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Gold Production To Hit 8% Increase By 2024

Ghana’s gold output is estimated to record a positive growth after a dip in 2020 due to disruptions by the COVID-19 pandemic.

The country’s gold production is forecasted to hit 3.6million ounces in 2021 and 3.9million ounces by 2024, according to GlobalData, a leading data and analytics company.

This implies a surge of 8.33% in the next three years.

“AngloGold’s Obuasi redevelopment project will be a key boost to production,” Vinneth Bajaj, Associate Project Manager at GlobalData, remarked. “The first phase has already been completed, and the momentum of the second phase was maintained despite COVID-19 challenges”.

The project is expected to contribute up to 200 000 ounces of gold production capacity and is anticipated to begin in 2021.

Despite a production dip by 7.5% in 2020 due to a three-week partial lockdown in March, a positive recovery is expected to keep Ghana’s status as the largest producer of gold in Africa after overtaking South Africa in 2019.

Comparatively, Ghana’s rival is expected to have recorded a decline of 10.9% in 2020.

Gold investments expected to shoot up

In January 2020, the average price for an ounce of fine gold was US$1,560.67 U.S. dollars. It increased to US$1,869.675 as of January 2021.

However, it has fallen to US$1,784.90.

Gold remains a major contributor to Ghana’s Gross Domestic Product.

In the first three quarters of 2019, mining and quarrying contributed GHS21.6bn ($4.2bn) to GDP.

Other estimations

In November 2020, Minister of Lands and Natural Resources, Kwaku Asomah-Cheremeh, said that the Nana Akufo-Addo government expected the mining sector to surpass last year’s production of over 4 million ounces of gold.

This does not seem to be the case from the figures produced by GlobalData.

Also, Fitch Solutions had expected gold production to achieve 9.0% growth year-on-year, reaching 4.7 million ounces of gold.

World outlook

Gold production in West Africa’s leading markets – Ghana, Burkina Faso and Mali – is expected to increase by 2.7% in 2021 to 8 million ounces and grow to 8.4 million ounces by 2024 – a 1.6% compound annual growth rate (CAGR).

The majority of this growth is expected to originate from Ghana.

“A total of 12 projects are currently under development across Ghana, Burkina Faso and Mali, which are expected to be operational by 2024, representing more than 1 500 000 ounces of gold production capacity. These include the Bombore and Kiaka in Burkina Faso, Obuasi Phase 2 in Ghana and Kobada in Mali,” Mr Bajaj added.

The pandemic had a significant impact on African operations, mainly during the early part of the second quarter of 2020, when, at one point, over 25% of the region’s gold mines were on hold due to COVID-19 lockdowns, reports GlobalData.

Production in Mali fell by 5.6% in 2020, owing to the COVID-19 operational disruptions across several mines, including the closure of the Morila and Sadiola mines. The country initially continued business activities, despite the outbreak.

However, in December 2020, the government imposed a lockdown for 10 days on the grounds of new COVID-19 cases.

In contrast, production in Burkina Faso is estimated to have grown by 2.1% in 2020 to 1, 941, 800 ounces. The growth was mainly supported by higher output from the Mana Gold, Karma and Hounde mines with 36.3%, 3.1% and 6.3% growth, respectively.

Furthermore, the commencement of the Wahgnion Gold project in 2019 and the Sanbrado Gold project in 2020 contributed towards higher output in 2020. In Burkina Faso, gold production is expected to grow at a CAGR of 3.8%, supported by 460 000 oz of new gold production capacity.

Gold production is expected to increase globally by 5.5% in 2021 to 113.9 million ounces and grow to 124.1 million ounces by 2024 – a 2.9% compound annual growth rate (CAGR).

Canada, Indonesia, Peru, and the US will be the key contributors to this growth.

Combined production in these countries is expected to recover from an estimated 20.1million ounces in 2021 to 25.3 million ounces in 2024.


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