiffs’ claim in May 2021 on procedural grounds. The plaintiffs subsequently appealed this decision and the appeal is currently pending before the Council of State.
•La Colosa Human Rights Litigation: In November 2014, the Personero (Ombudsman) of Ibagué, the capital of the Tolima department, filed a petition against the Colombian government before the Inter-American Commission on Human Rights (Commission), based in Washington, D.C., for alleged human rights violations protected by the American Convention on Human Rights (Convention) which has been ratified by Colombia along with many other Central and South American countries. The Commission has the power to refer a case to the Inter-American Court of Human Rights (Court) which is an autonomous judicial institution based in San José, Costa Rica whose purpose is the application and interpretation of the Convention. The petition alleges that the Colombian government denied justice to the Personero as a result of the failure of the Colombian judiciary to resolve the issues raised in two class actions filed by him before the local Colombian administrative courts within a reasonable period of time. Although AGAC is not a party to the suit, its outcome is nevertheless important to the development of the La Colosa project. The Commission currently has not accepted nor referred the case to the Court. If the case would be accepted or referred in the future, the Colombian government will have to defend itself against the lawsuit and will be bound by the findings of the Court. AGAC continues to regularly follow up with the Colombian government for updates.
•Paramo Delimitation: In November 2016, the Colombian government issued Resolution 1987/2016 delineating certain wetlands or moorlands as environmentally important protected areas, which designation includes certain areas in and around the La Colosa project. In these areas there are limitations, or in some instances outright bans, on mining and mining-related activities. These limitations and bans could potentially adversely impact the design, operations and production of the mining project at the La Colosa project. In June 2017, AGAC filed suit against the Colombian Ministry of the Environment in the Administrative Court of Cundinamarca to annul Resolution 1987/2016 on technical and other grounds. The lawsuit was admitted in April 2019. The Ministry of the Environment, as defendant in this action, is expected to file its response to the annulment claim.
•Zonte Metals: A Canadian junior mining company, Zonte Metals, filed applications for title to certain corridors, or small slivers of land, overlaying sections of the Gramalote project. The Secretary of Mines of Antioquia, the department in which the Gramalote project is located, denied the applications filed by Zonte Metals. However, Zonte Metals then filed a claim against the Colombian National Mining Agency (ANM) and the Antioquia Secretary of Mines before the Council of State of Colombia, by which it seeks to (i) revoke the resolution that denied its application and (ii) obtain the rights over the corridors requested in its application. The Council of State subsequently enjoined the Antioquia Secretary of Mines and Gramalote Colombia Limited (Gramalote) from progressing a pending application to integrate the disputed corridors with Gramalote’s tenement. The Antioquia Secretary of Mines has filed its response to the Zonte Metals claim, which includes arguments
aligned with the interests and position of Gramalote. In September 2017, the Council of State approved Gramalote’s request to be made an interested party to the lawsuit, but it rejected Gramalote’s request to join the Antioquia Secretary of Mines as a co-defendant in August 2019. In January 2019, the Council of State also re-affirmed that the Council of State is the competent judicial authority to hear the matter. The date for the first hearing is currently pending.
GHANA
•Pompora Treatment Plant Litigation: In April 2013, AngloGold Ashanti shares to(Ghana) Limited (AGAG) received a summons from Abdul Waliyu and 152 others in which the value of 75 percent of net annual base salary; and
At the end of six years, executive director is to accumulate a MSR of AngloGold Ashanti shares to the value of 150 percent of net annual base salary (additional 75 percent MSR) whichplaintiffs allege that they will be required to hold on an on-going basis.
Executive Committee members:
Within three years of appointment (or for existing executives, from the introduction of this rule), executive committee memberswere or are to accumulate a MSR of AngloGold Ashanti shares to the value of 75 percent of net annual base salary; and
At the end of six years, executive committee members are to accumulate a MSR of AngloGold Ashanti shares to the value of 150 percent of net annual base salary (additional 75 percent MSR) which they will be required to hold on an on-going basis.
The table below summarises each executive director and executive committee member’s accomplishmentresidents of the MSR:
|
| | | | | | | | | | | |
Executive | | Six-year target Achievement Date | | MSR holding as at 31 December 2019 as percentage of net base pay | | Three-year MSR Target Achievement Percentage | | Six-year MSR Target Achievement Percentage |
Executive Directors | | | | | | | | |
KPM Dushnisky | | March 2024 | | 279 | % | | 100 | % | | 200 | % |
KC Ramon | | March 2021 | | 507 | % | | 75 | % | | 150 | % |
Prescribed Officers | | | | | | | | |
SD Bailey(1) | | March 2025 | | 81 | % | | 75 | % | | 150 | % |
PD Chenard(2) | | March 2026 | | 0% |
| | 75 | % | | 150 | % |
GJ Ehm | | March 2019 | | 321 | % | | 75 | % | | 150 | % |
LEybers | | March 2023 | | 169 | % | | 75 | % | | 150 | % |
S Ntuli(1) | | March 2025 | | 34 | % | | 75 | % | | 150 | % |
ME Sanz Perez | | March 2019 | | 532 | % | | 75 | % | | 150 | % |
TR Sibisi | | March 2022 | | 155 | % | | 75 | % | | 150 | % |
| |
(1)
| Appointed prescribed officerObuasi municipality or its suburbs and that their health has been adversely affected by emissions and/or other environmental impacts arising in connection with effect from 1 January 2019 and the three year MSR achievement is due in March 2022. |
| |
(2)
| Appointed prescribed officer with effect from 1 April 2019 and the three year MSR achievement is due in March 2023. |
ANGLOGOLD ASHANTI SHARE INCENTIVE SCHEME
AngloGold Ashanti operated several share incentive schemes, the BSP, LTIP, CIP,current and/or historical operations of the Pompora Treatment Plant (PTP), which was decommissioned in 2000. The plaintiffs’ alleged injuries include respiratory infections, skin diseases and the DSP through which participating Executive Directors,certain cancers. The plaintiffs subsequently did not file their application for directions in time. In February 2014, executive members of the Executive CommitteePTP (AGAG) Smoke Effect Association (PASEA), sued AGAG by themselves and on behalf of their members (undisclosed number) on grounds similar to those discussed above, as well as economic hardships resulting from the failure of their crops. This matter has been adjourned indefinitely. As plaintiffs in these matters have not actively pursued these legal proceedings, AGAG is taking steps to have these matters dismissed for want of prosecution.
•Ghana Mining Licenses Litigation: In January 2019, AGAG and AngloGold Ashanti (Iduapriem) Limited (AAIL), along with other Ghanaian mining companies, were served with writs by two members of the Ghanaian Parliament seeking to invoke the jurisdiction of the Ghanaian Supreme Court (highest court in Ghana) for a declaration that the mining companies were not entitled to carry out any exploitation of minerals otherwise allowed under their relevant mining leases unless the leases had been timely ratified by the Parliament of Ghana. In January 2019, the Ghanaian Attorney General filed its statement of case, agreeing with the position of the plaintiffs (that the mining leases required parliamentary ratification) and requesting that the Supreme Court order the mining companies to pay the Ghanaian government all revenue related to mining activities accrued during the time such mining leases were unratified. In April 2019, AGAG and AAIL, in coordination with the other mining companies, filed their statement of case. The Supreme Court has not yet set a date for the first hearing to commence the case.
GUINEA
•Government of Guinea (National Claim Commission) v. Société AngloGold Ashanti Goldfields de Guinée SA (SAG): A national claim recovery commission established by the government of Guinea has demanded that SAG pay $43 million in dividends and penalties that would allegedly have been owed to the government of Guinea for the accounting years 2004 - 2007. SAG opposes the claim. Even though both parties had originally decided to submit their dispute to an independent audit firm to be appointed by a common accord, the independent audit firm was never appointed. In December 2010, the national claim recovery commission was disbanded and the matter was turned over to the Inspector General of the Ministry of Finance of Guinea. This matter has been dormant since it was handed over to the Inspector General.
TANZANIA
•Geita Gold Mining Limited (GGM): In January 2007, Jackson Manyelo and other management groupsplaintiffs filed a suit against GGM in the Mwanza High Court alleging that they were affected by blasting activities in the Katoma area carried out by GGM and had suffered damages in the amount of TZS9.6 billion (approximately $6 million). In April 2015, the High Court issued a judgment in favour of GGM. In 2016, plaintiffs appealed to the Court of Appeal, where the matter is pending.
•Geita Gold Mining Limited (GGM) and Samax Resources Limited (Samax) v. Government of Tanzania: In July 2017, GGM and Samax filed a notice of arbitration against the government of Tanzania arising from the enactment by the government of certain legislation that purports to make a number of changes to the operating environment of Tanzania’s extractive industries, including mining. The notice of arbitration was submitted in accordance with Article 12 of the companyAgreement for the Development of a Gold Mine at Geita, Mwanza between the government of Tanzania and its subsidiaries are giveneach of GGM and Samax (the MDA), and under the 1976 Arbitration Rules of the United Nations Commission on International Trade Law (UNCITRAL). The Arbitral Tribunal has been duly constituted. Since January 2019, at the request of the parties, the arbitral proceedings have been stayed several times in order to afford the parties the opportunity to acquire shares in the company. The intentionachieve an amicable resolution of the incentive scheme isdispute and as a result of the impact of the COVID-19 pandemic. In October 2022, the parties agreed to ensurestay the arbitration proceedings for a further period of 12 months until 6 November 2023.
•Arbitration under the United Kingdom-Tanzania Bilateral Investment Treaty (UK-Tanzania BIT):Unrelated to the arbitration proceedings under the MDA described above, in September 2017, GGM and Samax, together with Cluff Oil Limited and Cluff Mineral Exploration Limited, notified the government of Tanzania in writing that the mediumTanzanian government’s conduct amounted to long-term interestsa breach of its commitments under the UK-Tanzania BIT. This notice triggered a ‘cooling-off’ period under the UK-Tanzania BIT, pursuant to which the parties had six months to achieve an amicable resolution to their dispute. Following the expiry of the executive‘cooling off’ period in March 2018, GGM, Samax, Cluff Oil Limited and shareholdersCluff Mineral Exploration Limited are aligned, providing rewardsnow entitled to submit their dispute with the executives and wealth creation opportunitiesgovernment of Tanzania to ICSID arbitration in accordance with the shareholders whenterms of the strategic performance drivers are achieved.
Non-Executive Directors are not eligible to participate in any share incentive scheme.
Employees participate in the share incentive schemeUK-Tanzania BIT to the extent that they are granted optionsmay deem this necessary.
BRAZIL
•Public Civil Action between Mineração Serra Grande S.A. (MSG) and the Goiás State Public Prosecutor's Office (Prosecutor): In August 2019, the Prosecutor filed a public civil action against MSG in the local court of Crixás (Court) arguing that the Serra Grande tailings dam should be deactivated and decommissioned due to its size and upstream construction method. The Prosecutor requested the Court to grant an injunction ordering MSG to, inter alia, completely deactivate the tailings dam by 15 September 2021 and decommission the tailings dam, including complete removal of tailings material, by 15 September 2022. Further, the Prosecutor requested that a daily penalty of approximately $245,000 be imposed for MSG’s failure to comply with such injunction. MSG submitted its defence in September 2019 and contends that it has not violated any Brazilian laws or rightsregulations applicable to acquire shares and accept them. All options or rights which have not been exercised within 10 years from the date of grant, automatically expire.
The incentives offered by AngloGold Ashanti are reviewed periodically to ensure that they remain globally competitive, so as to attract, motivate and retain managersoperations of the highest calibre. As a result, several typesSerra Grande tailings dam. In February 2020, the Court granted an injunction in respect of incentives, each with their own issue and vesting criteria, have been granted to employees. These are collectively known as the “AngloGold Ashanti Share Incentive Scheme” or “Share Incentive Scheme”.
Although Remco has the discretion to incentivise employees through the issue of shares, only options or awards have so far been granted. The type and vesting criteria of the options or awards granted are:
Bonus Share Plan (BSP)
Prior to the implementation of the DSP in January 2018, AngloGold Ashanti granted awards under the BSP, which was approved by shareholders at the Annual General Meeting held on 29 April 2005. The scheme has undergone a number of changes, eachthe requests made by the Prosecutor. In line with the legal requirements of ANM Resolution No. 13/19, the injunction ordered the deactivation of the Serra Grande tailings dam by 15 September 2021, but did not include requirements to decommission the tailings dam, or to conduct complete removal of tailings material, by 15 September 2022. MSG filed a motion for clarification in relation to certain items of the Court’s decision. In May 2020, the Court clarified that its injunction should be interpreted in line with the legal requirements of ANM Resolution No. 13/19. In June 2020, the Prosecutor presented further technical arguments in court, reiterating its request for an injunction ordering MSG to, inter alia, deactivate the tailings dam by September 2021 and to decommission the tailings dam, including complete removal of tailings material. Afterwards, MSG filed an interlocutory appeal against the preliminary injunction granted in February 2020 and a motion for further clarification. In August 2020, both MSG and the Prosecutor filed petitions informing the Court that the parties did not wish to produce oral evidence at a hearing. In May 2021, the Court upheld the preliminary injunction ordering the deactivation of the Serra Grande tailings dam by 15 September 2021 and its decommissioning by 15 September 2025, both of which are consistent with the deadlines established by existing legal and regulatory requirements. In June 2021, the Prosecutor appealed this decision. The Court of Appeals of Goiás tried the case on 4 August 2022 and has affirmed the first instance decision. On 3 November 2022, the Prosecutor appealed this decision to the Superior Court of Justice.
•Public Civil Action between AngloGold Ashanti Córrego do Sítio Mineração SA (AGA Mineração) and the Minas Gerais State Public Prosecutor's Office (Prosecutor): In March 2020, the Prosecutor filed a public civil action against AGA Mineração in the local court of Sabará (Court) alleging a violation of Minas Gerais Law No. 23.291/19, which was adopted in February 2019. Article 12 of this law prohibits the grant of an environmental license for construction, installation, expansion or raising of a tailings dam if the “dam break” studies identify communities that are located in the self-rescue zone. In February 2020, the state of Minas Gerais approved AGA Mineração’s permit to operate the Cuiabá tailings dam following the determination by the Minas Gerais’ Attorney’s Office that Law No. 23.291/19 does not apply to tailings dams already in operation. In its lawsuit, the Prosecutor requested the Court to grant an injunction ordering the suspension of AGA Mineração’s operational permit for the Cuiabá tailings dam on the grounds that it was issued in violation of this law. During the months of March through May 2020, all parties presented their arguments in court. In June 2020, the Court rejected the Prosecutor’s request to grant an injunction. In July 2020, the Court’s decision not to grant an injunction was upheld on appeal by the Court of Appeals of Minas Gerais. Subsequently, the Court issued an order proposing a conciliation hearing between the parties, to which none of the parties objected. On 28 January 2022, the parties filed a joint petition requesting the cancellation of the conciliation hearing and the suspension of the legal proceedings in view of negotiations between the parties to explore a possible settlement. On 2 June 2022, AGA Mineração and the Prosecutor entered into a settlement. Pursuant to the settlement, AGA Mineração will, among other measures, update the emergency action plan and decommission the Cuiabá tailings dam according to the schedule filed with the relevant mining and environmental agencies. AGA Mineração will also prepare a technical study to assess the potential evacuation of communities from the self-rescue zone during the decommission stages. The Court approved the settlement on 29 July 2022 and the public civil action was terminated.
DIVIDENDS
General
Dividends are proposed by and approved by the shareholders. Each award madeboard of directors of AngloGold Ashanti (the “board”), based on the Company’s financial performance and compliance with applicable laws, including in respect of the BSP entitles the holder to acquire one ordinary share at “nil” cost, provided that the participant remainssolvency and liquidity test contemplated in the employ ofSA Companies Act. Dividends are recognised when declared by the company atBoard. AngloGold Ashanti’s dividend policy allows the date of vesting unless an event, such as death, retirement or redundancy occurs, which may result inBoard to declare a pro-rata allocation of awards and an earlier vesting date.
Under the scheme, the Executive Committee members received an annual matching allocation of 150 percent of their cash bonus while all other participating employees received an annual matching allocation of 120 percent of their cash bonus. The vesting period runs over a two year period with 50 percent vesting 12 months after the date of issue and the remaining 50 percent vesting 24 months after the date of issue.
The last shares allocation under the BSP, which became fully vested in February 2020, was made in February 2018 in respect of the 2017 performance year duesemi-annual dividend to the implementation of the new incentive scheme, the DSP, in January 2018.
Long Term Incentive Plan (LTIP)
Prior to the implementation of the DSP in January 2018, AngloGold Ashanti granted awards under the LTIP, which was approved by shareholders at the Annual General Meeting heldbe based on 29 April 2005. Executive directors and selected senior management were eligible for participation. Each award made in respect of the LTIP entitled the holder to acquire one ordinary share at “nil” cost. Awards granted vested in three years from the date of grant, to the extent that the set company performance targets, under which the awards were made, were met, and provided that the participant remained in the employ of the company at the date of vesting, unless an event, such as death, retirement or redundancy occurred, which may have resulted in a pro-rata allocation of awards and an earlier vesting date.
The last share allocation under the LTIP scheme was made in 2017 as cash and or share settled awards. There has not been any allocation under the LTIP scheme since 2017 due to the implementation of the new incentive scheme, the DSP, in January 2018. On 18 February 2020, the Remco approved that the awards granted in 2017 be settled as 50% cash settled and 50% share settled through an AngloGold Ashanti on market share purchase.
Co-investment plan
Prior to the implementation of the Deferred Share Plan (DSP) in January 2018, with effect from February 2013, AngloGold Ashanti operated a co-investment in order to assist our executives in meeting the MSR. Our executives were given the opportunity, on a voluntary basis, to participate in the Co-Investment Plan (CIP), on the conditions below:
Executives were allowed to take up to 50 percent of their after-tax cash bonus and participate in a further matching scheme by purchasing shares in AngloGold Ashanti and the company offered an equity matched their initial investment into the scheme at 15020 percent of the equity originally invested,free cash flow generated by the business for that financial year, before taking into account growth capital expenditure, subject to applicable laws required to be complied with vesting overbefore a two-year perioddividend may be declared by the Board. The Board may exercise its discretion on an annual basis, taking into consideration the prevailing market conditions, balance sheet flexibility and future capital commitments of the Group.
As a company incorporated in two equal tranches providedaccordance with and bound by the executives remainedcompany laws of the Republic of South Africa with its primary listing on the Johannesburg Stock Exchange, AngloGold Ashanti is required to declare dividends in employmentSouth African rands. Therefore, dividends are declared in South African rands and retainedpaid in Australian dollars, South African rands, British pounds and Ghanaian cedis. Dividends paid to registered holders of AngloGold Ashanti ADSs are paid in US dollars converted from South African rands by The Bank of New York Mellon, as Depositary, in accordance with the original investment. Duedeposit agreement. Exchange rate fluctuations may therefore affect the value of the dividends received by registered shareholders and distributions paid by the relevant Depositary to investors holding AngloGold Ashanti securities. Moreover, fluctuations in the exchange rates of the US dollar may affect the US dollar price of the ADSs on the NYSE. For details on taxation and exchange controls applicable to holders of ordinary shares or ADSs, see “Item 10D: Exchange Controls”,“Item 10E: Taxation—South African Taxation—Taxation of dividends” and “Item 10E: Taxation—United States Taxation—Taxation of dividends”.
Dividends declared (in the ordinary course from trading and non-trading profits) to foreign shareholders are not subject to the implementationapproval by the South African Reserve Bank (SARB) in terms of South African foreign exchange control regulations. Dividends are freely transferable to foreign shareholders from both trading and non-trading profits earned in South Africa by publicly listed companies. Dividends in specie or special dividends may require SARB approval prior to declaration and payment to foreign shareholders.
Under South African law, the Company may declare and pay dividends from any reserves included in total shareholder’s equity (including share capital and share premium) calculated in accordance with International Financial Reporting Standards (IFRS), subject to the solvency and liquidity test.
Withholding tax
South Africa currently imposes a Dividend Withholding Tax on Companies (dividends tax) at a rate of 20 percent on the net amount of the new incentive scheme in January 2018,dividend declared and paid by a resident company, other than a Headquarter Company.
The dividends tax is generally imposed on the DSP, the last CIP participation took place in 2018 in respectbeneficial owner of the cash bonusdividends. The dividends paid to South African shareholders may be exempt from dividend withholding tax in terms of certain domestic exemptions, or may be reduced to a lower rate under an applicable double tax treaty, if the required declarations and undertakings are provided by the beneficial owner of the dividend. In the case of dividends paid to a US holder with respect to shares, the Convention Between the Government of the United States of America and the Republic of South Africa for the 2017 performance year. Avoidance of Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on Income and Capital Gains, signed 17 February 1997 (the “US/SA Double Taxation Treaty”) would generally limit the dividends tax rate to five percent of the gross amount of the dividends if a corporate US holder holds directly at least ten percent of the voting stock of AngloGold Ashanti. In all other cases, the maximum tax rate under the US/SA Double Taxation Treaty is 15 percent of the gross amount of the dividend. Different rules may apply if the beneficial owner of the dividends is a US resident who carries on business in South Africa through a permanent establishment situated in South Africa, or performs in South Africa independent personal services from a permanent establishment situated in South Africa, and the dividends are attributable to such permanent establishment.
8B. SIGNIFICANT CHANGES
Refer to “Item 18: Financial Statements—Note 35—Subsequent Events”.
ITEM 9: THE OFFER AND LISTING
9A. OFFER AND LISTING DETAILS
The final company matching investment will be madeprincipal trading markets for AngloGold Ashanti’s ordinary shares are the New York Stock Exchange (NYSE), in 2020the form of ADSs, under the symbol “AU” and the JSE Limited, in the form of ordinary shares, under the symbol “ANG”. Each ADS represents one ordinary share.
9B. PLAN OF DISTRIBUTION
Not applicable.
9C. MARKETS
NATURE OF TRADING MARKET
The principal trading markets for AngloGold Ashanti’s ordinary shares are the executives who participatedNYSE, in 2018.the form of ADSs, under the symbol “AU” (each representing one ordinary share) and the JSE Limited, in the form of ordinary shares, under the symbol “ANG”.
Deferred Share Plan (DSP)AngloGold Ashanti’s ordinary shares are also listed on the Ghana Stock Exchange, as ordinary shares under the symbol “AGA” and in the form of Ghanaian Depositary Shares or GhDSs (each representing one one-hundredth of an ordinary share) under the symbol “AAD”, and the Australian Securities Exchange, in the form of CHESS Depositary Interests (each representing one-fifth of an ordinary share) under the symbol “AGG”. AngloGold Ashanti was approved for a secondary listing on A2X Markets (A2X) in South Africa and its shares were admitted to trading on A2X on 6 June 2022 under the symbol “ANG”.
On
9D. SELLING SHAREHOLDERS
Not applicable.
9E. DILUTION
Not applicable.
9F. EXPENSES OF THE ISSUE
Not applicable.
ITEM 10: ADDITIONAL INFORMATION
10A.SHARE CAPITAL
Not applicable.
10B.MEMORANDUM OF INCORPORATION
At the annual general meeting held on 16 May 2017,2022, AngloGold Ashanti received approval from shareholders (by way of a special resolution) to amend the shareholders approvedMoI as follows:
1.by the introductiondeletion of the DSPphrase “Subject to replace9.4.3, this” at the BSP, the LTIPbeginning of clause 1.3 and the CIPreplacement thereof with effect fromthe word “This”;
2.by the deletion of clause 9 (Rights Attaching to Preference Shares) in its entirety; and
3.by the amendment of Schedule 1 January 2018. The DSP is a single incentive scheme for short-term(Authorised Shares) as follows:
3.1 by the deletion of paragraphs 2, 3 and long-term performance. Under4 of Schedule 1 in their entirety; and
3.2 by the DSP, a portion of each award is paid in cash as a bonus and the balance is delivered as either deferred cash or deferred shares (ordinary shares), vesting equally over a period of two, three or five years, depending on the leveldeletion of the participant. The deferred shares are awarded as conditional rights to shares with dividend equivalents. The total incentive is determined based on a combination of company and individual performance measures, defined annually, and weightings are applied to each measure. The metrics are defined against the objectives that most strongly drive company performance and are weighted to financial outcomes, production, cost and sustainability. Each metric is weighted and has a threshold, target and stretch definition related to the company budget and the desired stretch targets for the year. Below threshold achievement results in no payment. Attable at the end of each financial year, the CompanySchedule 1 in its entirety and the CEO, CFO and EVP/COO’s performancereplacement thereof with the following new table:
| | | | | |
Share capital | South African Rands |
600,000,000 ordinary shares of R0.25 each | 150,000,000 |
The reason for these amendments is assessed byto comply with the Remcoprovisions of the SA Companies Act and the Board againstJSE Listings Requirements and, following the defined metrics to determine the quantumrecent redemption of all of the cash portion and the quantum of the deferred portion as a percentage of base salary as follows:
|
| | | | | | | | | | | | | | | | | | |
| Cash |
| Shares |
| Total Incentive |
| Cash |
| Shares |
| Total Incentive |
| Cash |
| Shares |
| Total Incentive |
|
Level | Threshold Achievement | On Target Achievement | Maximum Achievement |
CEO | 50.00% |
| 100.00% |
| 150.00% |
| 100.00% |
| 200.00% |
| 300.00 | % | 150.00% |
| 300.00% |
| 450.00 | % |
CFO | 42.50 | % | 92.50 | % | 135.00 | % | 85.00 | % | 185.00 | % | 270.00 | % | 127.50 | % | 277.50 | % | 405.00 | % |
EVP/COO | 37.50 | % | 87.00 | % | 124.50 | % | 75.00 | % | 174.00 | % | 249.00 | % | 112.50 | % | 261.00 | % | 373.50 | % |
CEO means Chief Executive Officer.
CFO means Chief Financial Officer.
EVP/COO means Executive Vice President/Chief Operating Officer.
One set of performance metrics is used to determine the cash portion and deferred portion. Future vesting of the deferred portion is subject to continued employment. Performance measures are weighted between company and individual key performance indicators (KPIs), as follows:
|
| | |
Level | Company performance weighting | Individual performance weighting |
CEO | 70.00% | 30.00% |
CFO | 60.00% | 40.00% |
EVP/COO | 60.00% | 40.00% |
Company and individual performance measures are assessed over each financial year, with the exception of certain company measures that are measured over a trailing three-year basis. The first allocation under the DSP was made in February 2019 in respect of the 2018 performance year. For further information about the DSP, see Exhibit 19.4.1.3.
PARTICIPATION BY EXECUTIVE DIRECTORS, EXECUTIVE MANAGEMENT AND OTHER MANAGERS IN THE ANGLOGOLD SHARE INCENTIVE SCHEME
For details of the share-based awards and rights to subscribe for ordinary shares in each company granted to, and exercised by, executive directors, executive management and other managers on an aggregate basis during the year to 31 December 2019 and subsequent to year end up to 19 March 2020, see "Item 18: Financial Statements-Note 33-Related Parties-Directors and other key management personnel".
PARTICIPATION BY EMPLOYEES IN THE ANGLOGOLD SHARE INCENTIVE SCHEME
For details of the share-based awards and rights to subscribe for ordinary shares in the company granted to, and exercised by, employees on an aggregate basis during the year to 31 December 2019, see "Item 18: Financial Statements-Note 11-Share-based payments".
ITEM 7: MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS
Overview
Description of AngloGold Ashanti’s share capital
AngloGold Ashanti’s share capital consists of four classes of stock:
Ordinary shares, par value 25 South African cents each (the “ordinary shares”);
A redeemable preference shares, par value 50 South African cents each (the “A preference shares”);
B redeemable preference shares, par value 1 South African cent each (the “B preference shares”); and
C redeemable preference shares of no par value (the “C preference shares”).
The authorised and issued share capital of AngloGold at 31 December 2019 is set out below:
|
| | | | | | |
Title of class | | Authorised |
| | Issued |
|
Ordinary shares | | 600,000,000 |
| | 415,301,215 |
|
A preference shares | | 2,000,000 |
| | 2,000,000 |
|
B preference shares | | 5,000,000 |
| | 778,896 |
|
C preference shares | | 30,000,000 |
| | 0 |
|
All the issued ordinary shares, A redeemable preference shares and B redeemable preference shares are fully paid and are not subjectof the Company, to further calls or assessment by AngloGold Ashanti. For a discussion of rights attachingremove all references in the MoI to the ordinary shares, the A redeemable preference shares, the B redeemable preference shares and the C redeemable preference shares, see “Item 10B: Memorandumas well as all of Incorporation”.
The following are the movements in the ordinary issued share capital at 31 December:
Ordinary shares
|
| | | | | | | | | | | | | | | | | | |
| | Number of Shares |
| | Rand |
| | Number of Shares |
| | Rand |
| | Number of Shares |
| | Rand |
|
| | 2019 | | 2018 | | 2017 |
At 1 January | | 412,769,980 |
| | 103,192,498 |
| | 410,054,615 |
| | 102,513,654 |
| | 408,223,760 |
| | 102,055,940 |
|
Issued during the year: | | | | | | | | | | | | |
Exercise of options by participants in the AngloGold Share Incentive Scheme | | 2,531,235 |
| | 632,809 |
| | 2,715,365 |
| | 678,844 |
| | 1,830,855 |
| | 457,714 |
|
31 December 2019 | | 415,301,215 |
| | 103,825,307 |
| | 412,769,980 |
| | 103,192,498 |
| | 410,054,615 |
| | 102,513,654 |
|
During the period 1 January 2020provisions relating to and including 19 March 2020, 740,448 ordinary shares were issued at an average issue price of R152.70 per share, resulting in 416,005,663 ordinary shares being in issue at 19 March 2020.
Redeemable preference shares
A and Ball such redeemable preference shares, and thereby to remove all of which are held by Eastvaal Gold Holdings Limited, a wholly owned subsidiary of AngloGold Ashanti. The Csuch redeemable preference shares have no par value but havefrom the same rights as the B preference shares save that the C preference shares rank after the B preference shares (but prior to the A preference shares) as regards the payment of dividends, redemption proceeds and payment on winding up of the company. The process to cancel all the A, B and C redeemable preference shares is ongoing.
7A. MAJOR SHAREHOLDERS
According to information available to the directors, the following are the only shareholders or their associates holding, directly or indirectly, in excess of five percent of the ordinary issuedauthorised share capital of the company:Company.
Registration
AngloGold Ashanti is incorporated under the company laws of the Republic of South Africa and is registered with the Companies and Intellectual Property Commission under registration number 1944/017354/06. The SA Companies Act has abolished the requirement for specific “object and purpose” provisions to be included in a memorandum of incorporation and although the MoI is silent on the matter, the company continues to carry on as its main business, gold exploration, the mining and production of gold, the manufacturing, marketing and selling of gold products and the development of markets for gold.
AngloGold Ashanti’s MoI is available for inspection as set out in “Item 10H: Documents on Display” and a summary of the pertinent provisions, including the rights of the holders of shares in AngloGold Ashanti, are set out below.
This summary does not contain all the information pertaining to the rights of holders of AngloGold Ashanti’s ordinary shares and is qualified in its entirety by reference to the laws of South Africa and AngloGold Ashanti’s governing corporate documents. As well as being governed by the provisions of the MoI, the rights of holders of AngloGold Ashanti’s ordinary shares are governed by the JSE Listings Requirements, the SA Companies Act and the Companies Regulations, 2011, promulgated under the SA Companies Act (the “Regulations”), which include the Takeover Regulations. Further, the rights of holders of AngloGold Ashanti ADSs are governed by the Deposit Agreement between AngloGold Ashanti and The Bank of New York Mellon. See “Item 10C: Material Contracts—The Deposit Agreement”.
The SA Companies Act provides that shares will no longer have a par or nominal value and hence no new shares having a nominal or par value may be authorised. However, any shares which have a nominal or par value authorised prior to 1 May 2011 (the effective date of the SA Companies Act) continue to have that nominal or par value and can be issued as such for so long as there are par value shares in the company’s authorised share capital. Should the company wish, it may also elect to convert its authorised par value shares to shares of no par value, subject to the relevant process and approvals contemplated in the SA Companies Act.
Directors
|
| | | | | | | | | | | | | | | |
Ordinary shares held at | | 31 December 2019 | | 31 December 2018 | | 31 December 2017 |
Shareholder* | | Number of Shares |
| | Percent Voting Rights | | Number of Shares |
| | Percent Voting Rights | | Number of Shares |
| | Percent Voting Rights |
BlackRock Inc. | | 41,236,154 |
| | 9.93 | | 32,926,713 |
| | 7.98 | | 38,926,159 |
| | 9.49 |
Public Investment Corp. of South Africa | | 30,439,075 |
| | 7.33 | | 25,395,823 |
| | 6.15 | | 25,808,607 |
| | 6.29 |
Van Eck Global | | 27,375,511 |
| | 6.59 | | 52,402,004 |
| | 12.70 | | | | |
The management and control of any business of AngloGold Ashanti is vested in its board of directors (board). The authority of the board to manage and direct the business and affairs of the company is not limited, restricted or qualified by the MoI.
* Shares
Appointment and Retirement of Directors
The shareholders of the Company have the power to elect the directors, and shareholders are also entitled to elect one or more alternate directors, in accordance with the provisions of the MoI and the SA Companies Act.
The board may not necessarily reflectappoint any person who satisfies the beneficial shareholder.requirements for election as a director to fill any vacancy and serve as a director on a temporary basis until the vacancy is filled by election by shareholders entitled to exercise voting rights in such an election.
The MoI authorises the chairperson of the board, subject to the written approval of the majority of the directors, to appoint any person as a director provided that such appointment is approved by shareholders at the next shareholders’ meeting or annual general meeting.
At 31 December 2019,every annual general meeting one-third of the directors will retire by rotation, or if their number is not a totalmultiple of 159,694,660three, then the number nearest to but not less than one third. The directors to retire at every annual general meeting will be those who have been the longest in office since their last election. Directors retiring by rotation are eligible for re-election. Directors who voluntarily decide not to make themselves available for re-election may be counted towards the one-third of directors required to retire at the relevant annual general meeting.
The MoI contains no provision for directors to hold qualification shares. The MoI does not impose an age limit for the retirement of directors.
Remuneration
In accordance with the SA Companies Act, the MoI provides that the directors are entitled to such remuneration for their services as directors as AngloGold Ashanti’s shareholders may approve by special resolution in a general meeting or annual general meeting within the previous two years of the date of payment of such remuneration. If a director is employed in any other capacity, or holds an executive office or performs services that, in the opinion of the board, are outside the scope of the ordinary duties of a director, he or she may be paid such additional remuneration as a disinterested quorum of directors may reasonably determine.
Interests of Directors and Restriction on Voting
Although the interests of directors are not dealt with in the MoI, the provisions of the SA Companies Act in this regard are unalterable and will automatically apply, together with the applicable common law rules. Under the SA Companies Act, the procedures to deal with the personal financial interests of directors also apply to prescribed officers (i.e., persons who exercise general executive control over and management of the whole, or a significant portion, of the business and activities of the company or regularly participate to a material degree in the exercise of general executive control over and management of the whole, or a significant portion, of the business and activities of the company, irrespective of the office held or function performed by such persons) and any person who is a member of a committee of the board of the company, whether or not that person is also a member of the company’s board. The SA Companies Act provides that a director or such other person with a personal financial interest must disclose this to the board and cannot vote on or, after having made the disclosures to the meeting as prescribed by the SA Companies Act, remain present during the meeting when the matter in which he/she has interest is being discussed but will be counted as present for the purposes of a quorum (but is not to be regarded as being present at the meeting for the purposes of determining whether a resolution has sufficient support to be adopted).
Share Rights, Preferences and Restrictions
Allotment and Issue of Ordinary Shares
Subject to the JSE Listings Requirements, the SA Companies Act and/or with approval of shareholders in a general meeting, unissued ordinary shares (or 38 percentmust be offered to existing ordinary shareholders, pro rata to their ordinary shareholdings, unless they are issued for the acquisition of issuedassets. The shareholders in a general meeting may authorise the board to issue any unissued ordinary share capital) were heldshares.
Dividends, Rights and Distributions
The ordinary shares participate fully in all dividends, other distributions and entitlements as and when declared by AngloGold Ashanti in respect of fully paid ordinary shares. Under South African law, AngloGold Ashanti may declare and pay distributions (as defined in the SA Companies Act, which includes dividends), subject to the Company satisfying the solvency and liquidity test as set out in section 4 of the SA Companies Act and the board passing a resolution acknowledging that such test has been applied and has reasonably concluded that the Company would satisfy such test immediately after completing the distribution. Dividends are payable to shareholders registered at a record date after the date of declaration of the dividend.
As a Company incorporated and registered in the Republic of South Africa with its primary listing on the Johannesburg Stock Exchange, AngloGold Ashanti is required to declare dividends in South African rands. Dividends are paid in South African rands, Australian dollars, Ghanaian cedis and British pounds. Registered holders of AngloGold Ashanti ADSs are paid dividends in US dollars by The Bank of New York Mellon as Depositary, forin accordance with the company’s American Depositary Receipt programme. Each American Depositary Share (ADS) is equivalentDeposit Agreement. See “Item 10C: Material Contracts—The Deposit Agreement”.
Although not stated in the MoI, but subject to one ordinary share. At 31 December 2019, the numberJSE Listings Requirements and the SA Companies Act, any dividend may be paid and satisfied, either wholly or in part, by the distribution of persons who were registered holders of ADSs was reported at 2,197. AngloGold Ashanti is aware that many ADSs are held of record by brokers and other nominees, and accordingly the above numbers are not necessarily representative of the actual number of persons who are beneficial holders of ADSsspecific assets, or the number of ADSs beneficially held by these persons.
All shareholders have the same voting rights.
As at 31 December 2019, there were 11,837 holders on recordin paid-up securities of AngloGold Ashanti or of any other Company, or in cash, or in any one or more of such ways as the directors may at the time of declaring the dividend determine and direct.
All dividends remaining unclaimed for a period of not less than three years from the date on which they became payable, may, by a resolution of the directors, become forfeited for the benefit of the Company.
Voting Rights
Each ordinary shares. Of these holders 492 had registered addressesshare confers the right to vote at all general meetings. Each holder present in person or by proxy or, in the United States andcase of a corporate entity, represented, has one vote on a show of hands. If a poll is held, a totalholders present or any duly appointed proxy will have one vote for each ordinary share held. A holder of 80,410,115 ordinary shares 19.36 percentis entitled to appoint a proxy to attend, speak and vote at any meeting on his or her behalf and the proxy need not be a shareholder. Holders of the total outstanding ordinary shares. In addition, certain accounts on record with registered addresses outside the United States, includingADSs are not entitled to vote in person at meetings, but may vote by way of proxy through The Bank of New York Mellon as the ADS issuer. Holders of Australian Chess Depositary Interests (CDIs) and Ghanaian Depositary Shares (GhDSs) are not entitled to vote in person or by proxy at meetings, but may vote by instructing Chess Depository Nominees and NTHC Limited as Depositary, respectively, how to vote their shares.
There are no limitations on the right of non-South African registered shareholders to hold or exercise voting rights attaching to any of the ordinary shares.
The MoI specifies that the rights relating to any class of shares may be modified or abrogated with the sanction of a resolution passed as if it were a special resolution of the holders of shares in that class at a separate general meeting.
Increase and Reduction of Capital
The Company is authorised to issue the shares specified in the MoI and all such shares are required to be issued as fully paid up in accordance with the applicable approval and/or other requirements of the SA Companies Act and the JSE Listings Requirements.
The directors are authorised, subject to any requirements of the JSE Listings Requirements, the SA Companies Act, the Regulations and the MoI, to increase or decrease the number of authorised shares of any class of shares, reclassify any shares that have been authorised but not issued, classify any unclassified shares that have been authorised but not issued, and determine the preferences, rights, limitations or other terms of any class of authorised shares or amend any preferences, rights, limitations or other terms as determined. However, such capital amendments require an amendment to be made to the MoI. The SA Companies Act and the JSE Listings Requirements currently do not allow the MoI to be amended to give effect to such capital amendments without the approval of ordinary shareholders by special resolution.
Rights Upon Liquidation
In the event of the winding up of AngloGold Ashanti the ordinary shares confer the right to participate equally in any surplus arising from the liquidation of all assets of AngloGold Ashanti.
Shareholders’ Meetings
The directors may convene meetings of AngloGold Ashanti shareholders. Subject to the provisions of the SA Companies Act, the shareholders may requisition for the convening of a meeting.
Notice of each AngloGold Ashanti annual general meeting and general meeting of AngloGold Ashanti shareholders must be delivered at least 15 business days before that shareholders’ meeting is to begin. In accordance with the SA Companies Act, business days are calculated by excluding the first day, including the last day and excluding Saturdays, Sundays and any public holiday in the Republic of South Africa. In terms of the MoI, all shareholders are entitled to attend shareholders’ meetings at which they are entitled to vote.
The quorum of a shareholders’ meeting is sufficient persons present, in person or by proxy, at the meeting to exercise, in aggregate, at least 25 percent of all of the voting rights that are entitled to be exercised in respect of at least one matter to be decided at the meeting and a quorum must remain present for the continuation of that shareholders meeting, provided that at least three shareholders must be present and remain at the meeting. Such quorum requirement also applies for the consideration of any matter to be decided at the meeting. If the meeting is not quorate within 30 minutes after the appointed time for the meeting to begin (or such longer or shorter period as the chairperson may determine), it will be postponed, without motion, vote or further notice, for 1 week and the shareholders present, in person or by proxy, at the postponed meeting will constitute a quorum.
For an ordinary resolution to be approved by shareholders, it must be supported by more than 50 percent of the voting rights exercised on the resolution. For a special resolution to be approved by shareholders, it must be supported by at least 75 percent of the voting rights exercised on the resolution.
Disclosure of Interest in Shares
Under South African law, a person must notify AngloGold Ashanti within three business days after that person (i) acquires a beneficial interest in sufficient securities of a class of securities issued by AngloGold Ashanti such that, as a result of the acquisition, the person holds a beneficial interest in securities amounting to five percent, ten percent, fifteen percent or any further whole multiple of five percent of the issued securities of that class or (ii) disposes of any beneficial interest in sufficient securities of a class of securities issued by AngloGold Ashanti such that, as a result of the disposition, the person no longer holds a beneficial interest in securities amounting to a particular multiple of five percent of issued securities of that class. When AngloGold Ashanti has received the notice referred to above it must file a copy with the Takeover Regulation Panel and report the information to holders of the relevant class of securities unless the notice concerned is a disposition of less than one percent of the class of securities.
If the securities of AngloGold Ashanti are registered in the name of a person who is not the holder of the beneficial interest in all of the securities in AngloGold Ashanti held by that person, that registered holder of the securities must disclose the identity of the person on whose behalf that security is held and the identity of each person with a beneficial interest in securities so held, the number and the class of securities held for each such person with a beneficial interest and the extent of each such beneficial interest. This information must be disclosed in writing to the Company within five business days after the end of every month during which a change has occurred in the information or more promptly or frequently to the extent so provided by the requirements of a Central Securities Depository. A Company that knows or has reasonable cause to believe that any of its securities are held by one person for the beneficial interest of another may by notice in writing require either of those persons to confirm or deny that fact, provide particulars of the extent of the beneficial interest held during the three years preceding the date of the notice and disclose the identity of each person with a beneficial interest in the securities held by that person, which information must be provided within ten business days of the receipt of the notice.
AngloGold Ashanti is obligated to establish and maintain a register of the disclosures described above and to publish in its annual financial statements a list of the persons who hold beneficial interests equal to or in excess of five percent of the total number of ordinary shares issued by AngloGold Ashanti together with the extent of those beneficial interests.
Rights of Minority Shareholders
Majority shareholders of South African companies have no fiduciary obligations under South African common law to minority shareholders. However, under the SA Companies Act, a shareholder or director may, under certain circumstances, seek relief from a court if he has been unfairly prejudiced by any act or omission of the Company or a related person, by the conduct of the business of the Company or a related person in a particular manner, or the exercise of the powers of the directors of the Company or a related person in a particular manner. There may also be personal and derivative actions available to a shareholder of a Company.
Pursuant to the SA Companies Act, a shareholder may petition a South African court for relief from the actions or omissions or business conduct of the Company or the actions of the Company’s directors or officers that is oppressive or unfairly prejudicial to, or unfairly disregards the interest of the shareholder. In addition, a shareholder who voted against a resolution to amend the Company’s MoI, or to approve a fundamental transaction (and complied with other requirements set out in the SA Companies
Act) may exercise its appraisal right to demand that the Company pay to it the fair value for all the shares of the Company held by that shareholder.
Description of ADSs
The Bank of New York Mellon registers and delivers AngloGold Ashanti’s American Depositary Shares, or ADSs. Please see “Item 10C: Material Contracts—Description of AngloGold Ashanti ADSs”.
10C.MATERIAL CONTRACTS
Multi-currency Revolving Credit Facility
General
On 23 October 2018, AngloGold Ashanti Holdings plc (“AGAH”) and AngloGold Ashanti Australia Limited, as borrowers, entered into a five-year unsecured multi-currency syndicated revolving credit facility of $1.4 billion (the “2018 multi-currency RCF”) with the Bank of Nova Scotia, as facility agent, and certain financial institutions party thereto, as lenders. The loan consisted of (i) a US dollar based facility with interest charged at a margin of 1.45% above LIBOR and (ii) an Australian dollar based facility capped at A$500 million with interest charged at a margin of 1.45% above BBSY. The A$500 million portion of the 2018 multi-currency RCF was used to fund the working capital and development costs associated with the Group’s mining operations within Australia without eroding the group’s headroom under its other facilities and exposing the Group to foreign exchange gains/losses each quarter. On 9 June 2022, the 2018 multi-currency RCF was repaid and cancelled, and replaced with the 2022 multi-currency RCF (as defined below).
On 9 June 2022, AGAH and AngloGold Ashanti Australia Limited, as borrowers, entered into a new five-year unsecured multi-currency syndicated revolving credit facility of $1.4 billion (the “2022 multi-currency RCF”) maturing in June 2027, with the option of two one-year extensions on application. The 2022 multi-currency RCF was entered into with The Bank of Nova Scotia, as facility agent, and certain financial institutions party thereto, as lenders. The 2022 multi-currency RCF consists of (i) a US dollar based facility (base currency) and (ii) an Australian dollar based facility capped at A$500 million which will be used to fund the working capital and development costs associated with the group's mining operations within Australia (without eroding the group's headroom under its other facilities and exposing the group to foreign exchange gains/losses each quarter). The 2022 multi-currency RCF was entered into on substantially similar terms to the 2018 multi-currency RCF, save in respect of the basis for the US dollar interest rate which transitioned from LIBOR to Compounded SOFR. As of 10 March 2023, the equivalent of $37 million was drawn under the AUD portion of the 2022 multi-currency RCF.
Guarantees
The 2022 multi-currency RCF is guaranteed by AGAH and AngloGold Ashanti Australia Limited. The guarantees constitute unconditional obligations of the guarantors and rank at least pari passu with all other future unsecured obligations of the guarantors, except for obligations mandatorily preferred by law.
Security
Save as set out under the heading “—Guarantees” above, the obligations under the 2022 multi-currency RCF are unsecured.
Amount and repayment of borrowings
Loans under the 2022 multi-currency RCF must be for a minimum of $10 million, if the currency selected is the base currency (US dollar), or a minimum of A$10 million (or for the balance of the undrawn total commitments at the time of the drawing), if the currency selected is Australian dollars. No more than 14 loans may be outstanding at any time. Each loan must be repaid on the maturity date in the same currency as the maturing loan. All loans must be repaid in full on the final maturity date. The 2022 multi-currency RCF matures in June 2027, with the option of two one-year extensions on application.
Interest rates and fees
The interest rate under the 2022 multi-currency RCF is calculated based on Compounded SOFR in the case of loans drawn in US dollars and BBSY in the case of loans drawn in Australian dollars, in each case plus a margin. The initial margin is 1.45 percent per annum, but may vary between 0.90 percent and 2.15 percent per annum depending on the long-term debt rating of AGAH. The applicable margin is subject to a ratings grid. In this regard, the interest margin will reduce if the group's credit rating improves from its current BB+/Baa3 status and will increase if its credit rating worsens. Interest on each loan is payable on the last day of the relevant loan’s interest period and, if the interest period exceeds six months, on the dates falling at six-monthly intervals after the first day of the interest period.
The borrowers under the 2022 multi-currency RCF are required to pay a commitment fee in the base currency equal to 35 percent of the then applicable margin per annum on the undrawn and uncancelled amount of each lender’s commitment during the commitment period. The borrowers are also required to pay a utilisation fee of 0.10 percent per annum (if the aggregate outstanding loans are less than one third of the total commitments then in effect), 0.20 percent per annum (if the aggregate outstanding loans are equal to or greater than one third but less than two-thirds of the total commitments then in effect) or 0.40 percent per annum (if the aggregate outstanding loans are equal to or greater than two-thirds of the total commitments then in effect).
Financial covenant
The 2022 multi-currency RCF includes a financial maintenance covenant which requires that the ratio of Total Net Financial Indebtedness to EBITDA (as such terms are defined in the revolving credit agreement) does not at any time exceed 3.50 to 1.00, with the proviso that this ratio may exceed 3.50 to 1.00 once during the life of the revolving credit agreement, for one six-month period subject to certain criteria. Refer to “Item 18: Financial Statements—Note 34—Capital Management” for the formulae used in the revolving credit agreement to test compliance with the covenants.
Change of control
If a lender so requires, the commitment of such lender under the 2022 multi-currency RCF will be cancelled and the participation of such lender in all outstanding loans, together with accrued interest and all other amounts accrued, will become immediately due and payable in case any person or group of persons acting in concert becomes (directly or indirectly) the beneficial owner of more than 50 percent of the issued share capital of AngloGold Ashanti Limited or (as applicable) an eligible successor holding company of AGAH.
Undertakings
The 2022 multi-currency RCF contains a negative pledge covenant, including restrictions on the granting of security, a change of business of AngloGold Ashanti Limited and its subsidiaries, acquisitions or participations in joint ventures and mergers and disposals.
The 2022 multi-currency RCF also contains, among other things, the following affirmative covenants: mandatory periodic reporting of financial and other information, notice upon the occurrence of events of default and certain other events, compliance with environmental laws and other obligations requiring each of AGAH and its subsidiaries to maintain its corporate existence and qualifications to conduct its business as currently conducted in all applicable jurisdictions and to maintain insurance coverage. The covenants are subject to exceptions and materiality thresholds.
Events of default
The 2022 multi-currency RCF contains events of default including failure to make payment of amounts due, breach of obligations under the loan documents, defaults under other agreements evidencing indebtedness, certain bankruptcy events and a cessation of business and the occurrence of a material adverse change in the business and financial condition of the borrowers and guarantors under the revolving credit agreement, or AngloGold Ashanti and its subsidiaries as a whole, or in the ability of the borrowers and guarantors to perform their payment obligations under the loan documents. The occurrence of an event of default could result in the immediate and automatic cancellation of all commitments and the acceleration of all payment obligations under the 2022 multi-currency RCF and the other loan documents.
