Randgold Resources Ltd. rejected a proposal to redevelop a Ghanaian gold mine with current owner AngloGold Ashanti Ltd., saying it doesn’t meet the company’s investment criteria.
The two producers agreed in September to explore a joint venture to rebuild AngloGold’s aging Obuasi mine, which needs investment to turn it into a fully mechanized operation.
“Following the work undertaken on the revised development plan, Randgold has determined that the development plan will not satisfy Randgold’s internal investment requirements,” the Jersey, Channel Islands-based company said in a statement.
AngloGold cut workers and placed Obuasi on limited operations last year as costs spiraled to more than $1,500 an ounce. The mine needs investment to access its 5.29 million ounces of gold situated in high-grade ore yielding 6.7 grams a ton.
Randgold would only go ahead with the redevelopment if it would cost less than $1 billion, Chief Executive Officer Mark Bristow told reporters Sept. 16.