Gold miner AngloGold Ashanti has produced first gold from its Tropicana joint venture project ahead of schedule and on budget.
The miner announced on Thursday the ounces were delivered below its current average cost structure.
“We’ve taken Tropicana all the way from discovery through development and now into production,” AngloGold Ashanti VP for Australia, group planning and technical Graham Ehm said.
“To pour gold ahead of schedule and within budget is a rare feat in this industry, and it’s a significant milestone for us and Independence Group, our partner,” he added.
It is estimated cash costs for Tropicana will be between $590 and $630 per ounce.
AngloGold holds a 70 per cent stake in the Tropicana mine, located in Western Australia, with Independence Group controlling the remaining 30 per cent interest.
At the recent Diggers and Dealers conference Ehm said the successful development of “new lower cost operations” is critical for growing margins.
Located 300 kilometres northeast of Kalgoorlie, the operation was originally forecast to begin production in December this year, but with commissioning already underway ramp-up was moved forward to occur in the December quarter.
“Tropicana is a significant new, low-cost mine in an emerging gold province and will improve the quality of AngloGold Ashanti (and Independence Group's) portfolio; we continue to make good progress with our partners on a project we've taken up the value curve, from discovery to commissioning,” Ehm said.
“First gold is obviously a significant milestone, but achieving a smooth ramp up and steady state production is just as significant.
“We’ve modelled Tropicana against other similar operations to generate a ramp-up profile and expect to be at 91 per cent availability within four to five months.”
Despite moving ahead of schedule the estimated capital expenditure for the project is unchanged at between $820 and $845 million.
The company is aiming to achieve a production rate of between 470 000 to 490 000 ounces in the first three years.
Tropicana has been on the radar of many analysts for some time now, after the joint venture partners announced in December last year that they had upped the total estimated resource to 7.89 million ounces of gold.