The above description is only a summary of certain provisions of the 2022 multi-currency RCF and is qualified in its entirety by reference to the provisions of the 2022 multi-currency RCF, a copy of which is attached hereto as Exhibit 19.4.4.1 and is incorporated herein by reference.
Notes
Each of the series of notes described below were issued under the indenture, dated as of 28 April 2010, among AngloGold Ashanti Holdings plc (“AGAH”), as issuer, AngloGold Ashanti Limited, as guarantor, and The Bank of New York Mellon, as trustee (the “Indenture”). The below descriptions are only a summary of certain provisions of those series of notes and are qualified in their entirety by reference to the provisions of the Indenture and such relevant series of notes, a copy of each – in respect of the outstanding series of notes – is attached hereto as Exhibits 19.2.1, 19.2.2, 19.2.3, 19.2.4 and 19.2.5 and is incorporated herein by reference.
2028 Notes
On 22 October 2021, AGAH issued $750 million 3.375 percent Notes due 2028 (the “2028 notes”). The interest on the 2028 notes is payable semi-annually on 1 May and 1 November of each year, commencing on 1 May 2022. AGAH may on any one or more occasions redeem all or part of the 2028 notes, at a redemption price equal to the greater of (1) 100 percent of the principal amount of the 2028 notes to be redeemed and (2) the sum of the present values of the remaining scheduled payments of principal and interest on the 2028 notes (excluding any portion of such payments of interest accrued or unpaid as of the date of redemption) discounted to the redemption date on a semiannual basis (assuming a 360-day year consisting of twelve 30-day months) at the treasury rate, plus 30 basis points, plus accrued and unpaid interest, if any, to the date of redemption. AGAH has agreed to pay certain additional amounts in respect of any withholdings or deductions for certain types of taxes in certain jurisdictions on payments to holders of the 2028 notes. The 2028 notes are unsecured and unsubordinated and are fully and unconditionally guaranteed by AngloGold Ashanti Limited.
AGAH has agreed to observe certain covenants with respect to the 2028 notes restricting, subject to certain limitations, the ability of AngloGold Ashanti Limited and AGAH to amalgamate, reconstruct, consolidate or merge with another company or other legal entity, and the ability of AngloGold Ashanti Limited and its restricted subsidiaries to pledge their assets to secure certain borrowings, create or incur liens on certain of their property or to engage in sale and leaseback transactions. In case of a change
of control of the guarantor and a downgrade, within a specified period, of the 2028 notes by three rating agencies, holders of the 2028 notes have the right to require the issuer to repurchase all or any part of their 2028 notes in cash for a value equal to 101 percent of the aggregate principal amount of 2028 notes repurchased, plus accrued and unpaid interest, if any, on the 2028 notes repurchased to the date of repurchase.
The offering of the 2028 notes was registered under the Securities Act. The 2028 notes were listed on the New York Stock Exchange.
2030 Notes
On 1 October 2020, AGAH issued $700 million 3.750 percent Notes due 2030 (the “2030 notes”). The interest on the 2030 notes is payable semi-annually on 1 April and 1 October of each year, commencing on 1 April 2021. AGAH may on any one or more occasions redeem all or part of the 2030 notes, at a redemption price equal to the greater of (1) 100 percent of the principal amount of the 2030 notes to be redeemed and (2) the sum of the present values of the remaining scheduled payments of principal and interest on the 2030 notes (excluding any portion of such payments of interest accrued or unpaid as of the date of redemption) discounted to the redemption date on a semiannual basis (assuming a 360-day year consisting of twelve 30-day months) at the treasury rate, plus 50 basis points, plus accrued and unpaid interest, if any, to the date of redemption. AGAH has agreed to pay certain additional amounts in respect of any withholdings or deductions for certain types of taxes in certain jurisdictions on payments to holders of the 2030 notes. The 2030 notes are unsecured and unsubordinated and are fully and unconditionally guaranteed by AngloGold Ashanti Limited.
AGAH has agreed to observe certain covenants with respect to the 2030 notes restricting, subject to certain limitations, the ability of AngloGold Ashanti Limited and AGAH to amalgamate, reconstruct, consolidate or merge with another company or other legal entity, and the ability of AngloGold Ashanti Limited and its restricted subsidiaries to pledge their assets to secure certain borrowings, create or incur liens on certain of their property or to engage in sale and leaseback transactions. In case of a change of control of the guarantor and a downgrade, within a specified period, of the 2030 notes by three rating agencies, holders of the 2030 notes have the right to require the issuer to repurchase all or any part of their 2030 notes in cash for a value equal to 101 percent of the aggregate principal amount of 2030 notes repurchased, plus accrued and unpaid interest, if any, on the 2030 notes repurchased to the date of repurchase.
The offering of the 2030 notes was registered under the Securities Act. The 2030 notes were listed on the New York Stock Exchange.
2022 Notes
On 30 July 2012, AGAH issued $750 million 5.125 percent Notes due 2022 (the “2022 notes”). The interest on the 2022 notes was payable semi-annually on 1 February and 1 August of each year, commencing on 1 February, 2013. AGAH was permitted on any one or more occasions to redeem all or part of the 2022 notes, at a redemption price equal to the greater of (1) 100 percent of the principal amount of the 2022 notes to be redeemed and (2) the sum of the present values of the remaining scheduled payments of principal and interest on the 2022 notes (excluding any portion of such payments of interest accrued or unpaid as of the date of redemption) discounted to the redemption date on a semiannual basis (assuming a 360-day year consisting of twelve 30-day months) at the treasury rate, plus 50 basis points, plus accrued and unpaid interest, if any, to the date of redemption. AGAH had agreed to pay certain additional amounts in respect of any withholdings or deductions for certain types of taxes in certain jurisdictions on payments to holders of the 2022 notes. The 2022 notes were unsecured and unsubordinated and were fully and unconditionally guaranteed by AngloGold Ashanti Limited.
AGAH had agreed to observe certain covenants with respect to the 2022 notes restricting, subject to certain limitations, the ability of AngloGold Ashanti Limited and AGAH to amalgamate, reconstruct, consolidate or merge with another company or other legal entity, and the ability of AngloGold Ashanti Limited and its restricted subsidiaries to pledge their assets to secure certain borrowings, create or incur liens on certain of their property or to engage in sale and leaseback transactions. In case of a change of control of the guarantor and a downgrade, within a specified period, of the 2022 notes below an investment grade rating by two rating agencies, holders of the 2022 notes had the right to require the issuer to repurchase all or any part of their 2022 notes in cash for a value equal to 101 percent of the aggregate principal amount of 2022 notes repurchased, plus accrued and unpaid interest, if any, on the 2022 notes repurchased to the date of purchase.
The offering of the 2022 notes was registered under the Securities Act. The 2022 notes were listed on the New York Stock Exchange.
The 2022 notes were redeemed in October and November 2021 and are no longer outstanding.
2020 Notes and 2040 Notes
On 28 April 2010, AGAH issued $700 million 5.375 percent Notes due 2020 (the “2020 notes”) and $300 million 6.500 percent Notes due 2040 (the “2040 notes” and together with the 2020 notes, the “2010 notes”). The interest on the 2010 notes is payable
semi-annually on 15 April and 15 October of each year, commencing on 15 October 2010. AGAH may on any one or more occasions redeem all or part of the 2010 notes, at a redemption price equal to the greater of (1) 100 percent of the principal amount of the 2010 notes to be redeemed and (2) the sum of the present values of the remaining scheduled payments of principal and interest on the 2010 notes (excluding any portion of such payments of interest accrued or unpaid as of the date of redemption) discounted to the redemption date on a semiannual basis (assuming a 360-day year consisting of twelve 30-day months) at the treasury rate, plus 25 basis points with respect to the 2020 notes and 30 basis points with respect to the 2040 notes, plus accrued and unpaid interest, if any, to the date of redemption. AGAH has agreed to pay certain additional amounts in respect of any withholdings or deductions for certain types of taxes in certain jurisdictions on payments to holders of the 2010 notes. The 2010 notes are unsecured and unsubordinated and are fully and unconditionally guaranteed by AngloGold Ashanti Limited.
AGAH has agreed to observe certain covenants with respect to the 2010 notes restricting, subject to certain limitations, the ability of AngloGold Ashanti Limited and AGAH to amalgamate, reconstruct, consolidate or merge with another company or other legal entity, and the ability of AngloGold Ashanti Limited and its restricted subsidiaries to pledge their assets to secure certain borrowings, create or incur liens on certain of their property or to engage in sale and leaseback transactions. In case of a change of control of the guarantor and a downgrade, within a specified period, of a series of 2010 notes below an investment grade rating by two rating agencies, holders of the 2010 notes have the right to require the issuer to repurchase all or any part of their 2010 notes in cash for a value equal to 101 percent of the aggregate principal amount of 2010 notes repurchased, plus accrued and unpaid interest, if any, on the 2010 notes repurchased to the date of purchase.
The offering of the 2010 notes was registered under the Securities Act. The 2010 notes were listed on the New York Stock Exchange. The 2020 notes were repaid at maturity on 15 April 2020 and are no longer outstanding.
For further information, see “Item 18: Financial Statements—Note 24—Borrowings”,“Item 5B: Liquidity and Capital Resources” and “Item 19: Exhibits to Form 20-F”.
Description of AngloGold Ashanti ADSs
The Bank of New York Mellon registers and delivers AngloGold Ashanti’s American Depositary Shares, or ADSs. Each ADS represents the ownership interest of one ordinary share of AngloGold Ashanti.
The Deposit Agreement
This section provides a summary description of AngloGold Ashanti’s ADSs.
AngloGold Ashanti has entered into an Amended and Restated Deposit Agreement dated 3 June 2008 with The Bank of New York Mellon as Depositary and the owners and beneficial owners of American Depositary Receipts (the “Deposit Agreement”).
The following is a summary of the material provisions of the Deposit Agreement. For more complete information, read the entire Deposit Agreement and the Form of American Depositary Receipt, which AngloGold Ashanti has filed with the SEC as an exhibit to AngloGold Ashanti’s registration statements on Form F-6 (Registration Nos. 333-133049 and 333-159248) on 27 May 2008 and 14 May 2009, respectively. A copy thereof is also attached hereto as Exhibit 19.2.6 and is incorporated herein by reference. See “Item 10H: Documents on Display”. Copies of the Deposit Agreement are also available for inspection at the Corporate Trust Office of The Bank of New York Mellon currently located at 240 Greenwich Street, New York, New York 10286.
Description of the ADSs
The Bank of New York Mellon, as Depositary, registers and delivers ADSs. Each ADS represents one ordinary share (or a right to receive one share) deposited with Standard Bank of South Africa Limited or HSBC Bank Australia Limited, each as a custodian for The Bank of New York Mellon, and both of which are referred to collectively as the “Custodian”. Each ADS also represents any other securities, cash or other property which may be held by The Bank of New York Mellon. The Bank of New York Mellon’s Corporate Trust Office at which the ADSs are administered is located at 240 Greenwich Street, New York, New York 10286. The Bank of New York Mellon’s principal executive office is also located at 240 Greenwich Street, New York, New York 10286.
ADSs may be held either (A) directly (i) by having an American Depositary Receipt, also referred to as an ADR, which is a certificate evidencing a specific number of ADSs, registered in the holder’s name, or (ii) by having ADSs registered in a holder’s name in the Direct Registration System, or (B) indirectly by holding a security entitlement in ADSs through a broker or other financial institution. If ADSs are held directly, such holders are ADS holders. This description applies to AngloGold Ashanti’s ADS holders. If ADSs are held indirectly, such holders must rely on the procedures of their broker or other financial institution to assert the rights of ADS registered holders described in this section. Such holders should consult with their broker or financial institution to find out what those procedures are.
The Direct Registration System, or DRS, is a system administered by DTC pursuant to which the Depositary may register the ownership of uncertificated ADSs, which ownership will be evidenced by periodic statements sent by the Depositary to the registered holders of uncertificated ADSs.
AngloGold Ashanti does not treat ADS holders as its shareholders and ADS holders do not have shareholder rights. South African law governs shareholder rights. The Bank of New York Mellon is the holder of the shares underlying the ADSs. Registered holders of ADSs have ADS holder rights. The Deposit Agreement sets out ADS holder rights as well as the rights and obligations of The Bank of New York Mellon. New York law governs the Deposit Agreement and the ADSs.
Dividends and Other Distributions
The Bank of New York Mellon has agreed to pay to holders of ADSs the cash dividends or other distributions it or a Custodian receives on AngloGold Ashanti ordinary shares or other deposited securities after deducting any fees and expenses and any applicable withholding taxes. Holders of ADSs will receive these distributions in proportion to the number of AngloGold Ashanti’s ordinary shares that their ADSs represent.
Cash
The Bank of New York Mellon will convert any cash dividend or other cash distribution (in South African rands) that AngloGold Ashanti pays on ordinary shares into US dollars (unless AngloGold Ashanti pays such dividend or cash distribution in US dollars) and distribute to registered holders of ADSs. If that is no longer possible or if any approval from any government is needed and cannot be obtained, The Bank of New York Mellon may distribute non-US currency only to those ADS holders to whom it is possible to make this type of distribution.
The Bank of New York Mellon may hold the non-US currency it cannot convert for the account of holders of ADSs who for one reason or the other have not been paid. It will not invest the non-US currency, and it will not be liable for interest on such amounts. Before making a distribution, any withholding taxes that must be paid will be deducted. See “—Payment of Taxes” below. The Bank of New York Mellon will distribute only whole US dollars and cents and will round fractional cents to the nearest whole cent. If the exchange rates fluctuate during a time when The Bank of New York Mellon cannot convert the non-US currency, holders of ADSs may lose some or all of the value of the distribution.
Ordinary Shares
The Bank of New York Mellon may distribute to holders of ADSs additional ADSs representing ordinary shares that AngloGold Ashanti distributes as a dividend or free distribution, if AngloGold Ashanti provides it promptly with satisfactory evidence that it is legal to do so. If The Bank of New York Mellon does not distribute additional ADSs, the outstanding ADSs will also represent the newly distributed AngloGold Ashanti ordinary shares. The Bank of New York Mellon will only distribute whole ADSs. It will sell AngloGold Ashanti ordinary shares that would require it to deliver a fraction of an ADS and distribute the net proceeds in the same way as it distributes cash. The Bank of New York Mellon may sell a portion of the distributed shares sufficient to pay its fees and expenses in connection with that distribution.
Rights to Subscribe for Additional Ordinary Shares
If AngloGold Ashanti offers holders of its ordinary shares any rights to subscribe for additional AngloGold Ashanti ordinary shares or any other rights, The Bank of New York Mellon, after consultation with AngloGold Ashanti, may make these rights available to holders of ADSs or sell the rights and distribute the proceeds in the same way as it distributes cash. If The Bank of New York Mellon cannot do either of these things for any reason, it may allow these rights to lapse. In that case, holders of ADSs will receive no value for them.
If The Bank of New York Mellon makes these types of subscription rights available to holders of ADS, upon instruction from holders of ADSs, it will exercise the rights and purchase AngloGold Ashanti’s ordinary shares on their behalf. The Bank of New York Mellon will then deposit the AngloGold Ashanti ordinary shares and deliver ADSs to the holders of ADSs. It will only exercise these rights if holders of ADSs pay it the exercise price and any other charges the rights require them to pay.
US securities laws may restrict the sale, deposit, cancellation and transfer of the ADSs issued after exercise of rights. For example, holders of ADSs may not be able to trade the ADSs freely in the United States. In this case, The Bank of New York Mellon may deliver ADSs which are “restricted securities” within the meaning of Rule 144 which will have the same provisions as the ADSs described here, except for the changes needed to put the restrictions in place.
Other Distributions
The Bank of New York Mellon will send to holders of ADSs any other distributions that AngloGold Ashanti makes on deposited securities by any means it thinks is legal, fair and practical. If it cannot make the distribution in that way, The Bank of New York Mellon may decide to sell what AngloGold Ashanti distributes, and then distribute the net proceeds in the same way as it distributes cash, or it may decide to hold what AngloGold Ashanti distributes, in which case the outstanding ADSs will also represent the newly distributed property. However, The Bank of New York Mellon is not required to distribute any securities (other than ADSs) to ADS holders unless it receives satisfactory evidence from AngloGold Ashanti that it is legal to make that distribution. The Bank of New York Mellon may sell a portion of the distributed securities or property sufficient to pay its fees and expenses in connection with that distribution.
The Bank of New York Mellon is not responsible if, based on available information, it decides that it is unlawful or impractical to make a distribution available to any ADS holders. AngloGold Ashanti has no obligation to register ADSs, AngloGold Ashanti ordinary shares, rights or other securities under the Securities Act. AngloGold Ashanti also has no obligation to take any other action to permit the distribution of ADSs, AngloGold Ashanti ordinary shares, or any other rights to ADS holders. This means that the holders of ADSs may not receive the distribution AngloGold Ashanti makes on its ordinary shares or any value for them if it is illegal or impracticable for AngloGold Ashanti to make them available to the holders of ADSs.
Deposit, Withdrawal and Cancellation
The Bank of New York Mellon will deliver ADSs if a holder of AngloGold Ashanti’s ordinary shares or its broker deposits AngloGold Ashanti’s ordinary shares or evidence of rights to receive ordinary shares with the Custodian. Upon payment of its fees and expenses and of any taxes or charges, such as stamp taxes or stock transfer taxes or fees, The Bank of New York Mellon will register the appropriate number of ADSs in the names such holder of AngloGold Ashanti ordinary shares requests and will deliver the ADSs at its Corporate Trust Office to the persons such holders request.
Holders of ADSs may turn in their ADSs at The Bank of New York Mellon’s Corporate Trust Office. Upon payment of its fees and expenses and of any taxes or charges, such as stamp taxes or stock transfer taxes or fees, The Bank of New York Mellon will deliver (1) the underlying ordinary shares to an account designated by the relevant holder of ADSs and (2) any other deposited securities underlying the ADSs at the office of the Custodian, or, at the request, risk and expense of ADS holders, The Bank of New York Mellon will deliver the deposited securities at its Corporate Trust Office.
Interchange Between Certificated ADSs and Uncertificated ADSs
ADS registered holders may surrender their ADS to The Bank of New York Mellon for the purpose of exchanging such ADS for uncertificated ADSs. The Bank of New York Mellon will cancel that ADS and will send to the ADS registered holder a statement confirming that the ADS registered holder is the registered holder of uncertificated ADSs. Alternatively, upon receipt by The Bank of New York Mellon of a proper instruction from a registered holder of uncertificated ADSs requesting the exchange of uncertificated ADSs for certificated ADSs, The Bank of New York Mellon will execute and deliver to the ADS registered holder an ADS evidencing those ADSs.
Voting Rights
ADS registered holders may instruct The Bank of New York Mellon to vote the number of deposited shares their ADSs represent. The Bank of New York Mellon will notify ADS registered holders of shareholders’ meetings and arrange to deliver AngloGold Ashanti’s voting materials to them if AngloGold Ashanti asks it to. Those materials will describe the matters to be voted on and explain how ADS registered holders may instruct The Bank of New York Mellon how to vote. For instructions to be valid, they must reach The Bank of New York Mellon by a date set by The Bank of New York Mellon.
Otherwise, ADS registered holders will not be able to exercise their right to vote unless they withdraw the shares. However, ADS registered holders may not know about the meeting sufficiently in advance to withdraw the shares.
The Bank of New York Mellon will try, as far as practicable, to vote or to have its agents vote the ordinary shares or other deposited securities as holders of ADSs instruct, but this is subject to South African law, the provisions of AngloGold Ashanti’s MoI and of the deposited securities and any applicable rule of the JSE. The Bank of New York Mellon will only vote or attempt to vote as such holders of ADSs instruct.
AngloGold Ashanti cannot assure the holders of ADSs that they will receive the voting materials in time for them to instruct The Bank of New York Mellon to vote their ordinary shares. In addition, The Bank of New York Mellon and its agents are not responsible for failing to carry out voting instructions or for the manner of carrying out voting instructions. This means that holders of ADSs may not be able to exercise their right to vote and there may be nothing they can do if their ordinary shares are not voted as they requested.
Fees and Expenses
| | | | | |
ADS holders must pay: | For: |
$5.00 (or less) per 100 ADSs | Each issuance of an ADS, including as a result of a distribution of AngloGold Ashanti ordinary shares or rights or other property
Each cancellation of an ADS, including if the Deposit Agreement terminates |
$0.02 (or less) per ADS | Any cash payment |
Registration or transfer fees | Transfer and registration of AngloGold Ashanti ordinary shares on the AngloGold Ashanti share register to or from the name of The Bank of New York Mellon or its agent when AngloGold Ashanti ordinary shares are deposited or withdrawn |
$0.02 (or less) per ADS per year | Depositary services |
Expenses of The Bank of New York Mellon | Conversion of non-US currency to US dollars
Cable, telex and facsimile transmission expenses
Servicing the deposited securities |
Taxes and other governmental charges that The Bank of New York Mellon or any Custodian has to pay on any ADS or AngloGold Ashanti ordinary share underlying an ADS; for example, stock transfer taxes, stamp duty or withholding taxes | As necessary
|
A fee equivalent to the fee that would have been payable if the securities distributed had been ordinary shares deposited for issuance of ADSs | Distribution of securities distributed to holders of deposited securities that are distributed by The Bank of New York Mellon to ADS holders |
Payment of Taxes
Holders of ADSs will be responsible for any taxes or other governmental charges payable on their ADSs or on the deposited securities underlying their ADSs. The Bank of New York Mellon may refuse to transfer their ADSs or allow them to withdraw the deposited securities underlying their ADSs until such taxes or other charges are paid. It may apply payments owed to holders of ADSs or sell deposited securities underlying their ADSs to pay any taxes they owe, and they will remain liable for any deficiency. If The Bank of New York Mellon sells deposited securities, it will, if appropriate, reduce the number of ADSs to reflect the sale and pay to holders of ADSs any proceeds, or send to them any property remaining after it has paid the taxes.
Reclassifications | | | | | | | | | | | |
If AngloGold Ashanti: | | | Then: |
Reclassifies, splits up or consolidates any of the deposited securities;
| | | The cash, ordinary shares or other securities received by The Bank of New York Mellon will become deposited securities. Each ADS will automatically represent its equal share of the new deposited securities. |
Distributes securities on the ordinary shares that are not distributed to holders of ADSs; or
Recapitalises, reorganises, merges, liquidates, sells all or substantially all of AngloGold Ashanti’s assets, or takes any similar action. | | | The Bank of New York Mellon may, and will if AngloGold Ashanti asks it to, distribute some or all of the cash, AngloGold Ashanti ordinary shares or other securities it receives. It may also issue new ADSs or ask holders of ADSs to surrender their outstanding ADSs in exchange for new ADSs identifying the new deposited securities. |
Amendment and Termination
AngloGold Ashanti may, for any reason, agree with The Bank of New York Mellon to amend the Deposit Agreement and the ADSs without the consent of holders. If the amendment increases fees or charges (except for taxes and other governmental charges or registration fees, cable, telex or facsimile transmission costs, delivery costs or other such expenses) or if the amendment prejudices an important right of ADS holders, it will only become effective 30 days after The Bank of New York Mellon notifies holders of ADSs of the amendment. At the time an amendment becomes effective, holders of ADSs are considered, by continuing to hold their ADSs, to agree to the amendment and to be bound by the ADSs and the agreement as amended.
The Bank of New York Mellon may terminate the Deposit Agreement by mailing notice of termination to ADS holders at least 30 days prior to the date fixed in the notice if AngloGold Ashanti asks it to do so. The Bank of New York Mellon may also terminate the Deposit Agreement if The Bank of New York Mellon has told AngloGold Ashanti that it would like to resign and AngloGold Ashanti has not appointed a new Depositary bank within 90 days. In both cases, The Bank of New York Mellon must notify holders of AngloGold Ashanti ADSs at least 30 days before termination.
After termination, The Bank of New York Mellon and its agents will be required to do only the following under the Deposit Agreement: collect distributions on the deposited securities, sell rights, and, upon surrender of ADSs, deliver AngloGold Ashanti ordinary shares and other deposited securities. Four months after the date of termination or later, The Bank of New York Mellon may sell any remaining deposited securities by public or private sale and will hold the proceeds of the sale, as well as any other cash it is holding under the Deposit Agreement, for the pro rata benefit of the ADS holders who have not surrendered their ADSs. It will not invest the money and will have no liability for interest. The Bank of New York Mellon’s only obligations will be to account for the proceeds of the sale and other cash. After termination, AngloGold Ashanti’s only obligations will be with respect to indemnification of, and payment of certain amounts to, The Bank of New York Mellon.
Limitations on Obligations and Liability to ADS Holders
The Deposit Agreement expressly limits AngloGold Ashanti’s obligations and the obligations of The Bank of New York Mellon, and limits AngloGold Ashanti’s liability and the liability of The Bank of New York Mellon. AngloGold Ashanti and The Bank of New York Mellon:
•are only obligated to take the actions specifically set forth in the Deposit Agreement without negligence or bad faith;
•are not liable if either of AngloGold Ashanti or The Bank of New York Mellon is prevented or delayed by law or circumstances beyond their control from performing their obligations under the Deposit Agreement;
•are not liable if either of AngloGold Ashanti or The Bank of New York Mellon exercises discretion permitted under the Deposit Agreement;
•are not liable for the inability of any holder of ADSs to benefit from any distribution on deposited securities that is not made available to holders of ADSs under the terms of the Deposit Agreement, or for any special, consequential or punitive damages for any breach of the terms of the Deposit Agreement;
•have no obligation to become involved in a lawsuit or other proceeding related to the ADSs or the Deposit Agreement on behalf of the holders of ADSs or on behalf of any other party;
•may rely on advice of or information from legal counsel, accountants, and any persons presenting AngloGold Ashanti’s ordinary shares for deposit, any registered holder or any other person believed by AngloGold Ashanti in good faith to be competent to give such advice or information; and
•pursuant to the Deposit Agreement, agree to indemnify each other under certain circumstances.
Requirements for Depositary Action
Before The Bank of New York Mellon will issue, transfer or register the transfer of an ADS, make a distribution on an ADS, or allow withdrawal of AngloGold Ashanti ordinary shares, The Bank of New York Mellon may require:
•payment of stock transfer or other taxes or other governmental charges and transfer or registration fees charged by third parties for the transfer of any ordinary shares or other deposited securities;
•production of satisfactory proof of the identity and genuineness of any signature or other information it deems necessary; and
•compliance with regulations it may establish, from time to time, consistent with the Deposit Agreement, including presentation of transfer documents.
The Bank of New York Mellon may refuse to deliver, transfer or register transfers of ADSs generally when the books of The Bank of New York Mellon or AngloGold Ashanti are closed, or at any time if either AngloGold Ashanti or The Bank of New York Mellon thinks it advisable to do so.
Holders of ADSs have the right to cancel their ADSs and withdraw the underlying ordinary shares at any time except:
•when temporary delays arise because: (1) either AngloGold Ashanti or The Bank of New York Mellon have closed AngloGold Ashanti’s transfer books; (2) the transfer of the ordinary shares is blocked in connection with voting at a general meeting of shareholders; or (3) AngloGold Ashanti is paying a dividend on the ordinary shares;
•when ADS holders seeking to withdraw the ordinary shares are liable for unpaid fees, taxes and similar charges; or
•when it is necessary to prohibit withdrawals in order to comply with any laws or governmental regulations that apply to ADSs or to the withdrawal of the ordinary shares or other deposited securities.
This right of withdrawal may not be limited by any other provision of the Deposit Agreement.
Pre-release of ADSs
In certain circumstances, subject to the provisions of the Deposit Agreement, The Bank of New York Mellon may deliver ADSs before deposit of the underlying ordinary shares. This is called a pre-release of the ADSs.
The Bank of New York Mellon may also deliver AngloGold Ashanti ordinary shares upon cancellation of pre-released ADSs (even if the ADSs are cancelled before the pre-release transaction has been closed out). A pre-release is closed out as soon as the underlying AngloGold Ashanti ordinary shares are delivered to The Bank of New York Mellon. The Bank of New York Mellon may receive ADSs instead of ordinary shares to close out a pre-release.
The Bank of New York Mellon may pre-release ADSs only under the following conditions:
•before or at the time of the pre-release, the person to whom the pre-release is being made must represent to The Bank of New York Mellon in writing that it or its customer: (a) owns the ordinary shares or ADSs to be remitted, (b) assigns all beneficial rights, title and interest in such ADSs or ordinary shares, as the case may be, to The Bank of New York Mellon in its capacity as the Depositary and for the benefit of the ADS holders, and (c) will not take any action with respect to such ADSs or ordinary shares, as the case may be, that is consistent with the transfer of beneficial ownership (including, without the consent of The Bank of New York Mellon, disposing of such ADSs or ordinary shares, as the case may be) other than satisfaction of such pre-release;
•the pre-release must be fully collateralised with cash, US government securities, or other collateral that The Bank of New York Mellon considers appropriate; and
•The Bank of New York Mellon must be able to close out the pre-release on not more than five business days’ notice. Each pre-release will be subject to any further indemnities and credit regulations that The Bank of New York Mellon deems appropriate. The Bank of New York Mellon will normally limit the number of AngloGold Ashanti ordinary shares not deposited but represented by ADSs outstanding at any time as a result of pre-release so that they do not exceed 30 percent of the ordinary shares deposited, although The Bank of New York Mellon may disregard this limit from time to time, if it thinks it is appropriate to do so.
Direct Registration System
In the Deposit Agreement, all parties to the Deposit Agreement acknowledge that the DRS and Profile Modification System, or Profile, will apply to uncertificated ADSs upon acceptance thereof to DRS by The Depository Trust Company, also referred to as DTC. DRS is the system administered by DTC pursuant to which the Depositary may register the ownership of uncertificated ADSs, which ownership will be evidenced by periodic statements sent by the Depositary to the registered holders of uncertificated ADSs. Profile is a required feature of DRS which allows a DTC participant, claiming to act on behalf of a registered holder of ADSs, to direct the Depositary to register a transfer of those ADSs to DTC or its nominee and to deliver those ADSs to
the DTC account of that DTC participant without receipt by the Depositary of prior authorisation from the ADS registered holder to register that transfer.
In connection with and in accordance with the arrangements and procedures relating to DRS/Profile, the parties to the Deposit Agreement understand that The Bank of New York Mellon will not verify, determine or otherwise ascertain that the DTC participant which is claiming to be acting on behalf of an ADS holder in requesting registration of transfer and delivery described in the paragraph above has the actual authority to act on behalf of the ADS holder (notwithstanding any requirements under the Uniform Commercial Code). In the Deposit Agreement, the parties agree that The Bank of New York Mellon’s reliance on and compliance with instructions received by The Bank of New York Mellon through the DRS/Profile System and in accordance with the Deposit Agreement will not constitute negligence or bad faith on the part of The Bank of New York Mellon.
Shareholder Communications: Inspection of Register of Holders of ADSs
The Bank of New York Mellon will make available for inspection at its office all communications that it receives from AngloGold Ashanti as a holder of deposited securities that AngloGold Ashanti makes generally available to holders of deposited securities. The Bank of New York Mellon will send copies of those communications if requested by AngloGold Ashanti. ADS holders have a right to inspect the register of holders of ADSs, but not for the purpose of contacting those holders about a matter unrelated to AngloGold Ashanti’s business or the ADSs.
10D.Exchange controls
Exchange controls and other limitations affecting security holders
The following is a general outline of South African exchange controls and such outline may not apply to former residents of South Africa. Investors should consult a professional advisor as to the exchange control implications of their particular investments.
South African law provides for exchange control regulations, which restrict the export of capital from South Africa. Exchange controls are administered by the Financial Surveillance Department of the South African Reserve Bank (SARB), in terms of the Exchange Control Regulations, and regulate transactions involving South African residents and non-residents, with the exception of transactions between South African residents and residents of the Common Monetary Area, which comprises the Kingdoms of Lesotho and Eswatini (formerly Swaziland) and the Republic of Namibia. The purpose of exchange controls is to mitigate the decline of foreign capital reserves in South Africa.
The Government of South Africa has, however, committed itself to relaxing exchange controls gradually and significant relaxation has occurred in recent years.
The comments below relate, in general, to exchange controls in place at the date of this annual report.
Investments in South African companies
Acquisitions of shares or assets of South African companies by non-South African purchasers are generally subject to review and approval by the SARB, particularly where the consideration is payable in a form other than cash. In this regard, the SARB will give approval where it is persuaded, inter alia, that the consideration payable for the acquisition of the shares or assets is an arm’s-length consideration and that such acquisition offers benefits to South Africa. In addition, where shares in a South African company are acquired by a non-resident, the share certificates issued to the non-resident shareholder must be endorsed “non-resident” by the SARB (or an Authorised Dealer).
Dividends
Dividends declared to foreign stockholders in public companies listed on the Johannesburg Stock Exchange (JSE) are not subject to the approval of the SARB, provided that the shares in respect of which the dividends are declared have been endorsed “non-resident” by the SARB or an Authorised Dealer at the time of acquisition. Dividends are freely transferable to foreign stockholders from both trading and non-trading profits earned in South Africa by public listed companies.
Voting rights
There are no limitations imposed by South African law, including South African exchange controls, or by the Memorandum of Incorporation of AngloGold Ashanti on the rights of non-South African shareholders to vote their ordinary shares.
Overseas financing, interest and investments
Interest on foreign loans, if paid from cash generated from operations in South Africa, may be remittable abroad, provided that the loans and the payment of the relevant interest in respect of such loans have received prior SARB approval.
AngloGold Ashanti and its South African subsidiaries require SARB approval to raise debt from and repay debt to non-residents of the Common Monetary Area, mainly in respect of the terms of repayment applicable to such loans, as well as any guarantees that may be provided in respect of such loans, by AngloGold Ashanti or its South African subsidiaries.
Debt raised outside the Common Monetary Area by AngloGold Ashanti’s non-South African subsidiaries is not restricted under South African exchange control regulations and can be used for investment outside the Common Monetary Area, subject to the relevant conditions imposed by the SARB in connection with such investment, the establishing of such a non-South African subsidiary or in raising the debt by such subsidiary. For example, AngloGold Ashanti and its South African subsidiaries would require SARB approval in order for AngloGold Ashanti and/or its South African subsidiaries to provide guarantees for the obligations of any of its non-South African subsidiaries. In addition, funds obtained from non-residents of the Common Monetary Area and debt raised outside the Common Monetary Area by AngloGold Ashanti’s non-South African subsidiaries must be repaid or serviced by AngloGold Ashanti’s foreign subsidiaries unless otherwise approved by the SARB.
A listing by a South African company on any stock exchange other than the JSE in connection with raising capital requires permission from the SARB.
Under current exchange control regulations, offshore investments by AngloGold Ashanti and its subsidiaries require the approval of the SARB. Subject to such prior approval of the SARB, there is no limit on the amount of capital that may be invested offshore.
10E.Taxation
South African taxation
General
The following section provides a summary of the South African tax consequences consequent upon the ownership and disposition of shares by South African residents or ADSs by a US holder (as defined below) and is not intended to constitute tax advice. This summary is based upon current South African tax law and practice of the South African Revenue Service (SARS), the US/SA Double Taxation Treaty, and in part beneficiallyupon representations made by the Depositary, on the basis that it assumes that each obligation provided for United States persons.in, or otherwise contemplated by, a Deposit Agreement and any related agreement will be performed in accordance with its respective terms.
At 19 March 2020,The following summary of the South African tax considerations does not address the tax consequences to a totalUS holder that is resident in South Africa for South African tax purposes, whose holding of 152,540,560shares or ADSs is effectively connected with a permanent establishment in South Africa through which such US holder carries on business activities or, 37in the case of an individual, with a fixed base situated therein, or who is otherwise not entitled to the full benefits under the US/SA Double Taxation Treaty. It should be appreciated that South Africa ratified the Multilateral Convention to Implement Tax Treaty-related measures to prevent Base Erosion and Profit Shifting (BEPS MLI) on 30 September 2022 and that one should thus read the applicable treaty, including the US/SA Double Taxation Treaty, in this context.
The statements of law set forth below are subject to any changes (which may be applied retroactively) in South African law or in the interpretation thereof by SARS, or in the US/SA Double Taxation Treaty, occurring after the date hereof. It should be expressly noted that South African tax law does not specifically address the treatment of ADSs. However, it is reasonable to assume (although no assurance can be made) that the tax treatment of US holders of shares is also applicable to US holders of ADSs.
Holders are strongly urged to consult their own tax advisors as to the consequences under South African, US federal, state and local, and other applicable laws, of the ownership and disposition of shares or ADSs.
Taxation of dividends
South Africa currently imposes a Dividend Withholding Tax on Companies (dividends tax) at a rate of 20 percent on the net amount of the dividend declared and paid by a resident company, other than a Headquarter Company.
The dividends tax is generally imposed on the beneficial owner of the dividends. The dividends tax is subject to domestic exemptions or relief in terms of an applicable double taxation treaty. The application of such domestic exemptions or relief in terms of an applicable double taxation treaty is subject to the making of certain declarations and undertakings by the beneficial owner of the dividends to the regulated intermediary making payment of the dividend. In terms of the latest amendments to the tax provisions, the declaration and undertaking entitling the beneficial owner to a reduced dividend withholding tax rate must be renewed every five years, subject to certain exemptions.
The dividends tax could be reduced to a lower rate under an applicable double tax treaty, if all requirements are met. In the case of dividends paid to a US holder with respect to shares, the US/SA Double Taxation Treaty would generally limit the dividends tax rate to five percent of total issued ordinarythe gross amount of the dividends if a corporate US holder holds directly at least ten percent of the voting stock of the Company, provided that the applicable declaration and undertaking are given by the beneficial owner that the reduced rate applies.
In all other cases, the maximum tax rate under the US/SA Double Taxation Treaty is 15 percent of the gross amount of the dividend.
Different rules may apply if the beneficial owner of the dividends is a US resident who carries on business in South Africa through a permanent establishment situated in South Africa, or performs in South Africa services from a permanent establishment situated in South Africa, and the dividends are attributable to such permanent establishment or fixed base.
Moreover, if the dividends tax rate is reduced under the auspices of an applicable double tax treaty, certain South African compliance requirements must be met in order to obtain the double tax treaty relief, including amongst others the completion of a declaration and undertaking by the beneficial owners in favour of the Company and/or the relevant regulated intermediary.
In terms of the latest tax provisions the declaration and undertaking need to be renewed at least every five years unless the regulated intermediary is subject to the provisions of inter alia the US Foreign Account Tax Compliance legislation.
A dividend is currently defined as any amount transferred or applied by a company that is a resident (including the Company) for the benefit or on behalf of any person in respect of any share in that company, whether that amount is transferred or applied by way of a distribution made by the company, or as consideration for the acquisition of any share in that company. The definition of
a dividend specifically excludes any amount transferred or applied by the Company that results in a reduction of so-called contributed tax capital (CTC) of the relevant class of shares, or constitutes shares in the Company or constitutes an acquisition by the Company of its own securities by way of a general repurchase of securities in terms of the JSE Listings Requirements. A distinction is thus made between a general repurchase of securities and a specific repurchase of securities. If the Company embarks upon a general repurchase of securities, the proceeds of such repurchase would not constitute a dividend, whereas, in the case of a specific repurchase of securities where the purchase price is not funded out of CTC of that class of shares, the proceeds would likely constitute a dividend.
The concept of CTC effectively means the sum of the stated capital or share capital were issued and outstandingshare premium of a company that existed on 1 January 2011, excluding any transfers from reserves to the share premium account or stated capital account, plus proceeds from the issue of any new shares by a company, less the amount of CTC that has been returned to shareholders. Any application of CTC is limited to the holders of a class of shares. In addition, a distribution of CTC attributable to a specific class must be made proportionately to the number of shares held by a shareholder in a specific class. The definition of CTC is subject to various provisos. Recently the definition of CTC was amended to make it clear that CTC can only be transferred to shareholders proportionally.
For dividends tax purposes a dividend is defined as any dividend as indicated above that is paid by a company that is a resident or paid by a foreign company if the share in respect of which that foreign dividend is paid is a listed share and heldto the extent that the foreign dividend does not constitute a distribution of an asset in kind.
Dividends are generally exempt from the payment of income tax, subject to various exclusions. If a dividend is not exempt from income tax it follows that dividends tax will not also be levied.
Taxation of capital gains on record by 2,174 registered holders.sale or other disposition
InsofarSouth African residents are taxed on their worldwide income, while non-residents are only taxed on South African sourced income (subject to the provisions of any relevant double taxation agreement).The general corporate income tax rate has recently been reduced to 27 percent.
Capital gains tax is not a separate tax to income tax; instead, a percentile of the taxpayer’s net capital gain (that is the taxable capital gain) is included in its taxable income on which it is taxed at the income tax rate.
Non-residents are only subject to the South African capital gains tax provisions in respect of the disposal of any immovable property (such as land and buildings or mining rights) or any interest or right of whatever nature to or in immovable property situated in South Africa, or any asset of a permanent establishment through which that non-resident is known to AngloGold Ashanti, there was no person who,carrying on a trade in South Africa.In the instance of a shareholder holding shares in a South African company, the ‘interest in immovable property’ requirements are met if 80 percent or more of the market value of the shares is directly or indirectly jointlyattributable to South African immovable property held on capital account, and that shareholder (whether alone or severally, exercisedtogether with any connected person in relation to that person), directly or could exercise control over AngloGold Ashanti, norindirectly, holds at least 20 percent of the equity shares of that South African company.
Gains realised on the sale of ordinary shares are deemed to be of a capital nature and subject to capital gains tax provided the ordinary shares have been held for a continuous period of at least three years. This deeming provision is AngloGold Ashanti awareapplicable to “equity shares” as defined in section 1 of the South African Income Tax Act, No. 58 of 1962 (the “SA Income Tax Act”), and may not extend to preference shares or ADSs where the preference shares or ADSs do not constitute “equity shares” as so defined.
The meaning of the word “resident” is different for individuals and corporations and is governed by the Act and by the Treaty. In the event of conflict, the Treaty, which contains a tie breaker clause or mechanism to determine residency if a holder is resident in both countries, will prevail. In terms of the Act and Treaty, a US resident holder of shares or ADSs will not be subject to capital gains tax on the disposal of securities held as capital assets unless the securities are linked to a permanent establishment conducted in South Africa or constitute an interest in immovable property as indicated above. In contrast, gains on the disposal of securities which are not capital in nature are usually subject to income tax. Any asset held as a long-term investment will be considered a capital asset and subject to capital gains tax on the disposal of such an asset. Any asset acquired for purposes of resale as part of a profit-making scheme will not be considered a capital asset and will be subject to income tax on the disposal of such an asset. However, even in the latter case, a US resident holder will not be subject to income tax, unless the US resident holder carries on business in South Africa through a permanent establishment situated therein.
Securities transfer tax (STT)
No securities transfer tax, or STT, is payable in South Africa with respect to the issue of a security, but STT is payable upon transfer, redemption or cancellation thereof.
STT on transfers of securities is charged at a rate of 0.25 percent on the ‘taxable amount’ in respect of the ‘transfer’ of every security issued by a company incorporated in South Africa, or a company incorporated outside South Africa, but listed on an exchange in South Africa, subject to certain exemptions.
The word ‘transfer’ is broadly defined and includes the transfer, sale, assignment or cession or disposal in any arrangementsother manner of a security which mightresults in a change in beneficial ownership.The cancellation or redemption of a security is also regarded as a ‘transfer’ unless the Company is being liquidated. However, the transfer of a security that does not result in a change in controlbeneficial ownership is not regarded as a ‘transfer’ for STT purposes. A security is also defined as a depositary receipt in a company. Apart from STT thus being payable upon the conversion of ADSs to shares and vice versa, , STT could also be payable on the transfer of a depositary receipt issued by a company, including specifically the ADSs issued by the Company. Generally, the central securities Depositary that has been accepted as a participant in terms of the Financial Markets Act, is liable for the payment of the STT, on the basis that it is recoverable from the person to whom it is transferred.
STT is levied on the ‘taxable amount’ of a security.The taxable amount of a listed security is the greater of the consideration for the security declared by the transferee or the closing price of that security as traded on the stock exchange concerned. The person to whom the listed security is transferred is liable for payment of the STT, and such tax must be paid through the member or the participant holding the security in custody, or where the listed security is not held in custody, the company that issued the listed security. The tax so payable may be recovered from the person to whom the security is transferred. The tax must be paid by the fourteenth day of the month following the month during which the transfer occurred.
Withholding tax on interest
Generally, a 15 percent withholding tax may apply to the payments of interest.Under the US/SA Double Taxation Treaty, interest derived and beneficially owned by a resident of the United States will be taxable only in the United States (and therefore not subject to interest withholding tax in South Africa), subject to certain exclusions.
Value-Added Tax
The issue or transfer of shares is not a taxable supply for value-added tax (“VAT”) purposes.However, fees charged by independent service providers are subject to VAT at the standard rate of 15 percent.
United States Taxation
General
The following is a general summary of certain material US federal income tax consequences of the ownership and disposition of shares or ADSs to a US holder (as defined below) that holds its shares or ADSs as a capital asset.With respect to the following, references to shares includes references to ADSs unless the context indicates otherwise.This summary does not address any aspect of US federal gift or estate tax, or the state, local or non-US tax consequences to a US holder of shares. This summary is based on US tax laws including the Internal Revenue Code of 1986, as amended (the “Code”), Treasury regulations promulgated thereunder, rulings, judicial decisions, administrative pronouncements, and the US/SA Double Taxation Treaty, all as currently in effect as of the date of this annual report, and all of which are subject to change or changes in interpretation, possibly with retroactive effect. In addition, this summary is based in part upon the representations of the Depositary and the assumption that each obligation in the Deposit Agreement relating to the ADSs and any related agreement will be performed in accordance with its terms.
This summary does not address all aspects of US federal income taxation that may apply to holders that are subject to special tax rules, including US expatriates, non-resident aliens present in the United States for at least 183 days during the calendar year, insurance companies, tax-exempt entities, banks, certain financial institutions, persons subject to the alternative minimum tax, regulated investment companies, securities broker-dealers, traders in securities who elect to apply a mark-to-market method of accounting, investors that own (directly, indirectly or by attribution) ten percent or more of the outstanding share capital or voting stock of AngloGold Ashanti.Ashanti, partnerships or other entities treated as partnerships for US federal income tax purposes or persons holding shares through such entities, persons holding their shares as part of a straddle, hedging or conversion transaction, persons who acquired their shares pursuant to the exercise of employee stock options or otherwise as compensation, or persons whose functional currency is not the US dollar. Such holders may be subject to US federal income tax consequences different from those set forth below.
7B. RELATED PARTY TRANSACTIONSAs used herein, the term “US holder” means a beneficial owner of shares that is: (a) a citizen or individual resident of the United States for US federal income tax purposes; (b) a corporation (or other entity taxable as a corporation for US federal income tax purposes) created or organised in or under the laws of the United States, any state thereof or the District of Columbia; (c) an estate the income of which is subject to US federal income taxation regardless of its source; or (d) a trust if (i) a court within the
United States can exercise primary supervision over the administration of the trust and one or more US persons are authorised to control all substantial decisions of the trust or (ii) it has a valid election in effect under applicable Treasury regulations to be treated as a United States person.
If a partnership (including for this purpose any entity treated as a partnership for US federal income tax purposes) holds shares, the tax treatment of a partner generally will depend upon the status of the partner and the activities of the partnership. If a US holder is a partner in a partnership that holds shares, the holder is urged to consult its own tax advisor regarding the specific tax consequences of the ownership and disposition of the shares.
US holders should consult their own tax advisors regarding the specific South African and US federal, state and local tax consequences of owning and disposing of shares in light of their particular circumstances as well as any consequences arising under the laws of any other taxing jurisdiction. In particular, US holders are urged to consult their own tax advisors regarding whether they are eligible for benefits under the US/SA Double Taxation Treaty.
For US federal income tax purposes, a US holder of ADSs should generally be treated as owning the underlying shares represented by those ADSs. Therefore, deposits or withdrawals by a US holder of shares for ADSs or of ADSs for shares will not be subject to US federal income tax. The following discussion (except where otherwise expressly noted) applies equally to US holders of shares and US holders of ADSs.
▪Taxation of dividends
The gross amount of any distribution (including the amount of any South African withholding tax thereon) paid to a US holder by AngloGold Ashanti generally will be taxable as dividend income to the US holder for US federal income tax purposes on the date the distribution is actually or constructively received by the US holder, in the case of shares, or by the Depositary, in the case of ADSs.Corporate US holders will not be eligible for the dividends received deduction in respect of dividends paid by AngloGold Ashanti. For foreign tax credit limitation purposes, dividends paid by AngloGold Ashanti will be income from sources outside the United States.
As noted above in “Taxation—South African taxation—Taxation of dividends”, the South African government has enacted a dividend withholding tax.As a result, US holders who are eligible for benefits under the current US/SA Double Taxation Treaty will be subject to a maximum withholding tax of 15 percent on the gross amount of dividend distributions paid by AngloGold Ashanti.
The Company hadamount of any distribution paid in foreign currency (including the amount of any South African withholding tax thereon) generally will be includible in the gross income of a US holder of shares in an amount equal to the US dollar value of the foreign currency calculated by reference to the spot rate in effect on the date of receipt by the US holder, in the case of shares, or by the Depositary, in the case of ADSs, regardless of whether the foreign currency is converted into US dollars on such date. If the foreign currency is converted into US dollars on the date of receipt, a US holder of shares generally should not be required to recognise foreign currency gain or loss in respect of the dividend. If the foreign currency received in the distribution is not converted into US dollars on the date of receipt, a US holder of shares generally will have a tax basis in the foreign currency equal to its US dollar value on the date of receipt. Any gain or loss recognised upon a subsequent conversion or other disposition of the foreign currency generally will be treated as US source ordinary income or loss. In the case of a US holder of ADSs, the amount of any distribution paid in a foreign currency generally will be converted into US dollars by the Depositary upon its receipt. Accordingly, a US holder of ADSs generally will not be required to recognise foreign currency gain or loss in respect of the distribution. Special rules govern and specific elections are available to accrual method taxpayers to determine the US dollar amount includible in income in the case of taxes withheld in a foreign currency. Accrual basis taxpayers are therefore urged to consult their own tax advisors regarding the requirements and elections applicable in this regard.
Subject to certain limitations, South African withholding taxes will be treated as foreign taxes eligible for credit against a US holder’s US federal income tax liability. The limitation on foreign taxes eligible for credit is calculated separately with respect to specific classes of income. Dividend income generally will constitute “passive category” income, or in the case of certain US holders, “general category” income. The use of foreign tax credits is subject to complex conditions and limitations. In lieu of a credit, a US holder who itemises deductions may elect to deduct all of such holder’s foreign taxes in the taxable year. A deduction does not reduce US tax on a dollar-for-dollar basis like a tax credit, but the deduction for foreign taxes is not subject to all the same limitations applicable to foreign tax credits. US holders are urged to consult their own tax advisors regarding the availability of foreign tax credits.
