Gold Fields has big plans to grow global holdings
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CAPE TOWN There was likely to be continued competition among the world's major gold players for the remaining quality listed bullion assets, Gold Fields director of international operations John Munro said yesterday.
During the past decade or so the global gold sector had seen consolidation that left about six major producers three SA-based producers and three in North America.
However, any acquisition ideas by a big gold player would be tempered by the US dollar gold price, hovering around 400/oz after touching a high of $430/oz in early January, he said.
After a strong period of consolidation, the industry was in a relative lull and the key companies were playing a waiting game, Munro said. But continued consolidation was evident in the fact that world No 2 AngloGold was in the process of merging with Ghana's Ashanti Goldfields to form AngloGoldAshanti.
Gold Fields did not enter the fray for Ashanti, fought between AngloGold and Randgold Resources, because it was exposed to Ghana via its Tarkwa and Damanga mines, Munro said. A successful bid for Ashanti would have given Gold Fields too great an interest in the west African nation, he said.
Gold Fields' three mines in SA are Driefontein, Kloof and Beatrix, and it also owns the St Ives and Agnew mines in Western Australia.
As part of its empowerment charter requirements, Gold Fields was winding up the R4,1bn sale of a 15% stake in its South African operations to Mvelaphanda Resources, Munro said.
After a tough December quarter, the group was improving margins at its S outh African operations. It was also expanding operations at St Ives and Tarkwa, which would begin contributing to earnings from December. Total output could be expected to rise to between 4,5million and 4,6-million ounces.
Gold Fields was also set to complete a feasibility study for its Artic Platinum project in Finland by December. This deposit consists mainly of palladium but contains platinum, copper and nickel.
The company had set itself a five-year target of doubling its dollar-denominated gold holdings to 1,5-million ounces from 800000. As part of this initiative, Gold Fields was conducting a due diligence of the Cerro Corona gold project in Peru in what could be its first foray into South America.
The group was also undertaking extensive prospective geology in China, but "we don't expect any developments in China in anything less than two years".
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