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FINALIST: MINER

Full pipeline has Gold Fields

content

by Dominic Piper

s peers consider expensive options for growth in a high gold operation was solidified in 2020 with the construction of a $112
Aprice environment, Gold Fields Ltd can look out to a stacked million sustainable power solution incorporating hybrid gas, solar
growth profile in the knowledge most of the heavy lifting has and wind.
already been done. “This is the first mine in the world to have a major component of
In 2014, Gold Fields was staring at a dwindling production outlook. power coming from wind,” Mathews said. “It has been online since
Having disposed of most of its South African assets, its only June and so far, there has been one day where we ran 100%
remaining domestic operation, the flagship South Deep mine, was renewable and all underpinned by gas. It hasn’t missed a beat.”
still underperforming and its Australian and West African assets The company expects to average 55-60% power from renewables
looked increasingly mature. once the project is at steady-state output. Mathews said the power
To rectify its subdued position and in defiance of a depressed project was evidence of Gold Fields’ confidence in Agnew’s future.
gold market, the company began investing heavily in its existing “We had a long-term power agreement for 20 years coming up
Australian and Ghanaian operations as well as setting out on an for renewal but would probably have had to upgrade our power
acquisition spree in the Eastern Goldfields of Western Australia. capacity because it wasn’t enough,” he said. “We thought with
Six years on, the company has one of the strongest growth profiles exploration potential and investment made and future we saw, the
in its peer group, stemming largely from organic opportunities. power solution should be big enough for our own long-term power
“We were the No.1 performer among the Top 10 stocks on the supply.”
JSE in 2019 and that continued in 2020, probably because we built A further $38 million has been invested in new accommodation
projects counter-cyclically,” Gold Fields vice president Australasia facilities.
Stuart Mathews explained to GMJ. “We spent three years on major “With those two strategic investments, Agnew feels like a state-of-
capital injection programmes into the company – particularly in the-art new mine, but it has been there for 40 years,” Mathews said.
West Africa and Australia. We came out of that process earlier than
It has also generated goodwill among Gold Fields employees.
our peers and now we are generating serious cash and serious
“People can now walk to site from camp,” Mathews said. “Morale
reward for it because we did what we said we would.”
on site is the highest in any mine we have, particularly because
That serious reward has included a 300% share price increase
of the commitment to renewables. It makes young people want to
between December 2019 and August 2020 – although it has
work for us.”
retracted 35% since then.
New power and camp infrastructure alone cannot ensure a future
At the heart of Gold Fields’ improvement has been its Australian
for Agnew but Gold Fields has been spending $20 million each
division which delivered 249,600oz at AISC of $1,288/oz in the
year on exploration.
September quarter and 256,900 @ $1,476/oz in the June quarter.
“The reserve and resource base is growing and now we have
There was also an overall reduction in total capex, from $94.4
million to $80.6 million quarter-on-quarter and from $86.6 million in confidence for further investment in the plant to increase throughput
and in the mine for even further reserve/resource extensions.”
the September 2019.
While Agnew continues to defy scepticism, St Ives is the kind of
Mathews said the capex spend was remarkable given the mature
operation every mid-tier gold miner wants; a consistent, prolific
nature of three-quarters of the group’s WA operations – Agnew, St
producer.
Ives and Granny Smith.
“It now has that consistency
“There has always been
Gold Fields has one of the largest brownfields exploration budgets
rhetoric about Agnew having a of delivery at 360,000 ozpa,”
in the Australian gold space
short mine life but it’s had three Mathews said. “We have been
running at that for four years
years of reserves for 40 years,”
and have a line-of-sight for
he said.
eight years at that rate with
Reserves at Agnew are up
exploration for beyond.”
38% and the company’s
To fulfil that potential, Gold
long-term commitment to the
Fields has doubled exploration
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