Certain US holders (including individuals) are eligible for reduced rates of US federal income tax in respect of “qualified dividend income” received. AngloGold Ashanti currently believes that dividends paid with respect to its shares should constitute qualified dividend income for US federal income tax purposes. Each individual US holder of AngloGold Ashanti shares is urged to consult his own tax advisor regarding the availability of the reduced dividend tax rate in light of his own particular situation.
The US Treasury has expressed concern that parties to whom ADSs are pre-released may be taking actions that are inconsistent with the claiming of foreign tax credits for US holders of ADSs. Such actions would also be inconsistent with the claiming of the reduced rate of tax described above, applicable to dividends received by certain non-corporate holders. Accordingly, the analysis of the creditability of South African withholding taxes or the availability of qualified dividend treatment could be affected by future actions that may be taken by the US Treasury with respect to ADSs.
•Taxation of dispositions
If a US holder is a resident of the United States for purposes of the US/SA Double Taxation Treaty, such holder will not be subject to South African tax on any capital gain if it sells or disposes of its shares. Special rules apply to individuals who are residents of more than one country.
Subject to the passive foreign investment company considerations discussed below, upon the sale, exchange or other disposition of shares, a US holder generally will recognise capital gain or loss for US federal income tax purposes in an amount equal to the difference between the US dollar value of the amount realised on the disposition and the holder’s tax basis, determined in US dollars, in the shares. Such gain or loss generally will be US source gain or loss, and will be treated as a long-term capital gain or loss if the holder’s holding period in the shares exceeds one year at the time of disposition. If the US holder is an individual, any capital gain generally will be subject to US federal income tax at preferential rates if specified minimum holding periods are met. The deductibility of capital losses is subject to limitations under the Code.
A US holder’s tax basis in a share will generally be its US dollar cost. The US dollar cost of a share purchased with foreign currency will generally be the US dollar value of the purchase price on the settlement date for the purchase (in the case of shares traded on an established securities market that are purchased by a cash basis US holder or an electing accrual basis US holder), or the date of purchase in all other cases. The amount realised on a sale or other disposition of shares for an amount in foreign currency will be the US dollar value of this amount on the settlement date for the sale or disposition (in the case of shares traded on an established securities market that are sold by a cash basis US holder or an electing accrual basis US holder), or the date of sale or disposition in all other cases. In addition, in such other cases, the US holder will recognise US source foreign currency gain or loss (taxable as ordinary income or loss) equal to the difference (if any) between the US dollar value of the amount received based on the exchange rates in effect on the date of sale or other disposition and the settlement date. If an accrual basis US holder makes either of the elections described above, it must be applied consistently from year to year and cannot be revoked without the consent of the Internal Revenue Services (IRS).
Foreign currency received on the sale or other disposition of a share will have a tax basis equal to its US dollar value on the settlement date. Any gain or loss recognised on a sale or other disposition of foreign currency (including its use to purchase shares or upon exchange for US dollars) will be US source ordinary income or loss.
▪Passive foreign investment company considerations
A foreign corporation will be classified a passive foreign investment company (PFIC) for any taxable year if at least 75 percent of its gross income consists of passive income (such as dividends, interest, rents or royalties (other than rents or royalties derived in the active conduct of a trade or business and received from an unrelated person), or gains on the disposition of certain minority interests), or at least 50 percent of the average value of its assets consists of assets that produce, or are held for the production of, passive income. AngloGold Ashanti believes that it was not treated as a PFIC for the taxable year ended 31 December 2022 or any prior taxable years and does not expect to become a PFIC in the foreseeable future. If AngloGold Ashanti were characterised as a PFIC for any taxable year, a US holder would suffer adverse tax consequences with respect to that taxable year and all future years during which it holds AngloGold Ashanti ordinary shares.
These consequences may include having gain realised on the disposition of shares treated as ordinary income rather than capital gain and being subject to punitive interest charges on the receipt of certain dividends and on the proceeds of the sale or other disposition of the shares. Furthermore, dividends paid by AngloGold Ashanti would not be “qualified dividend income” and would be taxed at the higher rates applicable to other items of ordinary income. US holders should consult their own tax advisors regarding the potential application of the PFIC rules to their ownership of the shares.
▪US information reporting and backup withholding
In general, dividend payments made to a US holder and proceeds paid from the sale, exchange, or other disposition of shares may be subject to information reporting to the IRS and possible backup withholding. US federal backup withholding generally is imposed at a current rate of 24 percent on specified payments including dividends and gross sale proceeds to persons who fail to furnish required information. Backup withholding will not apply to a US holder who furnishes a correct taxpayer identification number and makes any other required certification or who is otherwise exempt from backup withholding. US persons who are required to establish their exempt status generally must provide IRS Form W-9 (Request for Taxpayer Identification Number and Certification). Backup withholding is not an additional tax. Amounts withheld as backup withholding may be credited against a holder’s US federal income tax liability. A holder may obtain a refund of any excess amounts withheld under the backup withholding rules by filing the appropriate claim for refund with the IRS and furnishing any required information.
▪Information with respect to foreign financial assets
Individuals that own “specified foreign financial assets” with an aggregate value in excess of $50,000 are generally required to file information reports with respect to such assets with their U.S. federal income tax returns. Depending on the individual’s circumstances, higher threshold amounts may apply. “Specified foreign financial assets” include any financial accounts maintained by foreign financial institutions, as well as any of the following, but only if they are not held in accounts maintained by financial institutions: (i) stocks and securities issued by foreign persons, (ii) financial instruments and contracts held for investment that have foreign issuers or counterparties and (iii) interests in foreign entities. Therefore, the shares may be treated as specified foreign financial assets. In such cases, certain US holders may be subject to this information reporting regime and be required to file IRS Form 8938 listing these assets with their U.S. federal income tax returns. Failure to file information reports may subject a US holder to penalties. US holders are urged to consult their own tax advisors regarding their obligations to file information reports with respect to the shares.
10F. DIVIDENDS AND PAYING AGENTS
Not applicable.
10G. STATEMENT BY EXPERTS
Not applicable.
10H.Documents on Display
AngloGold Ashanti files annual reports on Form 20-F and reports on Form 6-K with the SEC. You may access this information at the SEC’s home page (http://www.sec.gov). Copies of the documents referred to herein may be inspected at AngloGold Ashanti’s offices by contacting AngloGold Ashanti at 112 Oxford Road, Houghton Estate, Johannesburg, 2198 (Private Bag X 20, Rosebank, 2196) South Africa, Attention: Company Secretary, telephone number: +27 11 637 6000.
No material on the AngloGold Ashanti website forms any part of, or is incorporated by reference into, this annual report on Form 20-F. References herein to the Company’s website shall not be deemed to cause such incorporation.
10I. SUBSIDIARY INFORMATION
Not applicable.
10J. Annual Report to Security Holders
AngloGold Ashanti intends to submit its annual report provided to security holders in electronic format as an exhibit to a current report on Form 6-K.
ITEM 11: QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
TREASURY POLICY
Risk management activities within the Group are the ultimate responsibility of the board. The Chief Financial Officer is responsible to the board for the design, implementation and monitoring of the risk management plan. The Audit and Risk Committee is responsible for overseeing risk management plans and systems, as well as financial risks which include a review of treasury activities and exposure to the Group’s counterparties.
Under the financial and risk management policy, hedges may be put in place once approved by the Board, using approved instruments over the Group’s planned gold production and resultant gold sales and currency exposures. The financial and risk management policy sets trading limits for the various levels of treasury management from dealer, through treasurer, executive management team and board members.
The financial risk management activities objectives of the Group are as follows:
•Safeguarding the Group’s core earnings stream from its major assets through the effective control and management of gold and other commodity price risk, foreign exchange risk and interest rate risk;
•Effective and efficient usage of credit facilities in both the short- and long-term through the adoption of reliable liquidity management planning and procedures;
•Ensuring that investment and hedging transactions are undertaken with creditworthy counterparts; and
•Ensuring that all contracts and agreements related partiesto financial risk management activities are co-ordinated and consistent throughout the Group and comply where necessary with all relevant regulatory and statutory requirements.
Under the financial and risk management policy, treasury reports are produced at the following minimum intervals for review by management and the board of directors:
| | | | | | | | | | | |
• | Daily | | Treasury Manager |
• | Weekly | | Treasurer |
• | Monthly | | Treasurer |
• | Quarterly | | Audit and Risk Committee and Board of Directors |
The Treasury Risk Analyst is responsible for monitoring all reports for completeness and accuracy which are reviewed by the Treasurer.
At AngloGold Ashanti, all front office (dealing), middle office (risk reporting), back office (deal confirmations) and payment (treasury settlements) activities are segregated. All treasury transactions are captured on a third party developed treasury and risk management system that is widely used in corporate treasuries. The Group internal audit function conducts regular and ad hoc reviews of the activities of treasury and the Group’s treasury system.
Gold price and other commodities risk management activities
In the normal course of its operations, the Group is exposed to gold and other commodity price, currency, interest rate, equity price, liquidity and non-performance risk, which includes credit risk. The Group is also exposed to certain by-product commodity price risk. In order to manage these risks, the Group may enter into transactions which make use of derivatives. The Group has developed a risk management process to facilitate, control and monitor these risks.
Gold price risk arises from the risk of an adverse effect of current or future earnings resulting from fluctuations in the price of gold.
As at 31 December 2022, the Group had no commitments against future production potentially settled in cash.
In July 2022, AngloGold Ashanti entered into forward contracts for a total of 999,000 barrels of Brent Crude oil for the period January 2023 to December 2023 that will be cash settled on a monthly basis against the contract price. The average price achieved on the forward contracts is $89.20 per barrel of Brent Crude oil. At 31 December 2022, the mark-to-market value of these oil derivatives was an unrealised loss of $6 million.
Foreign exchange price risk protection agreements
The Group, from time to time, may enter into currency forward exchange and currency option contracts to hedge certain anticipated transactions denominated in foreign currencies. The objective of the Group’s foreign currency hedging activities is to protect the Group from the risk that the eventual cash flows resulting from transactions denominated in US dollars will be adversely affected by changes in exchange rates.
As at 31 December 2022 and 2021, the Group had no open forward exchange or currency option contracts in its currency hedge position.
Cash flows related to these instruments designated as qualifying hedges are reflected in the consolidated statement of cash flows in the same category as the cash flow from the items being hedged. Accordingly, cash flows relating to the settlement of forward sale commodity derivatives contracts hedging the forecasted sale of production into the spot market will be reflected upon settlement as a component of operating cash flows.
Interest rate and liquidity risk
Fluctuations in interest rates impact interest paid and received on the short-term cash investments and financing activities, giving rise to interest rate risk.
In the ordinary course of business, the Group receives cash from the proceeds of its gold sales and is required to fund its working capital requirements. This cash is managed to ensure that surplus funds are invested in a manner to achieve market related returns while minimising risks.
The Group is able to actively source financing at competitive rates. The counterparts are financial and banking institutions and their credit ratings are regularly monitored by the Group.
Cash and loans advanced maturity profile
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 2022 | 2021 |
Maturity date | Currency | Fixed rate investment amount (million) | | Effective rate % | | Floating rate investment amount (million) | | Effective rate % | Fixed rate investment amount (million) | | Effective rate % | | Floating rate investment amount (million) | | Effective rate % |
All less than one year | $ | 8 | | | — | | | 507 | | | 3.48 | | 1 | | | — | | | 301 | | | 0.10 | |
| ZAR | 1,471 | | | 6.87 | | | — | | | | 1,337 | | | 3.54 | | | — | | | |
| AUD | — | | | — | | | 49 | | | 1.07 | | — | | | — | | | 72 | | | — | |
| BRL | — | | | — | | | 52 | | | 11.57 | | — | | | — | | | 106 | | | 4.27 | |
| ARS | 18,178 | | | 66.50 | | | 2,362 | | | 65.50 | | 13,256 | | | 34.00 | | | — | | | |
| CAD | — | | | — | | | — | | | — | | — | | | — | | | 353 | | | 0.19 | |
| GBP | — | | | — | | | 2 | | | 1.54 | | — | | | — | | | — | | | — | |
Borrowings maturity profile | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Within one year | | Between One and two years | Between Two and five years | After five years | Total |
Currency | Borrowings amount (million) | | Effective rate % | | Borrowings amount (million) | | Effective rate % | Borrowings amount (million) | | Effective rate % | Borrowings amount (million) | | Effective rate % | Borrowings amount (million) |
$ | 16 | | | 5.5 | | | 63 | | | 11.9 | | 58 | | | 12.4 | | 1,721 | | | 4.1 | | 1,858 | |
| | | | | | | | | | | | | | |
AUD | — | | | — | | | — | | | — | | 54 | | | 4.5 | | — | | | — | | 54 | |
TZS | 3,586 | | | 12.5 | | | 201,542 | | | 12.5 | | — | | | — | | — | | | — | | 205,128 | |
The table above is based on the borrowings as at 31 December 2022 including borrowing cost and accrued interest but excludes any fair value adjustments.
Interest rate risk | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Fixed for less than one year | | Fixed for between one and three years | | Fixed for greater than three years | | |
Currency | | Borrowings amount (million) | | Effective rate % | | Borrowings amount (million) | | Effective rate % | | Borrowings amount (million) | | Effective rate % | | Total Borrowings amount (million) |
$ | | 16 | | | 5.5 | | | 128 | | | 12.1 | | | 1,714 | | | 4.1 | | | 1,858 | |
AUD | | — | | | — | | | — | | | — | | | 54 | | | 4.5 | | | 54 | |
| | | | | | | | | | | | | | |
TZS | | 3,586 | | | 12.5 | | | 201,542 | | | 12.5 | | — | | | — | | | 205,128 | |
The table above is based on the borrowings as at 31 December 2022 including borrowing cost and accrued interest but excludes any fair value adjustments.
Non-performance risk
Realisation of contracts is dependent upon counterparts’ performance. The group has not obtained collateral or other security to support the financial instruments subject to non-performance risk, but the credit standing of counterparts was monitored on a regular basis throughout the year. The group spreads its business over a number of financial and banking institutions to minimise the risk of potential non-performance. Furthermore, the approval process of counterparts and the limits applied to each counterpart were monitored by the board of directors. Where possible, ISDA netting agreements were put in place.
The combined maximum credit risk exposure at balance sheet date amounts to $1,210 million in 2022 for financial assets (2021: $1,300 million) and nil for financial guarantees (2021: nil). Credit risk exposure netted by open derivative positions with counterparts was nil (2021: nil). No set-off is applied to balance sheet amounts due to the different maturity profiles of assets and liabilities.
Fair value of financial instruments
The estimated fair values of financial instruments are determined at discrete points in time based on relevant market information. The estimated fair values of the Group’s financial instruments, as measured at 31 December, are as follows (assets (liabilities)):
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| | 2022 | | 2021 |
| | Carrying Amount | | Fair value | | Carrying Amount | | Fair value |
(millions) | | $ | | $ | | $ | | $ |
Cash and cash equivalents | | 1,108 | | | 1,108 | | | 1,154 | | | 1,154 | |
Restricted cash | | 60 | | | 60 | | | 58 | | | 58 | |
Deferred compensation asset | | 12 | | | 12 | | | 25 | | | 25 | |
Short-term borrowings | | (18) | | | (18) | | | (51) | | | (51) | |
Long-term borrowings | | (1,965) | | | (1,808) | | | (1,858) | | | (1,960) | |
| | | | | | | | |
Listed investments - FVTOCI | | 2 | | | 2 | | | 116 | | | 116 | |
Listed and unlisted investments | | 1 | | | 1 | | | 1 | | | 1 | |
The following methods and assumptions were used to estimate the fair value of each class of financial instrument:
Cash restricted for use, cash and cash equivalents
The carrying amounts approximate fair value.
Trade and other receivables and trade and other payables
The carrying amounts approximate fair value because of the short-term duration of these instruments, except for the deferred compensation asset which is carried at fair value in level 3 of the fair value hierarchy.
Other investments
Listed equity investments classified as FVTOCI and FVTPL are carried at fair value in level 1 of the fair value hierarchy.
Borrowings
The interest rate on borrowings is reset on a short-term floating rate basis, and accordingly the carrying amount is considered to approximate fair value.
Derivatives
The fair values of volatility-based instruments (i.e., options) are estimated based on market prices, volatilities, credit risk and interest rates for the periods under review.
Gain (loss) on non-hedge derivatives and other commodity contracts recognised
| | | | | | | | | | | |
| Year ended 31 December |
| 2022 | | 2021 |
(millions) | $ | | $ |
| | | |
Other commodity contracts | (6) | | | — | |
Foreign exchange risk
Foreign exchange risk arises on financial instruments that are denominated in a foreign currency.
The following table discloses the approximate foreign exchange risk sensitivities of borrowings at 31 December 2022 (actual changes in the timing and amount of the following variables may differ from the assumed changes below). | | | | | | | | | | | | | | |
| | 2022 |
| | Change in exchange rate | | Change in borrowings Total |
| | | | $M |
Debt | | | | |
| | | | |
TZS denominated (TZS/$) | | Spot (+TZS250) | | (9) | |
AUD denominated (AUD/$) | | Spot (+AUD0.1) | | (2) | |
| | |
| | | | | | | | | | | | | | |
| | 2022 |
| | Change in exchange rate | | Change in borrowings Total |
| | | | $M |
Debt | | | | |
TZS denominated (TZS/$) | | Spot (-TZS250) | | 11 | |
AUD denominated (AUD/$) | | Spot (-AUD0.1) | | 2 | |
| | | | |
ITEM 12: DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES
12A. DEBT SECURITIES
Not applicable
12B. WARRANTS AND RIGHTS
Not applicable
12C. OTHER SECURITIES
Not applicable
12D. AMERICAN DEPOSITARY SHARES
12D.3. DEPOSITARY FEES AND CHARGES
AngloGold Ashanti’s American Depositary Shares, or ADSs, each representing one of AngloGold Ashanti’s ordinary shares, are traded on the New York Stock Exchange under the symbol “AU”. The ADSs are evidenced by American Depositary Receipts, or ADRs, issued by The Bank of New York Mellon, as Depositary under the Amended and Restated Deposit Agreement dated as of 3 June 2008, among AngloGold Ashanti Limited, The Bank of New York Mellon and owners and beneficial owners from time to time of ADRs. ADS holders may have to pay the following service fees to the Depositary:
| | | | | | | | |
Service | Fees (USD) |
| |
Issuance of ADSs | Up to 5 cents per ADS | (1) |
Cancellation of ADSs | Up to 5 cents per ADS | (1) |
Distribution of cash dividends or other cash distributions | Up to 2 cents per ADS | (2) |
Distribution of securities pursuant to | | |
(i) stock dividends, free stock distributions or | | |
(ii) exercises of rights to purchase additional ADSs | Up to 5 cents per ADS | (2) |
ADR Depositary Services fee | Up to 2 cents per year | (2) |
(1)These fees are typically paid to the Depositary by the brokers on behalf of their clients receiving the newly-issued ADSs from the Depositary and by the brokers on behalf of their clients delivering the ADSs to the Depositary for cancellation. The brokers in turn charge these transaction fees to their clients.
(2)In practice, the Depositary has not collected these fees. If collected, such fees are offset against the related distribution made to the ADR holder.
In addition, ADS holders are responsible for certain fees and expenses incurred by the Depositary on their behalf including (1) taxes and other governmental charges, (2) such registration fees as may from time to time be in effect for the registration of transfers of ordinary shares generally on the share register and applicable to transfers of ordinary shares to the name of the Depositary or its nominee or the Custodian or its nominee on the making of deposits or withdrawals, and (3) such cable, telex and facsimile transmission expenses as are expressly incurred by the Depositary in the conversion of foreign currency.
Fees and other charges payable by the Depositary, any of the Depositary’s agents, including the Custodian, or the agents of the Depositary’s agents in connection with the servicing of Shares or other Deposited Securities, shall be collected at the sole discretion of the Depositary by billing such owners for such charge or by deducting such charge from one or more cash dividends or other cash distributions.
For further information, refer to “Item 10C: Material Contracts—The Deposit Agreement”.
12D.4. DEPOSITARY PAYMENTS FOR 2022
For the year ended 31 December 2022, The Bank of New York Mellon, as Depositary, reimbursed AngloGold Ashanti an amount of $934,248 (2021: $1,083,405) mainly for investor relations-related expenses.
PART II
ITEM 13: DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES
None.
ITEM 14: MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS
None.
ITEM 15: CONTROLS AND PROCEDURES
(a)Disclosure Controls and Procedures:As of 31 December 2022, (the “Evaluation Date”), the Company, under the supervision and with the participation of its management, including the chief executive officer and chief financial officer has evaluated the effectiveness of the Company’s disclosure controls and procedures (as defined in Rules 13a - 15(e) and 15d - 15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)). Based on such evaluation, the chief executive officer and chief financial officer have concluded that, as of the Evaluation Date, the Company’s disclosure controls and procedures are effective, and are reasonably designed to ensure that information required to be disclosed by the Company in reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the Securities and Exchange Commission. These disclosure controls and procedures include without limitation, controls and procedures designed to ensure that information required to be disclosed by the Company in reports that it files or submits under the Exchange Act is accumulated and communicated to the Company’s management, including its chief executive officer and chief financial officer, as appropriate to allow timely decisions regarding disclosure.
(b) Management’s Annual Report on Internal Control over Financial Reporting: Management is responsible for establishing and maintaining adequate internal control over financial reporting for the Company, as defined in the Exchange Act Rule 13a - 15(f) and 15d -15(f). The Company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of the Company’s financial statements for external purposes in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board.
The Company’s internal control over financial reporting includes those policies and procedures that:
•Pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect transactions and dispositions of the assets of the Company;
•Provide reasonable assurance that the transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorisations of management and the Directors of the Company; and
•Provide reasonable assurance regarding prevention or timely detection of unauthorised acquisition, use, or disposition of the Company’s assets that could have a material effect on the financial statements.
Because of inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Projections of any evaluation of effectiveness to future periods is subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with policies and procedures may deteriorate.
The Company’s management assessed the effectiveness of the Company’s internal control over financial reporting as of the Evaluation Date. In making this assessment, management used the criteria set forth by the Committee of Sponsoring Organisations of the Treadway Commission (COSO) in Internal Control - Integrated Framework and related illustrative documents released on 14 May 2013.Based on this assessment, and using those criteria, management concluded that the Company’s internal control over financial reporting was effective as of the Evaluation Date.
(c) Changes in Internal Control over Financial Reporting: The Company maintains a system of internal control over financial reporting that is designed to provide reasonable assurance that its books and records accurately reflect transactions and that established policies and procedures are followed.
There have been no changes in the Company’s internal control over financial reporting identified in connection with the evaluation required by paragraph (d) of Exchange Act Rule 13(a) - 15 during the year ended 31 December 2019:2022 that have materially affected, or are reasonably likely to materially affect, the company’s internal control over financial reporting.
|
| | |
At 31 December | 2019 |
(in million) | Purchases from related party |
|
| $ |
Purchases of goods and services from related parties | |
Rand Refinery (Pty) Limited | 8 |
|
Margaret Water Company | 4 |
|
Société d’Exploitation des Mines d’Or de Sadiola S.A. | 1 |
|
| 13 |
|
See also “Item 3D: Risk Factors—AngloGold Ashanti’s inability to maintain an effective system of internal control over financial reporting may have an adverse effect on investors’ confidence in the reliability of its financial statements.”
Amounts due by joint ventures and associates arising from purchases(d) Attestation Report of goods and services are unsecured and non-interest bearing.the Registered Public Accounting Firm: The Company’s independent registered accounting firm, Ernst & Young Inc., has issued an attestation report on the effectiveness of the Company’s internal control over financial reporting. This report appears below.
|
| | |
At 31 December | 2019 |
(in million) | Sales and
services
rendered to
related parties
|
|
| $ |
|
Sales and services rendered to related parties | |
Rand Refinery (Pty) Limited | 19 |
|
Mali joint ventures | 5 |
|
Gramalote | 2 |
|
| 26 |
|
/s/ G A Doran
As at 31 December 2019 the outstanding balances arising from the sale of goods and services due by associates and joint ventures is $20 million.Gillian Ann Doran
Chief Financial Officer
As at 31 December 2019 there are no outstanding balances arising from loans owed to related parties.
/s/ A Calderon
Alberto Calderon
7C. INTERESTS OF EXPERTS AND COUNSEL
Not applicable.
ITEM 8: FINANCIAL INFORMATION
8A. CONSOLIDATED FINANCIAL STATEMENTS AND OTHER FINANCIAL INFORMATION
See “Item 18: Financial Statements”.
LEGAL PROCEEDINGS
There is no material proceeding in which a director, officer or affiliate of AngloGold Ashanti is either a party adverse or has a material interest adverse to the company.Company.
In addition to the proceedings described below, the companyCompany becomes involved, from time to time, in various claims, legal proceedings and complaints incidental to the ordinary course of its business.
TAX MATTERS
•The State of Minas Gerais v. Mineração Serra Grande S.A. (MSG): In Brazil, MSG received a tax assessment in October 2003 from the State of Minas Gerais related to VAT on gold bullion transfers. The tax administrators rejected MSG’s appeal against the assessment.assessment, which amounted to approximately $9.6 million. MSG is now appealingappealed the dismissal of the case to the State Court of Minas Gerais. The assessment is approximately $12 million. Any possible payment by MSG would be set off by an indemnity from Kinross Gold Corporation (Kinross) of $7.5$5 million provided for as part of the company’s acquisition of Kinross’ interest in MSG in 2012. The matter is currently pending in the State Court of Minas Gerais.
•Brazilian tax authorities v. AngloGold Ashanti Córrego do Sítio Mineração SA: SA and Mineração Serra Grande S.A. (MSG): AngloGold Ashanti’s subsidiaries in Brazil, including AngloGold Ashanti Córrego do SítioAGA Mineração SA (formerly AngloGold Ashanti Brasil Mineração Ltda), and MSG, are involved in various disputes with the Brazilian tax authorities. These disputes date back toas far as 2007 and involve federal tax assessments including income tax, royalties, social contributions, VAT and annual property tax. Collectively, the total possible amount involved across all tax disputes in Brazil is approximately $25$46.5 million, which include VAT claims and social security payments of $36 million.
•Colombian Tax Office (DIAN) v. AngloGold Ashanti Colombia S.A.S.A.S. (AGAC) and Gramalote Colombia Limited (Gramalote): In January Since 2013, AGAC received noticevarious notices from the DIAN that it disagreed with the company’s tax treatment of certain itemsexploration expenditure in theits 2010, 2011, 2013 and 20112014 income tax returns and its 2011 equity tax returns. On 23 October 2013,return. However, AGAC received the official assessments from the DIAN which established that an estimated additional tax of $20 million will be payable if the tax returns are amended. Penalties and interest for the additional taxes may amount to $125 million. The company believes that the DIAN has applied the tax legislation incorrectly. AGACincorrectly and subsequently challenged the DIAN’s ruling by filingfiled lawsuits in March and April 2015, before the Administrative Court of Cundinamarca (the trial court for tax litigation). Closing arguments on challenging each of the DIAN’s rulings in respect of those tax disputes were presented in February and June 2017. On 23 Aprilreturns. In 2018, the Administrative Court of Cundinamarca denied AGAC’s arguments with respect to the 2010 and 2011 income tax litigation. AGAC subsequently appealed this judgmentthese judgments to the Supreme CourtCouncil of Colombia. A final judgement could take several years. A determination byState of Colombia (the highest court for tax matters). In November and December 2022, the Administrative Court withCouncil of State ruled against AGAC upon appeal. The Council of State ordered AGAC to pay $34 million of additional taxes (which includes interest) in respect toof the 2010 incomeand 2011 tax litigation is still pending.
returns, but it fully waived any related penalties (which were originally assessed in the amount of $47 million). In January 2018,December 2022, a tax reform was adopted in Colombia, enacting changes which may lead to a reduction of interest charged on outstanding tax obligations in certain circumstances. In February 2023, AGAC received notice frompaid $25 million of additional taxes (which includes interest) in respect of the DIAN that it also disagreed with AGAC’s 20132011 income and equity tax returns, onafter taking into account a reduction of $6 million in interest under the same basis astax reform. Following this payment, the 2011 tax litigation was fully settled. AGAC is still awaiting the final decision under the new tax reform in respect of the 2010 tax litigation. AGAC’s other lawsuits with respect to its 2013 and 20112014 tax returns calculating additional tax, along with penalties and interest, of $9 million. On 13 March 2020, AGAC filed a lawsuitare still pending before the Administrative Court of Cundinamarca challengingand the DIAN’s 2013 assessment. The matter is currently pending. In May 2019, AGAC received notice from the DIAN that it also disagreed with AGAC’s 2014 income and equity tax returns on the same basis as the 2010, 2011 and 2013 returns, calculating additional tax, along with penalties and interest,company has disclosed a contingent liability of $7 million.$5.0 million in respect thereof (mainly covering related penalties).
In FebruarySince 2019, Gramalote also received noticevarious notices from the DIAN that it disagreed with its 2013 income and equity2014 income tax returns on the same basis as the abovementioned AGAC returns, calculating additional tax, along withtaxes as well as penalties and interest, of $9 million which was confirmed in its official assessment issued on 24 January 2020.interest. However, Gramalote also believes that the DIAN has until 10 June 2020 to file a lawsuit to challenge this official assessmentapplied the tax legislation incorrectly and subsequently filed lawsuits before the administrative courts. In addition,Administrative Court of Cundinamarca challenging each of the DIAN’s rulings in March 2019, Gramalote received notice from the DIAN that it disagreedrespect of those tax returns. Gramalote’s lawsuits with respect to its 2014 income2013 and equity2014 tax returns on the same basis as its 2013 returns, calculating additional tax, along with penalties, of approximately $3 million. In October 2019, the DIAN issued the official assessment for 2014 confirming this amount. On 23 December 2019, Gramalote filed a motion for reconsiderationare still pending before the DIAN.Administrative Court of Cundinamarca. The company has disclosed a contingent liability of $3.0 million in relation to Gramalote’s 2013 and 2014 tax returns (mainly covering related penalties).
The total amount claimed by the DIAN, related to the above tax matters amountsthat remain outstanding amounted to $164$8.1 million of which $144$8.0 million relatesrelated to penalties and interest.as of 31 December 2022. Following a judgment of the Council of State in July 2019 holding that duplicate penalties may not be charged, the company expects that certain penalties will likely be waived, reducing the overall exposure to $0.1 million in respect of those tax matters. In addition, from 2017 onwards, the deduction of exploration costs is prohibited following a change in Colombian tax legislation. As a result, exploration costs have been treated in accordance with the amended tax legislation subsequent to that date.
•Argentina Tax Authority (AFIP) v. Cerro Vanguardia S.A. (CVSA): On 12 In July 2013, CVSA received a notification from the AFIP requesting corrections to the 2007, 2008 and 2009 income tax returns of about $1.8$0.9 million relating to the non-deduction of tax losses previously claimed on hedge contracts. The AFIP is of the view that the financial derivatives could not be considered as hedge contracts, as hedge contract losses could only be offset against gains derived from the same kind of hedging contracts. Penalties and interest on the disputed amounts are estimated at a further $8.2$4.2 million. CVSA and AFIP have corresponded on this issue over the past several years, and the Argentinian tax authorities continue to assert their position regarding the use of the financial derivatives. CVSA filed an appeal with the Tax Court on 19in June 2015, and the parties submitted their final reports in July 2017. The matter is pending with the Tax Court.
•Ghanaian tax authorities v. AngloGold Ashanti (Ghana) Limited (AGAG): In Ghana, withholding tax audits: AGAG received a final tax assessmentsaudit report from the Ghana Revenue Authority (GRA) in which the GRA demanded payment of $4.4$9.0 million as of 31 December 2018 in respect of the 2004-2014 tax years, following an audit by the Ghanaian tax authorities related to withholding taxes on payments to non-resident persons. AGAG raised objectionsobjected to the GRA’s assessment of withholding taxes on the basis that AGAG was duly exempted by the government of Ghana from withholding taxes on payments made to non-residents during the relevant periods in terms of the Deed of Warranty signed with the Ghanaian tax authorities and believes that the withholding taxes were not properly assessed. On several occasions, most recently ingovernment of Ghana. In 2017, AGAG met with the Commissioner-General of the Ghana Revenue AuthorityGRA and provided its position in writing together with the relevant supporting documentation.documents. AGAG has not yet to receivereceived a response from the Commissioner-General.
SOUTH AFRICA
Silicosis and tuberculosis litigation: In August 2013, AngloGold Ashanti, along with several other mining companies, was served with a consolidated class action application. In May 2016, Due to the High Courtstatute of limitations applicable to tax assessments in Johannesburg ruled in favourGhana, the amount of the applicants and found that there were sufficient common issues to certify two industry-wide classes: a Silicosis Class and a Tuberculosis Class. In May 2018, settlement of the consolidated class action litigation was reached. The settlement agreement in relation to this silicosis and tuberculosis class action came into effect on 10 December 2019, following the approval of the settlement by the High Court in Johannesburg in July 2019. As a result, a trust (Tshiamiso Trust) was established for a minimum of 13 years responsible for making payments to eligible beneficiaries. The amount of monetary compensation will vary depending on the nature and seriousness of the disease. As oftax uncertainty is estimated at $6.0 million as at 31 December 2019, AngloGold Ashanti has recorded a provision of $65 million to cover the estimated settlement costs and related expenditure of the silicosis litigation.
2022.
COLOMBIA
•Santa María-Montecristo and La Colosa class action lawsuits: Class action lawsuits are pendinghave been filed in relation to each of AngloGold Ashanti Colombia S.A.S.A.S.’s (AGAC) Santa María-Montecristo and La Colosa projects. Each of the two lawsuits aims to stop exploration and mining in certain restricted areas affected by the projects due to environmental concerns.
In respect of the Santa María-Montecristo class action lawsuit, in September 2011, the Administrative Court of Tolima granted one of the plaintiffs a preliminary injunction suspending AGAC’s mining concession contracts in relation to this project. AGAC has challenged this injunction, nevertheless, it remains in place during the course of the court proceedings. On 30In May 2019, the Administrative Court of Tolima ruled that a technical study be prepared to define the places in which mining activities could be performed in the Combeima canyon without posing any threat to the water reservoirs of Ibagué, the capital of the Tolima department. AGAC’s appeal of this ruling was admitted and is currently pending beforeIn September 2020, the Council of State of Colombia (the highest court for administrative matters). on appeal overruled the decision of the Administrative Court of Tolima. The order to prepare the technical study has been temporarily suspended pending resolution by the Council of State. If AGAC’sState’s decision, which is final and not subject to further appeal, beforedetermined that AGAC, as concessionaire, has a right to develop the Councilproject if it can demonstrate to the mining and environmental authorities on the basis of State istechnical studies that its mining exploration and, eventually, exploitation activities, will not successful,impact the company may have to perform a technical study in respectwater resources of the Combeima canyon. IfCoello River basin and its tributaries. On 25 October 2022, AGAC returned the results of the study are unfavourable, certain development activities attenements involved in the Santa María-Montecristo project may be suspended.to the government of Colombia. This return is pending acceptance by the Colombian Mining Authority (Agencia Nacional de Minería) following which the Administrative Court of Tolima still needs to dismiss the case. Until such time, the injunction remains in place.
The consolidated La Colosa class action lawsuit originally consisted of four separate class actions. In relation to this project, on 10in October 2016, Tolima’s Administrative Court ordered that a technical study be prepared by a panel of seven experts (selected by the plaintiff, AGAC, universities, the Colombian government and an NGO) to determine whether the La Colosa project presents a “threat” to the environment during its exploration phase. On 4In December 2017, Ibagué’s Third Administrative Court ordered that another technical study, similar to the one described in the October 2016 order, be prepared for the La Colosa project. AGAC appealed both orders. On 6In September 2018, Tolima’s Administrative Court consolidated all class actions in relation to the La Colosa project into one single class action lawsuit which is currently pending before the Council of State. The orders to prepare the technical studies have been temporarily suspended pending resolution by the Council of State. If AGAC’s appeal before the Council of State is not successful, the companyCompany may have to perform one or more technical studies in relation to the La Colosa project. If the studies were to conclude that a “threat” exists, certain development activities at the La Colosa project may be suspended.
WhileFurther, while the plaintiffs in thesethe La Colosa class actionsaction have petitioned the courts to cancel the La Colosa and/or Santa María-Montecristo mining concession contracts, the companyCompany believes that the judiciary system in Colombia does not have the authority to order such cancellations.cancellation. Such power, by law, vests solely in the Colombian government which, through the relevant Colombian mining authorities, has the discretion to declare concessions void if a concession holder breaches applicable environmental laws or regulations. The Colombian government, as the authority granting the mining concession contracts, is also a defendant in thesethis class action lawsuitslawsuit together with AGAC. AGAC continues to oppose, through a variety of integrated legal and political strategies, the class action lawsuitslawsuit that have beenwas filed against it. However, if the plaintiffs prevail and AGAC is unable to perform its core concession contracts as a result of the judicial decision, the companyCompany would be required to abandon the La Colosa project and/or Santa María-Montecristo project.
•Cortolima’s injunction against AngloGold Ashanti Colombia S.A.S.A.S. (AGAC): On 11 In March 2013, Cortolima, a regional environmental authority in the Tolima department, issued a regulatory injunction against AGAC alleging, among other things, that in relation to certain of AGAC’s La Colosa mine design-related activities in the municipality of Piedras, AGAC engaged in drilling and other activities that could have negative effects on the environment. The injunction did not include any allegation that AGAC’s actions actually caused any environmental damages in Piedras. AGAC’s challenge of the injunction was unsuccessful before Cortolima. In August 2013, AGAC initiated legal proceedingproceedings before the Council of State of Colombia (the highest court for administrative matters) seeking annulment of the injunction as well as restoration of its rights to continue its
activities in the area. In November 2019, the Council of State ruled that the competent judicial authority to decide on this matter is the Administrative Court of Tolima and referred the case to that court. ThisIn July 2020, the Twelfth Administrative Court of Tolima ruled that since the injunction is a preliminary and temporary measure imposed as part of the administrative approval process within Cortolima and not a final decision, it is not yet amenable to administrative judicial review. In July 2021, this decision was reversed on appeal by the Administrative Superior Court of Tolima in a ruling that such injunctions are amenable to administrative judicial review. The appellate court ordered the Twelfth Administrative Court of Tolima to review the matter is currentlyand issue a decision thereon. Consequently, the Twelfth Administrative Court of Tolima admitted the case and a first hearing was held on 21 April 2022. Trial evidence was accepted. On 25 October 2022, another hearing was held to gather testimonies. The case remains pending. The companyCompany expects that a final resolution of this
matter will include payment of a penalty by AGAC in an amount that is not expected to be material. While the injunction remains in place, AGAC is not able to engage in certain of its activities related to the La Colosa project.
•Piedras and Cajamarca popular consultations: In 2013, the local council of the city of Piedras, near the La Colosa project, organised a popular consultation to ban all mining activities in Piedras (Piedras popular consultation), the result of which was validated by the Administrative Court of Tolima as part of an administrative procedure. Although the Piedras popular consultation did not have an immediate impact on the La Colosa project (due to its distant location from the project), AGAC believes the Piedras popular consultation was in violation of national law in Colombia. In 2013, AGAC filed a ‘tutela’ action (a legal action alleging a violation of AGAC’s constitutional rights) with the Council of State of Colombia (the highest court for administrative issues). In 2014, AGAC’s ‘tutela’ action was dismissed by the Council of State for lack of standing on the grounds that AGAC did not have mining tenements in Piedras. In addition, in 2015, AGAC filed a request for annulment of the administrative acts adopted by the local authorities in furtherance of the results of the Piedras popular consultation, which was rejected by the Second Administrative Court of Ibagué. AGAC’s appeal ofAGAC subsequently appealed this ruling is currently pending beforeruling. In July 2021, AGAC was notified that the Administrative Superior Court of Tolima which will have to decideruled on this matterappeal that, in light of the recent ruling2018 decision of the Constitutional Court onof Colombia (the highest court for constitutional issues) holding that local municipalities or regions are not entitled to veto mining activities through popular consultations (as further described below.
below), the results of the Piedras popular consultation, and the administrative acts adopted in furtherance thereof, were not enforceable. An extraordinary appeal against this ruling was submitted on 22 March 2022, which is pending. In addition, in September 2021, a third party filed a ‘tutela’ action with the Council of State arguing that the Administrative Superior Court of Tolima did not have the authority to determine that the results of the Piedras popular consultation, and the administrative acts adopted in furtherance thereof, were not enforceable. In December 2021, the Council of State dismissed this ‘tutela’ action for lack of standing.
In March 2017, the residents of the municipality of Cajamarca also voted in a popular consultation to disapprove mining projects in the municipality, including the La Colosa project (Cajamarca popular consultation). However, the Mining Minister of Colombia subsequently publicly confirmed that Cajamarca’s vote does not apply retroactively implying the Cajamarca popular consultation did not have an immediate impact on AGAC’s rights with respect to the La Colosa project. In April 2017, AGAC nevertheless suspended all exploration activities at the La Colosa project until there is more certainty about mining activity in Colombia. On 11In October 2018, the Colombian Constitutional Court issued ruling SU-095-2018 stating that local municipalities or regions were not entitled to veto mining activities through popular consultations. The Constitutional Court also ordered the national legislative body, the Congress of Colombia, to enact a law within two years to ensure that local communities and groups are adequately consulted in the approval of mining activities in accordance with specific criteria set out in its ruling. Subsequently, a group of citizens submitted an annulment claim before the Administrative Court of Cundinamarca to cancel AGA’sAGAC’s mining contract in Cajamarca on the grounds of the results of the Cajamarca popular consultation. TheAfter having admitted the annulment claim was admitted on 11in December 2019, the Administrative Court of Cundinamarca dismissed the plaintiffs’ claim in May 2021 on procedural grounds. The plaintiffs subsequently appealed this decision and the appeal is currently pending before Cundinamarca’s Administrative Court which will have to decide on this matter in lightthe Council of the abovementioned ruling of the Constitutional Court.State.
•La Colosa Human Rights Litigation: In November 2014, the Personero (Ombudsman) of Ibagué, the capital of the Tolima department, filed a petition against the Colombian government before the Inter-American Commission on Human Rights (Commission), based in Washington, D.C., for alleged human rights violations protected by the American Convention on Human Rights (Convention) which has been ratified by Colombia along with many other Central and South American countries. The Commission has the power to refer a case to the Inter-American Court of Human Rights (Court) which is an autonomous judicial institution based in San José, Costa Rica whose purpose is the application and interpretation of the Convention. The petition alleges that the Colombian government denied justice to the Personero as a result of the failure of the Colombian judiciary to resolve the issues raised in two class actions filed by him before the local Colombian administrative courts within a reasonable period of time. Although AGAC is not a party to the suit, its outcome is nevertheless important to the development of the La Colosa project. The Commission currently has not accepted nor referred the case to the Court. If the case would be accepted or referred in the future, the Colombian government will have to defend itself against the lawsuit and will be bound by the findings of the Court. AGAC continues to regularly follow up with the Colombian government for updates.
•Paramo Delimitation: In November 2016, the Colombian government issued Resolution 19871987/2016 delineating certain wetlands or moorlands as environmentally important protected areas, which designation includes certain areas in and around the La Colosa project. In these areas there are limitations, or in some instances outright bans, on mining and mining-related activities. These limitations and bans could potentially adversely impact the design, operations and production of the mining project at the La Colosa project. On 12In June 2017, AGAC filed suit against the Colombian Ministry of the Environment in the Administrative Court of Cundinamarca to annul Resolution 19871987/2016 on technical and other grounds. The lawsuit was admitted on 30in April 2019. The Ministry of the Environment, as defendant in this action, is expected to file its response to the annulment claim.
•Zonte Metals: A Canadian junior mining company, Zonte Metals, filed applications for title to certain corridors, or small slivers of land, overlaying sections of the Gramalote project. The Secretary of Mines of Antioquia, the department in which the Gramalote project is located, denied the applications filed by Zonte Metals. However, Zonte Metals then filed a claim against the Colombian National Mining Agency (ANM) and the Antioquia Secretary of Mines before the Council of State of Colombia, by which it seeks to (i) revoke the resolution that denied its application and (ii) obtain the rights over the corridors requested in its application. The Council of State subsequently enjoined the Antioquia Secretary of Mines and Gramalote Colombia Limited (Gramalote) from progressing a pending application to integrate the disputed corridors with Gramalote’s tenement. The Antioquia Secretary of Mines has filed its response to the Zonte Metals claim, which includes arguments
aligned with the interests and position of Gramalote. On 4In September 2017, the Council of State approved Gramalote’s request to be made an interested party to the lawsuit, but it rejected Gramalote’s request to join the Antioquia Secretary of Mines as a co-defendant on 28in August 2019. On 24In January 2019, the Council of State also re-affirmed that the Council of State is the competent judicial authority to hear the matter. The date for the first hearing is currently pending.
GHANA
•Pompora Treatment Plant Litigation: On 2In April 2013, AngloGold Ashanti (Ghana) Limited (AGAG) received a summons from Abdul Waliyu and 152 others in which the plaintiffs allege that they were or are residents of the Obuasi municipality or its suburbs and that their health has been adversely affected by emissions and/or other environmental impacts arising in connection with the current and/or historical operations of the Pompora Treatment Plant (PTP), which was decommissioned in 2000. The plaintiffs’ alleged injuries include respiratory infections, skin diseases and certain cancers. The plaintiffs subsequently did not timely file their application for directions but AGAG intends to allow some time to pass prior to applying to have the matter dismissed for want of prosecution. On 24in time. In February 2014, executive members of the PTP (AGAG) Smoke Effect Association (PASEA), sued AGAG by themselves and on behalf of their members (undisclosed number) on grounds similar to those discussed above, as well as economic hardships resulting from the failure of their crops. This matter has been adjourned indefinitely. As plaintiffs in these matters have not actively pursued these legal proceedings, AGAG intends to allow some time to pass prior to applyingis taking steps to have the matter struck outthese matters dismissed for want of prosecution.
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• | Mining and Building Contractors Limited: On 11 October 2011, AGAG terminated Mining and Building Contractors Limited’s (MBC) underground development agreement, construction on bulkheads agreement and diamond drilling agreement at Obuasi mine. The parties reached agreement on the terms of the separation and concluded a separation agreement on 8 November 2012. On 20February 2014, AGAG was served with a demand issued by MBC claiming a total of $97 million. In December 2015, the proceedings were stayed in the Ghanaian High Court pending arbitration. In February 2016, MBC submitted the matter to arbitration. The arbitration panel has been constituted and held an arbitration management meeting to address initial procedural matters on 26 July 2019. The arbitration is currently pending.
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•Ghana Mining Licenses Litigation:Litigation: In January 2019, AGAG and AngloGold Ashanti (Iduapriem) Limited (AAIL), along with other Ghanaian mining companies, were served with writs by two members of the Ghanaian Parliament seeking to invoke the jurisdiction of the Ghanaian Supreme Court (highest court in Ghana) for a declaration that the mining companies were not entitled to carry out any exploitation of minerals otherwise allowed under their relevant mining leases unless the leases had been timely ratified by the Parliament of Ghana. On 19In January 2019, the Ghanaian Attorney General filed its statement of case, agreeing with the position of the plaintiffs (that the mining leases required parliamentary ratification) and requesting that the Supreme Court order the mining companies to pay the Ghanaian government all revenue related to mining activities accrued during the time such mining leases were unratified. On 18In April 2019, AGAG and AAIL, in coordination with the other mining companies, filed their statement of case. The Supreme Court has not yet set a date for the first hearing to commence the case.
On 13 December 2019, AGAG, together with six other mining companies, were served with writs by a private individual seeking similar relief in the High Court of Ghana (instead of the Ghanaian Supreme Court). On 30 January 2020, during the first hearing, the High Court noted that AGAG and the other defendants had filed motions to have the writ struck out and ordered the parties to file their written submissions. The case has been adjourned to the beginning of April 2020 for a ruling on the interlocutory matter.
GUINEA
•Government of Guinea (National Claim Commission) v. Société AngloGold Ashanti Goldfields de Guinée SA (SAG): A national claim recovery commission established by the government of Guinea has demanded that SAG pay $43 million in dividends and penalties that would allegedly have been owed to the government of Guinea for the accounting years 2004 - 2007. SAG opposes the claim. Even though both parties had originally decided to submit their dispute to an independent audit firm to be appointed by a common accord, the independent audit firm was never appointed. In December 2010, the national claim recovery commission was disbanded and the matter was turned over to the Inspector General of the Ministry of Finance of Guinea. This matter has been dormant since it was handed over to the Inspector General.
NORTH AMERICA
Designated Matters under the Stock Purchase Agreement between AngloGold Ashanti and Newmont Corp.: On 19 October 2017, Newmont Corp. (formerly Newmont Mining Corp.) filed a lawsuit in the United States District Court for the Southern District of New York against AngloGold Ashanti and certain related parties, alleging that AngloGold Ashanti and such parties did not provide Newmont Corp. with certain information material to its purchase of the Cripple Creek & Victor Gold Mining Company (CC&V) in 2015 during the negotiation and sale process. On 18 March 2020, AngloGold Ashanti’s motions for summary judgment were granted and the case was dismissed.
TANZANIA
•Geita Gold Mining Limited (GGM): In January 2007, Jackson Manyelo and other plaintiffs filed a suit against GGM in the Mwanza High Court alleging that they were affected by blasting activities in the Katoma area carried out by GGM and had suffered damages in the amount of TZS9.6 billion (approximately $6 million). On 30In April 2015, the High Court issued a judgementjudgment in favour of GGM. In 2016, plaintiffs appealed to the Court of Appeal, where the matter is pending.
•Geita Gold Mining Limited (GGM) and Samax Resources Limited (Samax) v. Government of Tanzania: On 13 In July 2017, GGM and Samax filed a notice of arbitration against the government of Tanzania arising from the enactment by the government of certain legislation that purports to make a number of changes to the operating environment of Tanzania’s extractive industries, including mining. The notice of arbitration was submitted in accordance with Article 12 of the Agreement for the Development of a Gold Mine at Geita, Mwanza between the government of Tanzania and each of GGM and Samax (the MDA), and under the 1976 Arbitration Rules of the United Nations Commission on International Trade Law (UNCITRAL). The Arbitral Tribunal has been duly constituted. On 15Since January 2019, at the request of the parties, requested that the arbitral proceedings behave been stayed until 12 July 2019several times in order to afford the parties the opportunity to achieve an amicable resolution of the dispute. A further extensiondispute and as a result of the stay until 13 January 2020 was subsequently granted. On 29 January 2020,impact of the Arbitral Tribunal granted another extensionCOVID-19 pandemic. In October 2022, the parties agreed to stay the arbitralarbitration proceedings until 13 May 2020 on the basis that this stay is final, unless there are principled grounds for a further stay.
period of 12 months until 6 November 2023.
