SWISH THAT PAN

Tanzania 2015 | INDUSTRY & MINING | INTERVIEW

TBY talks to Brad Gordon, CEO of African Barrick Gold (ABG), on local content, expansion plans, and production targets.

Brad Gordon
BIOGRAPHY
Brad Gordon was appointed as CEO of African Barrick Gold (ABG) in August 2013. He was previously the CEO of Intrepid Mines, a Canadian and Australian listed precious metals exploration and development company with primary operations in Indonesia. Prior to his time at Intrepid, he was the CEO of Emperor Mines, the Australasian subsidiary of DRDGold before it merged with Intrepid. Before that, he held a series of progressively senior positions with Placer Dome. Gordon holds a Mining Engineering degree from the Western Australia School of Mines and an Executive MBA from INSEAD, France.

How is African Barrick Gold (ABG) working to increase the level of local content?

When I joined we had an office in Johannesburg, with a staff of over 200 people. We are relocating all but 25 to Dar es Salaam to our new premises. Those roles have been given to Tanzanians. Even at our mines, we have reduced the number of expatriates from over 500 to about 300 over the past few months, and that number will continue to decline.

How has your experience in Tanzania helped you in your expansion plans for other countries in the region?

We are the largest private employer in the country and the largest power contributor in the country. We are also the largest taxpayer. ABG has been here now for nearly 15 years, and it was one of the first companies to establish a foothold here when the mining industry was opened up to private enterprise. We have done well out of it—and so has Tanzania—as a result of our presence. Tanzania will always be our hub, although we do have an active exploration program in Kenya. One day that may become a second operating country if it develops into a mine. We are looking at opportunities in West Africa as well. ABG hopes to be a significant player on the African content, with Tanzania being the center of gravity.

Can you elaborate on ABG's plans regarding exploration?

Most of our opportunities in Tanzania are immediately around our three mines. We did have a large land bank in Tanzania, though we have now relinquished about 80% of that so that it can pass on to the next generation of miners. There are several junior explorers that have entered the country to start reworking that ground, which in itself creates a new economy in mining and exploration.

What brownfield projects are you focusing on in the near term?

The company has been losing money for some time; however, we are happy to acknowledge that we are starting to make money today even at the prevailing low gold prices. We have dropped our cost base by more than one-third over the past year. The primary focus for us is to fix the three mines. Next, we need to look at how we can improve their production and to examine the other resources we can mine at each of those three locations. We are doing quite a bit of drilling in and around the mines and deeper below them. At North Mara, for example, we think we will be going underground for the first time in 2015 from operating an open mine. And meanwhile, Bulyanhulu is a world-class deposit with nearly 20 million ounces running at around 10 grams per ton. Based upon today's numbers that will suffice for another 30 or 40 years. With the additional drilling we are doing on reef one and reef two we expect that that will be 50 years plus, making it a fantastic asset. I am glad it is ours and not someone else's.

What are your targets for 2015?

In 2013, we produced 640,000 ounces. In 2014, we are aiming for between 640,000 and 690,000 ounces. In 2015, we will be significantly higher than that, mainly driven by the improvement at Bulyanhulu. We are aiming to almost double the overall production level from that underground mine. That will be a significant achievement. I look forward to registering an annualized run rate of 350,000 ounces at Bulyanhulu by the end of 2015.