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Power cuts reduce gold production

Due to a power supply crisis, gold output from South Africa is likely to suffer considerable cutbacks.

AngloGold Ashanti expected a reduction of approximately 400000 ounces of gold in 2008, it announced in its Q4 and 2007 year end earnings results.

Anglo expected to produce between 4.8 million ounces (Moz) and 5.0 Moz of gold at cash costs ranging from $425/oz to $435/oz.

AngloGold Ashanti chief executive Mark Cutifani said: “The uncertainty around Eskom power supply is having a significant impact on our operations in South Africa.

“This uncertainty means that our South African business faces very particular challenges right now and we’re working constructively with organized labor, Eskom and the government to ensure that we find sustainable solutions that protect the reserve integrity and potential of these operations.”

“I am also pleased with the improving record in safety performance.”

In October 2007, President Thabo Mbeki ordered an audit to look into safety at mines nationwide, after 3200 miners were trapped underground. (Sapa)