•Arbitration under the United Kingdom-Tanzania Bilateral Investment Treaty (UK-Tanzania BIT):Unrelated to the arbitration proceedings under the MDA described above, on 4in September 2017, GGM and Samax, together with Cluff Oil Limited and Cluff Mineral Exploration Limited, notified the government of Tanzania in writing that the Tanzanian government’s conduct amounted to a breach of its commitments under the UK-Tanzania BIT. This notice triggered a ‘cooling-off’ period under the UK-Tanzania BIT, pursuant to which the parties had six months to achieve an amicable resolution to their dispute. Following the expiry of the ‘cooling off’ period on 4in March 2018, GGM, Samax, Cluff Oil Limited and Cluff Mineral Exploration Limited are now entitled to submit their dispute with the government of Tanzania to ICSID arbitration in accordance with the terms of the UK-Tanzania BIT to the extent that they may deem this necessary.
BRAZIL
•Public Civil Action between Mineração Serra Grande S.A. (MSG) and the Goiás State Public Prosecutor's Office (Prosecutor): On 28In August 2019, the Prosecutor filed a public civil action against MSG in the local court of Crixás (Court) arguing that the Serra Grande tailings dam should be deactivated and decommissioned due to its size and upstream construction method. The Prosecutor requested the Court to grant an injunction ordering MSG to, inter alia, completely deactivate the tailings dam by 15 September 2021 and decommission the tailings dam, including complete removal of tailings material, by 15 September 2022. Further, the Prosecutor requested that a daily penalty of approximately $245,000 be imposed for MSG’s failure to comply with such injunction. MSG submitted its defence on 27in September 2019 and contends that it has not violated any Brazilian laws or regulations applicable to operations of the Serra Grande tailings dam. On 10In February 2020, the Court granted an injunction in respect of a number of the requests made by the Prosecutors.Prosecutor. In line with the legal requirements of ANM Resolution No. 13/19, the injunction ordered the deactivation of the Serra Grande tailings dam by 15 September 2021, but did not include requirements to decommission the tailings dam, or to conduct complete removal of tailings material, by 15 September 2022. On 20 February 2020, MSG filed a motion for clarification in relation to certain items of the Court’s decision. This matter is ongoing.
In May 2020, the Court clarified that its injunction should be interpreted in line with the legal requirements of ANM Resolution No. 13/19. In June 2020, the Prosecutor presented further technical arguments in court, reiterating its request for an injunction ordering MSG to, inter alia, deactivate the tailings dam by September 2021 and to decommission the tailings dam, including complete removal of tailings material. Afterwards, MSG filed an interlocutory appeal against the preliminary injunction granted in February 2020 and a motion for further clarification. In August 2020, both MSG and the Prosecutor filed petitions informing the Court that the parties did not wish to produce oral evidence at a hearing. In May 2021, the Court upheld the preliminary injunction ordering the deactivation of the Serra Grande tailings dam by 15 September 2021 and its decommissioning by 15 September 2025, both of which are consistent with the deadlines established by existing legal and regulatory requirements. In June 2021, the Prosecutor appealed this decision. The Court of Appeals of Goiás tried the case on 4 August 2022 and has affirmed the first instance decision. On 3 November 2022, the Prosecutor appealed this decision to the Superior Court of Justice.
•Public Civil Action between AngloGold Ashanti Córrego do Sítio Mineração SA (AGA Mineração) and the Minas Gerais State Public Prosecutor's Office (Prosecutor): On 6In March 2020, the Prosecutor filed a public civil action against AGA Mineração in the local court of Sabará (Court) alleging a violation of Minas Gerais Law No. 23.291/19, which was adopted in February 2019. Article 12 of this law prohibits the grant of an environmental license for construction, installation, expansion or raising of a tailings storage facilitydam if the “dam break” studies identify communities that are located in the self-rescue zone. On 21In February 2020, the state of Minas Gerais approved AGA Mineração’s permit to operate the Cuiabá tailings dam following the determination by the Minas Gerais’ Attorney’s Office that Law No. 23.291/19 does not apply to tailings storage facilitiesdams already in operation. In its lawsuit, the Prosecutor requested the Court to grant an injunction ordering the suspension of AGA Mineração’s operational permit for the Cuiabá tailings dam on the grounds that it was issued in violation of this law. During the months of March through May 2020, all parties presented their arguments in court. In June 2020, the Court rejected the Prosecutor’s request to grant an injunction. In July 2020, the Court’s decision not to grant an injunction was upheld on appeal by the Court of Appeals of Minas Gerais. Subsequently, the Court issued an order proposing a conciliation hearing between the parties, to which none of the parties objected. On 12 March 2020,28 January 2022, the parties filed a joint petition requesting the cancellation of the conciliation hearing and the suspension of the legal proceedings in view of negotiations between the parties to explore a possible settlement. On 2 June 2022, AGA Mineração presented its arguments in court challengingand the requested injunction. This matter is ongoing.Prosecutor entered into a settlement. Pursuant to the settlement, AGA Mineração will, among other measures, update the emergency action plan and decommission the Cuiabá tailings dam according to the schedule filed with the relevant mining and environmental agencies. AGA Mineração will also prepare a technical study to assess the potential evacuation of communities from the self-rescue zone during the decommission stages. The Court approved the settlement on 29 July 2022 and the public civil action was terminated.
DIVIDENDS
General
Dividends are proposed by and approved by the board of directors of AngloGold Ashanti (the “board”), based on the company’sCompany’s financial performance.performance and compliance with applicable laws, including in respect of the solvency and liquidity test contemplated in the SA Companies Act. Dividends are recognised when declared by the Board of Directors of AngloGold Ashanti (Board).Board. AngloGold Ashanti’s dividend policy allows the Board to declare an annuala semi-annual dividend to be based on 1020 percent of the free cash flow generated by the business for that financial year, before taking into account growth capital expenditure.expenditure, subject to applicable laws required to be complied with before a dividend may be declared by the Board. The Board may exercise its discretion on an annual basis, taking into consideration the prevailing market conditions, balance sheet flexibility and future capital commitments of the group.Group.
Dividends may be declaredAs a company incorporated in any currency ataccordance with and bound by the discretioncompany laws of the Board orRepublic of South Africa with its primary listing on the Johannesburg Stock Exchange, AngloGold Ashanti shareholders at a general meeting. Currently,is required to declare dividends in South African rands. Therefore, dividends are declared in South African rands and paid in Australian dollars, South African rands, British pounds and Ghanaian cedis. Dividends paid to registered holders of AngloGold Ashanti ADSs are paid in US dollars converted from South African rands by The Bank of New York Mellon, as depositary,Depositary, in accordance with the deposit agreement. Exchange rate fluctuations may therefore affect the value of the dividends received by registered shareholders and distributions paid by the relevant depositaryDepositary to investors holding AngloGold Ashanti securities. Moreover, fluctuations in the exchange rates of the US dollar may affect the US dollar price of the ADSs on the NYSE. For details on taxation and exchange controls applicable to holders of ordinary shares or ADSs, see “Item“Item 10D: Exchange Controls”, “Item“Item 10E: Taxation-SouthTaxation—South African Taxation-TaxationTaxation—Taxation of dividends” and “Item 10E: Taxation-UnitedTaxation—United States Taxation-TaxationTaxation—Taxation of dividends”.
Dividends declared (in the ordinary course from trading and non-trading profits) to foreign shareholders are not subject to the approval by the South African Reserve Bank (SARB) in terms of South African foreign exchange control regulations. Dividends are freely transferable to foreign shareholders from both trading and non-trading profits earned in South Africa by publicly listed companies. Dividends in specie or special dividends may require SARB approval prior to declaration and payment to foreign shareholders.
Under South African law, the companyCompany may declare and pay dividends from any reserves included in total shareholder’s equity (including share capital and share premium) calculated in accordance with International Financial Reporting Standards (IFRS), subject to the solvency and liquidity test.
Withholding tax
South Africa currently imposes a Dividend Withholding Tax on Companies (dividends tax) at a rate of 20 percent on the net amount of the dividend declared and paid by a resident company, other than a Headquarter Company.
The dividends tax is generally imposed on the beneficial owner of the dividends. The dividends paid to South African shareholders may be exempt from dividend withholding tax couldin terms of certain domestic exemptions, or may be reduced to a lower rate under an applicable double tax treaty, if all requirementsthe required declarations and undertakings are met.provided by the beneficial owner of the dividend. In the case of dividends paid to a US holder with respect to shares, the Convention Between the Government of the United States of America and the Republic of South Africa for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on Income and Capital Gains, signed 17 February 1997 (Treaty)(the “US/SA Double Taxation Treaty”) would generally limit the dividends tax rate to five percent of the gross amount of the dividends if a corporate US holder holds directly at least 10ten percent of the voting stock of AngloGold Ashanti, provided that the applicable declaration and undertaking are given by the beneficial owner that the reduced rate applies.Ashanti. In all other cases, the maximum tax rate under the US/SA Double Taxation Treaty is 15 percent of the gross amount of the dividend. Different rules may apply if the beneficial owner of the dividends is a US resident who carries on business in South Africa through a permanent establishment situated in South Africa, or performs in South Africa independent personal services from a fixed basepermanent establishment situated in South Africa, and the dividends are attributable to such permanent establishment or fixed base. Moreover, if the dividends tax rate is reduced under the auspices of an applicable double tax treaty, certain South African compliance requirements must be met in order to obtain the double tax treaty relief.establishment.
8B. SIGNIFICANT CHANGES
Refer to “Item“Item 18: Financial Statements-Note 37-Subsequent events”Statements—Note 35—Subsequent Events”.
ITEM 9: THE OFFER AND LISTING
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9A. | OFFER AND LISTING DETAILS |
9A. OFFER AND LISTING DETAILS
The principal trading markets for AngloGold Ashanti’s ordinary shares are the New York Stock Exchange (NYSE), in the form of ADSs, under the symbol “AU” and the JSE Limited, in the form of ordinary shares, under the symbol “ANG”. Each ADS represents one ordinary share.
9B. PLAN OF DISTRIBUTION
Not applicable.
9C. MARKETS
NATURE OF TRADING MARKET
The principal trading markets for AngloGold Ashanti’s ordinary shares are the New York Stock Exchange,NYSE, in the form of ADSs, under the symbol “AU” (each representing one ordinary share) and the JSE Limited, in the form of ordinary shares, under the symbol “ANG”.
AngloGold Ashanti’s ordinary shares are also listed on the Ghana Stock Exchange, as ordinary shares under the symbol “AGA” and in the form of Ghanaian Depositary Shares or GhDSs (each representing one one-hundredth of an ordinary share) under the symbol “AADs”“AAD”, and the Australian Securities Exchange, in the form of ChessCHESS Depositary Interests (each representing one-fifth of an ordinary share) under the symbol “AGG”. AngloGold Ashanti was approved for a secondary listing on A2X Markets (A2X) in South Africa and its shares were admitted to trading on A2X on 6 June 2022 under the symbol “ANG”.
9D. SELLING SHAREHOLDERS
Not applicable.
Not applicable.
9F. EXPENSES OF THE ISSUE
Not applicable.
ITEM 10: ADDITIONAL INFORMATION
10A.SHARE CAPITAL
Not applicable.
10B.MEMORANDUM OF INCORPORATION
At the last annual general meeting held on 916 May 2019,2022, AngloGold Ashanti did not need to seekreceived approval from shareholders (by way of a special resolution) to make any changes to its Memorandum of Incorporation (MoI).amend the MoI as follows:
Considering1.by the South African nationwide lockdown enforced to combat the Covid-19 pandemic, the board has decided to postpone the annual general meeting (AGM) which was scheduled to take place on 6 May 2020. We will inform shareholdersdeletion of the phrase “Subject to 9.4.3, this” at the beginning of clause 1.3 and the replacement thereof with the word “This”;
2.by the deletion of clause 9 (Rights Attaching to Preference Shares) in its entirety; and
3.by the amendment of Schedule 1 (Authorised Shares) as follows:
3.1 by the deletion of paragraphs 2, 3 and 4 of Schedule 1 in their entirety; and
3.2 by the deletion of the table at the end of Schedule 1 in its entirety and the replacement thereof with the following new AGM date . AngloGold Ashanti will seek approval from shareholders to substitute clauses 9.1.1.3.2 and 9.2.1.3.2 with new clauses to enable the Companytable:
| | | | | |
Share capital | South African Rands |
600,000,000 ordinary shares of R0.25 each | 150,000,000 |
The reason for these amendments is to comply with the provisions of the SA Companies Act 71 of 2008 (as amended) (the Companies Act) and the JSE Listings Requirements in order to amendand, following the recent redemption of all of the A redeemable preference share termsshares and B redeemable preference shares of the Company, to remove all references in the MoI to the A redeemable preference shares, the B redeemable preference shares and the BC redeemable preference shares, as well as all of the provisions relating to all such redeemable preference shares, and thereby to remove all such redeemable preference shares from the authorised share terms atcapital of the next AGM.Company.
Registration
AngloGold Ashanti is incorporated under the company laws of the Republic of South Africa and is registered with the Companies and Intellectual Property Commission under registration number 1944/017354/06. The SA Companies Act has abolished the requirement for specific “object and purpose” provisions to be included in a memorandum of incorporation and although the MoI is silent on the matter, the company continues to carry on as its main business, gold exploration, the mining and production of gold, the manufacturing, marketing and selling of gold products and the development of markets for gold.
AngloGold Ashanti’s MoI is available for inspection as set out in “Item“Item 10H: Documents on Display” and a summary of the pertinent provisions, including the rights of the holders of shares in AngloGold Ashanti, are set out below.
This summary does not contain all the information pertaining to the rights of holders of AngloGold Ashanti’s ordinary shares and is qualified in its entirety by reference to the laws of South Africa and AngloGold Ashanti’s governing corporate documents. As well as being governed by the provisions of the MoI, the rights of holders of AngloGold Ashanti’s ordinary shares are governed by the JSE Listings Requirements, the SA Companies Act and the Companies Regulations, 2011, promulgated under the SA Companies Act (Regulations)(the “Regulations”), which include the Takeover Regulations. Further, the rights of holders of AngloGold Ashanti ADSs are governed by the Deposit Agreement between AngloGold Ashanti and The Bank of New York Mellon. See “Item“Item 10C: Material Contracts-TheContracts—The Deposit Agreement”.
The SA Companies Act provides that shares will no longer have a par or nominal value and hence no new shares having a nominal or par value may be authorised. However, any shares which have a nominal or par value authorised prior to the1 May 2011 (the effective date of the SA Companies ActAct) continue to have that nominal or par value and can be issued as such for so long as there are par value shares in the company’s authorised share capital. Should the company wish, it may also elect to convert its authorised par value shares to shares of no par value, subject to the relevant process and approvals contemplated in the SA Companies Act.
Directors
The management and control of any business of AngloGold Ashanti is vested in theits board of directors (board). The authority of the board to manage and direct the business and affairs of the company is not limited, restricted or qualified by the MoI.
Appointment and Retirement of Directors
The shareholders of the companyCompany have the power to elect the directors, and shareholders are also entitled to elect one or more alternate directors, in accordance with the provisions of the MoI.MoI and the SA Companies Act.
The board may appoint any person who satisfies the requirements for election as a director to fill any vacancy and serve as a director on a temporary basis until the vacancy is filled by election by shareholders entitled to exercise voting rights in such an election.
The MoI authorises the chairmanchairperson of the board, subject to the written approval of the majority of the directors, to appoint any person as a director provided that such appointment is approved by shareholders at the next shareholders’ meeting or annual general meeting.
At every annual general meeting one-third of the directors will retire by rotation, or if their number is not a multiple of three, then the number nearest to but not less than one third. The directors so to retire at every annual general meeting will be those who have
been the longest in office since their last election. Directors retiring by rotation are eligible for re-election. Directors who voluntarily decide not to make themselves available for re-election may be counted towards the one-third of directors required to retire at the relevant annual general meeting.
The MoI contains no provision for directors to hold qualification shares. The MoI does not impose an age limit for the retirement of directors.
Remuneration
In accordance with the SA Companies Act, the MoI provides that the directors are entitled to such remuneration for their services as directors as AngloGold Ashanti’s shareholders may approve by special resolution in a general meeting or annual general meeting within the previous two years of the date of payment of such remuneration. If a director is employed in any other capacity, or holds an executive office or performs services that, in the opinion of the board, are outside the scope of the ordinary duties of a director, he or she may be paid such additional remuneration as a disinterested quorum of directors may reasonably determine.
Interests of Directors and Restriction on Voting
Although the interests of directors are not dealt with in the MoI, the provisions of the SA Companies Act in this regard are unalterable and will automatically apply, together with the applicable common law rules. Under the SA Companies Act, the procedures to deal with the personal financial interests of directors also apply to prescribed officers (i.e., persons who exercise general executive control over and management of the whole, or a significant portion, of the business and activities of the company or regularly participate to a material degree in the exercise of general executive control over and management of the whole, or a significant portion, of the business and activities of the company, irrespective of the office held or function performed by such persons) and any person who is a member of a committee of the board of the company, whether or not that person is also a member of the company’s board. The SA Companies Act provides that a director or such other person with a personal financial interest must disclose this to the board and cannot vote on or, after having made the disclosures to the meeting as prescribed by the SA Companies Act, remain present during the meeting when the matter in which hehe/she has interest is being discussed but will be counted as present for the purposes of a quorum.quorum (but is not to be regarded as being present at the meeting for the purposes of determining whether a resolution has sufficient support to be adopted).
Share Rights, Preferences and Restrictions
Allotment and Issue of Ordinary Shares
Subject to the JSE Listings Requirements, the SA Companies Act and/or with approval of shareholders in a general meeting, unissued ordinary shares must be offered to existing ordinary shareholders, pro rata to their ordinary shareholdings, unless they are issued for the acquisition of assets. The shareholders in a general meeting may authorise the AngloGold Ashanti board to issue any unissued ordinary shares.
Dividends, Rights and Distributions
The ordinary shares participate fully in all dividends, other distributions and entitlements as and when declared by AngloGold Ashanti in respect of fully paid ordinary shares. Under South African law, AngloGold Ashanti may declare and pay dividends,distributions (as defined in the SA Companies Act, which includes dividends), subject to the companyCompany satisfying the solvency and liquidity test as provided byset out in section 4 of the SA Companies Act and the board passing a resolution acknowledging that such test has been applied and has reasonably concluded that the companyCompany would satisfy such test immediately after completing the distribution. Dividends are payable to shareholders registered at a record date after the date of declaration of the dividend.
As a companyCompany incorporated and registered in the Republic of South Africa with its primary listing on the Johannesburg Stock Exchange, AngloGold Ashanti is required to declare dividends in South African rands. Dividends are paid in South African rands, Australian dollars, Ghanaian cedis and British pounds. Registered holders of AngloGold Ashanti ADSs are paid dividends in US dollars by The Bank of New York Mellon as depositary,Depositary, in accordance with the Deposit Agreement. See “Item“Item 10C: Material Contracts-TheContracts—The Deposit Agreement”.
The holder of the B preference shares is entitled to the right to an annual dividend amounting to the lesser of 5 percent of the issue price of the B preference shares or an amount equivalent to the balance of the after tax profits arising from income derived from mining the Moab Lease Area as determined by the directors in each financial year. The annual dividend shall be a first charge on any profit available for distribution from the Moab Lease Area but shall not be payable from any other profits of the Company.
The holder of the A preference shares is entitled to an annual dividend equivalent to the balance of the after-tax profits from income derived from mining the Moab Lease Area as determined by AngloGold Ashanti’s directors in each financial year, only once the annual dividend on the B preference shares has been paid in full.
Although not stated in the MoI, but subject to the JSE Listings Requirements and the SA Companies Act, any dividend may be paid and satisfied, either wholly or in part, by the distribution of specific assets, or in paid-up securities of AngloGold Ashanti or of any other company,Company, or in cash, or in any one or more of such ways as the directors may at the time of declaring the dividend determine and direct.
All dividends remaining unclaimed for a period of not less than three years from the date on which they became payable, may, by a resolution of the directors, become forfeited for the benefit of the company.Company.
Voting Rights
Each ordinary share confers the right to vote at all general meetings. Each holder present in person or by proxy or, in the case of a corporate entity, represented, has one vote on a show of hands. If a poll is held, holders present or any duly appointed proxy will have one vote for each ordinary share held. A holder of ordinary shares is entitled to appoint a proxy to attend, speak and vote at any meeting on his or her behalf and the proxy need not be a shareholder. Holders of ADSs are not entitled to vote in person at meetings, but may vote by way of proxy through The Bank of New York Mellon as the ADS issuer. Holders of Australian Chess Depositary Interests (CDIs) and Ghanaian Depositary Shares (GhDSs) are not entitled to vote in person or by proxy at meetings, but may vote by instructing Chess Depository Nominees and NTHC Limited as depositary,Depositary, respectively, how to vote their shares.
There are no limitations on the right of non-South African registered shareholders to hold or exercise voting rights attaching to any of the ordinary shares.
The A redeemable preference shares have similar voting rights to those of ordinary shares.The B and C redeemable preference shares have voting rights only in the event that a dividend on this class of share has not been paid and remains unpaid for six months or more, or in connection with resolutions directly affecting these preference shares or in limited circumstances affecting AngloGold Ashanti as a whole, such as disposal of substantially all of the company’s assets, winding up AngloGold Ashanti or reducing the company’s share capital.
At any meeting of AngloGold Ashanti at which the holders of the ordinary shares, A redeemable preference shares, B redeemable preference shares and C redeemable preference shares are present and entitled to vote on a poll, each holder of the A redeemable preference shares shall be entitled to 50 votes for every A redeemable preference share held, each holder of the ordinary shares is entitled to 50 votes for every ordinary share held and each holder of the B redeemable preference shares and the C redeemable preference shares is entitled to one vote for every B redeemable preference share and C redeemable preference share held respectively.
The MoI specifies that the rights relating to any class of shares may be modified or abrogated with the sanction of a resolution passed as if it were a special resolution of the holders of shares in that class at a separate general meeting. The MoI also specifies that the holders of the A, B and C preference shares may provide written consents to the modification of their rights.
Increase and Reduction of Capital
The companyCompany is authorised to issue the shares specified in the MoI and all such shares are required to be issued as fully paid up in accordance with the applicable approval and/or other requirements of the SA Companies Act and the JSE Listings Requirements.
The directors are authorised, subject to any requirements of the JSE Listings Requirements, the SA Companies Act, the Regulations and the MoI, to increase or decrease the number of authorised shares of any class of shares, reclassify any shares that have been authorised but not issued, classify any unclassified shares that have been authorised but not issued, and determine the preferences, rights, limitations or other terms of any class of authorised shares or amend any preferences, rights, limitations or other terms as determined. However, such capital amendments require an amendment to be made to the MoIMoI. The SA Companies Act and the JSE Listings Requirements currently doesdo not allow the MoI to be amended to give effect to such capital amendments without the approval of ordinary shareholders by special resolution.
Rights Upon Liquidation
In the event of the winding up of AngloGold Ashanti:
The A preference shares shall confer the right, on a winding-up of the company, in priority to any payment in respect of the ordinary shares in the capital of the company then issued, but after any payment in respect of the B preference shares and the C preference shares in the capital of the company then issued, to receive only so much of the net proceeds from the disposal of the assets relating to the Moab Lease Area as is then available for distribution;
The B preference shares shall confer the right, on a winding-up of the company in priority to any payment in respect of the ordinary shares, the A preference shares and the C preference shares then in issue, to receive only so much of the net proceeds from the disposal of the assets relating to the Moab Lease Area as is available for distribution but not exceeding a return per B preference share of the capital paid-up thereon and any share premium paid on the issue of the B preference shares outstanding at that time;
The C preference shares shall confer the right, on a winding-up of the company, ranking after and following payment of the holders of the B preference shares, but in priority to any payment in respect of the ordinary shares and the A preference shares in the capital of the company then issued, to receive only so much of the net proceeds from the disposal of the assets relating to the Moab Lease Area as is available for distribution but not exceeding a return per C preference share of the capital paid-up on the issue of the C preference shares outstanding at that time;
The A, B and C preference shares shall not be entitled to any participation, on a winding-up, in any of the surplus funds of the company in any other manner arising; and
Ashanti the ordinary shares confer the right to participate equally in any surplus arising from the liquidation of all other assets of AngloGold Ashanti.
Redemption Provisions
The A redeemable preference shares may be redeemed for their nominal value, plus a premium per share of an amount equal to the net proceeds available from the disposal of the assets relating to the Moab Lease Area, after redemption in full of the B preference shares and payment of the nominal value of the A preference shares, divided by 2,000,000.
The B redeemable preference shares may be redeemed for their nominal value, plus a premium of up to R249.99 per share, but limited to an amount equal to the net proceeds available from the disposal of the assets relating to the Moab Lease Area after payment of the nominal value of the B preference shares.
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Shareholders’ meetingsMeetings
The directors may convene meetings of AngloGold Ashanti shareholders. Subject to the provisions of the SA Companies Act, the shareholders may requisition for the convening of a meeting.
Notice of each AngloGold Ashanti annual general meeting and general meeting of AngloGold Ashanti shareholders must be delivered at least 15 business days before that shareholders’ meeting is to begin. In accordance with the SA Companies Act, business days are calculated by excluding the first day, including the last day and excluding Saturdays, Sundays and any public holiday in the Republic of South Africa. In terms of the MoI, all shareholders are entitled to attend shareholders’ meetings.meetings at which they are entitled to vote.
In the case of a class meeting of the A or B preference shares, the sole holder of such shares shall constitute a quorum. Save as aforesaid, theThe quorum of a shareholders’ meeting is sufficient persons present, in person or by proxy, at the meeting to exercise, in aggregate, at least 25 percent of all of the voting rights that are entitled to be exercised in respect of at least one matter to be decided at the meeting and a quorum must remain present for the continuation of that shareholders meeting, provided that at least three shareholders must be present and remain at the meeting. Such quorum requirement also applies for the consideration of any matter to be decided at the meeting. If the meeting is not quorate within 30 minutes after the appointed time for the meeting to begin (or such longer or shorter period as the chairperson may determine), it will be postponed, without motion, vote or further notice, for 1 week and the shareholders present, in person or by proxy, at the postponed meeting will constitute a quorum.
For an ordinary resolution to be approved by shareholders, it must be supported by more than 50 percent of the voting rights exercised on the resolution. For a special resolution to be approved by shareholders, it must be supported by at least 75 percent of the voting rights exercised on the resolution.
Disclosure of Interest in Shares
Under South African law, a person must notify AngloGold Ashanti within three business days after that person (i) acquires a beneficial interest in sufficient securities of a class of securities issued by AngloGold Ashanti such that, as a result of the acquisition, the person holds a beneficial interest in securities amounting to five percent, 10ten percent, 15fifteen percent or any further whole multiple of five percent of the issued securities of that class or (ii) disposes of any beneficial interest in sufficient securities of a class of securities issued by AngloGold Ashanti such that, theas a result of the disposition, the person no longer holds a beneficial interest in securities amounting to a particular multiple of five percent of issued securities of that class. When AngloGold Ashanti has received the notice referred to above it must file a copy with the Takeover Regulation Panel and report the information to holders of the relevant class of securities unless the notice concerned is a disposition of less than one percent of the class of securities.
If the securities of AngloGold Ashanti are registered in the name of a person who is not the holder of the beneficial interest in all of the securities in AngloGold Ashanti held by that person, that registered holder of the securities must disclose the identity of the person on whose behalf that security is held and the identity of each person with a beneficial interest in securities so held, the number and the class of securities held for each such person with a beneficial interest and the extent of each such beneficial interest. This information must be disclosed in writing to the companyCompany within five business days after the end of every month during which a change has occurred in the information or more promptly or frequently to the extent so provided by the requirements of a Central Securities Depository. A companyCompany that knows or has reasonable cause to believe that any of its securities are held by one person for the beneficial interest of another may by notice in writing require either of those persons to confirm or deny that fact, provide particulars of the extent of the beneficial interest held during the three years preceding the date of the notice and disclose the identity of each person with a beneficial interest in the securities held by that person, which information must be provided within 10ten business days of the receipt of the notice.
AngloGold Ashanti is obligated to establish and maintain a register of the disclosures described above and to publish in its annual financial statements a list of the persons who hold beneficial interests equal to or in excess of five percent of the total number of ordinary shares issued by AngloGold Ashanti together with the extent of those beneficial interests.
Rights of Minority Shareholders
Majority shareholders of South African companies have no fiduciary obligations under South African common law to minority shareholders. However, under the SA Companies Act, a shareholder or director may, under certain circumstances, seek relief from thea court if he has been unfairly prejudiced by any act or omission of the companyCompany or a related person, by the conduct of the business of the companyCompany or a related person in a particular manner, or the exercise of the powers of the directors of the companyCompany or a related person in a particular manner. There may also be personal and derivative actions available to a shareholder of a company.Company.
Pursuant to the SA Companies Act, a shareholder may petition a South African court for relief from the actions or omissions or business conduct of the companyCompany or the actions of the company’sCompany’s directors or officers that is oppressive or unfairly prejudicial to, or unfairly disregards the interest of the shareholder. In addition, a shareholder who voted against a resolution to amend the company’sCompany’s MoI, or to approve a fundamental transaction (and complied with other requirements set out in the SA Companies
Act) may exercise its appraisal right to demand that the companyCompany pay to it the fair value for all the shares of the companyCompany held by that shareholder.
Description of ADSs
The Bank of New York Mellon issuesregisters and delivers AngloGold Ashanti’s American Depositary Shares, or ADSs. Please see “Item“Item 10C: Material Contracts-DescriptionContracts—Description of AngloGold Ashanti ADSs”.
10C.MATERIAL CONTRACTS
Multi-currency Revolving Credit FacilitiesFacility
General
On 7 July 2015,23 October 2018, AngloGold Ashanti Holdings plc (“AGAH”) and AngloGold Ashanti Australia Limited, as borrower,borrowers, entered into a five-year unsecured syndicated revolving credit facility with Nedbank Limited, as facility agent, who in conjunction with ABSA Bank Limited constitute the lenders. This credit agreement provides for a ZAR 1.4 billion (about $98 million) revolving credit facility available for drawing in South African Rands. The facility bears interest at JIBAR plus 1.65% per annum. This facility was cancelled on 19 February 2020.
On 23 August 2016, Geita Gold Mining Limited and Societé AngloGold Ashanti de Guinée S.A., as borrowers, entered into a three-year unsecured revolving credit facility agreement of $100 million with Nedbank Limited, as lender. Interest is currently charged at a margin of between 6.2% and 8% above LIBOR. On 29 January 2019, $35 million of this facility was combined with the Geita Revolving Credit Facility. The remaining portion of $65 million was renewed for a further three years on 27 February 2019. As of 19 March 2020, this facility is fully drawn.
On 3 November 2017, AngloGold Ashanti Limited, as borrower, entered into a new three-year unsecured revolving credit facility of ZAR 1 billion (about $71 million) with The Standard Bank of South Africa Limited, as facility agent and lender. This credit agreement includes an option, on application, to extend the facility for two years. The option was exercised. The facility bears interest at JIBAR plus 1.3% per annum. As of 19 March 2020, this facility is fully drawn.
On 12 December 2017, AngloGold Ashanti Limited, as borrower, entered into a three-year unsecuredmulti-currency syndicated revolving credit facility of ZAR 2.5$1.4 billion (about $179 million) (the ZAR Revolving Credit Facility)“2018 multi-currency RCF”) with Nedbank Limited and ABSAthe Bank Limited,of Nova Scotia, as lenders. The ZAR Revolving Credit Facility replaced a ZAR 1.5 billion revolving credit facility entered into on 3 December 2013. The agreement includes an option, on application, to extend the facility for two years. The option was exercised. The facility bears interest at JIBAR plus 1.8% per annum. As of 19 March 2020, ZAR 450 million was drawn under this revolving facility.
On 6 April 2018, Geita Gold Mining Limited, as borrower, entered into a three-year unsecured multi-currency revolving credit facility agreement of $115 million with Nedbank Limited, as underwriter and agent, and certain financial institutions party thereto, as original banks (the Geita Revolving Credit Facility).lenders. The agreement has been amended and restated on 29 January 2019. Facility A isloan consisted of (i) a US dollar based facility with interest charged at a margin of 6.7%1.45% above LIBOR. Facility B is a Tanzanian shillingLIBOR and (ii) an Australian dollar based facility capped at the equivalent of $45A$500 million with interest charged at a margin of 5% plus a reference rate as determined by1.45% above BBSY. The A$500 million portion of the lending agent. As of 19 March 2020,2018 multi-currency RCF was used to fund the equivalent of $110 millionworking capital and development costs associated with the Group’s mining operations within Australia without eroding the group’s headroom under its other facilities and exposing the Group to foreign exchange gains/losses each quarter. On 9 June 2022, the 2018 multi-currency RCF was drawn under this revolving facility.repaid and cancelled, and replaced with the 2022 multi-currency RCF (as defined below).
On 23 October 2018, AngloGold Ashanti Holdings plc9 June 2022, AGAH and AngloGold Ashanti Australia Limited, as borrowers, entered into a new five-year unsecured multi-currency syndicated revolving credit facility of $1.4 billion (the Multi-Currency Revolving Credit Facility)“2022 multi-currency RCF”) maturing in June 2027, with the option of two one-year extensions on application. The 2022 multi-currency RCF was entered into with The Bank of Nova Scotia, as facility agent, and certain financial institutions party thereto, as lenders. The loan2022 multi-currency RCF consists of (i) a US dollar based facility (base currency) with interest charged at a margin of 1.45% above LIBOR and (ii) an Australian dollar based facility capped at A$500 million which will be used to fund the working capital and development costs associated with the group's mining operations within Australia (without eroding the group's headroom under its other facilities and exposing the group to foreign exchange gains/losses each quarter). The 2022 multi-currency RCF was entered into on substantially similar terms to the 2018 multi-currency RCF, save in respect of the basis for the US dollar interest charged at a margin of 1.45% above BBSY. The applicable margin is subjectrate which transitioned from LIBOR to a ratings grid.Compounded SOFR. As of 1910 March 2020,2023, the equivalent of $945$37 million was drawn under this Revolving Credit Facility.the AUD portion of the 2022 multi-currency RCF.
Guarantees
The Multi-Currency Revolving Credit Facility2022 multi-currency RCF is guaranteed by AngloGold Ashanti Holdings plcAGAH and AngloGold Ashanti Australia Limited. The guarantees constitute unconditional obligations of the guarantors and rank at least pari passu with all other future unsecured obligations of the guarantors, except for obligations mandatorily preferred by law.
Security
TheSave as set out under the heading “—Guarantees” above, the obligations under all the revolving credit facility agreements2022 multi-currency RCF are unsecured.
Amount and repayment of borrowings
Loans under the Multi-Currency Revolving Credit Facility2022 multi-currency RCF must be for a minimum of $10 million, if the currency selected is the base currency (US dollar), or a minimum of A$10,000,00010 million (or for the balance of the undrawn total commitments at the time of the drawing), if the currency selected is Australian Dollars.dollars. No more than 14 loans may be outstanding at any time. Each loan must be repaid on the maturity date in the same currency as the maturing loan. All loans must be repaid in full on the final maturity date. The 2022 multi-currency RCF matures in June 2027, with the option of two one-year extensions on application.
Loans under the ZAR Revolving Credit Facility must be for a minimum of ZAR 100 million (or for the balance of the undrawn total commitments at the time of the drawing), and no more than 14 loans may be outstanding at any time. Each loan must be repaid on the last day of the loan’s interest period, which can be a period of one, two, three or six months or any other period agreed by AngloGold Ashanti Limited. All loans must be repaid in full on the final maturity date.
Interest rates and fees
The annual interest rate on loans drawn under the Multi-Currency Revolving Credit Facility2022 multi-currency RCF is calculated based on LIBOR,Compounded SOFR in the case of loans drawn in US dollars and BBSY in the case of loans drawn in Australian dollars, in each case plus ana margin. The initial margin ofis 1.45 percent per annum, that variesbut may vary between 0.950.90 percent and 2.15 percent per annum depending on the long-term debt rating of AngloGold Ashanti Holdings plc,AGAH. The applicable margin is subject to a ratings grid. In this regard, the interest margin will reduce if the group's credit rating improves from its current BB+/Baa3 status and in relation to any Loan in Australian Dollars, BBSY, and certain mandatory costs.will increase if its credit rating worsens. Interest on loanseach loan is payable on the last day of the loan’s interest period and, if the interest period exceeds six months, on the dates falling at six-monthly intervals after the day the loan was made.
The annual interest rate on loans drawn under the ZAR Revolving Credit Facility is calculated based on JIBAR, plus a margin of 1.8 percent. Interest on loans is payable on the last day of therelevant loan’s interest period and, if the interest period exceeds six months, on the dates falling at six-monthly intervals after the first day of thatthe interest period.
The borrowers under the Multi-Currency Revolving Credit Facility2022 multi-currency RCF are required to pay a commitment fee in the base currency equal to 35 percent of the then applicable margin per annum on the undrawn and uncancelled amount of each lender’s commitment during the commitment period. The borrowers are also required to pay a utilisation fee of 0.10 percent per annum (if the aggregate outstanding loans are less than one third of the total commitments then in effect), 0.20 percent per annum (if the aggregate outstanding loans are equal to or greater than one third but less than two thirdstwo-thirds of the total commitments then in effect) or 0.40 percent per annum (if the aggregate outstanding loans are equal to or greater than two thirdstwo-thirds of the total commitments then in effect).
The borrower under the ZAR Revolving Credit Facility is required to pay a commitment fee of 0.60 percent on the undrawn and uncancelled amount of each lender’s commitment during the commitment period. The borrower is also required to pay a utilisation fee of 0.20 percent per annum (if the aggregate outstanding loans are less than one third of the total commitments then in effect), 0.40 percent per annum (if the aggregate outstanding loans are equal to or greater than one third but less than two thirds of the total commitments then in effect) or 0.60 percent per annum (if the aggregate outstanding loans are equal to or greater than two thirds of the total commitments then in effect).
Financial covenant
The revolving credit agreements include2022 multi-currency RCF includes a financial maintenance covenant which requires that the ratio of Total Net Financial Indebtedness to EBITDA (as such terms are defined in the revolving credit agreements)agreement) does not at any time exceed 3.50 to 1.00, with the proviso that this ratio may exceed 3.50 to 1.00 once during the life of the revolving credit agreements,agreement, for one six-month period subject to certain criteria. Refer to “Item“Item 18: Financial Statements-Note 36-CapitalStatements—Note 34—Capital Management” for the formulae used in the revolving credit agreementsagreement to test compliance with the covenants.
Change of control
If a lender so requires, the commitment of such lender under the Multi-Currency Revolving Credit Facility or the ZAR Revolving Credit Facility2022 multi-currency RCF will be cancelled and the participation of such lender in all outstanding loans, together with accrued interest and all other amounts accrued, will become immediately due and payable in case any person or group of persons acting in concert becomes (directly or indirectly) the beneficial owner of more than 50 percent of the issued share capital of AngloGold Ashanti Limited.Limited or (as applicable) an eligible successor holding company of AGAH.
Undertakings
The revolving credit agreements contain2022 multi-currency RCF contains a negative pledge covenants,covenant, including restrictions on the granting of security, a change of business of AngloGold Ashanti Limited and its subsidiaries, acquisitions or participations in joint ventures and mergers and disposals.
The revolving credit agreements2022 multi-currency RCF also contain,contains, among others,other things, the following affirmative covenants: mandatory periodic reporting of financial and other information, notice upon the occurrence of events of default and certain other events, compliance with environmental laws and other obligations requiring each of AngloGold Ashanti Holdings plcAGAH and its subsidiaries to maintain its corporate existence and qualifications to conduct its business as currently conducted in all applicable jurisdictions and to maintain insurance coverage. The covenants are subject to exceptions and materiality thresholds.
Events of default
The revolving credits agreements contain2022 multi-currency RCF contains events of default including failure to make payment of amounts due, breach of obligations under the loan documents, defaults under other agreements evidencing indebtedness, certain bankruptcy events and a cessation of business failure of any of the borrowers to be a wholly-owned subsidiary of AngloGold Ashanti Holdings plc and the occurrence of a material adverse change in the business and financial condition of the borrowers and guarantors under the revolving credit agreements,agreement, or AngloGold Ashanti and its subsidiaries as a whole, or in the ability of the borrowers and guarantors to perform their payment obligations under the loan documents. The occurrence of an event of default could result in the immediate and automatic cancellation of all commitments and the acceleration of all payment obligations under the revolving credit agreements2022 multi-currency RCF and the other loan documents.
The above description is only a summary of certain provisions of the revolving credit agreements2022 multi-currency RCF and is qualified in its entirety by reference to the provisions of the revolving credit agreements,2022 multi-currency RCF, a copy of eachwhich is attached hereto as Exhibit 19.4.419.4.4.1 and is incorporated herein by reference.
Notes
2012 Notes
On 30 July, 2012,Each of the series of notes described below were issued under the indenture, dated as of 28 April 2010, among AngloGold Ashanti Holdings plc (AGAH)(“AGAH”), as issuer, AngloGold Ashanti Limited, as guarantor, and The Bank of New York Mellon, as trustee (the “Indenture”). The below descriptions are only a summary of certain provisions of those series of notes and are qualified in their entirety by reference to the provisions of the Indenture and such relevant series of notes, a copy of each – in respect of the outstanding series of notes – is attached hereto as Exhibits 19.2.1, 19.2.2, 19.2.3, 19.2.4 and 19.2.5 and is incorporated herein by reference.
2028 Notes
On 22 October 2021, AGAH issued $750 million 5.1253.375 percent Notes due 20222028 (the 2012 Notes)“2028 notes”). The interest on the 2012 Notes2028 notes is payable semi-annually on 1 FebruaryMay and 1 AugustNovember of each year, commencing on 1 February, 2013.May 2022. AGAH may on any one or more occasions redeem all or part of the 2012 Notes,2028 notes, at a redemption price equal to the greater of (1) 100 percent of the principal amount of the 2012 Notes2028 notes to be redeemed and (2) the sum of the present values of the remaining scheduled payments of principal and interest on the 20122028 notes (excluding any portion of such payments of interest accrued or unpaid as of the date of redemption) discounted to the redemption date on a semiannual basis (assuming a 360-day year consisting of twelve 30-day months) at the treasury rate, plus 30 basis points, plus accrued and unpaid interest, if any, to the date of redemption. AGAH has agreed to pay certain additional amounts in respect of any withholdings or deductions for certain types of taxes in certain jurisdictions on payments to holders of the 2028 notes. The 2028 notes are unsecured and unsubordinated and are fully and unconditionally guaranteed by AngloGold Ashanti Limited.
AGAH has agreed to observe certain covenants with respect to the 2028 notes restricting, subject to certain limitations, the ability of AngloGold Ashanti Limited and AGAH to amalgamate, reconstruct, consolidate or merge with another company or other legal entity, and the ability of AngloGold Ashanti Limited and its restricted subsidiaries to pledge their assets to secure certain borrowings, create or incur liens on certain of their property or to engage in sale and leaseback transactions. In case of a change
of control of the guarantor and a downgrade, within a specified period, of the 2028 notes by three rating agencies, holders of the 2028 notes have the right to require the issuer to repurchase all or any part of their 2028 notes in cash for a value equal to 101 percent of the aggregate principal amount of 2028 notes repurchased, plus accrued and unpaid interest, if any, on the 2028 notes repurchased to the date of repurchase.
The offering of the 2028 notes was registered under the Securities Act. The 2028 notes were listed on the New York Stock Exchange.
2030 Notes
On 1 October 2020, AGAH issued $700 million 3.750 percent Notes due 2030 (the “2030 notes”). The interest on the 2030 notes is payable semi-annually on 1 April and 1 October of each year, commencing on 1 April 2021. AGAH may on any one or more occasions redeem all or part of the 2030 notes, at a redemption price equal to the greater of (1) 100 percent of the principal amount of the 2030 notes to be redeemed and (2) the sum of the present values of the remaining scheduled payments of principal and interest on the 2030 notes (excluding any portion of such payments of interest accrued or unpaid as of the date of redemption) discounted to the redemption date on a semiannual basis (assuming a 360-day year consisting of twelve 30-day months) at the treasury rate, plus 50 basis points, plus accrued and unpaid interest, if any, to the date of redemption. AGAH has agreed to pay certain additional amounts in respect of any withholdings or deductions for certain types of taxes in certain jurisdictions on payments to holders of the 2012 Notes.2030 notes. The 2012 Notes2030 notes are unsecured and unsubordinated and are fully and unconditionally guaranteed by AngloGold Ashanti Limited.
AGAH has agreed to observe certain covenants with respect to the 2012 Notes2030 notes restricting, subject to certain limitations, the ability of AngloGold Ashanti Limited and AGAH to amalgamate, reconstruct, consolidate or merge with another company or other legal entity, and the ability of AngloGold Ashanti Limited and its restricted subsidiaries to pledge their assets to secure certain borrowings, create or incur liens on certain of their property or to engage in sale and leaseback transactions. In case of a change of control of the guarantor and a downgrade, within a specified period, of the 2012 Notes below an investment grade rating2030 notes by twothree rating agencies, holders of the 2012 Notes2030 notes have the right to require the issuer to repurchase all or any part of their 2012 Notes2030 notes in cash for a value equal to 101 percent of the aggregate principal amount of 2012 Notes2030 notes repurchased, plus accrued and unpaid interest, if any, on the 2012 Notes2030 notes repurchased to the date of purchase.repurchase.
The offering of the 2012 Notes2030 notes was registered under the Securities Act. The 2012 Notes2030 notes were listed on the New York Stock Exchange.
20102022 Notes
On 30 July 2012, AGAH issued $750 million 5.125 percent Notes due 2022 (the “2022 notes”). The interest on the 2022 notes was payable semi-annually on 1 February and 1 August of each year, commencing on 1 February, 2013. AGAH was permitted on any one or more occasions to redeem all or part of the 2022 notes, at a redemption price equal to the greater of (1) 100 percent of the principal amount of the 2022 notes to be redeemed and (2) the sum of the present values of the remaining scheduled payments of principal and interest on the 2022 notes (excluding any portion of such payments of interest accrued or unpaid as of the date of redemption) discounted to the redemption date on a semiannual basis (assuming a 360-day year consisting of twelve 30-day months) at the treasury rate, plus 50 basis points, plus accrued and unpaid interest, if any, to the date of redemption. AGAH had agreed to pay certain additional amounts in respect of any withholdings or deductions for certain types of taxes in certain jurisdictions on payments to holders of the 2022 notes. The 2022 notes were unsecured and unsubordinated and were fully and unconditionally guaranteed by AngloGold Ashanti Limited.
AGAH had agreed to observe certain covenants with respect to the 2022 notes restricting, subject to certain limitations, the ability of AngloGold Ashanti Limited and AGAH to amalgamate, reconstruct, consolidate or merge with another company or other legal entity, and the ability of AngloGold Ashanti Limited and its restricted subsidiaries to pledge their assets to secure certain borrowings, create or incur liens on certain of their property or to engage in sale and leaseback transactions. In case of a change of control of the guarantor and a downgrade, within a specified period, of the 2022 notes below an investment grade rating by two rating agencies, holders of the 2022 notes had the right to require the issuer to repurchase all or any part of their 2022 notes in cash for a value equal to 101 percent of the aggregate principal amount of 2022 notes repurchased, plus accrued and unpaid interest, if any, on the 2022 notes repurchased to the date of purchase.
The offering of the 2022 notes was registered under the Securities Act. The 2022 notes were listed on the New York Stock Exchange.
The 2022 notes were redeemed in October and November 2021 and are no longer outstanding.
2020 Notes and 2040 Notes
On 28 April 2010, AGAH issued $700 million 5.375 percent Notes due 2020 (the “2020 notes”) and $300 million 6.500 percent Notes due 2040 (together,(the “2040 notes” and together with the 2010 Notes)2020 notes, the “2010 notes”). The interest on the 2010 Notesnotes is payable
semi-annually on 15 April and 15 October of each year, commencing on 15 October 2010. AGAH may on any one or more occasions redeem all or part of the 2010 Notes,notes, at a redemption price equal to the greater of (1) 100 percent of the principal amount of the 2010 Notesnotes to be redeemed and (2) the sum of the present values of the remaining scheduled payments of principal and interest on the 2010 Notesnotes (excluding any portion of such payments of interest accrued or unpaid as of the date of redemption) discounted to the redemption date on a semiannual basis (assuming a 360-day year consisting of twelve 30-day months) at the treasury rate, plus 25 basis points with respect to the 2010 Notes maturing in 2020 notes and 30 basis points with respect to the 2010 Notes maturing in 2040 notes, plus accrued and unpaid interest, if any, to the date of redemption. AGAH has agreed to pay certain additional amounts in respect of any withholdings or deductions for certain types of taxes in certain jurisdictions on payments to holders of the 2010 Notes.notes. The 2010 Notesnotes are unsecured and unsubordinated and are fully and unconditionally guaranteed by AngloGold Ashanti Limited.
AGAH has agreed to observe certain covenants with respect to the 2010 Notesnotes restricting, subject to certain limitations, the ability of AngloGold Ashanti Limited and AGAH to amalgamate, reconstruct, consolidate or merge with another company or other legal entity, and the ability of AngloGold Ashanti Limited and its restricted subsidiaries to pledge their assets to secure certain borrowings, create or incur liens on certain of their property or to engage in sale and leaseback transactions. In case of a change of control of the guarantor and a downgrade, within a specified period, of a series of 2010 Notesnotes below an investment grade rating by two rating agencies, holders of the 2010 Notesnotes have the right to require the issuer to repurchase all or any part of their 2010 Notesnotes in cash for a value equal to 101 percent of the aggregate principal amount of 2010 Notesnotes repurchased, plus accrued and unpaid interest, if any, on the 2010 Notesnotes repurchased to the date of purchase.
The offering of the 2010 Notesnotes was registered under the Securities Act. The 2010 Notesnotes were listed on the New York Stock Exchange. The 2020 notes were repaid at maturity on 15 April 2020 and are no longer outstanding.
For further information, see “Note 26: Borrowings” to our Annual“Item 18: Financial Statements included in Statements—Note 24—Borrowings”,“Item 18 of this Annual Report, “Item 5B: Liquidity and Capital Resources” and “Item“Item 19: Exhibits to Form 20-F”.
Description of AngloGold Ashanti ADSs
The Bank of New York Mellon issuesregisters and delivers AngloGold Ashanti’s American Depositary Shares, or ADSs. Each ADS represents the ownership interest of one ordinary share of AngloGold Ashanti.
The Deposit Agreement
This section provides a summary description of AngloGold Ashanti’s ADSs.
AngloGold Ashanti has entered into an Amended and Restated Deposit Agreement dated 3 June 2008 with The Bank of New York Mellon as depositaryDepositary and the owners and beneficial owners of American Depositary Receipts (Deposit Agreement)(the “Deposit Agreement”).
The following is a summary of the material provisions of the Deposit Agreement. For more complete information, read the entire Deposit Agreement and the Form of American Depositary Receipt, which AngloGold Ashanti has filed with the SEC as an exhibit to AngloGold Ashanti’s registration statements on Form F-6F-6 (Registration No. 333-133049Nos. 333-133049 and No. 333-159248) on 27 May 2008 and 14 May 2009, respectively. A copy thereof is also attached hereto as Exhibit 19.2.6 and is incorporated herein by reference. See “Item“Item 10H: Documents on Display”. Copies of the Deposit Agreement are also available for inspection at the Corporate Trust Office of The Bank of New York Mellon currently located at 240 Greenwich Street, New York, New York 10286.
