AngloGold claims that South African gold is facing an inevitable decline

AngloGold, the third largest gold producer in the world, has announced that South Africa is facing an inevitable decline in production and is dissecting what it means for miners. gold that operate in the country. South Africa is facing an inevitable decline, the contraction of production showing no sign of stopping, Sipho Pityana, President of AngloGold Ashanti ( ASX: [19659003] AGG NYSE: AU), revealed on Monday (23 July).

Pityana reported that the country's production will continue to decline as miners chase deeper ore bodies while trying to reduce costs. This leaves companies with operations in South Africa, including AngloGold, questioning their future there.

"Gold is a declining industry.No matter what you do, no matter how you do it, you will not be able to change that ", Said Pityana to Bloomberg

South Africa's gold mines is the deepest in the world and the most labor-intensive. In May, the country's gold production fell 16% from the previous year, for an eighth consecutive month because of high costs and reduced production

Behind the Costs and the brakes are depleted reserves.Despite the current situation, Pityana believes that some producers may still have a future in South Africa if they are able to operate safely, cost-effectively and efficiently. rewarding shareholders with returns.He also added that automation could o provide the answer to the mining of super-deep reserves in the future.

For AngloGold, the company recovers about 13% of its production in South Africa, up from 43% in 2007. The company Due to the current challenges in South Africa, Pityana admits that some investors in the United AngloGold question the value of investing in the country, compared to other countries like Brazil.

"People ask" will you separate the two companies? "It's an option that stays on the table, it's not a clearly decided question," said Pityana.

"All of these things are the subject of an important debate in our boards of directors, among the cadres," he added.

While AngloGold has reduced its operational presence in South Africa, Pityana noted that registration in the country.

AngloGold will also continue to consider options such as sales, purchases or potential mergers, but will not make a final decision at this time.

"You take a view as a board when you really need it" the chairman said. "We are not here."

From 12:47 pm. On Monday, gold was at $ 1,223.60 US an ounce.

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Disclosure of Titles: I, Nicole Rashotte, have no direct interest in a company mentioned in this article.