Gold News

Gold mine's costs to rocket

South African gold producer Simmer and Jack Mines has said that it will be forced to invest large amounts of capital in its Buffelsfontein mine over the next six years.

The news follows an increasing number of mining companies having noted reduced output at their operations all over the world, which could be good news for investors as the global supply continues to be diminished.

Simmer and Jack has said that it will spend 156 million rand (£10.1 million) on waste rock treatment on top of 217 million rand (£14 million) to explore for more gold in deep-level shaft projects.

In addition, electricity rates are expected to rise by as much as 61 per cent in the coming months, potentially adding another 1 billion rand (£64.8 million) to the mine's cost by 2026.

GFMS recently found that global mine production fell to an 11-year low in 2007. Africa saw the heaviest regional drop, chiefly due to South Africa, while output in North America and Latin America also fell.
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