Description of the ADSs
The Bank of New York Mellon, as depositary,Depositary, registers and delivers ADSs. Each ADS represents one ordinary share (or a right to receive one share) deposited with Standard Bank of South Africa Limited FirstRand Bank Limited or HSBC Bank Australia Limited, each as a custodian for The Bank of New York Mellon, and allboth of which are referred to collectively as “the Custodian”the “Custodian”. Each ADS also represents any other securities, cash or other property which may be held by The Bank of New York Mellon. The Bank of New York Mellon’s Corporate Trust Office at which the ADSs are administered is located at 240 Greenwich Street, New York, New York 10286. The Bank of New York Mellon’s principal executive office is also located at 240 Greenwich Street, New York, New York 10286.
ADSs may be held either (A) directly (i) by having an American Depositary Receipt, also referred to as an ADR, which is a certificate evidencing a specific number of ADSs, registered in the holder’s name, or (ii) by having ADSs registered in a holder’s name in the Direct Registration System, or (B) indirectly by holding a security entitlement in ADSs through a broker or other financial institution. If ADSs are held directly, such holders are ADS holders. This description applies to AngloGold Ashanti’s ADS holders. If ADSs are held indirectly, such holders must rely on the procedures of their broker or other financial institution to assert the rights of ADS registered holders described in this section. Such holders should consult with their broker or financial institution to find out what those procedures are.
The Direct Registration System, or DRS, is a system administered by DTC pursuant to which the depositaryDepositary may register the ownership of uncertificated ADSs, which ownership will be evidenced by periodic statements sent by the depositaryDepositary to the registered holders of uncertificated ADSs.
AngloGold Ashanti does not treat ADS holders as its shareholders and ADS holders do not have shareholder rights. South African law governs shareholder rights. The Bank of New York Mellon is the holder of the shares underlying the ADSs. Registered holders of ADSs have ADS holder rights. The Deposit Agreement sets out ADS holder rights as well as the rights and obligations of The Bank of New York Mellon. New York law governs the Deposit Agreement and the ADSs.
Dividends and Other Distributions
The Bank of New York Mellon has agreed to pay to holders of ADSs the cash dividends or other distributions it or a Custodian receives on AngloGold Ashanti ordinary shares or other deposited securities after deducting any fees and expenses and any applicable withholding taxes. Holders of ADSs will receive these distributions in proportion to the number of AngloGold Ashanti’s ordinary shares that their ADSs represent.
Cash
The Bank of New York Mellon will convert any cash dividend or other cash distribution (in South African rands) that AngloGold Ashanti pays on ordinary shares into US dollars (unless AngloGold Ashanti pays such dividend or cash distribution in US dollars) and distribute to registered holders of ADSs. If that is no longer possible or if any approval from any government is needed and cannot be obtained, The Bank of New York Mellon may distribute non-US currency only to those ADS holders to whom it is possible to make this type of distribution.
The Bank of New York Mellon may hold the non-US currency it cannot convert for the account of holders of ADSs who for one reason or the other have not been paid. It will not invest the non-US currency, and it will not be liable for interest on such amounts. Before making a distribution, any withholding taxes that must be paid will be deducted. See “Payment“—Payment of Taxes” below. The Bank of New York Mellon will distribute only whole US dollars and cents and will round fractional cents to the nearest whole cent. If the exchange rates fluctuate during a time when The Bank of New York Mellon cannot convert the non-US currency, holders of ADSs may lose some or all of the value of the distribution.
Ordinary Shares
The Bank of New York Mellon may distribute to holders of ADSs additional ADSs representing ordinary shares that AngloGold Ashanti distributes as a dividend or free distribution, if AngloGold Ashanti provides it promptly with satisfactory evidence that it is legal to do so. If The Bank of New York Mellon does not distribute additional ADSs, the outstanding ADSs will also represent the newly distributed AngloGold Ashanti ordinary shares. The Bank of New York Mellon will only distribute whole ADSs. It will sell AngloGold Ashanti ordinary shares that would require it to deliver a fraction of an ADS and distribute the net proceeds in the same way as it distributes cash. The Bank of New York Mellon may sell a portion of the distributed shares sufficient to pay its fees and expenses in connection with that distribution.
Rights to Subscribe for Additional Ordinary Shares
If AngloGold Ashanti offers holders of its ordinary shares any rights to subscribe for additional AngloGold Ashanti ordinary shares or any other rights, The Bank of New York Mellon, after consultation with AngloGold Ashanti, may make these rights available to holders of ADSs or sell the rights and distribute the proceeds in the same way as it distributes cash. If The Bank of New York Mellon cannot do either of these things for any reason, it may allow these rights to lapse. In that case, holders of ADSs will receive no value for them.
If The Bank of New York Mellon makes these types of subscription rights available to holders of ADS, upon instruction from holders of ADSs, it will exercise the rights and purchase AngloGold Ashanti’s ordinary shares on their behalf. The Bank of New York Mellon will then deposit the AngloGold Ashanti ordinary shares and deliver ADSs to the holders of ADSs. It will only exercise these rights if holders of ADSs pay it the exercise price and any other charges the rights require them to pay.
US securities laws may restrict the sale, deposit, cancellation and transfer of the ADSs issued after exercise of rights. For example, holders of ADSs may not be able to trade the ADSs freely in the United States. In this case, The Bank of New York Mellon may deliver ADSs which are "restricted securities"“restricted securities” within the meaning of Rule 144 which will have the same provisions as the ADSs described here, except for the changes needed to put the restrictions in place.
Other Distributions
The Bank of New York Mellon will send to holders of ADSs any other distributions that AngloGold Ashanti makes on deposited securities by any means it thinks is legal, fair and practical. If it cannot make the distribution in that way, The Bank of New York Mellon may decide to sell what AngloGold Ashanti distributes, and then distribute the net proceeds in the same way as it distributes cash, or it may decide to hold what AngloGold Ashanti distributes, in which case the outstanding ADSs will also represent the newly distributed property. However, The Bank of New York Mellon is not required to distribute any securities (other than ADSs) to ADS holders unless it receives satisfactory evidence from AngloGold Ashanti that it is legal to make that distribution. The Bank of New York Mellon may sell a portion of the distributed securities or property sufficient to pay its fees and expenses in connection with that distribution.
The Bank of New York Mellon is not responsible if, based on available information, it decides that it is unlawful or impractical to make a distribution available to any ADS holders. AngloGold Ashanti has no obligation to register ADSs, AngloGold Ashanti ordinary shares, rights or other securities under the US Securities Act of 1933.Act. AngloGold Ashanti also has no obligation to take any other action to permit the distribution of ADSs, AngloGold Ashanti ordinary shares, or any other rights to ADS holders. This means that the holders of ADSs may not receive the distribution AngloGold Ashanti makes on its ordinary shares or any value for them if it is illegal or impracticable for AngloGold Ashanti to make them available to the holders of ADSs.
Deposit, Withdrawal and Cancellation
The Bank of New York Mellon will deliver ADSs if a holder of AngloGold Ashanti’s ordinary shares or its broker deposits AngloGold Ashanti’s ordinary shares or evidence of rights to receive ordinary shares with the Custodian. Upon payment of its fees and expenses and of any taxes or charges, such as stamp taxes or stock transfer taxes or fees, The Bank of New York Mellon will register the appropriate number of ADSs in the names such holder of AngloGold Ashanti ordinary shares requests and will deliver the ADSs at its Corporate Trust Office to the persons such holders request.
Holders of ADSs may turn in their ADSs at The Bank of New York Mellon’s Corporate Trust Office. Upon payment of its fees and expenses and of any taxes or charges, such as stamp taxes or stock transfer taxes or fees, The Bank of New York Mellon will deliver (1) the underlying ordinary shares to an account designated by the relevant holder of ADSs and (2) any other deposited
securities underlying the ADSs at the office of the Custodian, or, at the request, risk and expense of ADS holders, The Bank of New York Mellon will deliver the deposited securities at its Corporate Trust Office.
Interchange Between Certificated ADSs and Uncertificated ADSs
ADS registered holders may surrender their ADS to The Bank of New York Mellon for the purpose of exchanging such ADS for uncertificated ADSs. The Bank of New York Mellon will cancel that ADS and will send to the ADS registered holder a statement confirming that the ADS registered holder is the registered holder of uncertificated ADSs. Alternatively, upon receipt by The Bank of New York Mellon of a proper instruction from a registered holder of uncertificated ADSs requesting the exchange of uncertificated ADSs for certificated ADSs, The Bank of New York Mellon will execute and deliver to the ADS registered holder an ADS evidencing those ADSs.
Voting Rights
ADS registered holders may instruct The Bank of New York Mellon to vote the number of deposited shares their ADSs represent. The Bank of New York Mellon will notify ADS registered holders of shareholders’ meetings and arrange to deliver AngloGold Ashanti’s voting materials to them if AngloGold Ashanti asks it to. Those materials will describe the matters to be voted on and explain how ADS registered holders may instruct The Bank of New York Mellon how to vote. For instructions to be valid, they must reach The Bank of New York Mellon by a date set by The Bank of New York Mellon.
Otherwise, ADS registered holders will not be able to exercise their right to vote unless they withdraw the shares. However, ADS registered holders may not know about the meeting sufficiently in advance to withdraw the shares.
The Bank of New York Mellon will try, as far as practicable, to vote or to have its agents vote the ordinary shares or other deposited securities as holders of ADSs instruct, but this is subject to South African law, the provisions of AngloGold Ashanti’s MoI and of the deposited securities and any applicable rule of the JSE. The Bank of New York Mellon will only vote or attempt to vote as such holders of ADSs instruct.
AngloGold Ashanti cannot assure the holders of ADSs that they will receive the voting materials in time for them to instruct The Bank of New York Mellon to vote their ordinary shares. In addition, The Bank of New York Mellon and its agents are not responsible for failing to carry out voting instructions or for the manner of carrying out voting instructions. This means that holders of ADSs may not be able to exercise their right to vote and there may be nothing they can do if their ordinary shares are not voted as they requested.
Fees and Expenses
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ADS holders must pay: | For: |
$5.00 (or less) per 100 ADSs | Each issuance of an ADS, including as a result of a distribution of AngloGold Ashanti ordinary shares or rights or other property
Each cancellation of an ADS, including if the Deposit Agreement terminates
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$0.02 (or less) per ADS | Any cash payment |
Registration or transfer fees | Transfer and registration of AngloGold Ashanti ordinary shares on the AngloGold Ashanti share register to or from the name of The Bank of New York Mellon or its agent when AngloGold Ashanti ordinary shares are deposited or withdrawn |
$0.02 (or less) per ADS per year | Depositary services |
Expenses of The Bank of New York Mellon | Conversion of non-US currency to US dollars
Cable, telex and facsimile transmission expenses
Servicing the deposited securities
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Taxes and other governmental charges that The Bank of New York Mellon or any Custodian has to pay on any ADS or AngloGold Ashanti ordinary share underlying an ADS,ADS; for example, stock transfer taxes, stamp duty or withholding taxes | As necessary
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A fee equivalent to the fee that would have been payable if the securities distributed had been ordinary shares deposited for issuance of ADSs | Distribution of securities distributed to holders of deposited securities that are distributed by The Bank of New York Mellon to ADS holders |
Payment of Taxes
Holders of ADSs will be responsible for any taxes or other governmental charges payable on their ADSs or on the deposited securities underlying their ADSs. The Bank of New York Mellon may refuse to transfer their ADSs or allow them to withdraw the deposited securities underlying their ADSs until such taxes or other charges are paid. It may apply payments owed to holders of ADSs or sell deposited securities underlying their ADSs to pay any taxes they owe, and they will remain liable for any deficiency. If The Bank of New York Mellon sells deposited securities, it will, if appropriate, reduce the number of ADSs to reflect the sale and pay to holders of ADSs any proceeds, or send to them any property remaining after it has paid the taxes.
Reclassifications
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If AngloGold Ashanti: | | | Then: |
Reclassifies, splits up or consolidates any of the deposited securities;
| | | The cash, ordinary shares or other securities received by The Bank of New York Mellon will become deposited securities. Each ADS will automatically represent its equal share of the new deposited securities. |
Distributes securities on the ordinary shares that are not distributed to holders of ADSs; or
Recapitalises, reorganises, merges, liquidates, sells all or substantially all of AngloGold Ashanti’s assets, or takes any similar action.
| | | The Bank of New York Mellon may, and will if AngloGold Ashanti asks it to, distribute some or all of the cash, AngloGold Ashanti ordinary shares or other securities it receives. It may also issue new ADSs or ask holders of ADSs to surrender their outstanding ADSs in exchange for new ADSs identifying the new deposited securities. |
Amendment and Termination
AngloGold Ashanti may, for any reason, agree with The Bank of New York Mellon to amend the Deposit Agreement and the ADSs without the consent of holders. If the amendment increases fees or charges (except for taxes and other governmental charges or registration fees, cable, telex or facsimile transmission costs, delivery costs or other such expenses) or if the amendment prejudices an important right of ADS holders, it will only become effective 30 days after The Bank of New York Mellon notifies holders of ADSs of the amendment. At the time an amendment becomes effective, holders of ADSs are considered, by continuing to hold their ADSs, to agree to the amendment and to be bound by the ADSs and the agreement as amended.
The Bank of New York Mellon may terminate the Deposit Agreement by mailing notice of termination to ADS holders at least 30 days prior to the date fixed in the notice if AngloGold Ashanti asks it to do so. The Bank of New York Mellon may also terminate the Deposit Agreement if The Bank of New York Mellon has told AngloGold Ashanti that it would like to resign and AngloGold Ashanti has not appointed a new depositaryDepositary bank within 90 days. In both cases, The Bank of New York Mellon must notify holders of AngloGold Ashanti ADSs at least 30 days before termination.
After termination, The Bank of New York Mellon and its agents will be required to do only the following under the Deposit Agreement: collect distributions on the deposited securities, sell rights, and, upon surrender of ADSs, deliver AngloGold Ashanti ordinary shares and other deposited securities. Four months after the date of termination or later, The Bank of New York Mellon may sell any remaining deposited securities by public or private sale and will hold the proceeds of the sale, as well as any other cash it is holding under the Deposit Agreement, for the pro rata benefit of the ADS holders who have not surrendered their ADSs. It will not invest the money and will have no liability for interest. The Bank of New York Mellon’s only obligations will be to account for the proceeds of the sale and other cash. After termination, AngloGold Ashanti’s only obligations will be with respect to indemnification of, and payment of certain amounts to, The Bank of New York Mellon.
Limitations on Obligations and Liability to ADS Holders
The Deposit Agreement expressly limits AngloGold Ashanti’s obligations and the obligations of The Bank of New York Mellon, and limits AngloGold Ashanti’s liability and the liability of The Bank of New York Mellon. AngloGold Ashanti and The Bank of New York Mellon:
•are only obligated to take the actions specifically set forth in the Deposit Agreement without negligence or bad faith;
•are not liable if either of AngloGold Ashanti or The Bank of New York Mellon is prevented or delayed by law or circumstances beyond their control from performing their obligations under the Deposit Agreement;
•are not liable if either of AngloGold Ashanti or The Bank of New York Mellon exercises discretion permitted under the Deposit Agreement;
•are not liable for the inability of any holder of ADSs to benefit from any distribution on deposited securities that is not made available to holders of ADSs under the terms of the Deposit Agreement, or for any special, consequential or punitive damages for any breach of the terms of the Deposit Agreement;
•have no obligation to become involved in a lawsuit or other proceeding related to the ADSs or the Deposit Agreement on behalf of the holders of ADSs or on behalf of any other party;
•may rely on advice of or information from legal counsel, accountants, and any persons presenting AngloGold Ashanti’s ordinary shares for deposit, any registered holder or any other person believed by AngloGold Ashanti in good faith to be competent to give such advice or information; and
•pursuant to the Deposit Agreement, agree to indemnify each other under certain circumstances.
Requirements for Depositary Action
Before The Bank of New York Mellon will issue, transfer or register the transfer of an ADS, make a distribution on an ADS, or allow withdrawal of AngloGold Ashanti ordinary shares, The Bank of New York Mellon may require:
•payment of stock transfer or other taxes or other governmental charges and transfer or registration fees charged by third parties for the transfer of any ordinary shares or other deposited securities;
•production of satisfactory proof of the identity and genuineness of any signature or other information it deems necessary; and
•compliance with regulations it may establish, from time to time, consistent with the Deposit Agreement, including presentation of transfer documents.
The Bank of New York Mellon may refuse to deliver, transfer or register transfers of ADSs generally when the books of The Bank of New York Mellon or AngloGold Ashanti are closed, or at any time if either AngloGold Ashanti or The Bank of New York Mellon thinks it advisable to do so.
Holders of ADSs have the right to cancel their ADSs and withdraw the underlying ordinary shares at any time except:
•when temporary delays arise because: (1) either AngloGold Ashanti or The Bank of New York Mellon have closed AngloGold Ashanti’s transfer books; (2) the transfer of the ordinary shares is blocked in connection with voting at a general meeting of shareholders; or (3) AngloGold Ashanti is paying a dividend on the ordinary shares;
•when ADS holders seeking to withdraw the ordinary shares are liable for unpaid fees, taxes and similar charges; or
•when it is necessary to prohibit withdrawals in order to comply with any laws or governmental regulations that apply to ADSs or to the withdrawal of the ordinary shares or other deposited securities.
This right of withdrawal may not be limited by any other provision of the Deposit Agreement.
Pre-release of ADSs
In certain circumstances, subject to the provisions of the Deposit Agreement, The Bank of New York Mellon may deliver ADSs before deposit of the underlying ordinary shares. This is called a pre-release of the ADS.ADSs.
The Bank of New York Mellon may also deliver AngloGold Ashanti ordinary shares upon cancellation of pre-released ADSs (even if the ADSs are cancelled before the pre-release transaction has been closed out). A pre-release is closed out as soon as the underlying AngloGold Ashanti ordinary shares are delivered to The Bank of New York Mellon. The Bank of New York Mellon may receive ADSs instead of ordinary shares to close out a pre-release.
The Bank of New York Mellon may pre-release ADSs only under the following conditions:
•before or at the time of the pre-release, the person to whom the pre-release is being made must represent to The Bank of New York Mellon in writing that it or its customer: (a) owns the ordinary shares or ADSs to be remitted, (b) assigns all beneficial rights, title and interest in such ADSs or ordinary shares, as the case may be, to The Bank of New York Mellon in its capacity as the depositaryDepositary and for the benefit of the ADS holders, and (c) will not take any action with respect to such ADSs or ordinary shares, as the case may be, that is consistent with the transfer of beneficial ownership (including, without the consent of The Bank of New York Mellon, disposing of such ADSs or ordinary shares, as the case may be) other than satisfaction of such pre-release;
•the pre-release must be fully collateralizedcollateralised with cash, US government securities, or other collateral that The Bank of New York Mellon considers appropriate; and
•The Bank of New York Mellon must be able to close out the pre-release on not more than five business days’ notice. Each pre-release will be subject to any further indemnities and credit regulations that The Bank of New York Mellon deems appropriate. The Bank of New York Mellon will normally limit the number of AngloGold Ashanti ordinary shares not deposited but represented by ADSs outstanding at any time as a result of pre-release so that they do not exceed 30 percent of the ordinary shares deposited, although The Bank of New York Mellon may disregard this limit from time to time, if it thinks it is appropriate to do so.
Direct Registration System
In the Deposit Agreement, all parties to the Deposit Agreement acknowledge that the DRS and Profile Modification System, or Profile, will apply to uncertificated ADSs upon acceptance thereof to DRS by The Depository Trust Company, also referred to as DTC. DRS is the system administered by DTC pursuant to which the depositaryDepositary may register the ownership of uncertificated ADSs, which ownership will be evidenced by periodic statements sent by the depositaryDepositary to the registered holders of uncertificated ADSs. Profile is a required feature of DRS which allows a DTC participant, claiming to act on behalf of a registered holder of ADSs, to direct the depositaryDepositary to register a transfer of those ADSs to DTC or its nominee and to deliver those ADSs to
the DTC account of that DTC participant without receipt by the depositaryDepositary of prior authorizationauthorisation from the ADS registered holder to register that transfer.
In connection with and in accordance with the arrangements and procedures relating to DRS/Profile, the parties to the Deposit Agreement understand that The Bank of New York Mellon will not verify, determine or otherwise ascertain that the DTC participant which is claiming to be acting on behalf of an ADS holder in requesting registration of transfer and delivery described in the paragraph above has the actual authority to act on behalf of the ADS holder (notwithstanding any requirements under the Uniform Commercial Code). In the Deposit Agreement, the parties agree that The Bank of New York Mellon’s reliance on and compliance with instructions received by The Bank of New York Mellon through the DRS/Profile System and in accordance with the Deposit Agreement will not constitute negligence or bad faith on the part of The Bank of New York Mellon.
Shareholder Communications: Inspection of Register of Holders of ADSs
The Bank of New York Mellon will make available for inspection at its office all communications that it receives from AngloGold Ashanti as a holder of deposited securities that AngloGold Ashanti makes generally available to holders of deposited securities. The Bank of New York Mellon sendswill send copies of those communications if requested by AngloGold Ashanti. ADS holders have a right to inspect the register of holders of ADSs, but not for the purpose of contacting those holders about a matter unrelated to AngloGold Ashanti’s business or the ADSs.
10D.Exchange controls
Exchange controls and other limitations affecting security holders
The following is a general outline of South African exchange controls and such outline may not apply to former residents of South Africa. Investors should consult a professional advisor as to the exchange control implications of their particular investments.
South African law provides for exchange control regulations, which restrict the export of capital from South Africa. Exchange controls are administered by the Financial Surveillance Department of the South African Reserve Bank (SARB), in terms of the Exchange Control Regulations, and regulate transactions involving South African residents and non-residents, with the exception of transactions between South African residents and residents of the Common Monetary Area, which comprises South Africa, the Kingdoms of Lesotho and Eswatini (formerly Swaziland) and the Republic of Namibia. The exchange control regulations, which are administered by the Financial Surveillance Department of the South African Reserve Bank (SARB), are applied throughout the Common Monetary Area and regulate transactions (including capital flows into and out of the Common Monetary Area) involving South African residents, including natural persons and legal entities.
Government officials have from time to time stated their intentions to relax South Africa’s exchange control regulations when economic conditions permit such action. In his budget speech in March 1998, the then Minister of Finance first announced that restrictions relating to offshore investments by South African companies and individuals subject to South African exchange control would, to a limited extent, be lifted. Since then, the government has incrementally relaxed aspectspurpose of exchange control forcontrols is to mitigate the decline of foreign capital reserves in South African companies and financial institutions as well as forAfrica.
The Government of South African individuals. However, it is impossibleAfrica has, however, committed itself to predict with any certainty if and when the government will removerelaxing exchange controls gradually and significant relaxation has occurred in their entirety or how the controls may continue to change over time.recent years.
The comments below relate, in general, to exchange controls in place at the date of this annual report.
Investments in South African companies
A foreign investor may invest freely in ordinary shares in a South African company. Any foreign investor may also sell shares in a South African company and transfer the proceeds out of South Africa without restriction. Acquisitions of shares or assets of South African companies by non-South African purchasers are not generally subject to review and approval by the SARB, whenparticularly where the consideration is payable in cash, but may requirea form other than cash. In this regard, the SARB review andwill give approval in certain circumstances, including whenwhere it is persuaded, inter alia, that the consideration is equity in a non-South African company or whenpayable for the acquisition of the shares or assets is financed by a loan froman arm’s-length consideration and that such acquisition offers benefits to South Africa. In addition, where shares in a South African lender.company are acquired by a non-resident, the share certificates issued to the non-resident shareholder must be endorsed “non-resident” by the SARB (or an Authorised Dealer).
Dividends
Dividends declared to foreign stockholders in public companies listed on the Johannesburg Stock Exchange (JSE) are not subject to the approval of the SARB.SARB, provided that the shares in respect of which the dividends are declared have been endorsed “non-resident” by the SARB or an Authorised Dealer at the time of acquisition. Dividends are freely transferable to foreign stockholders from both trading and non-trading profits earned in South Africa by public listed companies.
Voting rights
There are no limitations imposed by South African law, including South African exchange controls, or by the Memorandum of Incorporation of AngloGold Ashanti on the rights of non-South African shareholders to vote their ordinary shares.
Overseas financing, interest and investments
Interest on foreign loans, if paid from cash generated from operations in South Africa, may be remittable abroad, provided that the loans and the payment of the relevant interest in respect of such loans have received prior SARB approval.
AngloGold Ashanti and its South African subsidiaries require SARB approval to raise debt from and repay debt to non-residents of the Common Monetary Area, mainly in respect of the terms of repayment applicable to such loans, as well as any guarantees that may be provided in respect of such loans, by AngloGold Ashanti or its South African subsidiaries.
Debt raised outside the Common Monetary Area by AngloGold Ashanti’s non-South African subsidiaries is not restricted under South African exchange control regulations and can be used for investment outside the Common Monetary Area, subject to the relevant conditions imposed by the SARB in connection with such investment, the establishing of such a non-South African subsidiary or in raising the debt by such subsidiary. For example, AngloGold Ashanti and its South African subsidiaries would require SARB approval in order for AngloGold Ashanti and/or its South African subsidiaries to provide guarantees for the obligations of any of its non-South African subsidiaries. In addition, funds obtained from non-residents of the Common Monetary Area and debt raised outside the Common Monetary Area by AngloGold Ashanti’s non-South African subsidiaries must be repaid or serviced by AngloGold Ashanti’s foreign subsidiaries unless otherwise approved by the SARB.
A listing by a South African company on any stock exchange other than the JSE in connection with raising capital requires permission from the SARB.
Under current exchange control regulations, offshore investments by AngloGold Ashanti and its subsidiaries require the approval of the SARB. Subject to such prior approval of the SARB, there is no limit on the amount of capital that may be invested offshore.
10E.Taxation
South African taxation
General
The following discussion summarisessection provides a summary of the South African tax consequences ofconsequent upon the ownership and disposition of shares by South African residents or ADSs by a US holder (as defined below) and is not intended to constitute tax advice. This summary is based upon current South African tax law and practice of the South African Revenue Service (SARS) practice,, the Convention Between the Government of the United States of America and the Republic of South Africa for the Avoidance ofUS/SA Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on Income and Capital Gains, signed 17 February 1997 (Treaty),Treaty, and in part upon representations ofmade by the depositary, andDepositary, on the basis that it assumes that each obligation provided for in, or otherwise contemplated by, a Deposit Agreement and any related agreement will be performed in accordance with its respective terms.
The following summary of the South African tax considerations does not address the tax consequences to a US holder that is resident in South Africa for South African tax purposes, whose holding of shares or ADSs is effectively connected with a permanent establishment in South Africa through which such US holder carries on business activities or, in the case of an individual, with a fixed base situated therein, or who is otherwise not entitled to the full benefits under the US/SA Double Taxation Treaty. It should be appreciated that South Africa ratified the Multilateral Convention to Implement Tax Treaty-related measures to prevent Base Erosion and Profit Shifting (BEPS MLI) on 30 September 2022 and that one should thus read the applicable treaty, including the US/SA Double Taxation Treaty, in this context.
The statements of law set forth below are subject to any changes (which may be applied retroactively) in South African law or in the interpretation thereof by SARS, or in the US/SA Double Taxation Treaty, occurring after the date hereof. It should be expressly noted that South African tax law does not specifically address the treatment of ADSs. However, it is reasonable to assume (although no assurance can be made) that the tax treatment of US holders of shares is also applicable to US holders of ADSs.
Holders are strongly urged to consult their own tax advisors as to the consequences under South African, US federal, state and local, and other applicable laws, of the ownership and disposition of shares or ADSs.
Taxation of dividends
South Africa currently imposes a Dividend Withholding Tax on Companies (dividends tax) at a rate of 20 percent on the net amount of the dividend declared and paid by a resident company, other than a Headquarter Company.
The dividends tax is generally imposed on the beneficial owner of the dividends. The dividends tax is subject to domestic exemptions or relief in terms of an applicable double taxation treaty. The application of such domestic exemptions or relief in terms of an applicable double taxation treaty is subject to the making of certain declarations and undertakings by the beneficial owner of the dividends to the regulated intermediary making payment of the dividend. In terms of the latest amendments to the tax provisions, the declaration and undertaking entitling the beneficial owner to a reduced dividend withholding tax rate must be renewed every five years, subject to certain exemptions.
The dividends tax could be reduced to a lower rate under an applicable double tax treaty, if all requirements are met. In the case of dividends paid to a US holder with respect to shares, the US/SA Double Taxation Treaty would generally limit the dividends tax rate to five percent of the gross amount of the dividends if a corporate US holder holds directly at least 10ten percent of the voting stock of AngloGold Ashanti,the Company, provided that the applicable declaration and undertaking are given by the beneficial owner that the reduced rate applies.
In all other cases, the maximum tax rate under the US/SA Double Taxation Treaty is 15 percent of the gross amount of the dividend. Even though the domestic rate is 20 percent on the net amount of the dividends, the maximum rate that is payable under the Treaty is 15 percent of the gross amount of the dividends.
Different rules may apply if the beneficial owner of the dividends is a US resident who carries on business in South Africa through a permanent establishment situated in South Africa, or performs in South Africa services from a fixed basepermanent establishment situated in South Africa, and the dividends are attributable to such permanent establishment or fixed base.
Moreover, if the dividends tax rate is reduced under the auspices of an applicable double tax treaty, certain South African compliance requirements must be met in order to obtain the double tax treaty relief, including amongst others the completion of a declaration and undertaking by the beneficial owners in favour of the Company and/or the relevant participant. regulated intermediary.
In terms of the latest tax proposalsprovisions the declaration and undertaking need to be renewed at least every five years unless the regulated intermediary is subject to the provisions of inter alia the US Foreign Account Tax Compliance legislation.
A dividend is currently defined as any amount transferred or applied by a company that is a resident (including AngloGold Ashanti)the Company) for the benefit or on behalf of any person in respect of any share in that company, whether that amount is transferred or applied by way of a distribution made by the company, or as consideration for the acquisition of any share in that company. The definition of
a dividend specifically excludes any amount transferred or applied by the companyCompany that results in a reduction of so-called contributed tax capital (CTC) of the relevant class of shares, or constitutes shares in the companyCompany or constitutes an acquisition by the companyCompany of its own securities by way of a general repurchase of securities in terms of the JSE Listings Requirements. A distinction is thus made between a general repurchase of securities and a specific repurchase of securities. If the companyCompany embarks upon a general repurchase of securities, the proceeds areof such repurchase would not deemed to beconstitute a dividend, whereas, in the case of a specific repurchase of securities where the purchase price is not funded out of CTC of that class of shares, the proceeds arewould likely to constitute a dividend.
The concept of CTC effectively means the sum of the stated capital or share capital and share premium of a company that existed on 1 January 2011, excluding any transfers from reserves to the share premium account or stated capital account, plus proceeds from the issue of any new shares by a company.company, less the amount of CTC that has been returned to shareholders. Any application of CTC is limited to the holders of a class of shares and specifically thatshares. In addition, a distribution of CTC attributable to a specific class must be made proportionately to the number of shares held by a shareholder in a specific class. The definition of CTC is subject to various provisos. Recently the definition of CTC was amended to make it clear that CTC can only be transferred to shareholders proportionally.
For dividends tax purposes a dividend is defined as any dividend as indicated above that is paid by a company that is a resident or paid by a foreign company if the share in respect of which that foreign dividend is paid is a listed share and to the extent that the foreign dividend does not constitute a distribution of an asset in kind.
Dividends are generally exempt from the payment of income tax, subject to various exclusions. If a dividend is not exempt from income tax it follows that dividends tax will not also be levied.
Taxation of capital gains on sale or other disposition
South African residents are (subject to certain exemptions) taxed on their worldwide income, while non-residents are only taxed on South African sourced income (subject to the provisions of any relevant double taxation agreement).The general corporate income tax rate has recently been reduced to 27 percent.
Capital gains tax is not a separate tax to income tax; instead, a percentile of the taxpayer’s net capital gain (that is the taxable capital gain) is included in its taxable income on which it is taxed at the income tax rate.
Non-residents are only subject to the South African capital gains tax provisions in respect of the disposal of any immovable property (such as land and buildings or mining rights) or any interest or right of whatever nature to or in immovable property situated in South Africa, or any asset of a permanent establishment through which that non-resident is carrying on a trade in South Africa.In the instance of a shareholder holding shares in a South African company, the ‘interest in immovable property’ requirements are met if 80 percent or more of the market value of the shares is directly or indirectly attributable to South African immovable property held on capital account, and that shareholder (whether alone or together with any connected person in relation to that person), directly or indirectly, holds at least 20 percent of the equity shares of that South African company.
Gains realised on the sale of ordinary shares are automatically deemed to be onof a capital accountnature and therefore, subject to capital gains tax provided the ordinary shares have been held for a continuous period of at least three years. This deeming provision is limitedapplicable to ordinary shares“equity shares” as defined in section 1 of the South African Income Tax Act, No. 58 of 1962 (the “SA Income Tax Act”), and doesmay not extend to preference shares or ADSs. ADSs where the preference shares or ADSs do not constitute “equity shares” as so defined.
The meaning of the word “resident” is different for individuals and corporations and is governed by the South African Income Tax Act 1962 ( the Act) and by the Treaty. In the event of conflict, the Treaty, which contains a tie breaker clause or mechanism to determine residency if a holder is resident in both countries, will prevail. In terms of the Act and Treaty, a US resident holder of shares or ADSs will not be subject to capital gains tax on the disposal of securities held as capital assets unless the securities are linked to a permanent establishment conducted in South Africa.Africa or constitute an interest in immovable property as indicated above. In contrast, gains on the disposal of securities which are not capital in nature are usually subject to income tax. Any asset held as a long-term investment will be considered a capital asset and subject to capital gains tax on the disposal of such an asset. Any asset acquired for purposes of resale as part of a profit-making scheme will not be considered a capital asset and will be subject to income tax on the disposal of such an asset. However, even in the latter case, a US resident holder will not be subject to income tax, unless the US resident holder carries on business in South Africa through a permanent establishment situated therein.
The effective marginal rate for South African residents is 36 percent for trusts, 18 percent for individuals and 22,4 percent for companies. The income tax rate applicable in each instance is 45 percent for trusts, 45 percent for individuals and 28 percent for companies.
Securities transfer tax (STT)
No securities transfer tax, or STT, is payable in South Africa with respect to the issue of a security, but STT is payable upon transfer, redemption or redemptioncancellation thereof.
STT on transfers of securities is charged at a rate of 0,250.25 percent on the 'taxable amount'‘taxable amount’ in respect of the 'transfer'‘transfer’ of every security issued by a company incorporated in South Africa, or a company incorporated outside South Africa, but listed on an exchange in South Africa, subject to certain exemptions.
The word 'transfer'‘transfer’ is broadly defined and includes the transfer, sale, assignment or cession or disposal in any other manner of a security which results in a change in beneficial ownership.The cancellation or redemption of a security is also regarded as a 'transfer'‘transfer’ unless the companyCompany is being liquidated. However, the transfer of a security that does not result in a change in beneficial ownership is not regarded as a 'transfer'‘transfer’ for STT purposes. A security is also defined as a depositary receipt in a company. Accordingly,Apart from STT isthus being payable upon the conversion of ADSs to shares and vice versa, , STT could also be payable on the transfer of a depositary receipt issued by a company, including specifically the ADSs issued by AngloGold Ashanti.the Company. Generally, the central securities depositaryDepositary that has been accepted as a participant in terms of the Financial Markets Act, is liable for the payment of the STT, on the basis that it is recoverable from the person to whom it is transferred.
STT is levied on the 'taxable amount'‘taxable amount’ of a security.The taxable amount of a listed security is the greater of the consideration for the security declared by the transferee or the closing price of that security as traded on the stock exchange concerned. InThe person to whom the case of a transfer of a listed security eitheris transferred is liable for payment of the STT, and such tax must be paid through the member or the participant holding the security in custody, or where the listed security is not held in custody, the company that issued the listed security. The tax so payable may be recovered from the person to whom the security is liable for the tax.transferred. The tax must be paid by the fourteenth day of the month following the month during which the transfer occurred.
Withholding tax on interest
Generally, a 15 percent withholding tax may apply to the payments of interest.Under the US/SA Double Taxation Treaty, withholding is reduced to zero percent provided the interest is derived and beneficially owned by a resident of the United States.States will be taxable only in the United States (and therefore not subject to interest withholding tax in South Africa), subject to certain exclusions.
Value-Added Tax
The issue or transfer of shares is not a taxable supply for value-added tax (“VAT”VAT”) purposes.However, fees charged by independent service providers would beare subject to VAT at the standard rate of 15%.15 percent.
United States Taxation
General
The following is a general summary of certain material US federal income tax consequences of the ownership and disposition of shares or ADSs to a US holder (as defined below) that holds its shares or ADSs as a capital asset.With respect to the following, references to shares includes references to ADSs unless the context indicates otherwise.This summary does not address any aspect of US federal gift or estate tax, or the state, local or non-US tax consequences to a US holder of shares. This summary is based on US tax laws including the Internal Revenue Code of 1986, as amended (the Code)“Code”), Treasury regulations promulgated thereunder, rulings, judicial decisions, administrative pronouncements, and the US/SA Double Taxation Treaty, all as currently in effect as of the date of this annual report, and all of which are subject to change or changes in interpretation, possibly with retroactive effect. In addition, this summary is based in part upon the representations of the depositaryDepositary and the assumption that each obligation in the Deposit Agreement relating to the ADSs and any related agreement will be performed in accordance with its terms.
This summary does not address all aspects of US federal income taxation that may apply to holders that are subject to special tax rules, including US expatriates, non-resident aliens present in the United States for at least 183 days during the calendar year, insurance companies, tax-exempt entities, banks, certain financial institutions, persons subject to the alternative minimum tax, regulated investment companies, securities broker-dealers, traders in securities who elect to apply a mark-to-market method of accounting, investors that own (directly, indirectly or by attribution) 10ten percent or more of the outstanding share capital or voting stock of AngloGold Ashanti, partnerships or other entities treated as partnerships for US federal income tax purposes or persons holding shares through such entities, persons holding their shares as part of a straddle, hedging or conversion transaction, persons who acquired their shares pursuant to the exercise of employee stock options or otherwise as compensation, or persons whose functional currency is not the US dollar. Such holders may be subject to US federal income tax consequences different from those set forth below.
As used herein, the term “US holder” means a beneficial owner of shares that is: (a) a citizen or individual resident of the United States for US federal income tax purposes; (b) a corporation (or other entity taxable as a corporation for US federal income tax purposes) created or organised in or under the laws of the United States, any state thereof or the District of Columbia; (c) an estate the income of which is subject to US federal income taxation regardless of its source; or (d) a trust if (i) a court within the
United States can exercise primary supervision over the administration of the trust and one or more US persons are authorised to control all substantial decisions of the trust or (ii) it has a valid election in effect under applicable Treasury regulations to be treated as a United States person.
If a partnership (including for this purpose any entity treated as a partnership for US federal income tax purposes) holds shares, the tax treatment of a partner generally will depend upon the status of the partner and the activities of the partnership. If a US holder is a partner in a partnership that holds shares, the holder is urged to consult its own tax advisor regarding the specific tax consequences of the ownership and disposition of the shares.
US holders should consult their own tax advisors regarding the specific South African and US federal, state and local tax consequences of owning and disposing of shares in light of their particular circumstances as well as any consequences arising under the laws of any other taxing jurisdiction. In particular, US holders are urged to consult their own tax advisors regarding whether they are eligible for benefits under the US/SA Double Taxation Treaty.
For US federal income tax purposes, a US holder of ADSs should generally be treated as owning the underlying shares represented by those ADSs. Therefore, deposits or withdrawals by a US holder of shares for ADSs or of ADSs for shares will not be subject to US federal income tax. The following discussion (except where otherwise expressly noted) applies equally to US holders of shares and US holders of ADSs.
▪Taxation of dividends
The gross amount of any distribution (including the amount of any South African withholding tax thereon) paid to a US holder by AngloGold Ashanti generally will be taxable as dividend income to the US holder for US federal income tax purposes on the date the distribution is actually or constructively received by the US holder, in the case of shares, or by the depositary,Depositary, in the case of ADSs.Corporate US holders will not be eligible for the dividends received deduction in respect of dividends paid by AngloGold Ashanti. For foreign tax credit limitation purposes, dividends paid by AngloGold Ashanti will be income from sources outside the United States.
As noted above in “-Taxation-South“Taxation—South African Taxation-Taxationtaxation—Taxation of dividends”, the South African government has enacted a dividend withholding tax.As a result, US holders who are eligible for benefits under the current US/SA Double Taxation Treaty will be subject to a maximum withholding tax of 15 percent on the gross amount of dividend distributions paid by AngloGold Ashanti.
The amount of any distribution paid in foreign currency (including the amount of any South African withholding tax thereon) generally will be includible in the gross income of a US holder of shares in an amount equal to the US dollar value of the foreign currency calculated by reference to the spot rate in effect on the date of receipt by the US holder, in the case of shares, or by the depositary,Depositary, in the case of ADSs, regardless of whether the foreign currency is converted into US dollars on such date. If the foreign currency
is converted into US dollars on the date of receipt, a US holder of shares generally should not be required to recognise foreign currency gain or loss in respect of the dividend. If the foreign currency received in the distribution is not converted into US dollars on the date of receipt, a US holder of shares generally will have a tax basis in the foreign currency equal to its US dollar value on the date of receipt. Any gain or loss recognised upon a subsequent conversion or other disposition of the foreign currency generally will be treated as US source ordinary income or loss. In the case of a US holder of ADSs, the amount of any distribution paid in a foreign currency generally will be converted into US dollars by the depositaryDepositary upon its receipt. Accordingly, a US holder of ADSs generally will not be required to recognise foreign currency gain or loss in respect of the distribution. Special rules govern and specific elections are available to accrual method taxpayers to determine the US dollar amount includible in income in the case of taxes withheld in a foreign currency. Accrual basis taxpayers are therefore urged to consult their own tax advisors regarding the requirements and elections applicable in this regard.
Subject to certain limitations, South African withholding taxes will be treated as foreign taxes eligible for credit against a US holder’s US federal income tax liability. The limitation on foreign taxes eligible for credit is calculated separately with respect to specific classes of income. Dividend income generally will constitute ‘passive category’“passive category” income, or in the case of certain US holders, ‘general category’“general category” income. The use of foreign tax credits is subject to complex conditions and limitations. In lieu of a credit, a US holder who itemises deductions may elect to deduct all of such holder’s foreign taxes in the taxable year. A deduction does not reduce US tax on a dollar-for-dollar basis like a tax credit, but the deduction for foreign taxes is not subject to all the same limitations applicable to foreign tax credits. US holders are urged to consult their own tax advisors regarding the availability of foreign tax credits.
Certain US holders (including individuals) are eligible for reduced rates of US federal income tax in respect of “qualified dividend income” received. AngloGold Ashanti currently believes that dividends paid with respect to its shares should constitute qualified dividend income for US federal income tax purposes. Each individual US holder of AngloGold Ashanti shares is urged to consult his own tax advisor regarding the availability of the reduced dividend tax rate in light of his own particular situation.
The US Treasury has expressed concern that parties to whom ADSs are pre-released may be taking actions that are inconsistent with the claiming of foreign tax credits for US holders of ADSs. Such actions would also be inconsistent with the claiming of the reduced rate of tax described above, applicable to dividends received by certain non-corporate holders. Accordingly, the analysis of the creditability of South African withholding taxes or the availability of qualified dividend treatment could be affected by future actions that may be taken by the US Treasury with respect to ADSs.
•Taxation of dispositions
If a US holder is a resident of the United States for purposes of the US/SA Double Taxation Treaty, such holder will not be subject to South African tax on any capital gain if it sells or disposes of its shares. Special rules apply to individuals who are residents of more than one country.
Subject to the passive foreign investment company considerations discussed below, upon the sale, exchange or other disposition of shares, a US holder generally will recognise capital gain or loss for US federal income tax purposes in an amount equal to the difference between the US dollar value of the amount realised on the disposition and the holder’s tax basis, determined in US dollars, in the shares. Such gain or loss generally will be US source gain or loss, and will be treated as a long-term capital gain or loss if the holder’s holding period in the shares exceeds one year at the time of disposition. If the US holder is an individual, any capital gain generally will be subject to US federal income tax at preferential rates if specified minimum holding periods are met. The deductibility of capital losses is subject to limitations under the Code.
A US holder’s tax basis in a share will generally be its US dollar cost. The US dollar cost of a share purchased with foreign currency will generally be the US dollar value of the purchase price on the date of purchase, or the settlement date for the purchase in(in the case of shares traded on an established securities market that are purchased by a cash basis US holder or an electing accrual basis US holder.holder), or the date of purchase in all other cases. The amount realised on a sale or other disposition of shares for an amount in foreign currency will be the US dollar value of this amount on the settlement date for the sale or disposition (in the case of shares traded on an established securities market that are sold by a cash basis US holder or an electing accrual basis US holder), or the date of sale or disposition. On the settlement date,disposition in all other cases. In addition, in such other cases, the US holder will recognise US source foreign currency gain or loss (taxable as ordinary income or loss) equal to the difference (if any) between the US dollar value of the amount received based on the exchange rates in effect on the date of sale or other disposition and the settlement date. However, in the case of shares traded on an established securities market that are sold by a cash basis US holder (or an accrual basis US holder that so elects), the amount realised will be based on the exchange rate in effect on the settlement date for the sale, and no exchange gain or loss will be recognised at that time. If an accrual basis US holder makes either of the elections described above, it must be applied consistently from year to year and cannot be revoked without the consent of the Internal Revenue Services (IRS).
Foreign currency received on the sale or other disposition of a share will have a tax basis equal to its US dollar value on the settlement date. Any gain or loss recognised on a sale or other disposition of foreign currency (including its use to purchase shares or upon exchange for US dollars) will be US source ordinary income or loss.
| |
| Passive foreign investment company considerations |
▪Passive foreign investment company considerations
A foreign corporation will be classified a passive foreign investment company (PFIC) for any taxable year if at least 75 percent of its gross income consists of passive income (such as dividends, interest, rents or royalties (other than rents or royalties derived in the active conduct of a trade or business and received from an unrelated person), or gains on the disposition of certain minority interests), or at least 50 percent of the average value of its assets consists of assets that produce, or are held for the production of, passive income. AngloGold Ashanti believes that it was not treated as a PFIC for the taxable year ended 31 December 20192022 or
any prior taxable years and does not expect to become a PFIC in the foreseeable future. If AngloGold Ashanti were characterised as a PFIC for any taxable year, a US holder would suffer adverse tax consequences with respect to that taxable year and all future years during which it holds AngloGold Ashanti ordinary shares.
These consequences may include having gain realised on the disposition of shares treated as ordinary income rather than capital gain and being subject to punitive interest charges on the receipt of certain dividends and on the proceeds of the sale or other disposition of the shares. Furthermore, dividends paid by AngloGold Ashanti would not be “qualified dividend income” and would be taxed at the higher rates applicable to other items of ordinary income. US holders should consult their own tax advisors regarding the potential application of the PFIC rules to their ownership of the shares.
| |
| US information reporting and backup withholding |
▪US information reporting and backup withholding
In general, dividend payments made to a US holder and proceeds paid from the sale, exchange, or other disposition of shares may be subject to information reporting to the IRS and possible backup withholding. US federal backup withholding generally is imposed at a current rate of 24 percent on specified payments including dividends and gross sale proceeds to persons who fail to furnish required information. Backup withholding will not apply to a US holder who furnishes a correct taxpayer identification number and makes any other required certification or who is otherwise exempt from backup withholding. US persons who are required to establish their exempt status generally must provide IRS Form W-9 (Request for Taxpayer Identification Number and Certification). Backup withholding is not an additional tax. Amounts withheld as backup withholding may be credited against a holder’s US federal income tax liability. A holder may obtain a refund of any excess amounts withheld under the backup withholding rules by filing the appropriate claim for refund with the IRS and furnishing any required information.
| |
| Information with respect to foreign financial assets |
▪Information with respect to foreign financial assets
Individuals that own “specified foreign financial assets” with an aggregate value in excess of $50,000 are generally required to file information reports with respect to such assets with their U.S. federal income tax returns. Depending on the individual’s circumstances, higher threshold amounts may apply. “Specified foreign financial assets” include any financial accounts maintained by foreign financial institutions, as well as any of the following, but only if they are not held in accounts maintained by financial institutions: (i) stocks and securities issued by foreign persons, (ii) financial instruments and contracts held for investment that have foreign issuers or counterparties and (iii) interests in foreign entities. Therefore, the shares may be treated as specified foreign financial assets. In such cases, certain US holders may be subject to this information reporting regime and be required to file IRS formForm 8938 listing these assets with their U.S. federal income tax returns. Failure to file information reports may subject a US holder to penalties. US holders are urged to consult their own tax advisors regarding their obligations to file information reports with respect to the shares.
| |
10F. | DIVIDENDS AND PAYING AGENTS |
265
10F. DIVIDENDS AND PAYING AGENTS
Not applicable.
10G. STATEMENT BY EXPERTS
Not applicable.
10H.Documents on Display
AngloGold Ashanti files annual reports on Form 20-F and reports on Form 6-K with the SEC. You may access this information at the SEC’s home page (http://www.sec.gov). Copies of the documents referred to herein may be inspected at AngloGold Ashanti’s offices by contacting AngloGold Ashanti at 76 Rahima Moosa Street, Newtown,112 Oxford Road, Houghton Estate, Johannesburg, 2001 (P.O. Box 62117, Marshalltown, 2107)2198 (Private Bag X 20, Rosebank, 2196) South Africa, Attention: Company Secretary, telephone number: +27 11 637 6000.
No material on the AngloGold Ashanti website forms any part of, or is incorporated by reference into, this annual report on Form 20-F. References herein to the company’sCompany’s website shall not be deemed to cause such incorporation.
| |
10I. | SUBSIDIARY INFORMATION |
10I. SUBSIDIARY INFORMATION
Not applicable.
10J. Annual Report to Security Holders
AngloGold Ashanti intends to submit its annual report provided to security holders in electronic format as an exhibit to a current report on Form 6-K.
ITEM 11: QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
TREASURY POLICY
Risk management activities within the groupGroup are the ultimate responsibility of the board of directors.board. The Chief Financial Officer is responsible to the board of directors for the design, implementation and monitoring of the risk management plan. The Audit and Risk Committee is responsible for overseeing risk management plans and systems, as well as financial risks which include a review of treasury activities and exposure to the group’sGroup’s counterparties.
