South African Mining firm Anglogold Ashanti on Tuesday reopened its Obuasi mines in Ghana after years of inactivity.
The development is expected to revive economic activities at Obuasi in Ghana’s Ashanti Region.
The concession was shut down about three years ago following the invasion of illegal miners. It led to the death of an official of the mining firm.
Africafeeds.com understands the mine is starting gold production at an initial cost estimated between $450 million to $500 million.
Obuasi has gold reserves of 5.8 million ounces and will operate at costs lower than Anglogold’s current average operational cost.
Ghana’s President Nana Akuffo Addo helped to officially reopen the mine on Tuesday.
In 2018 Ghana’s Parliament ratified the Stability and Development Agreements including fiscal concessions entered into between Ghana and Anglogold Ashanti Ghana Limited.
The agreement also granted the mining firm a tax concession worth $259 million in a bid to give the firm a lifeline opportunity to redevelop its defunct Obuasi mine.
Per the agreement, Anglogold Ashanti is expected to make a capital investment of $880 million in the Obuasi mine during the execution of the agreement.
Ghana is hoping to derive some $5.3 billion from the development of the mine over a 22-year period.