Buzwagi ‒ one of
African Barrick’s four
gold mines in Tanzania
Dar es Salaam, Tanzania --- 15 May 2012 - A fall in national gold production caused by rising operational costs because of unreliable power supply is making Tanzania's dream to be among the four biggest gold producers in Africa increasingly difficult to realise.
Tanzania, which competes with Mali to be Africa's third-biggest gold producer, is now facing uncertainty regarding a position in the top four producers, leaving the way clear for Mali to take third place, according to an “East African Business Week” report from Kampala, monitored by allAfrica.com.
African Barrick Gold (ABG) vice-president of corporate affairs Deo Mwanyika says poor infrastructure is among the significant obstacles affecting production. “Lack of adequate infrastructure, rising operational costs and the absence of huge deposits of gold in the country compared to its neighbours, could force investors in mining to turn away from Tanzania to other gold producing countries,” he added.
A statement from ABG showed that the gold miner posted a 17% fall in its first quarter gold production, a move which forced its shares to decline.
Mwanyika said gold mining companies were facing a long list of problems which hindered growth in production.
“The increased cost of production forced ABG to cut production by 10% last year, although the overall shipments of the metal rose to a record level due to the increased prices in the world market,” he elaborated.
In terms of production, South Africa is still the largest gold producer in Africa as it produced a whopping 240t of the precious metal last year, followed by Ghana with 80t, Mali 60t and Tanzania 50t.
Tanzania is closely followed by Burkina Faso with 40t, but the west African country is catching up steadily.
The country earning from minerals increased to US$2 billion last year from US$1.5 billion in 2010, and hence generated 2.6 % to GDP.
Source: allAfrica.com. For more information, click here.