Under the treasuryfinancial and risk management policy, hedges may be put in place once approved by the Board, using approved instruments over the group’sGroup’s planned gold production and resultant gold sales and currency exposures. The tenor of the hedges may extend out to 10 years. The treasuryfinancial and risk management policy sets trading limits on the extent to which the hedge position may change for the various levels of treasury management from dealer, through treasurer, executive management team and board.board members.
The financial risk management activities objectives of the groupGroup are as follows:
•Safeguarding the group’sGroup’s core earnings stream from its major assets through the effective control and management of gold and other commodity price risk, foreign exchange risk and interest rate risk;
•Effective and efficient usage of credit facilities in both the short- and long-term through the adoption of reliable liquidity management planning and procedures;
•Ensuring that investment and hedging transactions are undertaken with creditworthy counterparts; and
•Ensuring that all contracts and agreements related to financial risk management activities are co-ordinated and consistent throughout the groupGroup and comply where necessary with all relevant regulatory and statutory requirements.
Under the treasuryfinancial and risk management policy, treasury reports are produced at the following minimum intervals for review by management and the board of directors.
|
| | | | | | | | | | |
• | Daily | | TreasurerTreasury Manager |
• | MonthlyWeekly | | Executive CommitteeTreasurer |
• | QuarterlyMonthly | | Treasurer |
• | Quarterly | | Audit and Risk Committee and Board of Directors |
• | Half-yearly | | Audit and Risk Committee, Board of Directors and shareholder reports |
The Treasury Risk Analyst is responsible for monitoring all reports for completeness and accuracy which are reviewed by the Treasurer.
At AngloGold Ashanti, all front office (dealing), middle office (risk reporting), back office (deal confirmations) and payment (treasury settlements) activities are segregated. All treasury transactions are captured on a third party developed treasury and risk management system that is widely used in corporate treasuries. The groupGroup internal audit function conducts regular and ad-hocad hoc reviews of the activities of treasury and the group’sGroup’s treasury system.
Gold price and other commodities risk management activities
In the normal course of its operations, the groupGroup is exposed to gold and other commodity price, currency, interest rate, equity price, liquidity and non-performance risk, which includes credit risk. The groupGroup is also exposed to certain by-product commodity price risk. In order to manage these risks, the groupGroup may enter into transactions which make use of derivatives. The groupGroup has developed a risk management process to facilitate, control and monitor these risks.
Gold price risk arises from the risk of an adverse effect of current or future earnings resulting from fluctuations in the price of gold. The group eliminated its hedge book during 2010 and has since had full exposure to the spot price of gold.
As at 31 December 2019,2022, the groupGroup had no commitments against future production potentially settled in cash.
In January 2020, AGAJuly 2022, AngloGold Ashanti entered into Asian style zero-cost collarsforward contracts for a total of 130,900 ounces ( i.e. 70%999,000 barrels of Argentina’s annual gold production)Brent Crude oil for the period February 2020January 2023 to December 2020.2023 that will be cash settled on a monthly basis against the contract price. The strike prices are $1,500 per ounceaverage price achieved on the floor andforward contracts is $89.20 per barrel of Brent Crude oil. At 31 December 2022, the mark-to-market value of these oil derivatives was an average priceunrealised loss of $1,701.34 per ounce on the cap.$6 million.
Foreign exchange price risk protection agreements
The group,Group, from time to time, may enter into currency forward exchange and currency option contracts to hedge certain anticipated transactions denominated in foreign currencies. The objective of the group’sGroup’s foreign currency hedging activities is to protect the groupGroup from the risk that the eventual cash flows resulting from transactions denominated in US dollars will be adversely affected by changes in exchange rates.
As at 31 December 20192022 and 2018,2021, the groupGroup had no open forward exchange or currency option contracts in its currency hedge position.
IFRS guidance on derivatives and hedging requires that derivative instruments be accounted for as follows:
Contracts that meet the criteria for hedge accounting are designated as hedging instruments, hedging the variability of forecasted cash flows from the sale of production into the spot market and from capital expenditure denominated in a foreign currency and are classified as cash flow hedges. Cash flow hedge losses pertaining to capital expenditure of $1 million as at 31 December 2019 (2018: $1 million) are expected to be reclassified from accumulated other comprehensive income and recognised as an adjustment to depreciation expense over the life of the Serra Grande mine.
All other derivatives are measured at their estimated fair value, with the changes in estimated fair value at each reporting date reported as gains or losses on derivatives in earnings in the period in which they occur.
Cash flows related to these instruments designated as qualifying hedges are reflected in the consolidated statement of cash flows in the same category as the cash flow from the items being hedged. Accordingly, cash flows relating to the settlement of forward sale commodity derivatives contracts hedging the forecasted sale of production into the spot market will be reflected upon settlement as a component of operating cash flows.
Interest rate and liquidity risk
Fluctuations in interest rates impact interest paid and received on the short-term cash investments and financing activities, giving rise to interest rate risk.
In the ordinary course of business, the groupGroup receives cash from the proceeds of its gold sales and is required to fund its working capital requirements. This cash is managed to ensure that surplus funds are invested in a manner to achieve market related returns while minimising risks.
The groupGroup is able to actively source financing at competitive rates. The counterparts are financial and banking institutions and their credit ratings are regularly monitored by the group.Group.
Cash and loans advanced maturity profile | | | | 2019 | 2018 | | 2022 | 2021 |
Maturity date | Currency | Fixed rate investment amount (million) |
| | Effective rate % | | Floating rate investment amount (million) |
| | Effective rate % | Fixed rate investment amount (million) |
| | Effective rate % | | Floating rate investment amount (million) |
| | Effective rate % | Maturity date | Currency | Fixed rate investment amount (million) | | Effective rate % | | Floating rate investment amount (million) | | Effective rate % | Fixed rate investment amount (million) | | Effective rate % | | Floating rate investment amount (million) | | Effective rate % |
All less than one year | $ | 21 |
| | 0.58 | | 103 |
| | 1.09 | — |
| | — | | 131 |
| | 1.99 | All less than one year | $ | 8 | | | — | | | 507 | | | 3.48 | | 1 | | | — | | | 301 | | | 0.10 | |
| ZAR | 166 |
| | 6.56 | | 25 |
| | 5.00 | 121 |
| | 6.44 | | 21 |
| | 5.25 | | ZAR | 1,471 | | | 6.87 | | | — | | | 1,337 | | | 3.54 | | | — | | | |
| AUD | — |
| | — | | 41 |
| | 0.23 | — |
| | — | | 52 |
| | 0.20 | | AUD | — | | | — | | | 49 | | | 1.07 | | — | | | — | | | 72 | | | — | |
| BRL | — |
| | — | | 33 |
| | 5.94 | — |
| | — | | 64 |
| | 6.13 | | BRL | — | | | — | | | 52 | | | 11.57 | | — | | | — | | | 106 | | | 4.27 | |
| ARS | 1,831 |
| | 35.00 | | 81 |
| | 28.00 | — |
| | — | | — |
| | — | | ARS | 18,178 | | | 66.50 | | | 2,362 | | | 65.50 | | 13,256 | | | 34.00 | | | — | | | |
| | | CAD | — | | | — | | | — | | | — | | — | | | — | | | 353 | | | 0.19 | |
| | | GBP | — | | | — | | | 2 | | | 1.54 | | — | | | — | | | — | | | — | |
Borrowings maturity profile | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Within one year | | Between One and two years | Between Two and five years | After five years | Total |
Currency | Borrowings amount (million) | | Effective rate % | | Borrowings amount (million) | | Effective rate % | Borrowings amount (million) | | Effective rate % | Borrowings amount (million) | | Effective rate % | Borrowings amount (million) |
$ | 16 | | | 5.5 | | | 63 | | | 11.9 | | 58 | | | 12.4 | | 1,721 | | | 4.1 | | 1,858 | |
| | | | | | | | | | | | | | |
AUD | — | | | — | | | — | | | — | | 54 | | | 4.5 | | — | | | — | | 54 | |
TZS | 3,586 | | | 12.5 | | | 201,542 | | | 12.5 | | — | | | — | | — | | | — | | 205,128 | |
|
| | | | | | | | | | | | | | | | | | | | | | | |
| Within one year | | Between One and two years | Between Two and five years | After five years | Total |
Currency | Borrowings amount (million) |
| | Effective rate % |
| | Borrowings amount (million) |
| | Effective rate % |
| Borrowings amount (million) |
| | Effective rate % |
| Borrowings amount (million) |
| | Effective rate % |
| Borrowings amount (million) |
|
$ | 731 |
| | 5.4 |
| | 65 |
| | 9.3 |
| 811 |
| | 5.5 |
| 291 |
| | 6.5 |
| 1,898 |
|
ZAR | 9 |
| | 8.2 |
| | — |
| | — |
| 999 |
| | 8.5 |
| — |
| | — |
| 1,008 |
|
BRL | 1 |
| | 3.2 |
| | — |
| | — |
| 1 |
| | 3.2 |
| — |
| | — |
| 2 |
|
AUD | — |
| | — |
| | — |
| | — |
| 22 |
| | 2.3 |
| — |
| | — |
| 2 |
|
TZS | 4,955 |
| | 12.5 |
| | 103,185 |
| | 12.5 |
| — |
| | — |
| — |
| | — |
| 108,140 |
|
The table above is based on the borrowings as at 31 December 20192022 including borrowing cost and accrued interest but excludes any fair value adjustments.
Interest rate risk | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Fixed for less than one year | | Fixed for between one and three years | | Fixed for greater than three years | | |
Currency | | Borrowings amount (million) | | Effective rate % | | Borrowings amount (million) | | Effective rate % | | Borrowings amount (million) | | Effective rate % | | Total Borrowings amount (million) |
$ | | 16 | | | 5.5 | | | 128 | | | 12.1 | | | 1,714 | | | 4.1 | | | 1,858 | |
AUD | | — | | | — | | | — | | | — | | | 54 | | | 4.5 | | | 54 | |
| | | | | | | | | | | | | | |
TZS | | 3,586 | | | 12.5 | | | 201,542 | | | 12.5 | | — | | | — | | | 205,128 | |
|
| | | | | | | | | | | | | | | | | | | | |
| | Fixed for less than one year | | Fixed for between one and three years | | Fixed for greater than three years | | |
Currency | | Borrowings amount (million) |
| | Effective rate % |
| | Borrowings amount (million) |
| | Effective rate % | | Borrowings amount (million) |
| | Effective rate % |
| | Total Borrowings amount (million) |
|
$ | | 731 |
| | 5.4 |
| | 811 |
| | 5.5 | | 356 |
| | 5.3 |
| | 1,898 |
|
ZAR | | 9 |
| | 8.2 |
| | 999 |
| | 8.5 | | — |
| | — |
| | 1,008 |
|
BRL | | 1 |
| | 3.2 |
| | 1 |
| | 3.2 | | — |
| | — |
| | 2 |
|
AUD | | — |
| | — |
| | — |
| | — | | 22 |
| | 2.3 |
| | 22 |
|
TZS | | 4,955 |
| | 12.5 |
| | 103,185 |
| | 12.5 | | — |
| | — |
| | 108,140 |
|
The table above is based on the borrowings as at 31 December 20192022 including borrowing cost and accrued interest but excludes any fair value adjustments.
Non-performance risk
Realisation of contracts is dependent upon counterparts’ performance. The group has not obtained collateral or other security to support the financial instruments subject to non-performance risk, but the credit standing of counterparts was monitored on a regular basis throughout the year. The group spreads its business over a number of financial and banking institutions to minimise the risk of potential non-performance. Furthermore, the approval process of counterparts and the limits applied to each counterpart were monitored by the board of directors. Where possible, ISDA netting agreements were put in place.
The combined maximum credit risk exposure at balance sheet date amounts to $644$1,210 million in 20192022 for financial assets (2018: $495(2021: $1,300 million) and nil million for financial guarantees (2018:(2021: nil). Credit risk exposure netted by open derivative positions with counterparts was nil (2018:(2021: nil). No set-off is applied to balance sheet amounts due to the different maturity profiles of assets and liabilities.
Fair value of financial instruments
The estimated fair values of financial instruments are determined at discrete points in time based on relevant market information. The estimated fair values of the group’sGroup’s financial instruments, as measured at 31 December, are as follows (assets (liabilities)):
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| | 2022 | | 2021 |
| | Carrying Amount | | Fair value | | Carrying Amount | | Fair value |
(millions) | | $ | | $ | | $ | | $ |
Cash and cash equivalents | | 1,108 | | | 1,108 | | | 1,154 | | | 1,154 | |
Restricted cash | | 60 | | | 60 | | | 58 | | | 58 | |
Deferred compensation asset | | 12 | | | 12 | | | 25 | | | 25 | |
Short-term borrowings | | (18) | | | (18) | | | (51) | | | (51) | |
Long-term borrowings | | (1,965) | | | (1,808) | | | (1,858) | | | (1,960) | |
| | | | | | | | |
Listed investments - FVTOCI | | 2 | | | 2 | | | 116 | | | 116 | |
Listed and unlisted investments | | 1 | | | 1 | | | 1 | | | 1 | |
|
| | | | | | | | | | | | |
| | 2019 | | 2018 |
| | Carrying Amount |
| | Fair value |
| | Carrying Amount |
| | Fair value |
|
(millions) | | $ |
| | $ |
| | $ |
| | $ |
|
Cash and cash equivalents | | 456 |
| | 456 |
| | 329 |
| | 329 |
|
Restricted cash | | 64 |
| | 64 |
| | 66 |
| | 66 |
|
Short-term borrowings | | (734 | ) | | (741 | ) | | (139 | ) | | (139 | ) |
Long-term borrowings | | (1,299 | ) | | (1,394 | ) | | (1,911 | ) | | (1,945 | ) |
Listed investments - FVTPL | | 21 |
| | 21 |
| | 19 |
| | 19 |
|
Listed investments - FVTOCI | | 82 |
| | 82 |
| | 69 |
| | 69 |
|
Listed and unlisted investments - held to maturity | | 67 |
| | 67 |
| | 59 |
| | 59 |
|
The following methods and assumptions were used to estimate the fair value of each class of financial instrument:
Cash restricted for use, cash and cash equivalents
The carrying amounts approximate fair value.
Trade and other receivables and trade and other payables
The carrying amounts approximate fair value because of the short-term duration of these instruments.instruments, except for the deferred compensation asset which is carried at fair value in level 3 of the fair value hierarchy.
Investments and other non-current assetsOther investments
Listed equity investments classified as FVTOCI and FVTPL are carried at fair value while fixed income investments and other non-current assets are carried at amortised cost. Thein level 1 of the fair value of fixed income investments and other non-current assets has been calculated using market interest rates. The unlisted equity investments are carried at cost.hierarchy.
Borrowings
The interest rate on borrowings is reset on a short-term floating rate basis, and accordingly the carrying amount is considered to approximate fair value.
Derivatives
The fair values of volatility-based instruments (i.e., options) are estimated based on market prices, volatilities, credit risk and interest rates for the periods under review.
Gain (loss) on non-hedge derivatives and other commodity contracts recognised
| | | | | | | | | | | |
| Year ended 31 December |
| 2022 | | 2021 |
(millions) | $ | | $ |
| | | |
Other commodity contracts | (6) | | | — | |
|
| | | | | |
| Year ended 31 December |
| 2019 |
| | 2018 |
|
(millions) | $ | | $ |
Unrealised | | | |
Other commodity contracts(1) | 8 |
| | 2 |
|
| |
(1)
| Included in other commodity contracts are amounts transferred to held for sale liabilities. |
Foreign exchange risk
Foreign exchange risk arises on financial instruments that are denominated in a foreign currency.
The following table discloses the approximate foreign exchange risk sensitivities of borrowings at 31 December 20192022 (actual changes in the timing and amount of the following variables may differ from the assumed changes below).
|
| | | | | | | | | | | | | |
| | 20192022 |
| | Change in exchange rate | | Change in exchange rate
| | Change in
borrowings Total |
| | | | $M |
Debt | | | | $M |
|
Debt | | | | |
ZAR denominated (R/$) | | Spot (+R1.50) | | (7 | ) |
TZS denominated (TZS/$) | | Spot (+TZS250) | | (5(9) | ) |
AUD denominated (AUD/$) | | Spot (+AUD0.1) | | (1(2) | ) |
| | |
|
| | | | | | | | | | | | | |
| | 20192022 |
| | Change in exchange rate
| | Change in borrowings
Total
|
|
| | | | $M |
|
Debt | | | | |
ZAR denominated (R/$) | | Spot (-R1.50) | | 9 |
|
TZS denominated (TZS/$) | | Spot (-TZS250) | | 611 |
|
AUD denominated (AUD/$) | | Spot (-AUD0.1) | | 12 |
|
| | | | |
ITEM 12: DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES
12A. DEBT SECURITIES
Not applicable
Not applicable
12C. OTHER SECURITIES
Not applicable
| |
12D. | AMERICAN DEPOSITARY SHARES |
| |
12D.3. | DEPOSITARY FEES AND CHARGES |
12D. AMERICAN DEPOSITARY SHARES
12D.3. DEPOSITARY FEES AND CHARGES
AngloGold Ashanti’s American Depositary Shares, or ADSs, each representing one of AngloGold Ashanti’s ordinary shares, are traded on the New York Stock Exchange under the symbol “AU.”“AU”. The ADSs are evidenced by American Depositary Receipts, or ADRs, issued by The Bank of New York Mellon, as Depositary under the Amended and Restated Deposit Agreement dated as of 3 June 2008, among AngloGold Ashanti Limited, The Bank of New York Mellon and owners and beneficial owners of from time to time of ADRs. ADS holders may have to pay the following service fees to the Depositary:
|
| | | | | | | |
Service | Fees (USD) |
| |
Issuance of ADSs | Up to 5 cents per ADS | (1) |
Cancellation of ADSs | Up to 5 cents per ADS | (1) |
Distribution of cash dividends or other cash distributions | Up to 2 cents per ADS | (2) |
Distribution of securities pursuant to | | |
(i) stock dividends, free stock distributions or | | |
(ii) exercises of rights to purchase additional ADSs | Up to 5 cents per ADS | (2) |
ADR Depositary Services fee | Up to 2 cents per year | (2) |
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(1)
| These fees are typically paid to the Depositary by the brokers on behalf of their clients receiving the newly-issued ADSs from the Depositary and by the brokers on behalf of their clients delivering the ADSs to the Depositary for cancellation. The brokers in turn charge these transaction fees to their clients. |
| |
(2)
| In practice, the Depositary has not collected these fees. If collected, such fees are offset against the related distribution made to the ADR holder. |
(1)These fees are typically paid to the Depositary by the brokers on behalf of their clients receiving the newly-issued ADSs from the Depositary and by the brokers on behalf of their clients delivering the ADSs to the Depositary for cancellation. The brokers in turn charge these transaction fees to their clients.
(2)In practice, the Depositary has not collected these fees. If collected, such fees are offset against the related distribution made to the ADR holder.
In addition, ADS holders are responsible for certain fees and expenses incurred by the Depositary on their behalf including (1) taxes and other governmental charges, (2) such registration fees as may from time to time be in effect for the registration of transfers of ordinary shares generally on the share register and applicable to transfers of ordinary shares to the name of the Depositary or its nominee or the Custodian or its nominee on the making of deposits or withdrawals, and (3) such cable, telex and facsimile transmission expenses as are expressly incurred by the Depositary in the conversion of foreign currency.
Fees and other charges payable by the Depositary, any of the Depositary’s agents, including the Custodian, or the agents of the Depositary’s agents in connection with the servicing of Shares or other Deposited Securities, shall be collected at the sole discretion of the Depositary by billing such owners for such charge or by deducting such charge from one or more cash dividends or other cash distributions.
For further information, refer to “Item“Item 10C: Material Contracts - Contracts—The Deposit Agreement”.
12D.4. DEPOSITARY PAYMENTS FOR 2022 | |
12D.4. | DEPOSITARY PAYMENTS FOR 2019 |
For the year ended 31 December 2019,2022, The Bank of New York Mellon, as Depositary, reimbursed AngloGold Ashanti an amount of $1,097,316.10 (2018: $557,454)$934,248 (2021: $1,083,405) mainly for investor relations relatedrelations-related expenses.
PART II
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ITEM 13: | DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES |
ITEM 13: DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES
None.
ITEM 14: MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS
None.
ITEM 15: CONTROLS AND PROCEDURES
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(a) | Disclosure Controls and Procedures: As of 31 December 2019, (the “Evaluation Date”), the company, under the supervision and with the participation of its management, including the chief executive officer and chief financial officer has evaluated the effectiveness of the company’s disclosure controls and procedures (as defined in Rules 13a - 15(e) and 15d - 15(e) under the Securities Exchange Act of 1934, as amended (“the Exchange Act”)). Based on such evaluation, the chief executive officer and chief financial officer have concluded that, as of the Evaluation Date, the company’s disclosure controls and procedures are effective, and are reasonably designed to ensure that information required to be disclosed by the company in reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the Securities and Exchange Commission. These disclosure controls and procedures include without limitation, controls and procedures designed to ensure that information required to be disclosed by the company in reports that it files or submits under the Exchange Act is accumulated and communicated to the company’s management, including its chief executive officer and chief financial officer, as appropriate to allow timely decisions regarding disclosure.
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(a)Disclosure Controls and Procedures:As of 31 December 2022, (the “Evaluation Date”), the Company, under the supervision and with the participation of its management, including the chief executive officer and chief financial officer has evaluated the effectiveness of the Company’s disclosure controls and procedures (as defined in Rules 13a - 15(e) and 15d - 15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)). Based on such evaluation, the chief executive officer and chief financial officer have concluded that, as of the Evaluation Date, the Company’s disclosure controls and procedures are effective, and are reasonably designed to ensure that information required to be disclosed by the Company in reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the Securities and Exchange Commission. These disclosure controls and procedures include without limitation, controls and procedures designed to ensure that information required to be disclosed by the Company in reports that it files or submits under the Exchange Act is accumulated and communicated to the Company’s management, including its chief executive officer and chief financial officer, as appropriate to allow timely decisions regarding disclosure.
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(b) | Management’s Annual Report on Internal Control over Financial Reporting: Management is responsible for establishing and maintaining adequate internal control over financial reporting for the company, as defined in the Exchange Act Rule 13a - 15(f) and 15d -15(f). The company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of the company’s financial statements for external purposes in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board. |
(b) Management’s Annual Report on Internal Control over Financial Reporting: Management is responsible for establishing and maintaining adequate internal control over financial reporting for the Company, as defined in the Exchange Act Rule 13a - 15(f) and 15d -15(f). The Company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of the Company’s financial statements for external purposes in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board.
The company’sCompany’s internal control over financial reporting includes those policies and procedures that:
•Pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect transactions and dispositions of the assets of the company;Company;
•Provide reasonable assurance that the transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the companyCompany are being made only in accordance with authorisations of management and the Directors of the company;Company; and
•Provide reasonable assurance regarding prevention or timely detection of unauthorised acquisition, use, or disposition of the company’sCompany’s assets that could have a material effect on the financial statements.
Because of inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Projections of any evaluation of effectiveness to future periods is subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with policies and procedures may deteriorate.
The company’sCompany’s management assessed the effectiveness of the company’sCompany’s internal control over financial reporting as of the Evaluation Date. In making this assessment, management used the criteria set forth by the Committee of Sponsoring Organisations of the Treadway Commission (COSO) in Internal Control - Integrated Framework and related illustrative documents released on 14 May 2013.Based on this assessment, and using those criteria, management concluded that the company’sCompany’s internal control over financial reporting was effective as of the Evaluation Date.
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(c) | Changes in Internal Control over Financial Reporting: The Company maintains a system of internal control over financial reporting that is designed to provide reasonable assurance that its books and records accurately reflect transactions and that established policies and procedures are followed.
|
(c) Changes in Internal Control over Financial Reporting: The Company maintains a system of internal control over financial reporting that is designed to provide reasonable assurance that its books and records accurately reflect transactions and that established policies and procedures are followed.
There have been no further changes in the company’sCompany’s internal control over financial reporting identified in connection with the evaluation required by paragraph (d) of Exchange Act Rule 13(a) - 15 during the year ended 31 December 20192022 that have materially affected, or are reasonably likely to materially affect, the company’s internal control over financial reporting.
See also “Item 3D,3D: Risk Factors of this annual report on Form 20F for risk factors related—AngloGold Ashanti’s inability to maintainingmaintain an effective system of internal control over financial reporting.reporting may have an adverse effect on investors’ confidence in the reliability of its financial statements.”
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(d) | Attestation Report of the Registered Public Accounting Firm: The Company’s independent registered accounting firm, Ernst & Young Inc., has issued an attestation report on the effectiveness of the company’s internal control over financial reporting. This report appears below.
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(d) Attestation Report of the Registered Public Accounting Firm: The Company’s independent registered accounting firm, Ernst & Young Inc., has issued an attestation report on the effectiveness of the Company’s internal control over financial reporting. This report appears below.
/s/ KC RamonG A Doran
Kandimathie Christine RamonGillian Ann Doran
Chief Financial Officer
/s/ KPM DushniskyA Calderon
Kelvin Paul Michael DushniskyAlberto Calderon
Chief Executive Officer
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
TheTo the Shareholders and the Board of Directors and Shareholders of AngloGold Ashanti Limited
Opinion on Internal Control over Financial Reporting
We have audited AngloGold Ashanti Limited’s (the Company) internal control over financial reporting as of 31 December 2019,2022, based on criteria established in Internal Control-IntegratedControl—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 COSO framework) (the COSO criteria). In our opinion, AngloGold Ashanti Limited (the Company)the Company maintained, in all material respects, effective internal control over financial reporting as of 31 December 2019,2022, based on the COSO criteria.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States)(PCAOB), the consolidated statement of financial position of AngloGold Ashanti Limitedthe Company as of 31 December 2019, 20182022, 2021 and 2017,2020, the related consolidated statements of income, comprehensive income, cash flows and changes in equity for each of the three years in the period ended 31 December 2019,2022, and the related notes and our report dated 2717 March 20202023 expressed an unqualified opinion thereon.
Basis for Opinion
The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Management’s Annual Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects.
Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.
Definition and LimitationLimitations of Internal Control overOver Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
/s/ Ernst & Young Inc.
Johannesburg, Republic of South Africa
2717 March 20202023
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ITEM 16A: | AUDIT COMMITTEE FINANCIAL EXPERT |
275
ITEM 16A: AUDIT COMMITTEE FINANCIAL EXPERT
Membership of the Audit and Risk Committee, including its chairman, comprises only independent non-executive directors, in compliance with the Sarbanes-Oxley Act. This also fulfils the guidelines of King IV, which became effective 1 November 2016, and the requirements of the SA Companies Act, of 2008, which became effective on 1 May 2011. The Sarbanes-Oxley Act requires the board to identify a financial expert from within its ranks. The board has resolved that Mr Rhidwaan GasantMr. Alan Ferguson is the Audit and Risk Committee'sCommittee’s financial expert. Individually, the remaining members of the committeeAudit and Risk Committee have considerable knowledge and experience in associated areas such as audit, risk and corporate governance to help oversee and guide the board and the company.Company.
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ITEM 16B: | CODE OF ETHICS AND WHISTLE-BLOWING POLICIES |
ITEM 16B: CODE OF ETHICS AND WHISTLE-BLOWING POLICIES
In order to comply with the company'sCompany’s obligation in terms of the Sarbanes-Oxley Act and King IV, and in the interests of good governance, the companyCompany has systems and procedures to introduce, monitor and enforce its ethical codes and has adopted a code of business principles and ethics for employees and directors, a code of ethics for the Chief Executive Officer, Chief Financial Officer and Senior Financial Officers, and a whistle-blowing policy that encourages employees to report anonymously if they wish and without fear of retaliation acts of an unethical or illegal nature that affect the company'sCompany’s interests. The code of business principles and ethics expresses the company’sCompany’s commitment to the conduct of its business in line with ethical standards and is designed to enable employees and directors to perform their roles and duties with integrity and responsibility.
The whistle-blowing policy provides channels for employees to report acts and practices that are in conflict with the company’sCompany’s code of business principles and ethics or are unlawful, including financial malpractice or dangers to the public or the environment. Reports may be made to management or through several mediums including the intranet, internet, telephone, short messaging system (sms), fax and post. All reports not made to management are administered by a third party, Tip-Offs Anonymous, to ensure independence of the process. Reported cases are relayed to management through group compliance and group internal audit.compliance. A report is provided by group compliance and group internal audit to the Serious Concerns Committee, a management committee, on a quarterly basis as well as the Social, Ethics and Sustainability Committee and the Audit and Risk Committee on a quarterly basis. Reporters have the option to request feedback on reported cases. The whistle-blowing policy encourages reports to be made in good faith in a responsible and ethical manner. Employees are encouraged to first seek resolution of alleged malpractices through discussion with their direct managers, if appropriate, or other management including legal, compliance, human resources or internal audit.
The code of business principles and ethics for employees and directors and the code of ethics for the Chief Executive Officer, Chief Financial Officer and Senior Financial Officers are available on the company’sCompany’s website at https://www.anglogoldashanti.com/company/sustainability/governance/policies-standards/ .
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ITEM 16C: | PRINCIPAL ACCOUNTANT FEES AND SERVICES |
277
ITEM 16C: PRINCIPAL ACCOUNTANT FEES AND SERVICES
Ernst & Young Inc. has served as AngloGold Ashanti’s independent public accountants for each of the financial years in the three-year period ended 31 December 2019,2022, for which audited financial statements appear in this annual report on Form 20-F.
The following table presents the aggregate fees for professional services and other services rendered by Ernst & Young Inc. to AngloGold Ashanti in 20192022 and 2018.2021.
| | | 2019 |
| | 2018 |
| | 2022 | | 2021 |
(in millions) | $ |
| | $ |
| (in millions) | $ | | $ |
Audit fees(1) | 5.77 |
| | 5.96 |
| Audit fees(1) | 6.45 | | | 5.87 | |
Audit-related fees(2) | 1.14 |
| | 0.76 |
| Audit-related fees(2) | 1.91 | | | 2.10 | |
Tax fees(3) | 0.07 |
| | 0.18 |
| Tax fees(3) | 0.22 | | | 0.03 | |
All other fees(4) | 0.09 |
| | 0.02 |
| All other fees(4) | 0.02 | | | 0.01 | |
Total | 7.07 |
| | 6.92 |
| Total | 8.60 | | | 8.01 | |
Rounding may result in computational differences.
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(1)
| The Audit fees consist of fees billed for the annual audit services engagement and other audit services, which are those services that only the external auditor reasonably can provide, and include the Company audit; statutory audits; attest services; and assistance with and review of documents filed with the SEC. |
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(2)
| Audit-related fees consist of fees billed for assurance and related services. |
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(3)
| Tax fees include fees billed for tax advice and tax compliance services. |
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(4)
| All other fees include non-audit services. |
(1) The Audit fees consist of fees billed for the annual audit services engagement and other audit services, which are those services that only the external auditor reasonably can provide, and include the Company audit; statutory audits; attest services; and assistance with and review of documents filed with the SEC.
(2) Audit-related fees consist of fees billed for assurance and related services.
(3) Tax fees include fees billed for tax advice and tax compliance services.
(4) All other fees include non-audit services.
Audit and Risk Committee Pre-approval Policies and Procedures
It is the policy of AngloGold Ashanti to maintain compliance with the requirements of the various applicable legislation and good governance practices when appointing or assigning work to the Company’s external auditor. Non-audit services may not be undertaken without an employee of AngloGold Ashanti obtaining the pre-approval of the Audit and Risk Committee as is laid out in the procedures relating to the pre-approval process.
The Audit and Risk Committee has delegated the approval authority to the chairman of the committee, Mr. Rhidwaan GasantAlan Ferguson or his designated official. The approval may take the form of a written or oral instruction, and in the case of an oral instruction this would be ratified at the next Audit and Risk Committee meeting. On a half yearly basis a summary of all approvals and work to date is tabled at the Audit and Risk Committee meeting.
All non-audit services provided to AngloGold Ashanti by the principal independent registered public accounting firm during 20192022 were reviewed and approved according to the procedures above. None of the services provided during 20192022 were approved under the de minimis exception allowed under the Exchange Act.
ITEM 16D: EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES
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ITEM 16D: | EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES |
Not applicable.
ITEM 16E: PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS
Neither the issuer nor any affiliate of the issuer purchased any of the company’sCompany’s shares during 2019.2022.
ITEM 16F: CHANGE IN REGISTRANT’S CERTIFYING ACCOUNTANT
Not applicable.On 19 November 2021, PwC was appointed by the AngloGold Ashanti Limited’s Board of Directors as the Company’s independent principal accountants for the financial year ending 31 December 2023 after a formal tender process to appoint a new independent registered public accounting firm. The appointment of PwC was approved by AngloGold Ashanti’s shareholders at the AGM on 16 May 2022. Ernst & Young Inc. (EY) will resign as independent principal accountants of the Group on conclusion of its responsibilities relating to the 31 December 2022 financial year audit, which is expected to conclude during April 2023.
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ITEM 16G: | CORPORATE GOVERNANCE |
The reports of EY on the Company’s consolidated financial statements for the past two fiscal years did not contain an adverse opinion or a disclaimer of opinion, and were not qualified or modified as to uncertainty, audit scope, or accounting principles. In connection with the audits of the Company’s financial statements for each of the two fiscal years ended 31 December 2022, there were (i) no disagreements with EY, as that term is used in Item 16F(a)(1)(iv) of Form 20-F over any matters of accounting principles or practices, financial statement disclosure, or auditing scope or procedures, which, if not resolved to the satisfaction of EY, would have caused EY to make reference to the matter in their report and (ii) there were no “reportable events” as defined in Item 16F(a)(1)(v) of Form 20-F.
AngloGold Ashanti has provided EY with a copy of the foregoing disclosure and has requested EY to provide it with a letter addressed to the SEC stating whether or not EY agrees with the above statements. A copy of such letter, dated 17 March 2023, in which EY state they agree with such disclosure, is filed as an exhibit to this annual report on Form 20-F, see “Item 19: Exhibits to the Form 20-F—Exhibit 19.15.9. “Letter from Ernst & Young Inc. to the Securities and Exchange Commission regarding a change in registrant's certifying accountant”.
ITEM 16G: CORPORATE GOVERNANCE
AngloGold Ashanti’s corporate governance practices do notare regulated by the JSE Listings Requirements. The following is a summary of the significant ways in which South Africa’s corporate governance standards which are followed by AngloGold Ashanti differ in any significant way from those followed by US domestic companies under the New York Stock Exchange’s NYSE Listing Standards. At this time, as described further below, AngloGold Ashanti complies with all of the NYSE Listing Standards as well as the JSE Listings Requirements.
The NYSE Listing Standards require that non-management directors of US-listed companies meet at regularly scheduled executive sessions without management. The JSE Listings Requirements do not require such meetings of listed company non-executive directors. However, management is invited to attend the executive section of board meetings.
The NYSE Listing Standards require US-listed companies to have a nominating/corporate governance listing standards.committee composed entirely of independent directors. The JSE Listings Requirements do not require such a committee but AngloGold Ashanti currently has a Nominations and Governance Committee composed of six non-executive directors, all of whom are independent under the JSE Listings Requirements and NYSE Listing Standards. The Nominations and Governance Committee is chaired by the Chairperson of the AngloGold Ashanti Board.
The NYSE Listing Standards also require US-listed companies to have a compensation committee composed entirely of independent directors. The JSE Listings Requirements merely require that boards have such a committee but not that its members be independent. AngloGold Ashanti has appointed a Remuneration and Human Resources Committee, currently comprised of four non-executive directors, all of whom are independent under the JSE Listings Requirements and NYSE Listing Standards. | |
ITEM 16H: | MINE SAFETY DISCLOSURE |
The NYSE Listings Standards require US-listed companies to have an audit committee composed entirely of independent directors. The SA Companies Act requires that the members of the Audit Committee be approved by shareholders on an annual basis at a company’s annual general meeting. Both the SA Companies Act and the JSE Listings Requirements require that the audit committee be composed entirely of independent directors. AngloGold Ashanti has appointed an Audit and Risk Committee, currently comprising three (pending shareholder approval at the 2023 AGM of the appointment of two additional non-executive directors to the Audit and Risk Committee) non-executive directors, all of whom are independent, as defined under the SA Companies Act, the JSE Listings Requirements and the NYSE Listing Standards.
The SA Companies Act and the JSE Listings Requirements require the appointment of a Social and Ethics Committee, and AngloGold Ashanti has appointed a Social, Ethics and Sustainability Committee, comprising independent non-executive directors.
ITEM 16H: MINE SAFETY DISCLOSURE
The information concerning certain mine safety violations or other regulatory matters required pursuant to Section 1503(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act and this Item 16H of Form 20-F is included in Exhibit 19.16 to this annual report on Form 20-F.
ITEM 16I: DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT
INSPECTIONS
Not applicable.
PART III
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ITEM 17: | FINANCIAL STATEMENTS |
ITEM 17: FINANCIAL STATEMENTS
Not applicable.
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ITEM 18: | FINANCIAL STATEMENTS |
280
ITEM 18: FINANCIAL STATEMENTS
The consolidated financial statements for the year ended 31 December 20192022 were authorised for issue by the Board of Directors on 2715 March 20202023 and were signed on its behalf by Kelvin Paul Michael Dushnisky, Chief Executive Officer, Kandimathie Christine Ramon,Gillan A Doran, Chief Financial Officer, Sipho M. Pityana, ChairmanMaria DC Ramos, Chairperson of the Board of Directors, and Rhidwaan Gasant, ChairmanAlan Ferguson, Chairperson of the Audit and Risk Committee.
The report of independent registered public accounting firm Ernst & Young Inc. Johannesburg, Republic of South Africa (PCAOB ID # 1698) is included in Item 18.
Report of independent registered public accounting firm
To the shareholdersShareholders and the boardBoard of directorsDirectors of AngloGold Ashanti Limited
Opinion on the Financial Statements
We have audited the accompanying consolidated statement of financial position of AngloGold Ashanti Limited (“the Company”)(the Company) as of 31 December 2019, 20182022, 2021 and 2017,2020, the related consolidated statements of income, comprehensive income, cash flows and changes in equity for each of the three years in the period ended 31 December 2019,2022, and the related notes (collectively referred to as the “consolidated financial statements”). In our opinion, based on our audits and the report of other auditors, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at 31 December 2019, 2018,2022, 2021 and 2017,2020, and the results of its operations and its cash flows for each of the three years in the periodthen ended, 31 December 2019, in conformity with International Financial Reporting Standards (“IFRS’IFRS”) as Issuedissued by the International Accounting Standards Board.
We did not audit the financial statements of Kibali (Jersey) Limited (“Kibali”)(Kibali), a corporation in which the Company has a 50% interest. In the consolidated financial statements, the Company’s investment in Kibali was stated at $1,506$1,063 million, $1,439$1,604 million and $1,423$1,604 million as of 31 December 2019, 20182022, 2021 and 2017,2020, respectively, and the Company’s equity in the net income of Kibali was stated at $143$153 million in 2019, $1042022, $231 million in 20182021 and, $9$238 million in 2017.2020. Those statements were audited by other auditors whose report has been furnished to us, and our opinion, insofar as it relates to the amounts included for Kibali, is based solely on the report of the other auditors.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of 31 December 2019,2022, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) and our report dated 2717 March 20202023 expressed an unqualified opinion thereon.
Basis for Opinion
These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the U.S. Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits and the report of other auditors provide a reasonable basis for our opinion.
Critical Audit Matters
The critical audit matters communicated below are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective or complex judgments.judgements. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.
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Description of the Matter | Geita VAT recoverability |
| AtAs disclosed in Note 20 to the consolidated financial statements, at 31 December 2019,2022, the Company’s Geita mine has recorded $119$155 million of VAT receivables due from the Tanzanian Revenue Authority (TRA). $35 million has been classified as current assets, and the remaining $84 million is classified as non-current assets based on management’s estimate of when the Geita mine will be able to offset the VAT receivables with future taxes.
As disclosed in note 22 to the consolidated financial statements, an amendment, effective 20 July 2017, to Tanzania’s mining legislation included an amendment to the VAT Act 2015 to the effect that no input tax credit can be claimed for expenses incurred in the production of raw minerals which are to be exported, resulting in Geita’s VAT input claims being disqualified since then by the Tanzania Revenue Authorities. In the current year, an amendment issued by the Tanzanian Ministry of Minerals, effective 22 February 2019, provided clarity on the definition of raw minerals. This amendment has not yet been accepted by the Tanzanian Revenue Authorities, resulting in
The VAT input claims and offsets from 2017 still not being allowed. The total of VAT input claims submitted since July 2017 is $134 million.
to June 2020 remain disallowed in the current year. In the current year, new correspondence and information was received from the TRA and draft agreements relating to the recovery of the historical VAT claims has been exchanged between The Government of Tanzania and Geita Gold Mine (GGM).
Auditing the recoverabilitymanagement’s probability weighted discounted model and their expected timing of recovery of these receivables involved significant auditor judgement, in assessing whether the TRA will accept the definition of raw minerals and also assessing the timing of when the VAT receivable balance will be recovered. As a result, we requiredincluding the involvement of our tax specialist,specialists, to assess the likelihood of the recovery of the historical VAT claims and a significant amount of time was spentrelated recovery mechanisms in relation to VAT offsetting against taxable income, as well as assessing the position put forward by managementimpact, if any, of the terms of the draft agreements exchanged with The Government of Tanzania. This is because the timing of VAT offsetting depends on forecasts of Geita’s available taxable income, which includes judgements around Geita’s business plan, VAT claims as a percentage of corporate tax offset, assigned weighting and their external legal counsel whilst considering correspondenceprobability per scenario in the model and the interaction with the TRA received to date. timing of the mining license renewal and the end of life of the mine.
|
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How We Addressed the Matter in Our Audit | Our procedures to address this matter included, amongstamong others, obtaining an understanding, evaluating the design and testing the operating effectiveness of certain internal controls over the Company’s assessment of tax law and the process to estimate the recoverability of the VAT receivable.
We read correspondence between management the TRA and the Mining Commission,Tanzanian authorities, including correspondence related to the tax returns and assessments received during the period, to evaluate management’s assumptions, primarily related to the expected timing of the VAT recoverability. As part of our audit procedures, we met with management to understand their strategy to resolve the matter and obtain an update on progress made and discussions that took place with the relevant parties during the year. We also assessed whether the draft agreements exchanged with the Government of Tanzania were consistent with management’s stated strategy to fully recover the carrying value of the receivables.
We read the external legal counsel opinions obtained by management to support their interpretation of the tax legislation for set-offs, in this manner. of the manner undertaken or proposed by the Company.
We involved our tax professionals with specialised skills and knowledge to assist us to evaluatein evaluating the recoverability of the VAT receivable, based on the above correspondence and their interpretation of legislation, including historical payments and offsets received to date, for claims priorin the period July 2017 to July 2017. June 2020.
We assessed the judgements around the timing of VAT offsetting by comparing the Company’s business plan to historical performance. We also evaluated the reasonableness of the annual percentage of VAT to corporate tax offset and weighted probabilities in the model, by assessing the recoverability of forecast VAT offsets and the discounting calculation performed by management on VAT refunds owing.
We evaluated the classificationmanagement’s assessment of the VAT receivables as current or non-current, based on management’s estimated schedulingvarious scenarios in the model, by performing a sensitivity analysis, taking into account alternative weighting probability scenarios.
We assessed the adequacy of setting off the VAT receivables. This scheduling is based on management’s forecasts of available taxable income against which set offs can be made. We evaluated the VAT receivable disclosuredisclosures in Note 20 in the consolidated financial statements.
|
|
| | | | |
Description of the Matter | Rehabilitation and decommissioning provisionEnvironmental rehabilitation obligations |
| At 31 December 20192022, the rehabilitationprovision for decommissioning and decommissioningthe provision for restoration in aggregate amounted to $730$578 million ($619 million classified as non-current liabilities, $15 million classified as current liabilities and $96 million transferred to assets and liabilities held for sale). in the consolidated financial statements.
The Company incurs obligations to close, restore and rehabilitate its mine sites. Auditing the Company’sGroup’s rehabilitation and decommissioning provision iswas complex due to the significance, as well as the high estimation uncertainty, of the provision. The determination of the provision is based on, among other things, judgements and estimates of current damage caused, nature, timing and amount of future costs to be incurred to rehabilitate the mine sites, estimates of future inflation, exchange rates and discount rates. These assumptions are inherently judgemental and subject to change due to continued mining activity and rehabilitation, legislation and environmental changes, which cannot be predicted with certainty. For instance, incertainty and thus requires specific focus each year and the current year the Brazilian Mining Agency issued Resolution 13, which states that tailings storage facilities (TSF) that were built basedinvolvement of specialists on the upstream method should be decommissioned by 15 September 2022. our team.
The Serra Grande mine in Brazil has one upstream TSF that was impacted by this change in legislation, resulting in an increase in the provision. Theconsolidated disclosures are included in Note 27 Environmental rehabilitation and other provisions,1.2 and Note 30 Trade, other payables and provisions25 to the consolidated financial statements.
|
| |
How We Addressed the Matter in Our Audit | Our procedures to address this matter included, amongstamong others, obtaining an understanding, evaluating the design and testing the operating effectiveness of controls over the Company’sGroup’s process to estimate rehabilitation and decommissioning provisions. For example, we tested controls over the determination of key inputs such as life of mine reserves and production profile, discount rates, inflation and exchange rates, and the nature, amount and timing of future rehabilitation costs. With the support of our valuation specialists, we assessed management’s macro-economic assumptions in their rehabilitation models by comparing them to available market information. The most significant of these macro-economic assumptions were the risk-free interest rates, expected inflation and exchange rates. We
To assess the rehabilitation models prepared by management, among other procedures, we tested the mathematical accuracy of the valuation models. Weand compared the timing of the expected cash flows with reference to the life of mine plans for the respective mines. Wemines and compared the current year cash flow assumptions to those of the prior year and considered management’s explanations where these have changed or deviated. We compared the cost rates used by management to publicly available information, as well as ongoing rehabilitation activities undertaken by the Company.
With the support of our environmental specialists, we inquired of operational management whether additional environmental disturbancedamage or changes in the relevant legislation occurred since the prior year that would require additional rehabilitation in the future and compared this information to the current mine plan. Weplan and the currently applicable legislation. Also, with the support of our environmental specialists, we inspected reports of the Company’sGroup’s mine closure plans and assessments of the timing and determination of costs to be incurred prepared by management’s external and internal experts. We, together with our specialists, evaluated the reports prepared by management’s internal experts and external experts, where these had been engaged by management, to assist in the calculationmanagement.
|
| |
Description of the provision. We, together with our specialists, evaluated the scope, competencyMatter | Impairment assessment of AGA Mineração |
| As described in Notes 1.2 and objectivity of the external experts engaged by management, including their professional qualifications, experience, and use of industry accepted methodology. We evaluated the related disclosures in13 to the consolidated financial statements.statements, the Group conducts an impairment test whenever events or changes in circumstances indicate that the carrying amount for a cash generating unit (“CGU”) may not be recoverable. An impairment loss is recognised in the income statement for the amount by which the asset’s carrying amount exceeds its recoverable amount. During the year, the AGA Mineração CGU was disaggregated into two separate CGUs, namely Córrego do Sítio (CdS) and Cuiabá, following management’s reinvestment strategy to assess strategic options for CdS, as a result of the continued underperformance of the CdS complex. Further and in December 2022, processing of gold concentrate at the Queiroz plant which services the Cuiabá mine complex was suspended. These events were impairment indicators, which required the Group to conduct an impairment test on these CGUs.
A gross impairment of $189 million for CdS and $70 million for Cuiabá was recorded for the year ended 31 December 2022. Auditing the assessment of the recoverable amount of these CGUs involved significant auditor judgment, since there are a number of forward looking and other assumptions that require significant estimation, including the extent of economic mineral resource and reserve and associated life of mine plans, discount rate, future gold prices, foreign exchange rates and specifically for Cuiaba, the probability weighted discounted cash flows including the period of suspension of operations at the Queiroz plant due to the completion of structural improvements, as well as the application of judgment around the disaggregation of the AGA Mineração CGU into two CGUs.
|
| | | | | |
| |
Description of the Matter | Planned disposal of the South African Assets |
| On 9 May 2019, management announced that it had commenced a process to review divestment options for its remaining South African assets.
Management performed an assessment of whether the planned disposal of the remaining South African assets met the requirements of IFRS 5 Non-current Assets Held for Sale and Discontinued Operations. The application of IFRS 5 is subjective, particularly in determining whether the completion of the sale is highly probable within 12 months. Management has concluded that this threshold was met at 31 December 2019. On 12 February 2020, prior to the release of the annual financial statements, management announced that a sale and purchase agreement for disposal of the South African assets was signed. Disclosure of this post balance sheet event is included in Note 37 to the consolidated financial statements.
The planned disposal of the remaining South African assets represents a significant change to the composition of the Company’s South African operations, resulting in these assets being reflected as discontinued operations. The results of these businesses and operations, including the adjustment of the carrying value to fair value less cost to sell have been separately presented from continuing operations in the income statement with comparative numbers restated accordingly.
Auditing management’s assessment of IFRS 5 is subjective. In addition, the accounting for discontinued operations is complex in terms of the identification and separation of the financial effects (related income and expenditure) between continuing and discontinued operations, as well as identifying the specific assets and liabilities, including the tax effects, included within the scope of the divestiture.
The disclosures of this matter are included in Note 9 to the consolidated financial statements.
|
How We Addressed the Matter in Our Audit | Our procedures to address this matter included, amongstamong others, obtaining an understanding, evaluating the design and testing the operating effectiveness of controls over the Company’s impairment trigger assessment and the preparation, review and approval of the impairment calculation. For example, we evaluated management’s methods, processes and controls determining the carrying values, and the associated recoverable amounts of each CGU.
We assessed management’s disaggregation of the CGUs by, among other procedures, reference to approve and accountwhether an active market exists for the transaction including separationoutput produced by each CGU.
With the support of financial items between discontinued and continued operations. Through discussions with management and inspection of minutes of meetings,our valuation specialists, we assessed management’s plansmacro-economic assumptions, including future gold prices and foreign exchange rates in their valuation models by comparing them to disposethe latest available market information.
We also involved our valuation specialists to evaluate the discount rate, by independently calculating a discount rate range using available market information and comparing to management’s discount rate. In addition, we performed sensitivity analyses to evaluate the impact of the remaining South African assets. We inquired into the status of the transaction at year-end, read the offer agreements from potential buyers and considered whether the then conditions, including ongoing sales negotiations, met the ‘highly probable’ threshold of IFRS 5 Non-Current Assets Held for Sale and Discontinued Operations at year-end.
We considered management’s estimate of fair value less costs to sell, including the determination of the deferred consideration component, which included assessingreasonably possible changes in the key assumptions applied and evaluating the explanations provided by management through comparing the key assumptions to market data, where available. For example, we compared the future production volumes to the mine plans and involved our specialists to assist with assessing theincluding discount rate, applied by management.
We assessed management’s accounting policiesfuture gold prices and procedures for accounting for discontinued operations under IFRS 5. We considered management’s determination of the operations that should be separated and presented as discontinued operations and compared the assets and liabilities that were reclassified as held for sale to those listed in the sales and purchase agreement. We consideredCuiabá, the impact of currentdelay in the net cash flows due to possible delays in the projected timelines of completion of structural improvements.
