South Africa is set to open its first new underground gold mine in 15 years, a rare development for a country that once led the world in gold production.
Junta-led Burkina Faso bets on revived gold mines to boost production in 2025. West Wits Mining Ltd. plans to start output next year at its Qala Shallows project, located on the western edge of Johannesburg, a city built on the 1880s Witwatersrand gold rush, Bloomberg reports.
South Africa is set to open its first underground gold mine in 15 years, Bloomberg reports. The $90 million project is expected to produce around 70,000 ounces of gold annually.
While modest by global standards, it represents a significant boost for South Africa’s struggling gold sector.
Qala Shallows, part of a concession that operated for more than a century before closing in 2000, is projected to generate $2.7 billion in revenue over its 17-year lifespan, with production costs estimated below $1,300 per ounce, according to a feasibility study.
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West Wits has secured approximately $50 million in loans from the state-owned Industrial Development Corp. and Absa Group Ltd. to support construction, with ore to be processed at a nearby plant owned by Sibanye.
Once the world’s top gold producer, South Africa’s output has fallen by more than 70 percent over the last two decades, as deep, high-cost mines struggle to compete internationally. Ghana overtook South Africa as Africa’s leading gold producer.
Top five biggest African producers of gold in 2019. Today, the country’s gold sector employs fewer than 90,000 people, less than a fifth of the workforce it had during the 1980s.
Rising wages, soaring electricity costs, and the challenges of operating some of the world’s deepest mines have intensified this decline.
Qala Shallows will reach a maximum depth of 850 meters (2,788 feet), relatively shallow compared to other South African mines that extend beyond 3 kilometers (1.9 miles) underground.
The country’s last new underground mines were Gold One Group Ltd.’s Modder East, which began producing in 2009, and Burnstone, briefly opened in 2010 before being acquired by Sibanye Stillwater Ltd.
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