Randgold ramps up at Tongon, directs rhetoric at Ivorian government

Randgold Resources was continuing to ramp up production at its Tongon gold mine in Côte d'Ivoire, tracking towards its 2017 target of 285,000 ounces, the company reported on Monday morning.

The FTSE 100 company confirmed that, with Tongon now operating to plan, its focus had shifted to finding additional reserves and resources to replace depleted ounces and extend the mine’s life beyond the currently anticipated four years.

At the same time, the mine had continued its engagement with employees and other regional stakeholders, according to chief executive Mark Bristow.

Elsewhere in Côte d'Ivoire, Randgold said its exploration programmes had defined a large target at Boundiali in the Fonondara corridor, which Bristow described as “potentially the most exciting” gold prospect in West Africa.

The company recently completed its annual review of its exploration targets, which Bristow said also highlighted “very positive results” from its other holdings in the country, underlining Côte d'Ivoire's exceptional prospectivity.

“The success of Côte d'Ivoire's growing gold mining industry is a tribute to the vision and commitment shared by the government and the industry, and to a mining code which is fair to both parties," Bristow said.

“We cannot rest on past achievements, however, and the future of the industry depends on new discoveries and developments.

“There have been some project failures recently and these I believe have shown the need for greater resolve and engagement by the government, particularly in the north of the country, where the new opportunities are located.”

Bristow said the single biggest challenge facing the industry was the increasing and unhindered encroachment of illegal mining, which he claimed was happening at Boundiali.

He asserted that while all stakeholders should address this growing problem, it was ultimately the government's responsibility to assert the rule of law.

The delivery of new projects was also being impeded by delays and difficulties in the permitting process, Bristow claimed, but the new mining cadastre system recently put in place by the Ministry in charge of mines was giving hope that the problems would be resolved “very soon”.

Bristow also claimed that Randgold's $28m contribution to a public-private partnership investment in the power infrastructure had not yet been settled despite the Ivorian power utility having earned almost $100m from supplying the mine and surrounding communities.

Tongon last quarter declared its second dividend, of which the government's share - including taxes - was $20m.

In total, the Tongon mine had contributed just under $1bn to the Ivorian economy in the form of royalties, taxes, dividends, salaries, payments to local suppliers and community investments since it started production in 2010, Randgold claimed.