To assess the cash flow models prepared by management, among other procedures, we tested the mathematical accuracy and deferred taxescompared relevant data therein to historical performance, as it relateswell as to the planned disposallatest long-term business plans used by management to manage and reclassificationmonitor the performance of the assetsCGUs. We compared the production and liabilities.
cost assumptions in the cash flow models to the current approved life of mine plans.
To test management’s assessment of the scenarios used in the Cuiaba probability weighted discounted cash flow model, we involved our internal valuation and mining engineer specialists to assess the reasonableness of management’s assumptions.
We evaluatedcompared our results to management’s estimated recoverable amounts.
We assessed the adequacy of the disclosures in Note 13 in the consolidated financial statements, including the disclosure of the post-balance sheet events. statements.
|
/s/Ernst & Young Inc.
We have served as the Company’s auditor since 1944
Johannesburg, Republic of South Africa
2717 March 20202023
PAGE LEFT BLANK INTENTIONALLY
ANGLOGOLD ASHANTI LIMITED
Group – income statement
FOR THE YEARS ENDED December 31, DECEMBER 2019, 20182022, 2021 and 20172020
| | | | | | | | | | | | | | | | | | | | |
Figures in millions | Notes | 2022 | | 2021 | | 2020 |
| | | | | | Restated (1) |
| | US Dollars |
Continuing operations | | | | | | |
Revenue from product sales | 3 | 4,501 | | | 4,029 | | | 4,595 | |
Cost of sales | 4 | (3,362) | | | (2,857) | | | (2,829) | |
(Loss) gain on non-hedge derivatives and other commodity contracts | | (6) | | | — | | | (19) | |
Gross profit | 2 | 1,133 | | | 1,172 | | | 1,747 | |
Corporate administration, marketing and related expenses | | (79) | | | (73) | | | (68) | |
Exploration and evaluation costs | | (205) | | | (164) | | | (124) | |
Impairment, derecognition of assets and profit (loss) on disposal | | (304) | | | 11 | | | (1) | |
Other (expenses) income | 5 | (26) | | | (136) | | | (57) | |
Operating profit | | 519 | | | 810 | | | 1,497 | |
Interest income | | 81 | | | 58 | | | 27 | |
Dividend received | | — | | | — | | | 2 | |
Foreign exchange and fair value adjustments | | (128) | | | (43) | | | — | |
Finance costs and unwinding of obligations | 6 | (149) | | | (116) | | | (177) | |
| | | | | | |
Share of associates and joint ventures’ profit | 7 | 166 | | | 249 | | | 278 | |
Profit before taxation | | 489 | | | 958 | | | 1,627 | |
Taxation | 10 | (173) | | | (312) | | | (625) | |
Profit after taxation from continuing operations | | 316 | | | 646 | | | 1,002 | |
Discontinued operations | | | | | | |
Profit (loss) from discontinued operations | | — | | | — | | | 7 | |
Profit (loss) for the year | | 316 | | | 646 | | | 1,009 | |
| | | | | | |
Allocated as follows: | | | | | | |
Equity shareholders | | | | | | |
- Continuing operations | | 297 | | | 622 | | | 984 | |
- Discontinued operations | | — | | | — | | | 7 | |
Non-controlling interests | | | | | | |
- Continuing operations | | 19 | | | 24 | | | 18 | |
| | 316 | | | 646 | | | 1,009 | |
| | | | | | |
Basic earnings (loss) per ordinary share (cents) | 11 | 71 | | | 148 | | | 236 | |
Earnings per ordinary share from continuing operations | | 71 | | | 148 | | | 234 | |
Earnings (loss) per ordinary share from discontinued operations | | — | | | — | | | 2 | |
| | | | | | |
Diluted earnings (loss) per ordinary share (cents) | 11 | 71 | | | 148 | | | 236 | |
Earnings per ordinary share from continuing operations | | 71 | | | 148 | | | 234 | |
Earnings (loss) per ordinary share from discontinued operations | | — | | | — | | | 2 | |
| | | | | | |
(1) Comparative periods have been retrospectively restated, where indicated, due to the initial application of the amendment to IAS 16 "Property, Plant and Equipment - Proceeds before Intended Use" on 1 January 2022. Refer to note 1.
|
| | | | | | | | | |
| | 2019 |
| | 2018 |
| | 2017 |
|
Figures in millions | Notes | | | Restated |
| | Restated |
|
| | US Dollars |
Continuing operations | | | | | | |
Revenue from product sales | 3 | 3,525 |
|
| 3,336 |
|
| 3,394 |
|
Cost of sales | 4 | (2,626 | ) |
| (2,584 | ) |
| (2,607 | ) |
Gain (loss) on non-hedge derivatives and other commodity contracts | | 5 |
|
| (2 | ) |
| — |
|
Gross profit (loss) | 2 | 904 |
| | 750 |
| | 787 |
|
Corporate administration, marketing and other expenses | 5 | (82 | ) | | (76 | ) | | (64 | ) |
Exploration and evaluation costs | | (112 | ) | | (98 | ) | | (105 | ) |
Impairment, derecognition of assets and profit (loss) on disposal | | (6 | ) | | (7 | ) | | (2 | ) |
Other expenses (income) | 6 | (83 | ) | | (79 | ) | | (150 | ) |
Operating profit (loss) | | 621 |
| | 490 |
| | 466 |
|
Interest income | | 14 |
| | 8 |
| | 8 |
|
Dividend received | | — |
| | 2 |
| | — |
|
Foreign exchange losses | | (12 | ) | | (9 | ) | | (11 | ) |
Finance costs and unwinding of obligations | 7 | (172 | ) | | (168 | ) | | (157 | ) |
Share of associates and joint ventures’ profit (loss) | 8 | 168 |
| | 122 |
| | 22 |
|
Profit (loss) before taxation | | 619 |
| | 445 |
| | 328 |
|
Taxation | 12 | (250 | ) | | (212 | ) | | (163 | ) |
Profit (loss) after taxation from continuing operations | | 369 |
| | 233 |
| | 165 |
|
Discontinued operations | | | | | | |
Profit (loss) from discontinued operations | 9 | (376 | ) | | (83 | ) | | (336 | ) |
Profit (loss) for the year | | (7 | ) | | 150 |
| | (171 | ) |
| | | | | | |
Allocated as follows: | | | | | | |
Equity shareholders | | | | | | |
- Continuing operations | | 364 |
| | 216 |
| | 145 |
|
- Discontinued operations | | (376 | ) | | (83 | ) | | (336 | ) |
Non-controlling interests | | | | | | |
- Continuing operations | | 5 |
| | 17 |
| | 20 |
|
| | (7 | ) | | 150 |
| | (171 | ) |
| | | | | | |
Basic earnings (loss) per ordinary share (cents) | 13 | (3 | ) | | 32 |
| | (46 | ) |
Earnings (loss) per ordinary share from continuing operations | | 87 |
| | 52 |
| | 35 |
|
(Loss) earnings per ordinary share from discontinued operations | | (90 | ) | | (20 | ) | | (81 | ) |
| | | | | | |
Diluted earnings (loss) per ordinary share (cents) | 13 | (3 | ) | | 32 |
| | (46 | ) |
Earnings (loss) per ordinary share from continuing operations | | 87 |
| | 52 |
| | 35 |
|
(Loss) earnings per ordinary share from discontinued operations | | (90 | ) | | (20 | ) | | (81 | ) |
| | | | | | |
ANGLOGOLD ASHANTI LIMITED
Group – statement of comprehensive income
FOR THE YEARS ENDED December 31, DECEMBER 2019, 20182022, 2021 and 20172020 | | | | | | | | | | | | | | | | | | | | |
Figures in millions | | 2022 | | 2021 | | 2020 |
| | | | | | Restated (1) |
| | US Dollars |
Profit (loss) for the year | | 316 | | | 646 | | | 1,009 | |
| | | | | | |
Items that will be reclassified subsequently to profit or loss: | | (27) | | | (22) | | | 38 | |
Exchange differences on translation of foreign operations | | (27) | | | (22) | | | 38 | |
| | | | | | |
| | | | | | |
| | | | | | |
| | | | | | |
| | | | | | |
| | | | | | |
Items that will not be reclassified subsequently to profit or loss: | | (47) | | | (83) | | | 86 | |
Exchange differences on translation of non-foreign operations | | (1) | | | (3) | | | (16) | |
Net (loss) gain on equity investments | | (50) | | | (73) | | | 98 | |
Actuarial (loss) gain recognised | | (10) | | | (1) | | | 10 | |
Deferred taxation thereon | | 14 | | | (6) | | | (6) | |
| | | | | | |
Other comprehensive (loss) income for the year, net of tax | | (74) | | | (105) | | | 124 | |
| | | | | | |
Total comprehensive income for the year, net of tax | | 242 | | | 541 | | | 1,133 | |
| | | | | | |
Allocated as follows: | | | | | | |
Equity shareholders | | | | | | |
- Continuing operations | | 223 | | | 517 | | | 1,159 | |
- Discontinued operations | | — | | | — | | | (44) | |
Non-controlling interests | | | | | | |
- Continuing operations | | 19 | | | 24 | | | 18 | |
| | 242 | | | 541 | | | 1,133 | |
(1) Comparative periods have been retrospectively restated, where indicated, due to the initial application of the amendment to IAS 16 "Property, Plant and Equipment - Proceeds before Intended Use" on 1 January 2022. Refer to note 1.
|
| | | | | | | | | | |
Figures in millions | | 2019 |
| | 2018 |
| | 2017 |
| |
| | | | Restated |
| | Restated |
| |
| | US Dollars | |
Profit (loss) for the year | | (7 | ) | | 150 |
| | (171 | ) | |
| | | | | | | |
Items that will be reclassified subsequently to profit or loss: | | 4 |
| | (150 | ) | | 148 |
| |
Exchange differences on translation of foreign operations | | 4 |
| | (150 | ) | | 123 |
| |
Available-for-sale financial assets | | | | | | 25 |
| |
Net gain (loss) on available-for-sale financial assets | |
|
| | | | 20 |
| |
Release on impairment of available-for-sale financial assets | | | | | | 3 |
| |
Release on disposal of available-for-sale financial assets | | | | | | (6 | ) | |
Deferred taxation thereon | | | | | | 8 |
| |
| | | | | | | |
Items that will not be reclassified subsequently to profit or loss: | | 10 |
| | 9 |
| | 6 |
| |
Net gain (loss) on equity investments | | 6 |
| | 9 |
| |
|
| |
Actuarial gain (loss) recognised | | 2 |
| | 5 |
| | 8 |
| |
Deferred taxation thereon | | 2 |
| | (5 | ) | | (2 | ) | |
| | | | | | | |
Other comprehensive income (loss) for the year, net of tax | | 14 |
| | (141 | ) | | 154 |
| |
| | | | | | | |
Total comprehensive income (loss) for the year, net of tax | | 7 |
| | 9 |
| | (17 | ) | |
| | | | | | | |
Allocated as follows: | | | | | | | |
Equity shareholders | | | | | | | |
- Continuing operations | | 378 |
| | 75 |
| | 299 |
| |
- Discontinued operations | | (376 | ) | | (83 | ) | | (336 | ) | |
Non-controlling interests | | | | | | | |
- Continuing operations | | 5 |
| | 17 |
| | 20 |
| |
| | 7 |
| | 9 |
| | (17 | ) | |
ANGLOGOLD ASHANTI LIMITED
Group – statement of financial position
AS AT December 31, DECEMBER 2019, 20182022, 2021 and 20172020 | | | | | | | | | | | | | | | | | | | | |
Figures in millions | Notes | 2022 | | 2021 | | 2020 |
| | | | Restated (1) | | Restated (1) |
| | US Dollars |
ASSETS | | | | | | |
Non-current assets | | | | | | |
Tangible assets | 13 | 4,209 | | | 3,493 | | | 2,917 | |
Right of use assets | 14 | 156 | | | 175 | | | 142 | |
Intangible assets | 15 | 106 | | | 122 | | | 131 | |
Investments in associates and joint ventures | 17 | 1,100 | | | 1,647 | | | 1,651 | |
Other investments | 18 | 3 | | | 117 | | | 188 | |
Inventories | 19 | 5 | | | 27 | | | 69 | |
Trade, other receivables and other assets | 20 | 231 | | | 237 | | | 235 | |
Reimbursive right for post-retirement benefits | 26 | 12 | | | — | | | — | |
Deferred taxation | 27 | 72 | | | 7 | | | 7 | |
Cash restricted for use | 21 | 33 | | | 32 | | | 31 | |
| | | | | | |
| | 5,927 | | | 5,857 | | | 5,371 | |
Current assets | | | | | | |
| | | | | | |
Inventories | 19 | 773 | | | 703 | | | 733 | |
Trade, other receivables and other assets | 20 | 237 | | | 260 | | | 229 | |
Cash restricted for use | 21 | 27 | | | 26 | | | 42 | |
Cash and cash equivalents | 22 | 1,108 | | | 1,154 | | | 1,330 | |
| | | | | | |
| | | | | | |
| | 2,145 | | | 2,143 | | | 2,334 | |
| | | | | | |
Total assets | | 8,072 | | | 8,000 | | | 7,705 | |
EQUITY AND LIABILITIES | | | | | | |
Share capital and premium | 23 | 7,239 | | | 7,223 | | | 7,214 | |
Accumulated losses and other reserves | | (3,139) | | | (3,181) | | | (3,486) | |
Shareholders’ equity | | 4,100 | | | 4,042 | | | 3,728 | |
Non-controlling interests | | 34 | | | 52 | | | 45 | |
Total equity | | 4,134 | | | 4,094 | | | 3,773 | |
| | | | | | |
Non-current liabilities | | | | | | |
Borrowings | 24 | 1,965 | | | 1,858 | | | 1,789 | |
Lease liabilities | 14 | 102 | | | 124 | | | 116 | |
Environmental rehabilitation and other provisions | 25 | 634 | | | 729 | | | 731 | |
Provision for pension and post-retirement benefits | 26 | 71 | | | 77 | | | 83 | |
Trade, other payables and provisions | 28 | 7 | | | 7 | | | 8 | |
Deferred taxation | 27 | 300 | | | 313 | | | 246 | |
| | 3,079 | | | 3,108 | | | 2,973 | |
Current liabilities | | | | | | |
Borrowings | 24 | 18 | | | 51 | | | 142 | |
Lease liabilities | 14 | 84 | | | 61 | | | 37 | |
Trade, other payables and provisions | 28 | 710 | | | 647 | | | 627 | |
Bank overdraft | | 2 | | | — | | | — | |
Taxation | 29 | 45 | | | 39 | | | 153 | |
| | | | | | |
| | | | | | |
| | 859 | | | 798 | | | 959 | |
| | | | | | |
Total liabilities | | 3,938 | | | 3,906 | | | 3,932 | |
| | | | | | |
Total equity and liabilities | | 8,072 | | | 8,000 | | | 7,705 | |
(1) The tangible assets and accumulated losses and other reserve balances for 31 December 2021 and 31 December 2020 have been retrospectively restated and increased with $33m due to the initial application of the amendment to IAS 16 “Property, Plant and Equipment - Proceeds before Intended Use” on 1 January 2022. Refer to note 1.
|
| | | | | | | | | |
Figures in millions | Notes | 2019 |
| | 2018 |
| | 2017 |
|
| | US Dollars |
ASSETS | | | | | | |
Non-current assets | | | | | | |
Tangible assets | 15 | 2,592 |
| | 3,381 |
| | 3,742 |
|
Right of use assets | 16 | 158 |
| | | | |
Intangible assets | 17 | 123 |
| | 123 |
| | 138 |
|
Investments in associates and joint ventures | 19 | 1,581 |
| | 1,528 |
| | 1,507 |
|
Other investments | 20 | 76 |
| | 141 |
| | 131 |
|
Inventories | 21 | 93 |
| | 106 |
| | 100 |
|
Trade, other receivables and other assets | 22 | 122 |
| | 102 |
| | 67 |
|
Deferred taxation | 29 | 105 |
| | — |
| | 4 |
|
Cash restricted for use | 23 | 31 |
| | 35 |
| | 37 |
|
| | 4,881 |
| | 5,416 |
| | 5,726 |
|
Current assets | | | | | | |
Other investments | 20 | 10 |
| | 6 |
| | 7 |
|
Inventories | 21 | 632 |
| | 652 |
| | 683 |
|
Trade, other receivables and other assets | 22 | 250 |
| | 209 |
| | 222 |
|
Cash restricted for use | 23 | 33 |
| | 31 |
| | 28 |
|
Cash and cash equivalents | 24 | 456 |
| | 329 |
| | 205 |
|
| | 1,381 |
| | 1,227 |
| | 1,145 |
|
Assets held for sale | 9 | 601 |
| | — |
| | 348 |
|
| | 1,982 |
|
| 1,227 |
|
| 1,493 |
|
| | | | | | |
Total assets | | 6,863 |
|
| 6,643 |
|
| 7,219 |
|
EQUITY AND LIABILITIES | | | | | | |
Share capital and premium | 25 | 7,199 |
| | 7,171 |
| | 7,134 |
|
Accumulated losses and other reserves | | (4,559 | ) | | (4,519 | ) | | (4,471 | ) |
Shareholders’ equity | | 2,640 |
| | 2,652 |
| | 2,663 |
|
Non-controlling interests | | 36 |
| | 42 |
| | 41 |
|
Total equity | | 2,676 |
| | 2,694 |
| | 2,704 |
|
| | | | | | |
Non-current liabilities | | | | | | |
Borrowings | 26 | 1,299 |
| | 1,911 |
| | 2,230 |
|
Lease liabilities | 16 | 126 |
| | | | |
Environmental rehabilitation and other provisions | 27 | 697 |
| | 827 |
| | 942 |
|
Provision for pension and post-retirement benefits | 28 | 100 |
| | 100 |
| | 122 |
|
Trade, other payables and provisions | 30 | 15 |
| | 3 |
| | 3 |
|
Deferred taxation | 29 | 241 |
| | 315 |
| | 363 |
|
| | 2,478 |
| | 3,156 |
| | 3,660 |
|
Current liabilities | | | | | | |
Borrowings | 26 | 734 |
| | 139 |
| | 38 |
|
Lease liabilities | 16 | 45 |
| | | | |
Trade, other payables and provisions | 30 | 586 |
| | 594 |
| | 638 |
|
Taxation | 31 | 72 |
| | 60 |
| | 53 |
|
| | 1,437 |
| | 793 |
| | 729 |
|
Liabilities held for sale | 9 | 272 |
| | — |
| | 126 |
|
| | 1,709 |
|
| 793 |
|
| 855 |
|
| | | | | | |
Total liabilities | | 4,187 |
| | 3,949 |
| | 4,515 |
|
| | | | | | |
Total equity and liabilities | | 6,863 |
| | 6,643 |
| | 7,219 |
|
ANGLOGOLD ASHANTI LIMITED
Group – statement of cash flows
FOR THE YEARS ENDED December 31, DECEMBER 2019, 20182022, 2021 and 20172020 | | | | | | | | | | | | | | | | | | | | |
Figures in millions | Notes | 2022 | | 2021 | | 2020 |
| | | | | | Restated (1) |
| | | | | | |
| | US Dollars |
Cash flows from operating activities | | | | | | |
Receipts from customers | | 4,517 | | | 4,054 | | | 4,580 | |
Payments to suppliers and employees | | (3,273) | | | (2,701) | | | (2,714) | |
Cash generated from operations | 30 | 1,244 | | | 1,353 | | | 1,866 | |
Dividends received from joint ventures | | 694 | | | 231�� | | | 148 | |
Taxation refund | 29 | 32 | | | 20 | | | — | |
Taxation paid | 29 | (166) | | | (336) | | | (431) | |
Net cash inflow (outflow) from operating activities from continuing operations | | 1,804 | | | 1,268 | | | 1,583 | |
Net cash inflow (outflow) from operating activities from discontinued operations | | — | | | — | | | 109 | |
Net cash inflow (outflow) from operating activities | | 1,804 | | | 1,268 | | | 1,692 | |
| | | | | | |
Cash flows from investing activities | | | | | | |
Capital expenditure | | | | | | |
- project capital | 13 | (378) | | | (392) | | | (369) | |
- stay-in-business capital | 13 | (650) | | | (635) | | | (370) | |
Interest capitalised and paid | | (2) | | | (14) | | | (17) | |
Acquisition of assets | 13 | (517) | | | — | | | — | |
Acquisition of intangible assets | | — | | | (1) | | | (1) | |
Dividends from associates and other investments | | 18 | | | 22 | | | 9 | |
Proceeds from disposal of tangible assets | | 8 | | | 25 | | | 3 | |
Other investments and assets acquired | | (16) | | | (4) | | | (8) | |
| | | | | | |
Proceeds from disposal of other investments | | — | | | — | | | 9 | |
| | | | | | |
Proceeds from disposal of joint ventures | | — | | | 2 | | | 26 | |
Loans advanced | | (1) | | | (15) | | | — | |
| | | | | | |
Loans repaid by associates and joint ventures | | — | | | — | | | 12 | |
Recognition of joint operation - cash | | — | | | — | | | 2 | |
| | | | | | |
Proceeds from disposal of discontinued assets and subsidiaries | | — | | | — | | | 200 | |
| | | | | | |
| | | | | | |
Decrease (increase) in cash restricted for use | | (4) | | | 14 | | | (9) | |
Interest received | | 81 | | | 58 | | | 27 | |
Net cash inflow (outflow) from investing activities from continuing operations | | (1,461) | | | (940) | | | (486) | |
Net cash outflow from investing activities from discontinued operations | | — | | | — | | | (31) | |
Cash in subsidiaries sold and transferred to held for sale | | — | | | — | | | 3 | |
Net cash inflow (outflow) from investing activities | | (1,461) | | | (940) | | | (514) | |
| | | | | | |
Cash flows from financing activities | | | | | | |
Proceeds from borrowings | 24 | 266 | | | 822 | | | 2,226 | |
Repayment of borrowings | 24 | (184) | | | (820) | | | (2,310) | |
Repayment of lease liabilities | 14 | (82) | | | (63) | | | (47) | |
Finance costs - borrowings | 24 | (99) | | | (111) | | | (110) | |
Finance costs - leases | 14 | (10) | | | (9) | | | (8) | |
Other borrowing costs | | (11) | | | (35) | | | (33) | |
Dividends paid | | (203) | | | (240) | | | (47) | |
Net cash outflow from financing activities from continuing operations | | (323) | | | (456) | | | (329) | |
| | | | | | |
| | | | | | |
| | | | | | |
Net increase (decrease) in cash and cash equivalents | | 20 | | | (128) | | | 849 | |
Translation | | (68) | | | (48) | | | 25 | |
Cash and cash equivalents at beginning of year | | 1,154 | | | 1,330 | | | 456 | |
Cash and cash equivalents at end of year (2) | 22 | 1,106 | | | 1,154 | | | 1,330 | |
(1) Comparative periods have been retrospectively restated, where indicated, due to the initial application of the amendment to IAS 16 "Property, Plant and Equipment - Proceeds before Intended Use" on 1 January 2022. Refer to note 1.
(2) Cash and cash equivalents at the end of December 2022 is net of a bank overdraft of $2m.
|
| | | | | | | | | |
Figures in millions | Notes | 2019 |
| | 2018 |
| | 2017 |
|
| | | | Restated |
| | Restated |
|
| | US Dollars |
Cash flows from operating activities | | | | | | |
Receipts from customers | | 3,535 |
| | 3,339 |
| | 3,418 |
|
Payments to suppliers and employees | | (2,433 | ) | | (2,408 | ) | | (2,351 | ) |
Cash generated from operations | 32 | 1,102 |
| | 931 |
| | 1,067 |
|
Dividends received from joint ventures | | 77 |
| | 91 |
| | 6 |
|
Taxation refund | 31 | 7 |
| | 5 |
| | 14 |
|
Taxation paid | 31 | (228 | ) | | (171 | ) | | (174 | ) |
Net cash inflow (outflow) from operating activities from continuing operations | | 958 |
| | 856 |
| | 913 |
|
Net cash inflow (outflow) from operating activities from discontinued operations | | 89 |
| | 1 |
| | 84 |
|
Net cash inflow (outflow) from operating activities | | 1,047 |
| | 857 |
| | 997 |
|
| | | | | | |
Cash flows from investing activities | | | | | | |
Capital expenditure | | | | | | |
- project capital | | (336 | ) | | (170 | ) | | (132 | ) |
- stay-in-business capital | | (367 | ) | | (405 | ) | | (543 | ) |
Interest capitalised and paid | | (6 | ) | | — |
| | — |
|
Dividends from other investments | | — |
| | 2 |
| | — |
|
Proceeds from disposal of tangible assets | | 3 |
| | 10 |
| | 3 |
|
Other investments acquired | | (9 | ) | | (13 | ) | | (8 | ) |
Proceeds from disposal of other investments | | 3 |
| | 7 |
| | 3 |
|
Investments in associates and joint ventures | | (5 | ) | | (8 | ) | | (27 | ) |
Loans advanced to associates and joint ventures | | (3 | ) | | (5 | ) | | (6 | ) |
Loans repaid by associates and joint ventures | | 23 |
| | 22 |
| | — |
|
Decrease (increase) in cash restricted for use | | — |
| | (6 | ) | | (8 | ) |
Interest received | | 14 |
| | 5 |
| | 7 |
|
Net cash inflow (outflow) from investing activities from continuing operations | | (683 | ) | | (561 | ) | | (711 | ) |
Net cash inflow (outflow) from investing activities from discontinued operations | | (54 | ) | | 226 |
| | (151 | ) |
Cash in subsidiaries sold and transferred to held for sale | | (6 | ) | | — |
| | — |
|
Net cash inflow (outflow) from investing activities | | (743 | ) | | (335 | ) | | (862 | ) |
| | | | | | |
Cash flows from financing activities | | | | | | |
Proceeds from borrowings | | 168 |
| | 753 |
| | 815 |
|
Repayment of borrowings | | (123 | ) | | (967 | ) | | (767 | ) |
Repayment of lease liabilities | | (42 | ) | |
|
| |
|
|
Finance costs - borrowings | 26 | (128 | ) | | (130 | ) | | (138 | ) |
Finance costs - leases | | (9 | ) | | | | |
Bond settlement premium, RCF and bond transaction costs | | — |
| | (10 | ) | | — |
|
Dividends paid | | (43 | ) | | (39 | ) | | (58 | ) |
Net cash inflow (outflow) from financing activities from continuing operations | | (177 | ) | | (393 | ) | | (148 | ) |
Net cash inflow (outflow) from financing activities from discontinued operations | | — |
| | — |
| | — |
|
Net cash inflow (outflow) from financing activities | | (177 | ) | | (393 | ) | | (148 | ) |
| | | | | | |
Net increase (decrease) in cash and cash equivalents | | 127 |
| | 129 |
| | (13 | ) |
Translation | | — |
| | (5 | ) | | 3 |
|
Cash and cash equivalents at beginning of year | | 329 |
| | 205 |
| | 215 |
|
Cash and cash equivalents at end of year | 24 | 456 |
| | 329 |
| | 205 |
|
ANGLOGOLD ASHANTI LIMITED
Group – statement of changes in equity
FOR THE YEARS ENDED December 31, DECEMBER 2019, 20182022, 2021 and 20172020
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Equity holders of the parent | | | |
Figures in millions | Share capital and premium | Other capital reserves(2) | Retained earnings (Accumulated losses)(1) | Fair value through OCI | | Actuarial gains (losses) | Foreign currency translation reserve (3) | Total | Non- controlling interests | Total equity |
US Dollars | | | | | | | | | | |
| | | | | | | | | | |
| | | | | | | | | | |
Balance at 31 December 2019 Restated | 7,199 | | 83 | | (3,273) | | 45 | | | (10) | | (1,409) | | 2,635 | | 36 | | 2,671 | |
Profit (loss) for the year | — | | — | | 991 | | — | | | — | | — | | 991 | | 18 | | 1,009 | |
Other comprehensive income (loss) | — | | — | | — | | 92 | | 10 | | 22 | | 124 | | — | | 124 | |
Total comprehensive income (loss) | — | | — | | 991 | | 92 | | 10 | | 22 | | 1,115 | | 18 | | 1,133 | |
Shares issued | 15 | | — | | — | | — | | | — | | — | | 15 | | — | | 15 | |
Share-based payment for share awards net of exercised | — | | (3) | | — | | — | | | — | | — | | (3) | | — | | (3) | |
Dividends paid (note 12) | — | | — | | (38) | | — | | | — | | — | | (38) | | — | | (38) | |
Dividends of subsidiaries | — | | — | | — | | — | | | — | | — | | — | | (9) | | (9) | |
Recognition of joint operation | | | 4 | | | | | | 4 | | | 4 | |
Transfer on disposal and derecognition of equity investments | — | | — | | 6 | | (6) | | | — | | — | | — | | — | | — | |
Translation | — | | (3) | | 2 | | — | | | 1 | | — | | — | | — | | — | |
Balance at 31 December 2020 Restated | 7,214 | | 77 | | (2,308) | | 131 | | | 1 | | (1,387) | | 3,728 | | 45 | | 3,773 | |
Profit (loss) for the year | — | | — | | 622 | | — | | | — | | — | | 622 | | 24 | | 646 | |
Other comprehensive income (loss) | — | | — | | — | | (78) | | | (2) | | (25) | | (105) | | — | | (105) | |
Total comprehensive income (loss) | — | | — | | 622 | | (78) | | | (2) | | (25) | | 517 | | 24 | | 541 | |
Shares issued | 9 | | — | | — | | — | | | — | | — | | 9 | | — | | 9 | |
Share-based payment for share awards net of exercised | — | | 11 | | — | | — | | | — | | — | | 11 | | — | | 11 | |
Dividends paid (note 12) | — | | — | | (224) | | — | | | — | | — | | (224) | | — | | (224) | |
Dividends of subsidiaries | — | | — | | — | | — | | | — | | — | | — | | (16) | | (16) | |
| | | | | | | | | | |
| | | | | | | | | | |
Translation | — | | (4) | | 6 | | — | | | (1) | | — | | 1 | | (1) | | — | |
Balance at 31 December 2021 Restated | 7,223 | | 84 | | (1,904) | | 53 | | | (2) | | (1,412) | | 4,042 | | 52 | | 4,094 | |
Profit (loss) for the year | | | 297 | | | | | | 297 | | 19 | | 316 | |
Other comprehensive income (loss) | | | | (36) | | | (10) | | (28) | | (74) | | | (74) | |
Total comprehensive income (loss) | — | | — | | 297 | | (36) | | | (10) | | (28) | | 223 | | 19 | | 242 | |
Shares issued | 16 | | | | | | | | 16 | | | 16 | |
| | | | | | | | | | |
Dividends paid (note 12) | — | | — | | (181) | | — | | | — | | — | | (181) | | — | | (181) | |
Dividends of subsidiaries | — | | — | | | — | | | — | | — | | — | | (37) | | (37) | |
| | | | | | | | | | |
Transfer on derecognition of equity investment | — | | — | | 69 | | (69) | | | — | | — | | — | | — | | — | |
Translation | — | | (3) | | 4 | | — | | | (1) | | — | | — | | — | | — | |
Balance at 31 December 2022 | 7,239 | | 81 | | (1,715) | | (52) | | | (13) | | (1,440) | | 4,100 | | 34 | | 4,134 | |
(1)The (Accumulated losses) Retained earnings balances have been restated, where indicated, due to the initial application of the amendment to IAS 16 “Property, Plant and Equipment - Proceeds before Intended Use” on 1 January 2022. Refer to note 1.
(2)Other capital reserves include a surplus on disposal of Company shares held by companies prior to the formation of AngloGold Ashanti Limited of $8m (2021: $9m; 2020: $10m), surplus on equity transaction of joint venture of $36m (2021: $36m; 2020: $36m), equity items for share-based payments of $39m (2021: $41m; 2020: $33m) and other reserves.
(3) Foreign currency translation reserve includes a loss of $1,400m (2021: $1,399m; 2020: $1,396m) that will not re-cycle through the Income statement on disposal of the non-foreign operations, and a loss of $40m (2021: $13m: 2020: $9m gain) relating to the foreign operations that will re-cycle through the Income statement on disposal.
|
| | | | | | | | | | | | | | | | | | | | |
| Equity holders of the parent | | | |
Figures in millions | Share capital and premium |
| Other capital reserves(1) |
| Retained earnings (Accumulated losses)(2) |
| Fair value through OCI |
| Available- for-sale reserve |
| Actuarial gains (losses) |
| Foreign currency translation reserve |
| Total |
| Non- controlling interests |
| Total equity |
|
US Dollars | | | | | | | | | | |
Balance at 31 December 2016 | 7,108 |
| 116 |
| (3,119 | ) |
|
| 17 |
| (21 | ) | (1,386 | ) | 2,715 |
| 39 |
| 2,754 |
|
Profit (loss) for the year | — |
| — |
| (191 | ) |
| — |
| — |
| — |
| (191 | ) | 20 |
| (171 | ) |
Other comprehensive income (loss) | — |
| — |
| — |
|
| 25 |
| 6 |
| 123 |
| 154 |
| — |
| 154 |
|
Total comprehensive income (loss) | — |
| — |
| (191 | ) | | 25 |
| 6 |
| 123 |
| (37 | ) | 20 |
| (17 | ) |
Shares issued | 26 |
| — |
| — |
|
| — |
| — |
| — |
| 26 |
| — |
| 26 |
|
Share-based payment for share awards net of exercised | — |
| (1 | ) | — |
|
| — |
| — |
| — |
| (1 | ) | — |
| (1 | ) |
Dividends paid (note 14) | — |
| — |
| (39 | ) |
| — |
| — |
| — |
| (39 | ) | — |
| (39 | ) |
Dividends of subsidiaries | — |
| — |
| — |
|
| — |
| — |
| — |
| — |
| (19 | ) | (19 | ) |
Translation | — |
| 9 |
| (10 | ) |
| 1 |
| (1 | ) | — |
| (1 | ) | 1 |
| — |
|
Balance at 31 December 2017 | 7,134 |
| 124 |
| (3,359 | ) |
|
| 43 |
| (16 | ) | (1,263 | ) | 2,663 |
| 41 |
| 2,704 |
|
Impact of adopting IFRS 9 | — |
| — |
| 10 |
| 33 |
| (43 | ) | — |
| — |
| — |
| — |
| — |
|
Opening balance under IFRS 9 | 7,134 |
| 124 |
| (3,349 | ) | 33 |
| — |
| (16 | ) | (1,263 | ) | 2,663 |
| 41 |
| 2,704 |
|
Profit (loss) for the year | — |
| — |
| 133 |
| — |
|
| — |
| — |
| 133 |
| 17 |
| 150 |
|
Other comprehensive income (loss) | — |
| — |
| — |
| 5 |
|
|
| 4 |
| (150 | ) | (141 | ) | — |
| (141 | ) |
Total comprehensive income (loss) | — |
| — |
| 133 |
| 5 |
|
|
| 4 |
| (150 | ) | (8 | ) | 17 |
| 9 |
|
Shares issued | 37 |
| — |
| — |
| — |
|
| — |
| — |
| 37 |
| — |
| 37 |
|
Share-based payment for share awards net of exercised | — |
| (17 | ) | — |
| — |
|
| — |
| — |
| (17 | ) | — |
| (17 | ) |
Dividends paid (note 14) | — |
| — |
| (24 | ) | — |
| | — |
| — |
| (24 | ) | — |
| (24 | ) |
Dividends of subsidiaries | — |
| — |
| — |
| — |
|
| — |
| — |
| — |
| (15 | ) | (15 | ) |
Transfer of gain on disposal of equity investments | — |
| — |
| 1 |
| (1 | ) |
|
| — |
| — |
| — |
| — |
| — |
|
Translation | — |
| (11 | ) | 12 |
| — |
|
|
| — |
| — |
| 1 |
| (1 | ) | — |
|
Balance at 31 December 2018 | 7,171 |
| 96 |
| (3,227 | ) | 37 |
|
|
| (12 | ) | (1,413 | ) | 2,652 |
| 42 |
| 2,694 |
|
Profit (loss) for the year | — |
| — |
| (12 | ) | — |
|
| — |
| — |
| (12 | ) | 5 |
| (7 | ) |
Other comprehensive income (loss) | — |
| — |
| — |
| 8 |
| | 2 |
| 4 |
| 14 |
| — |
| 14 |
|
Total comprehensive income (loss) | | | (12 | ) | 8 |
| | 2 |
| 4 |
| 2 |
| 5 |
| 7 |
|
Shares issued | 28 |
| — |
| — |
| — |
|
| — |
| — |
| 28 |
| — |
| 28 |
|
Share-based payment for share awards net of exercised | — |
| (10 | ) | — |
| — |
|
| — |
| — |
| (10 | ) | — |
| (10 | ) |
Dividends paid (note 14) | — |
| — |
| (27 | ) | — |
|
|
| — |
| — |
| (27 | ) | — |
| (27 | ) |
Dividends of subsidiaries | — |
| — |
| — |
| — |
|
| — |
| — |
| — |
| (16 | ) | (16 | ) |
Transactions with non-controlling interests | — |
| (4 | ) | — |
| — |
| | — |
| — |
| (4 | ) | 4 |
| — |
|
Translation | — |
| 1 |
| (2 | ) | — |
| | — |
| — |
| (1 | ) | 1 |
| — |
|
Balance at 31 December 2019 | 7,199 |
| 83 |
| (3,268 | ) | 45 |
|
|
| (10 | ) | (1,409 | ) | 2,640 |
| 36 |
| 2,676 |
|
F - 11
| |
(1)
| Other capital reserves include a surplus on disposal of company shares held by companies prior to the formation of AngloGold Ashanti Limited of $10m (2018: $10m; 2017: $11m), surplus on equity transaction of joint venture of $36m (2018: $36m; 2017: $36m), equity items for share-based payments of $39m (2018: $48m; 2017: $75m) and other reserves. |
| |
(2)
| Included in accumulated losses are retained earnings totalling $378m (2018: $283m; 2017: $287m) arising at the equity accounted investments and certain subsidiaries which may not be remitted without third party consent. |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
ANGLOGOLD ASHANTI LIMITED
Notes to the consolidated financial statements
FOR THE YEARS ENDED 31 December, 2019, 20182022, 2021 and 20172020
1 ACCOUNTING POLICIESSTATEMENT OF COMPLIANCE
Statement of compliance
The consolidated and company financial statements are prepared in compliance with International Financial Reporting Standards (IFRS) and Interpretations of those standards, as issued by the International Accounting Standards Board (IASB), SAICA Financial Reporting Guides as issued by the Accounting Practices Committee, Financial Reporting Pronouncements as issued by the Financial Reporting Standards Council, JSE Listings Requirements and in the manner required by the South African Companies Act, 2008.
New standards and interpretations issued
The financial statements have been drawn up on the basis of accountingAccounting standards, interpretations and amendments to published accounting standards
The following amendments to IFRS were effective atfor the first time from 1 January 2022:
•Amendments to IAS 16 ‘Property, plant and equipment’ relating to proceeds before intended use;
The Group adopted the amendment to IAS 16 “Property, Plant and Equipment - Proceeds before Intended Use” on 1 January 2022. The amendment prohibits deducting from the cost of an item of property, plant and equipment any proceeds from selling items produced while bringing that asset to the location and condition necessary for it to be capable of operating in the manner intended by management. Instead, an entity recognises the proceeds from selling such items, and the cost of producing those items, in profit or loss. The cost allocation requires significant judgement in terms of this amendment. In accordance with the transitional provisions of IAS 16 an entity applies the amendments retrospectively to items of property, plant and equipment made available for use on or after the beginning of the accountingearliest period on 1 January 2019. presented when the entity first applies the amendment.
The adoption of the new standards, interpretations and amendments effective fromamendment on 1 January 2019 had the following impact on the group:
IFRS 16 Leases
The group elected to apply IFRS 16 utilising the modified retrospective approach, no cumulative effect of initially applying IFRS 16 was identified and recognised as an adjustment to the opening balance of retained earnings. The cumulative impact on the adoption of IFRS 162022 resulted in the recognitiona retrospective increase in property, plant and equipment and gross profit of right$38m for 31 December 2020 (2019: decrease of use assets, lease liabilities and the resultant deferred tax. Refer to Note 16 for the detail on the right of use assets and lease liabilities. Comparative information has not been restated.
For contracts previously classified as leases under IAS 17 Leases, the group has reassessed whether the contract is or contains a lease upon initial transition to the new standard and has also performed an assessment to identify significant contracts which have not previously classified as leases, but which may be a lease under the new standard.
The group applied the following practical expedients upon transition to IFRS 16:
Transition options:
Leases with a remaining contract period of less than 12 months will not be recorded on the statement of financial position and the lease payments will be expensed in the income statement on a straight-line basis.
The right-of-use asset is based on the lease liability recognised.
Practical expedients:
The short-term lease exemption - leases with a duration of one year or less will be expensed in the income statement on a straight-line basis.
The low value lease exemption - the group has elected to take the low value exemption with a value of $10k for the individual leased asset value. Further, the group has added an exception within its accounting policy to not capitalise leases with a net present value of $250k based on an IAS 1 materiality assessment.
Exclusion of initial direct costs for the measurement of the right of use asset at the date of initial application.
Use of hindsight in determining the lease term where the contract contains options to extend or terminate the lease.
The leases accounting policy applicable from 1 January 2019 is included under “Leases” in Annexure A.
CHANGE IN DISCLOSURE
Effective 1 January 2019, the group changed the disclosure of “Special Items” in the income statement. In prior years, the group disclosed items that due to their size and/or nature, required separate disclosure on the face of the income statement as Special Items. In addition, a disclosure category, “Other operating expenses”,$5m). There was reported to disclose expenses which were not included in gross profit. Going forward these two categories of expenses and income will be disclosed as:
Other expenses (income); and
Separate line item(s) on the face of the income statement depending on materiality.
The re-presentation provides more useful information by reporting material items separately. The change in presentation has no impact on the reported totals, headline earnings per share or on amounts presented2021 results as no revenue was capitalised in 2021. The effects of the 2019 and 2020 restatement has been included in the Statementaccumulated losses opening balance of Financial Position.the 2020 and 2021 financial reporting period respectively. The impact arises from the reclassification of revenue, cost of sales, and tangible assets and the resulting amortisation recalculation, resulting exclusively from the redevelopment of the Obuasi mine. No other operation was impacted by the adoption of the amendment
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
| | | | | | | | | | | | | | | | | | | | |
| 2021 | 2020 |
US Dollar million | As previously reported | Adjustments |
Restated |
As previously reported | Adjustments | Restated |
Statement of financial position | | | | | | |
Tangible assets (note 13) | 3,460 | | 33 | | 3,493 | | 2,884 | | 33 | | 2,917 | |
(Accumulated losses) and other reserves | (3,214) | | 33 | | (3,181) | | (3,519) | | 33 | | (3,486) | |
| | | | | | |
Income statement | | | | | | |
Revenue from product sales (note 3) | 4,029 | | — | | 4,029 | | 4,427 | | 168 | | 4,595 | |
Cost of sales (note 4) | (2,857) | | — | | (2,857) | | (2,699) | | (130) | | (2,829) | |
Gross profit | 1,172 | | — | | 1,172 | | 1,709 | | 38 | | 1,747 | |
Operating profit | 810 | | — | | 810 | | 1,459 | | 38 | | 1,497 | |
Profit before taxation | 958 | | — | | 958 | | 1,589 | | 38 | | 1,627 | |
Profit after taxation from continuing operations | 646 | | — | | 646 | | 964 | | 38 | | 1,002 | |
Profit for the year | 646 | | — | | 646 | | 971 | | 38 | | 1,009 | |
| | | | | | |
Basic earnings per ordinary share (US cents) (1) (note 11) | 148 | | — | | 148 | | 227 | | 9 | | 236 | |
Basic earnings per ordinary share (US cents) from continuing operations (note 11) | 148 | | — | | 148 | | 225 | | 9 | | 234 | |
Diluted earnings per ordinary share (US cents) (1) (note 11) | 148 | | — | | 148 | | 227 | | 9 | | 236 | |
Diluted earnings per ordinary share (US cents) from continuing operations (note 11) | 148 | | — | | 148 | | 225 | | 9 | | 234 | |
| | | | | | |
Statement of Comprehensive Income | | | | | | |
Profit for the year | 646 | | — | | 646 | | 971 | | 38 | | 1,009 | |
Total comprehensive income for the year | 541 | | — | | 541 | | 1,095 | | 38 | | 1,133 | |
Equity shareholders - Continuing operations | 517 | | — | | 517 | | 1,121 | | 38 | | 1,159 | |
| | | | | | |
Statement of changes in equity | | | | | | |
Retained earnings (Accumulated losses) | (1,937) | | 33 | | (1,904) | | (2,341) | | 33 | | (2,308) | |
| | | | | | |
Statement of cash flows | | | | | | |
Receipts from customers | 4,054 | | — | | 4,054 | | 4,411 | | 169 | | 4,580 | |
Payments to suppliers and employees | (2,701) | | — | | (2,701) | | (2,583) | | (131) | | (2,714) | |
Cash generated from operations (note 30) | 1,353 | | — | | 1,353 | | 1,828 | | 38 | | 1,866 | |
Net cash inflow from operating activities from continuing operations | 1,268 | | — | | 1,268 | | 1,545 | | 38 | | 1,583 | |
Net cash inflow from operating activities | 1,268 | | — | | 1,268 | | 1,654 | | 38 | | 1,692 | |
| | | | | | |
Capital expenditure - project capital (note 13) | (392) | | — | | (392) | | (331) | | (38) | | (369) | |
Net cash inflow from investing activities from continuing operations | (940) | | — | | (940) | | (448) | | (38) | | (486) | |
Net cash inflow from investing activities | (940) | | — | | (940) | | (476) | | (38) | | (514) | |
| | | | | | |
Other Disclosures | | | | | | |
Basic headline earnings per share (note 11) | 146 | | — | | 146 | | 238 | | 10 | | 248 | |
Diluted headline earnings per share (note 11) | 146 | | — | | 146 | | 238 | | 9 | | 247 | |
| | | | | | |
As(1) There was no impact on basic and diluted earnings per ordinary share from discontinued operations
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1 STATEMENT OF COMPLIANCE continued
•Amendments to IAS 37 ‘Provisions, Contingent Liabilities and Contingent Assets’ relating to onerous contracts - costs of fulfilling a result ofcontract;
•Amendments to IFRS 3 ‘Business Combinations’ with regards to updating a reference to the change, reclassificationsconceptual framework; and
•Annual improvements to IFRS Standards 2018 – 2020 for IFRS 16 ‘Leases’ relating to lease incentives and IFRS 9 ‘Financial Instruments’ relating to fees in the income statement are as follows:’10 per cent’ test for derecognition of financial liabilities.
|
| | | | | | | | | |
| Income statement extract (1) |
|
| | 2018 | 2018 | 2017 | 2017 |
| | Previously reported | Reclassified | Previously reported | Reclassified |
| US dollar million | | | | |
| | | | | |
| Gross profit (loss) | 772 |
| 772 |
| 784 |
| 784 |
|
| Corporate administration, marketing and other expenses | (76 | ) | (76 | ) | (64 | ) | (64 | ) |
| Exploration and evaluation costs | (102 | ) | (102 | ) | (114 | ) | (114 | ) |
| Impairment, derecognition of assets and profit (loss) on disposal | n/a |
| (124 | ) | n/a |
| (293 | ) |
| Other expenses (income) | (97 | ) | (143 | ) | (88 | ) | (233 | ) |
| Special items | (170 | ) | n/a |
| (438 | ) | n/a |
|
| Operating profit (loss) | 327 |
| 327 |
| 80 |
| 80 |
|
Other than the amendment to IAS 16, these amendments had no material impact on the Group.
(1) Represents reclassification priorThe following amendments to IFRS were early adopted by the Group effective from 1 January 2022:
•Amendments to IAS 1 ‘Presentation of Financial Statements’ with regards to the disclosure of Discontinued operations.accounting policies;
•Amendments to IAS 8 ‘Accounting Policies, Changes in Accounting Estimates and Errors’ relating to the definition of accounting estimates;
•Amendments to IAS 1 ‘Classification of Liabilities as Current or Non-Current’; and
•Amendments to IAS 1 ‘Non-Current Liabilities with Covenants’.
The significantadoption of these amendments had no material impact on the Group.
Accounting standards, amendments and interpretations issued which are relevant to the Group, but not yet effective
The new accounting standards and amendments to accounting standards issued which are relevant to the Group, but not yet effective on 31 December 2022, include:
IFRS 17 'Insurance Contracts' and Amendments to IFRS 17 'Insurance Contracts'
IFRS 17 replaces IFRS 4 ‘Insurance Contracts’ and sets out principles for the recognition, measurement, presentation and disclosure of insurance contracts. IFRS 17 requires insurance liabilities to be measured at a current fulfilment value and provides a more uniform approach for all insurance contracts. The standard and the amendments to the standard is effective for the Group’s reporting period starting on 1 January 2023 and will be applied in the presentationretrospectively. The effect of the group annual financial statementsimplementation of the new standard is not expected to have a material impact on the Group’s results.
Amendments to IAS 12 ‘Deferred Tax related to Assets and Liabilities arising from a Single Transaction’
This amendment narrowed the scope of the recognition exemption in paragraphs 15 and 24 of IAS 12 (recognition exemption) so that it no longer applies to transactions that, on initial recognition, give rise to equal taxable and deductible temporary differences. This should mainly impact right of use assets and lease liabilities and decommissioning, restoration and similar liabilities and the corresponding amounts recognised as part of the cost of the related asset. The amendments are set out below.effective for the Group from 1 January 2023, will be applied retrospectively and are not expected to materially impact the Group.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1 STATEMENT OF COMPLIANCE continued
1.1 BASIS OF PREPARATION
The financial statements are prepared according to the historical cost convention, except for the revaluation of certain financial instrumentsassets and liabilities to fair value. The group’sGroup’s accounting policies as set out below are consistent in all material respects with those applied in the previous year except for the changes arising from the adoption of IFRS 16 as described in “New Standards and Interpretations Issued” above.year.
The comparative periods have been restated to separate continuing operations from discontinued operations in accordance with IFRS 5 Non-current Assets Held for Sale and Discontinued Operations, as a consequence of the classification of the sale of the South African producing assets and related liabilities as a discontinued operation. The sale agreement was announced on 12 February 2020.
The groupGroup financial statements are presented in US dollars.
Based on materiality, certain comparatives in the notes have been aggregated and comparatives have been restated to accord with current year disclosures. All notes are from continuing operations unless otherwise stated.
The groupGroup financial statements incorporate the financial statements of the company,Company, its subsidiaries and its interests in joint ventures and associates. The financial statements of all material subsidiaries, the Environmental Rehabilitation Trust Fund, joint ventures and associates, are prepared for the same reporting period as the holding company,Company, using the same accounting policies.
Subsidiaries are all entities over which the groupGroup has control. The groupGroup controls an entity when it is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. Control would generally exist where the groupGroup owns more than 50% of the voting rights, unless the groupGroup and other investors collectively control the entity where they must act together to direct the relevant activities. In such cases, as no investor individually controls the entity the investment is accounted for as an associate, joint venture or a joint operation. Subsidiaries are fully consolidated from the date on which control is transferred to the group.Group. They are deconsolidated from the date on which control ceases. The groupGroup re-assesses whether or not it controls an investee if facts and circumstances indicate that there are changes to one or more of the three elements of control.
Intra-group transactions, balances and unrealised gains and losses on transactions between group companies, including any resulting tax effects are eliminated.
The significant accounting judgements and estimates applied in the presentation of the Group and Company annual financial statements are set out below. The accounting policies adopted are detailed in Annexure A: “Summary of material accounting policies”.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1.2 SIGNIFICANT ACCOUNTING JUDGEMENTS AND ESTIMATES
Use of estimates
The preparation of the financial statements requires the group’sGroup’s management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. The determination of estimates requires the exercise of judgement based on various assumptions and other factors such as historical experience, current and expected economic conditions, and in some cases actuarial techniques. Actual results could differ from those estimates.
The more significant areas requiring the use of management estimates and assumptions relate to OreMineral Reserve which isthat are the basis of future cash flow estimates and unit-of-production depreciation, depletion and amortisation calculations; environmental, reclamation and closure obligations; asset impairments/reversals (including impairments of goodwill); production start date; recoverability of indirect taxes; recoverability of deferred tax assets; and write-downswrite downs of inventory to net realisable value. Other estimates include employee benefit liabilities, and unrecognised tax positions.positions and deferred compensation assets.
EstimatesThe complex or subjective judgements that have the most significant effect on amounts recognised and judgementssources of estimation uncertainty where there is a significant risk of material adjustment to the carrying amounts of assets or liabilities with the next reporting period are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.
The judgements thatapplied by management has applied in the application of accounting policies, and the estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year, are discussed below.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Use of estimates continued
Carrying value of tangible assets
Amortisation
The majority of mining assets are amortised using the units-of-production method where the mine operating plan calls for production from a well-defined provedProven and probable OreProbable Mineral Reserve.
For other tangible assets, the straight-line method is applied over the estimated useful life of the asset which does not exceed the estimated mine life based on provedProven and probable OreProbable Mineral Reserve as the useful lives of these assets are considered to be limited to the life of the relevant mine.Assets are amortised to residual values. Residual values and useful lives are reviewed, and adjusted if appropriate, at the beginning of each financial year.
The calculation of the units-of-production rate of amortisation could be impacted to the extent that actual production in the future is different from current forecast production based on provedProven and probable OreProbable Mineral Reserve. This would generally arise from the following factors:
•changes in provedProven and probable OreProbable Mineral Reserve;
•variations in the grade of OreMineral Reserve which may be significantvary significantly from time to time;
•differences between actual commodity prices and commodity price assumptions;
•unforeseen operational issues at mine sites; and
•changes in capital, operating, mining, processing and reclamation costs, discount rates and foreign exchange rates.
Changes in provedProven and probable OreProbable Mineral Reserve could similarly impact the useful lives of assets amortised on the straight-line method, where those lives are limited to the life of the mine.
Stripping costs
The groupGroup has a number of surface mining operations that are in the production phase for which production stripping costs are incurred. The benefits that accrue to the groupGroup as a result of incurring production stripping costs include (a) ore that can be used to produce inventory and (b) improved access to further quantities of material that will be mined in future periods.
The production stripping costs relating to improved access to further quantities of material in future periods are capitalised as a stripping activity asset, if and only if, all of the following are met:
•It is probable that the future economic benefit (improved access to the orebody) associated with the stripping activity will flow to the group;Group;
•The groupGroup can identify the component of the orebody for which access has been improved; and
•The costs relating to the stripping activity associated with that component or components can be measured reliably.
Components of the various orebodies at the operations of the groupGroup are determined based on the geological areas identified for each of the orebodies and are reflected in the OreMineral Reserve reporting of the group.Group. In determining whether any production stripping costs should be capitalised as a stripping activity asset, the groupGroup uses three operational guidance measures; two of which relate to production measures, while the third relates to an average stripping ratio measure.
Once determined that any portion of the production stripping costs should be capitalised, the groupGroup determines the amount of the production stripping costs that should be capitalised with reference to the average mine costs per tonne of the component and the
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
actual waste tonnes that should be deferred. Stripping activity assets are amortised on the units-of-production method based on the OreMineral Reserve of the component or components of the orebody to which these assets relate.
This accounting treatment is consistent with that for stripping costs incurred during the development phase of a pit, before production commences, except that stripping costs incurred during the development phase of a pit, before production commences, are amortised on the units-of-production method based on the OreMineral Reserve of the pit.
Deferred stripping costs are included in ‘Mine development costs’, within tangible assets. These costs form part of the total investment in the relevant cash-generating unit, which is reviewed for impairment if events or a change in circumstances indicate that the carrying value may not be recoverable. Amortisation of stripping activity assets is included in operating costs.cost of sales.
Impairment
The groupGroup reviews and tests the carrying value of tangible assets when events or changes in circumstances indicate that the carrying amount may not be recoverable. Assets are grouped at the lowest level for which identifiable cash flows are largely independent of cash flows of other assets, which is generally at the individual mine level. If there are indications that impairment may have occurred, estimates are prepared of expected future cash flows for each group of assets. Expected future cash flows used to determine the value in use of goodwill and tangible assets are inherently uncertain and could materially change over time and impact the recoverable amounts. The cash flows and value in use are significantly affected by a number of factors including published reserves, resources,Mineral Reserve, Mineral Resource, exploration potential and production estimates, together with economic factors such as spot and future metal prices, discount rates, foreign currency exchange rates, estimates of costs to produce reservesMineral
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Use of estimates continued
Reserve and future capital expenditure. AtThe estimated future cash flows and discount rates are post-tax. Discounting post-tax cash flows at a post-tax discount rate yields the same result as discounting pre-tax cash flows at a pre-tax discount rate.At the reporting date the groupGroup assesses whether any of the indicators which gave rise to previously recognised impairments have changed such that the impairment loss no longer exists or may have decreased. The impairment loss is then assessed on the original factors for reversal and if indicated, such reversal is recognised.
An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs to sell and value in use.
The recoverable amount is estimated based on the positive indicators. If an impairment loss has decreased, the carrying amount is recorded at the recoverable amount as limited in terms of IAS 36 Impairment of Assets.
The carrying value of tangible assets at 31 December 20192022 was $2,592m (2018: $3,381m; 2017: $3,742m)$4,209m (2021: $3,493m; 2020: $2,917m). The impairment and derecognition of tangible assets recognised in the consolidated financial statements for the year ended 31 December 2019 (including impairment2022 was $282m (2021: $6m; 2020: nil).
Production start date
The Group assesses the stage of tangibleeach mine construction project to determine when a project moves into the production stage. The criteria used to assess the start date are determined by the unique nature of each mine construction project and include factors such as the complexity of a plant and its location. The Group considers various relevant criteria to assess when the construction project is substantially complete and ready for its intended use and moves into the production stage. The criteria used in the assessment would include, but are not limited to the following:
•the level of capital expenditure compared to the construction cost estimates;
•completion of a reasonable period of testing of the constructed asset;
•adequacy of stope face;
•ability to produce metals in saleable form (within specifications); and
•ability to sustain ongoing production of metal.
When a mine construction project moves into the production stage, the capitalisation of certain mine construction costs ceases and costs are either regarded as inventory or expensed, except for capitalisable costs related to mining asset additions or improvements, underground mine development, deferred stripping activities, or Ore Reserve development.
Phase 2 of the Obuasi mine re-development project, after initially being delayed due to voluntary suspension of all underground activities following a sill pillar incident during May 2021, moved into the production stage on 1 October 2022 when it was determined that the Phase 2 assets transferred to held for sale) was $505m (2018: $104m; 2017: $288m).were capable of operating in the manner intended by management.
Carrying value of goodwill and intangible assets
Where an investment in a subsidiary, joint venture or an associate is made, any excess of the consideration transferred over the fair value of the attributable Mineral Resource including value beyond provedProven and probable OreProbable Mineral Reserve, exploration properties and net assets is recognised as goodwill.
Intangible assets that have an indefinite useful life and separately recognised goodwill areGoodwill is not subject to amortisation and areis tested annually for impairment and whenever events or changes in circumstance indicate that the carrying amount may not be recoverable. Assets that are subject to amortisation are tested for impairment whenever events or changes in circumstance indicate that the carrying amount may not be recoverable.
An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs to sell and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable independent cash flows (cash-generating units).
An individual operating mine is not a typical going-concern business because of the finite life of its reserves.Mineral Reserve. The allocation of goodwill to an individual mine will result in an eventual goodwill impairment due to the wasting nature of the mine reporting unit. In accordance with the provisions of IAS 36, the groupGroup performs its annual impairment review of assigned goodwill during the fourth quarter of each year.year, refer note 15 for impairment assumptions.
The carrying value of goodwill in the consolidated financial statements at 31 December 20192022 was $116m (2018: $116m; 2017: $127m)$105m (2021: $119m; 2020: $126m). The impairmentImpairment of goodwill recognised in the consolidated financial statements for the year ended 31 December 20192022 was nil (2018:$8m (2021: nil; 2017: $9m)2020: nil).
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Use of estimates continued
Income taxes
The groupGroup is subject to income taxes in numerous jurisdictions. Significant judgement is required in determining the worldwide provision for income taxes due to the complexity of legislation. There are many transactions and calculations for which the
ultimate tax determination is uncertain during the ordinary course of business. The groupGroup recognises liabilities for anticipated tax audit issues based on estimates of whether additional taxes will be due. Where the final tax outcome of these matters is different from the
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
amounts that were initially recorded, such differences will impact the income tax and deferred tax provisions in the period in which such determination is made.
The groupGroup tax reconciliation between tax expense and the product of accounting profit multiplied by the applicable tax rate, prepared in accordance with IAS 12 Income Taxes, applies the South African domestic corporate tax rate of 28 percent. This rate will be reduced to 27 percent with effect for years of assessment ending on or after 31 March 2023.
The groupGroup recognises the net future tax benefit related to deferred income tax assets to the extent that it is probable that the deductible temporary differences will reverse in the foreseeable future. Assessing the recoverability of deferred income tax assets requires the groupGroup to make significant estimates related to expectations of future taxable income. Estimates of future taxable income are based on forecast cash flows from operations and the application of existing tax laws in each jurisdiction. To the extent that future cash flows and taxable income differ significantly from estimates, the ability of the groupGroup to realise the net deferred tax assets recorded at the reporting date could be impacted.
Additionally, future changes in tax laws in the jurisdictions in which the groupGroup operates could limit the ability of the groupGroup to obtain tax deductions in future periods.
Carrying values of the group at 31 December 2019:2022:
•deferred tax asset: $105m (2018: nil; 2017: $4m);
$72m (2021: $7m; 2020: $7m );•deferred tax liability: $241m (2018: $315m; 2017: $363m)$300m (2021: $313m; 2020: $246m);
•taxation liability: $72m (2018: $60m; 2017: $53m)$45m (2021: $39m; 2020: $153m); and
•taxation asset: $10m (2018: $6m; 2017: $3m)$41m (2021: $49m; 2020: $14m), included in trade, other receivables and other assets.
UnrecognisedThe unrecognised value of deferred tax assets: $389m (2018: $501m; 2017: $470m)assets is $857m (2021: $834m; 2020: $487m).
Provision for environmental rehabilitation obligations
The group’sGroup incurs obligations to close, restore and rehabilitate its mine sites affected by mining and exploration activities which are subject to various laws and regulations governing the protection of the environment. The groupGroup recognises management’s best estimate for decommissioning and restoration obligations in the period in which they are incurred.incurred and the costs can be reasonably estimated. The determination of the provision is based on, among other considerations, judgements and estimates of current damage caused, timing and amount of future costs to be incurred to rehabilitate the mine sites, estimates of future inflation, exchange rates and discount rates. Future changes to environmental laws and regulations, technology, life of mine estimates, inflation rates, foreign currency exchange rates and discount rates could affect the carrying amount of this provision.provision, cannot be predicted with certainty and could have a material impact on our business, financial condition, results of operations and cash flows. A sensitivity assessment is included in note 25.
The carrying amount of the rehabilitation obligations (including held for sale rehabilitation obligations) for the groupGroup at 31 December 20192022 was $730m (2017: $637m; 2016: $724m).$578m (2021: $673m; 2020: $659m ). Note 25 provides information about related environmental guarantees and bonds.
Stockpiles and metals in process
Costs that are incurred in or benefit the production process are accumulated in stockpiles and metals in process values. Net realisable value tests are performed at least annually and represent the estimated future sales price of the product, based on prevailing and long-term metals prices, less estimated costs to complete production and bring the product to sale.
Surface and underground stockpiles and metals in process are measured by estimating the number of tonnes added and removed from the stockpile, the number of contained ounces based on assay data, and the estimated recovery percentage based on the expected processing method. Stockpile ore tonnages are verified by periodic surveys.
Although the quantities of recoverable metal are reconciled by comparing the grades of ore to the quantities of metals actually recovered (metallurgical balancing), the nature of the process inherently limits the ability to precisely monitor recoverability levels. As a result, the metallurgical balancing process is constantly monitored and engineering estimates are refined based on actual results over time.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Use of estimates continued
Variations between actual and estimated quantities resulting from changes in assumptions and estimates that do not result in write-downswrite downs to net realisable value are accounted for on a prospective basis.
The carrying value of inventories (excluding finished goods and mine operating supplies) for the groupGroup at 31 December 20192022 was $377m (2018: $404m; 2017: $424m)$306m (2021: $299m; 2020: $382m).
Recoverable tax, rebates, levies and duties
In a number of countries, particularly in Continental Africa,Tanzania and Argentina, AngloGold Ashanti is due refunds of indirect tax which remain outstanding for periods longer than those provided for in the respective statutes. The Group uses probability weighted discounting models together with the expected timing of recovery of these refunds to estimate their fair values and related discounting effects which are updated at each reporting period. Timing of the recoverability and the resultant probabilities is updated based on several factors including ongoing correspondence and meetings with the relevant authorities and available income taxes for off-sets, if applicable. Where the recovery of the indirect tax refunds is tied to off-set arrangements against income taxes, the modeled scenarios incorporate judgements around the applicable mine’s business plan and availability of future income tax off-sets. The Group consults tax and legal specialists to determine the current basis of applicable laws and regulations in the associated jurisdictions which are highly complex and subject to interpretation. Future changes to such laws and regulations or the interpretation thereof could have a material impact on the carrying value of these assets, results of operations and cash flows.
In addition, AngloGold Ashanti has unresolved non-income tax disputes in a number of countries, particularly in Continental Africa and inTanzania, Brazil and Argentina. If the outstanding input taxes are not received and these disputes are not resolved in a manner favourable to AngloGold Ashanti, it could have a material adverse effect upon the carrying value of these assets and our results of operations.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
The net carrying value of recoverable tax, rebates, levies and duties (excluding normal taxation assets) for the groupGroup at 31 December 20192022 was $227m (2018: $194m; 2017: $174m).$307m (2021: $304m; 2020: $281m) and is included in trade, other receivables and other assets, refer note 20.
Post-retirement obligations
The determination of AngloGold Ashanti’s obligationsthe Group’s obligation and expense for post-retirement liabilities, including the Group's reimbursive asset relating to annuities purchased to fund the obligation, depends on the selection of certain assumptions used by actuaries to calculate amounts. These assumptions include, among others, the discount rate, the expected long-term rate of return of plan assets, health care inflation costs, rates of increase in compensation costs and the number of employees who reach retirement age before the mine reaches the end of its life. While AngloGold Ashanti believes that these assumptions are appropriate, significant changes in the assumptions may materially affect post-retirement obligations as well as future expenses, which may result in an impact on earnings in the periods that the changes in these assumptions occur.
The carrying value of the post-retirement obligations at 31 December 20192022 was $100m (2018: $100m; 2017: $122m)$71m (2021: $77m; 2020: $83m).
OreMineral Reserve estimates
An OreThe Group reports its Mineral Resource and Mineral Reserve in accordance with Subpart 1300 of Regulation S-K (17 CFR § 229.1300) (“Regulation S-K 1300”) as well as the minimum standards described by the South African Code for the reporting of Exploration Results, Mineral Resource and Mineral Reserve, 2016 Edition (SAMREC Code).
A Mineral Reserve estimate is an estimate of the amounttonnage and grade or quality of productIndicated and Measured Mineral Resource that can be the basis of an economically viable project. More specifically, it is the economically mineable part of a Measured or Indicated Mineral Resource, which includes diluting materials and legally extracted fromallowances for losses that may occur when the group’s properties.material is mined or extracted. In order to calculateestimate the OreMineral Reserve, estimates and assumptions are required about a range of geological, technical and economic factors, including quantities, grades, production techniques, recovery rates, production costs, transport costs, commodity demand, commodity prices and exchange rates.
Estimating the quantity and/or grade of the OreMineral Reserve requires the size, shape and depth of orebodies to be determined by analysing geological data such as the logging and assaying of drill samples. This process may require complex and difficult geological judgements and calculations to interpret the data.
The group is required to determine and report its Ore ReserveWith the change in accordance with the minimum standards described by the South African Code for the reporting of Exploration Results, Mineral Resources and Mineral Reserves (The SAMREC Code, 2016 Edition).
Because the economic assumptions used to estimate changes in the OreMineral Reserve from period to period, and because additional geological data is generated during the course of operations, estimates of the OreMineral Reserve may change from
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Use of estimates continued
period to period. Changes in the reported OreMineral Reserve may affect the group’sGroup’s financial results and financial position in a number of ways, including the following:
•asset carrying values may be affected due to changes in estimated future cash flows;
•depreciation, depletion and amortisation charged in the income statement may change where such charges are determined by the units-of-production method, or where the useful economic lives of assets change;
•overburden removal costs, including production stripping activities, recorded on the statement of financial position or charged in the income statement may change due to changes in stripping ratios or the units-of-production method of depreciation;
•decommissioning site restoration and environmental provisions may change where changes in the estimated OreMineral Reserve affect expectations about the timing or cost of these activities; and
•the carrying value of deferred tax assets may change due to changes in estimates of the likely recovery of the tax benefits.
Development expenditure
Development activities commence after project sanctioning by the appropriate level of management. Judgement is applied by management in determining when a project has reached a stage at which economically recoverable reserves exist such that development may be sanctioned. In exercising this judgement, management is required to make certain estimates and assumptions similar to those described in the accounting policy for exploration and evaluation assets. Any such estimates and assumptions may change as new information becomes available. If, after having started the development activity, a judgement is made that a development asset is impaired, the appropriate amount will be written off to the income statement.
Provision for silicosis
The Settlement Agreement in the silicosis and tuberculosis class action litigation became operational on 10 December 2019. A settlement trust, known as the Tshiamiso Trust, was established to carry out the terms of the Settlement Agreement. Significant judgement is applied in estimating the costs that will be incurred to settle the silicosis class action claims and related expenditure. The final costs may differ from current cost estimates. The provision is based on actuarial assumptions including:
•silicosis prevalence rates;
•estimated settlement per claimant;
•benefit take-up rates;
•disease progression rates;
•timing of cashflows; and
•discount rate.
Management believes the assumptions are appropriate, however changes in the assumptions may materially affect the provision and final costs of settlement. A sensitivity assessment is included in note 25.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
The carrying value of the silicosis provision at 31 December 20192022 was $65m (2018: $63m; 2017: $63m)$35m (2021: $50m; 2020: $61m).
Identification and classificationDeferred compensation asset
As a consequence of discontinued operations
During 2019, the decision to sellsale of the remaining South African operations in 2020, a deferred compensation asset was made. Judgement was applied regarding classificationrecognised. The deferred compensation asset is included at fair value in level 3 of the disposal group as held for salefair value hierarchy. Management used a probability weighted discounted cash flow model to measure the deferred compensation asset. The significant inputs and assumptions used in the discounted cash flow calculation, include the production plan over the deferred compensation period and the weighted average cost of capital. Details of the valuation, including a sensitivity assessment, are included in note 33.
The carrying value of the deferred compensation asset at year end, and whether the disposal group should be classified as a discontinued operation. The South African asset sale31 December 2022 was assessed as a major geographical area of operations and part of a single co-ordinated plan to dispose of a major geographical area of operations and accordingly, it was classified as a discontinued operation. The sale was announced on 12 February 2020.$12m (2021: $25m; 2020: $28m).
Contingencies
By their nature, contingencies will only be resolved when one or more future events occur or fail to occur. The assessment of such contingencies inherently involves the exercise of significant judgement and estimates of the outcome of future events. Such contingencies include, but are not limited to environmental obligations, litigation, regulatory proceedings, tax matters and losses resulting from other events and developments. Refer note 10 for tax uncertainties and contingencies and note 32 for legal claims and other contingencies.
When a loss is considered probable and reasonably estimable, a liability is recorded in the amount of the best estimate for the ultimate loss. The likelihood of a loss with respect to a contingency can be difficult to predict and determining a meaningful estimate of the loss or a range of loss may not always be practicable based on the information available at the time and the potential effect of future events and decisions by third parties that will determine the ultimate resolution of the contingency. It is not uncommon for such matters to be resolved over many years, during which time relevant developments and new information is continuously evaluated to determine both the likelihood of any potential loss and whether it is possible to reasonably estimate a range of possible losses. When a loss is probable but a reasonable estimate cannot be made, disclosure is provided.
In determining the threshold for disclosure on a qualitative and quantitative basis, management considers the potential for a disruptive effect on the normal functioning of the groupGroup and/or whether the contingency could impact investment decisions. Such qualitative matters considered are reputational risks, regulatory compliance issues and reasonable investor considerations. For quantitative purposes, amateriality thresholdan amount of $18m$33m has been applied.
considered. As a global company, the groupGroup is exposed to numerous legal risks. The outcome of currently pending and future proceedings cannot be predicted with certainty. Litigation and other judicial proceedings as a rule raise difficult and complex legal issues and are subject to uncertainties and complexities including, but not
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
limited to, the facts and circumstances of each particular case, issues regarding the jurisdiction in which each suit is brought and differences in applicable law. Upon resolution of any pending legal matter, the groupGroup may be forced to incur charges in excess of the presently established provisions and related insurance coverage. It is possible that the financial position, results of operations or cash flows of the groupGroup could be materially affected by the unfavourable outcome of litigation.
Use of estimates continued
Climate change considerations
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
The Company’s 2021 TCFD-aligned Climate Change Report outlines the Board-approved Climate Change Strategy and seeks to embed the management of physical and transition climate risks and opportunities into the Company’s strategic and operational planning processes, a process that is enabled through a refreshed company-wide climate change governance framework. The report also summarises at a high level specific outcomes from the physical climate risk assessment conducted at each of the operating assets, considering the business as usual scenario. The potential effect of decarbonisation scenarios and other transition risks on the Company’s business strategy and planning assumptions including the cost of energy and other key mining inputs, is an area that will be addressed through the continued implementation of the Company’s Climate Change Strategy.
Unlike other major mineral resources companies, AngloGold Ashanti does not mine or extract fossil fuels such as coal, natural gas or oil. AngloGold Ashanti does, however, emit greenhouse gases directly through the combustion of fuels and other energy products at its gold mining operations and indirectly through the consumption of electricity purchased from national grids that include fossil-based energy in its production. AngloGold Ashanti has committed to a target of net zero Scope 1 and 2 greenhouse gas (GHG) emissions by 2050 in line with the ambitions of the Paris Agreement, as a member of the International Council on Mining and Metals (ICMM). As a member of the ICMM, the Company has also committed to accelerating action on Scope 3 emissions, including setting credible targets in partnership with suppliers, if not by the end of 2023, as soon as possible thereafter.
1.3 SUMMARY OF SIGNIFICANTMATERIAL ACCOUNTING POLICIES
Equity-accounted investments
Joint ventures and Associates
A joint venture is an entity in which the groupGroup holds a long-term interest and which the groupGroup and one or more other ventures jointly control under a contractual arrangement, that provides for strategic, financial and operating policy decisions relating to the activities requiring unanimous consent of the parties sharing control. The group’s interests inIn a joint arrangements classified as joint ventures are accountedventure the Group has rights to the net assets of the arrangement, rather than rights to its assets and obligations for using the equity method.
Profits and losses realised in connection with transactions between the group and joint ventures are eliminated in proportion to share ownership. Such profits and losses are deducted from the group’s equity and related statement of financial position amount and released in the group accounts when the assets are effectively realised outside the group. Dividends received from joint ventures are included in operating activities in the cash flow statement.
Associates
The equity method of accountingits liabilities. An associate is used for investmentsan investment over which the groupGroup exercises significant influence, but not control or joint control, over the financial and operating policies and normally owns between 20% and 50% of the voting equity.
Joint ventures and Associates are equity-accounted from the effective date of acquisition to the effective date of disposal.
Profits and losses realised in connection with transactions between the group and associated companies are eliminated in proportion to share ownership. Such profits and losses are deducted from the group’s equity and related statement of financial position amount and released in the group accounts when the assets are effectively realised outside the group. Dividends received from associates are included in investing activities in the cash flow statement.
Joint ventures and associates
If necessary, impairment losses on loans and equity are reported under share of joint ventures and associates profit and loss.
Any losses of equity-accounted investments are accounted for in the consolidated financial statements until the investment in such investments is written down to zero. Thereafter, losses are accounted for only insofar as the groupGroup is committed to providing financial support to such investees.
The carrying value of equity-accounted investments represents the cost of each investment, including goodwill, balance outstanding on loans advanced if the loan forms part of the net investment in the investee, any impairment losses/ impairment reversals recognised, the share of post-acquisition retained earnings and losses, and any other movements in reserves. The carrying value of equity-accounted investments is reviewed when indicators arise and if any impairment in value/ impairment reversal has occurred; it is recognised in the period in which the impairment arose. If necessary, impairment and impairment reversals on loans and equity are reported under share of joint ventures and associates profit and loss
In the cash flow statement, dividends received from joint ventures are included in operating activities and dividends received from associates are included in investing activities.
In determining materiality for the disclosure requirements of IFRS 12 “DisclosureDisclosure of Interest in Other Entities”,Entities, management has assessed that amounts representing the carrying value of at least 90% of the investments in associates and joint ventures balances, reported in the statement of financial position, constitute quantitative materiality.
Unincorporated joint ventures – joint
Joint operations
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
A joint operation is a joint arrangement whereby the parties that have joint control of the arrangement have rights to the use of assets and obligations for the liabilities of the arrangement. The groupGroup accounts for activities under joint operations by recognising, in relation to the joint operation, the assets it controls and the liabilities it incurs, the expenses it incurs and the revenue from the sale or use of its share of the joint operations output.
Foreign currency translation
Functional currency
Items included in the financial statements of each of the group’sGroup’s entities are measured using the currency of the primary economic environment in which the entity operates (the ‘functional currency’). The functional currency of the parent companyCompany is South African Rands.
Transactions and balances
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Foreign currency transactions are translated into the functional currency using the approximate exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of foreign currencysuch transactions, and from the translation at the reporting period exchange rate of monetary assets and liabilities denominated in foreign currencies, are recognised in the income statement.profit or loss.
Group companies
The results and financial position of all groupGroup entities (none of which has the currency of a hyperinflationary economy) that have a functional currency different from the presentation currency are translated into the presentation currency as follows:
•share capital and premium are translated at historicalusing closing rates of exchange at the reporting date;
•retained earnings are converted at historical average exchange rates;
•date for assets and liabilities, average rates of exchange for each statement of financial position presented are translated at the closing rate at the date of that statement of financial position;
•year for income and expensesexpense items and historical rates of exchange for each income statement presented are translated at monthly average exchange rates (unless this average is not a reasonable approximation of the cumulative effect of the rates prevailing on the transaction dates, in which case income and expenses are translated at the rates prevailing at the date of the transaction); and
•allequity items. All resulting exchange differences are recognised in other comprehensive income and presented as a separate component of equity (foreign currency translation reserve, or FCTR).
Exchange differences arising from the translation of the net investment in foreign operations and of borrowings and other currency instruments designated as hedges of such investments, are accounted for as other comprehensive income on consolidation. On repayment or realisation permanent loans andof net investments arein foreign operations, the resulting FCTR is recycled from FCTR to the income statement.
Segment reporting
An operating segment On disposal of non-foreign operations, where the parent’s functional currency, is a business activity whose results are regularly reviewed by the chief operating decision maker (CODM) in order to make decisions about resources to be allocated to it and to assess its performance and for which discrete financial information is available. The chief executive officer and the executive committee are collectively identifiedsame as the CODM.subsidiary’s, associate’s, joint venture’s or branch’s functional currency, no reclassification of FCTR is required.
Tangible assets
Tangible assets are recorded at cost less accumulated amortisation and impairments/reversals. Cost includes pre-production expenditure incurred during the development of a mine and the present value of related future decommissioning costs.
Interest on borrowings relating to the financing of major capital projects under construction is capitalised during the construction phase as part of the cost of the project. Such borrowing costs are capitalised over the period during which the asset is being acquired or constructed and borrowings have been incurred. Capitalisation ceases when construction is interrupted for an extended period or when the asset is substantially complete. Other borrowing costs are expensed as incurred.
If there is an indication that the recoverable amount of any of the tangible assets is less than the carrying value, the recoverable amount is estimated and the difference is recognised as an impairment.
Subsequent costs are included in the asset’s carrying amount only when it is probable that future economic benefits associated with the asset will flow to the group, and the cost of the addition can be measured reliably. All other repairs and maintenance are charged to the income statement during the financial period in which they are incurred.
To the extent a legal or constructive obligation to a third party exists, the acquisition cost includes estimated costs of dismantling and removing the asset and restoring the site. A change in estimated expenditures for dismantling, removal and restoration is added to or deducted from the carrying value of the related asset. To the extent that the change would result in a negative carrying amount forof the related asset, this effect is recognised as income. The change in depreciation charge is recognised prospectively.
For assets amortised on the units-of-production method, amortisation is calculated to allocate the cost of each asset to its residual value over its estimated useful life. For assets not amortised on the units-of-production method, amortisation is calculated over their estimated useful life as follows:
•buildings up to life of mine;
•plant and machinery up to life of mine;
•equipment and motor vehicles up to five years; and
•computer equipment up to three years; andyears.
leased assets over the shorter of the period of the lease and the useful life of the leased asset.
Major renovations are depreciated over the remaining useful life of the related asset or to the date of the next major renovation, whichever is sooner.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Assets are amortised to residual values. Residual values and useful lives are reviewed, and adjusted if appropriate, at the beginning of each financial year.
Gains and losses on disposals are determined by comparing net sale proceeds with the carrying amount at the date of sale. These are included in the income statement.
Mine development costs
Capitalised mine development costs include expenditure incurred to develop new orebodies, to define further mineralisation in existing orebodies and to expand the capacity of a mine. Mine development costs include acquired provedProven and probable OreProbable Mineral Reserve at cost at the acquisition date. These costs are amortised from the date on which commercial production begins.the assets are ready for use as intended by management.
Depreciation, depletion and amortisation of mine development costs are computed by the units-of-production method based on estimated provedProven and probable OreProbable Mineral Reserve. The provedProven and probable OreProbable Mineral Reserve reflects estimated quantities of reservesMineral Reserve which can be recovered economically in the future from known mineral deposits.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Capitalised mine development costs also include stripping activity assets relating to production stripping activities incurred in the production phase of open-pit operations of the group.Group. Once determined that any portion of the production stripping costs should be capitalised, the groupGroup determines the average mine costs per tonne of the component and the waste tonnes to which the production stripping costs relate to determine the amount of the production stripping costs that should be capitalised. Stripping activity assets are amortised on a units-of-production method based on the OreMineral Reserve of the component of the orebody to which these assets relate.
The average mine cost per tonne of the component is calculated as the total expected costs to be incurred to mine the relevant component of the orebody, divided by the number of tonnes expected to be mined from the component. The average mine cost per tonne of the component to which the stripping activity asset relates are recalculated annually in the light of additional knowledge and changes in estimates.
Mine infrastructure
Mine plant facilities, including decommissioning assets, are amortised using the lesser of their useful life or units-of-production method based on estimated provedProven and probable OreProbable Mineral Reserve.
Equipment, furniture and fittings in the Company financial statements are included in Mine infrastructure in the Group financial statements.
Land and assets under construction
Land and assets under construction are not depreciated and are measured at historical cost less impairments.
Mineral rights and dumps
Mineral rights are amortised using the units-of-production method based on the estimated provedProven and probable OreProbable Mineral Reserve. Dumps are amortised over the period of treatment.
Exploration and evaluation assets
All pre-license and exploration costs, including geological and geographical costs, labour, Mineral Resource and exploratory drilling cost, are expensed as incurred, until it is concluded that a future economic benefit will more likely than not be realised. In evaluating if expenditures meet this criterion to be capitalised, several different sources of information are used depending on the level of exploration. While the criterion for concluding that expenditure should be capitalised is always probable, the information used to make that determination depends on the level of exploration:
•Costs on greenfields sites, being those where the groupGroup does not have any mineral deposits which are already being mined or developed under the planned method of extraction, are expensed as incurred until the groupGroup is able to demonstrate that future economic benefits are probable, which generally will be the establishment of provedProven and probable OreProbable Mineral Reserve at this location;
•Costs on brownfields sites, being those adjacent to mineral deposits which are already being mined or developed under the planned method of extraction, are expensed as incurred until the groupGroup is able to demonstrate that future economic benefits are probable, which generally will be the establishment of increased inclusive provedProven and probable Ore Reserve,Probable Mineral Resource, after which the expenditure is capitalised as a mine development cost; and
•Costs relating to extensions of mineral deposits, which are already being mined or developed, including expenditure on the definition of mineralisation of such mineral deposits, are capitalised as a mine development cost.
Costs relating to property acquisitions are capitalised within mine development costs.
LeasesImpairment of non-financial assets
The Group’s non-financial assets, other than inventories and deferred tax assets, are reviewed at each reporting date or whenever events or changes in circumstances indicate that the carrying amount may not be recoverable, to determine whether there is any indication of impairment. An impairment test is performed annually on all goodwill, intangible assets not yet in use and intangible assets with indefinite useful lives irrespective of whether any impairment indicators have been identified.
For non-financial assets or cash generating units, in circumstances in which indicators of impairment are identified, a formal impairment test is required to be carried out. The impairment test compares the assets or cash generating units (CGUs) carrying amount with its recoverable amount. The recoverable amount is the higher of the amounts calculated under the fair value less cost of disposal and value in use approaches.
Value-in-use is estimated using a discounted cash flow model. The future cash flows are adjusted for risks specific to the asset and is adjusted where applicable to consider any specific risks relating to the country where the asset or cash-generating unit is
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
located. Future cash flows are discounted to their present value using a discount rate that reflects current market assessments of the time value of money.
A cash-generating unit is the smallest identifiable group of assets that generates cash inflows that are largely independent of the cash inflows from other assets or groups of assets. The composition and nature of the Group’s CGUs vary and is determined largely by identifying the smallest identifiable group of assets that generates independent cash inflows and factors specific to the Group’s mining operations. The Group’s CGUs are generally at the individual mine level with some operating mines consisting of a combination of shafts and/or pits.
The groupGroup allocates regional support assets to the CGUs. If there is an indication that a regional support asset may be impaired, then the recoverable amount is determined for the CGU to which the corporate asset belongs.
Exploration assets are tested for impairment whenever facts and circumstances indicate that the carrying amount is not recoverable. Assets will be allocated to CGUs or groups of CGUs based on how the entity manages its operations i.e., by mineral within a specific geographic area. An impairment loss is recognised for the amount by which the assets or CGUs carrying amount exceeds their recoverable amount.
Development expenditure
Development activities commence after project sanctioning by the appropriate level of management. Judgement is applied by management in determining when a project has reached a stage at which economically recoverable reserves exist such that development may be sanctioned. In exercising this judgement, management is required to make certain estimates and assumptions that may change as new information becomes available. If, after having started the development activity, a judgement is made that a development asset is impaired, the appropriate amount will be written off to the income statement. Capitalised development costs are included as assets under construction and mine development costs in tangible assets.
Goodwill
Where an investment in a subsidiary, joint venture or an associate is made, any excess of the consideration transferred over the fair value of the attributable Mineral Resource including value beyond Proven and Probable Mineral Reserve, exploration properties and net assets is recognised as goodwill. Goodwill in respect of subsidiaries is disclosed as goodwill.
Goodwill relating to subsidiaries is tested annually for impairment and carried at cost less accumulated impairment losses. Gains and losses on the disposal of an entity include the carrying amount of goodwill relating to the entity sold. Goodwill is allocated to cash-generating units for the purpose of impairment testing.
Leases
The Group assesses whether a contract is or contains a lease at inception of a contract. The groupGroup recognises a right-of-use asset and a corresponding lease liability with respect to all lease agreements in which it is the lessee, except for short-term leases (defined as leases with a lease term of 12 months or less)less with no purchase option) and leases of low value assets.assets, where the recognition exemption is applied. For these leases, the groupGroup recognises the lease payments as an operating expense on a straight-line basis over the term of the lease unless another systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed. The lease liability is initially measured at the present value of the lease payments that are not paid at the commencement date, discounted by using the rate implicit in the lease. If this rate cannot be readily determined, the groupGroup uses its incremental borrowing rate. The group has appliedincremental borrowing rate is the rate that the Group would have to pay to borrow the funds necessary to obtain an asset of similar value to the right of use asset in a similar economic environment with similar terms, security and conditions. The Group applies the IFRS 16 portfolio approach in determining the discount rate for leases. As such a single discount rate has been used for contracts that share similar characteristics. The groupGroup has determined that contracts that are denominated in the same currency will use a single discount rate. This rate has been determined using various factors including in-country borrowings as well as other sources of finance. Contracts may contain both lease and non-lease components. The groupGroup allocates the consideration in the contract to the lease and non-lease components based on their relative stand-alone prices.
Lease payments included in the measurement of the lease liability comprise:
•fixed lease payments (including in-substance fixed payments), less any lease incentives;
•variable lease payments that depend on an index or rate, initially measured using the index or rate at the commencement date;
•the amount expected to be payable by the lessee under residual value guarantees;
•the exercise price of purchase options, if the lessee is reasonably certain to exercise the options; and
•payments of penalties for terminating the lease, if the lease term reflects the exercise of an option to terminate the lease.
The lease liability is presented separately in the consolidated statement of financial position, allocated to non-current and current liabilities.
The lease liability is subsequently measured by increasing the carrying amount to reflect interest on the lease liability (using the effective interest method) and by reducing the carrying amount to reflect the lease payments made.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
The groupGroup remeasures the lease liability (and makes a corresponding adjustment to the related right-of-use asset) whenever:
•the lease term has changed or there is a change in the assessment of exercise of a purchase option, in which case the lease liability is remeasured by discounting the revised lease payments using a revised discount rate.rate;
•the lease payments change due to changes in an index or rate or a change in expected payment under a guaranteed residual value, in which cases the lease liability is remeasured by discounting the revised lease payments using the initial discount rate (unless the lease payments change is due to a change in a floating interest rate, in which case a revised discount rate is used).;
•a lease contract is modified and the lease modification is not accounted for as a separate lease, in which case the lease liability is remeasured by discounting the revised lease payments using a revised discount rate.
The right-of-use assets comprise the initial measurement of the corresponding lease liability, lease payments made at or before the commencement day, any initial direct costs and restoration costs as described below. They are subsequently measured at cost less accumulated depreciation and impairment losses.
The lease term is determined as the non-cancellable period of a lease, together with:
Periods•periods covered by an option to extend the lease if AngloGold Ashantithe Group is reasonably certain to make use of that option; and / or
Periods•periods covered by an option to terminate the lease, if AngloGold Ashantithe Group is reasonably certain not to make use of that option.
Whenever the groupGroup incurs an obligation for costs to dismantle and remove a leased asset, restore the site on which it is located or restore the underlying asset to the condition required by the terms and conditions of the lease, a provision is recognised and measured under IAS 37 Provisions, Contingent Liabilities and Contingent Assets. The costs are included in the related right-of-use asset, unless those costs are incurred to produce inventories.
Right-of-use assets are depreciated over the shorter period of lease term and useful life of the underlying asset. If a lease transfers ownership of the underlying asset or the cost of the right-of-use asset reflects that the groupGroup expects to exercise a purchase option, the related right-of-use asset is depreciated over the useful life of the underlying asset. The depreciation starts at the commencement date of the lease.
The right-of-use assets are presented as a separate line in the consolidated statement of financial position.
The groupGroup applies IAS 36 Impairment of Assets to determine whether a right-of-use asset is impaired and accounts for any identified impairment loss accordingly.
Non-current assets held for sale and discontinued operations
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Non-current assets and disposal groups are classified as held for sale if their carrying amount will be recovered principally through a sale transaction rather than through continuing use. This condition is regarded as having been met only when the sale is highly probable and the asset (or disposal group) is available for immediate sale in its present condition. Management must be committed to the sale, which should be expected to qualify for recognition as a completed sale within one year from the date of classification.
Non-current assets (and disposal groups) classified as held for sale are measured at the lower of their previous carrying amount and fair value less costs to sell.
Tangible assets, right of use assets and intangible assets are not depreciated once classified as held for sale.
A disposal group qualifies as a discontinued operation if it is a component of an entity that either has been disposed of, or is classified as held for sale, and:
•Represents a separate major line of business or geographical area of operations;
•Is part of a single co-ordinated plan to dispose of a separate major line of business or geographical area of operations; or
•Is a subsidiary acquired exclusively with a view to resale.
Discontinued operations are excluded from the results of continuing operations and are presented as a single amount as profit or loss after tax from discontinued operations in the statement of profit or loss.
Inventories
Inventories are valued at the lower of cost and net realisable value after appropriate allowances for redundant and obsolete items. Cost is determined on the following bases:
•metals in process are valued at the average total production cost at the relevant stage of production;
•gold doré/bullion is valued on an average total production cost method;
•ore stockpiles are valued at the average moving cost of mining and stockpiling the ore. Stockpiles are classified as a non-current asset where the stockpile exceeds current processing capacity;
•by-products, which include uranium oxide, silver and sulphuric acid, are valued using an average total production cost method;
•mine operating supplies are valued at average cost; and
•heap leach pad materials are measured on an average total production cost basis.
A portion of the related depreciation, depletion and amortisation charge is included in the cost of inventory. Impairments resulting from a decrease in prices are disclosed in other expenses, all other impairmentsInventory write downs are included in cost of sales.
Provisions
Environmental Expenditure
The Group has long term remediation obligations comprising decommissioning and restoration liabilities relating to its past operations which are based on the Group’s environmental management plans, in compliance with current environmental and regulatory requirements. Provisions for non-recurring remediation costs are recognisedmade when the group hasthere is a present obligation, whether legal or constructive, because of a past event for which it is probable that an outflow of resources embodying economic benefitsexpenditure on remediation work will be required to settleand the obligation and a reliable estimatecost can be madeestimated within a reasonable range of the amount of the obligation. Where some or all of the expenditure required to settle a provision ispossible outcomes. The costs are based on currently available facts, technology expected to be reimbursed by another party,available at the reimbursementtime of the clean-up, laws and regulations presently or virtually certain to be enacted and prior experience in remediation of contaminated sites.
Decommissioning costs
The provision for decommissioning represents the cost that will arise from rectifying damage caused before production commences. Accordingly, a provision and a decommissioning asset is recognised only when the reimbursement is virtually certain. The amount to be reimbursed is recognised as a separate asset. Where the group has a joint and several liability with one or more other parties, no provision is recognised to the extent that those other partiesincluded within mine infrastructure.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Decommissioning costs are expected to settle part or all of the obligation.
Provisions are measuredprovided at the present value of management’s best estimate of the expenditure requiredexpenditures expected to settle the obligation, using estimated cash flows based on current prices. The unwinding of the decommissioning obligation is included in the income statement. Estimated future costs of decommissioning obligations are reviewed regularly and adjusted as appropriate for new circumstances or changes in law or technology. Changes in estimates are capitalised or reversed against the relevant asset. Estimates are discounted at the reporting date. The discounta pre-tax rate used to determine the present valuethat reflects current market assessments of the time value of moneymoney.
Gains or losses from the expected disposal of assets are not taken into account when determining the provision.
Restoration costs
The provision for restoration represents the cost of restoring site damage after the start of production. Changes in the provision are recorded in the income statement as a cost of production.
Restoration costs are estimated at the present value of the expenditures expected to settle the obligation, using estimated cash flows based on current prices and theadjusted for risks specific to the liability. The estimates are discounted at a pre-tax rate that reflects current market assessments of the time value of money.
Other
Litigation and administrative proceedings are evaluated on a case-by-case basis considering the information available, including that of legal counsel, to assess potential outcomes. Where it is considered probable that an obligation will result in an outflow of resources, a provision is recorded for the present value of the expected cash outflows if these are reasonably measurable. These provisions cover the estimated payments to plaintiffs, court fees and the cost of potential settlements.
Where some or all of the expenditure required to settle a provision is expected to be reimbursed by another party, the reimbursement is recognised only when the reimbursement is virtually certain. The amount to be reimbursed is recognised as a separate asset. Where the Group has a joint and several liability with one or more other parties, no provision is recognised to the extent that those other parties are expected to settle part or all of the obligation.
Employee benefits
Other post-employmentPost-employment benefit obligations
Some groupGroup companies provide post-retirement health care benefits to their retirees. The entitlement to these benefits is usually conditional on the employee remaining in service up to retirement age and completion of a minimum service period. The expected costs of these benefits are accrued over the period of employment using an accounting methodology on the same basis as that used for defined benefit pension plans. Actuarial gains and losses arising from experience adjustments and changes in actuarial assumptions are recorded in other comprehensive income immediately. These obligations are valued annually by independent qualified actuaries.
Some of these obligations are funded with a purchased insurance policy to which the Group contributes premiums to. As this insurance policy does not meet the definition of a qualifying insurance policy the entity recognises its right to reimbursement under the insurance policy as a separate asset measured at fair value similar to a defined benefit plan asset. Actuarial gains and losses arising from experience adjustments and changes in actuarial assumptions are recorded in other comprehensive income immediately. These obligations are valued annually by independent qualified actuaries.
Termination benefits
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Termination benefits are payable when employment is terminated before the normal retirement date, or when an employee accepts voluntary redundancy in exchange for these benefits. The groupGroup recognises a liability and expense for termination benefits at the earlier of the following dates: (a) when the entity can no longer withdraw the offer of those benefits; and (b) when the entity recognises costs for a restructuring that is within the scope of IAS 37 Provisions, Contingent Liabilities and Contingent Assets and involves the payment of termination benefits. The group recognises termination benefits when it is demonstrably committed to either terminating the employment of current employees according to a detailed formal plan without possibility of withdrawal; or providing termination benefits as a result of an offer made to encourage voluntary redundancy based on the number of employees expected to accept the offer. Benefits falling due more than 12 months after reporting date are discounted to present value.
Share-based payments
The group’sGroup’s management awards certain employee bonuses in the form of equity-settled share-based payments on a discretionary basis.
The fair value of the equity instruments granted is calculated at grant date. For transactions with employees, fair value is based on market prices of the equity instruments granted, if available, taking into account the terms and conditions upon which those equity instruments were granted. If market prices of the equity instruments granted are not available, the fair value of the equity instruments granted is estimated using an appropriate valuation model. Vesting conditions, other than market conditions, are not taken into account when estimating the fair value of shares or share options at measurement date.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Over the vesting period, the fair value at measurement date is recognised as an employee benefit expense with a corresponding increase in other capital reserves based on the group’sGroup’s estimate of the number of instruments that will eventually vest. The income statement charge or credit for a period represents the movement in cumulative expense recognised as at the beginning and end of that period. Vesting assumptions for non-market conditions are reviewed at each reporting date to ensure they reflect current expectations.
When options are exercised or share awards vest, the proceeds received, net of any directly attributable transaction costs, are credited to share capital (nominal value) and share premium.
Where the terms of an equity settled award are modified, as a minimum, an expense is recognised as if the terms had not been modified. In addition, an expense is recognised for any modification which increases the total fair value of the share-based payment arrangement, or is otherwise beneficial to the employee, as measured at the date of the modification.
In addition, the group’sGroup’s management awards certain employee bonuses in the form of a cash settled scheme, whereby awards granted are linked to the performance of the company’sCompany’s share price. A liability is recognised based upon the grant date fair value and is subsequently remeasured to the closing share price at each reporting date up to the date of vesting. Remeasurements to fair value are recognised in the income statement.
Environmental expenditure
The group has long-term remediation obligations comprising decommissioning and restoration liabilities relating to its past operations which are based on the group’s environmental management plans, in compliance with current environmental and regulatory requirements. Provisions for non-recurring remediation costs are made when there is a present obligation, it is probable that expenditure on remediation work will be required and the cost can be estimated within a reasonable range of possible outcomes. The costs are based on currently available facts, technology expected to be available at the time of the clean-up, laws and regulations presently or virtually certain to be enacted and prior experience in remediation of contaminated sites.
Decommissioning costs
The provision for decommissioning represents the cost that will arise from rectifying damage caused before production commences. Accordingly, a provision and a decommissioning asset is recognised and included within mine infrastructure.
Decommissioning costs are provided at the present value of the expenditures expected to settle the obligation, using estimated cash flows based on current prices. The unwinding of the decommissioning obligation is included in the income statement. Estimated future costs of decommissioning obligations are reviewed regularly and adjusted as appropriate for new circumstances or changes in law or technology. Changes in estimates are capitalised or reversed against the relevant asset. Estimates are discounted at a pre-tax rate that reflects current market assessments of the time value of money.
Gains or losses from the expected disposal of assets are not taken into account when determining the provision.
Restoration costs
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Revenue is recognised when control of the goods passes to the customer and the performance obligations of transferring control have been met. The amount of revenue recognised reflects the consideration to which the entity is entitled in exchange for the goods transferred.
Revenue from product sales is recognised at a point in time.
Deferred taxation is recognised on all qualifying temporary differences at the reporting date between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes.
Deferred tax assets are only recognised to the extent that it is probable that the deductible temporary differences will reverse in the foreseeable future and future taxable profit will be available against which the temporary difference can be utilised.
The carrying amount of deferred tax assets is reviewed at each reporting date.
Deferred tax assets and liabilities are measured at future anticipated tax rates, which have been enacted or substantively enacted at the reporting date.
Current and deferred tax is recognised as income or expense and included in profit or loss for the period, except to the extent that the tax arises from a transaction or event which is recognised, in the same or a different period in other comprehensive income or directly in equity, or an acquisition that is a business combination that is an acquisition.combination.
Current tax is measured on taxable income at the applicable statutory rate enacted or substantively enacted at the reporting date. Interest and penalties, if any, are recognised in the income statement as part of taxation expense.
assets and financial liabilities, except financial instruments classified as at fair value through profit or loss (FVTPL)., which are expensed. The subsequent measurement of financial instruments is dealt with below.