12:25 p.m. Jul 21, 1999 Eastern
ACCRA, July 21 (Reuters) – Ghana’s Ashanti Goldfields said on Wednesday it was cutting 2,155 jobs, or over 20 percent of the workforce, at its main Obuasi mine from September 1 because of the fall in the gold price.
It said in a statement it had agreed the cuts with the Ghana Mineworkers Union, the Obuasi workforce and the ministry of employment.
The agreement will mean 2,000 of 8,152 shift workers will lose their jobs, 150 Ghanaian senior staff out of 942 and five expatriate senior staff out of 41.
The total cost of the redundancy plan is estimated at $10 million.
Ashanti said it would take a special charge to cover that cost in the quarter ending September 1999.
“The plan is expected to reduce Obuasi operating costs by about $7 million per annum, equivalent to $9 per ounce at current production levels,” it said.
“All of Ashanti’s mines other than Iduapriem, which is expected to close in 2000, and Obuasi have operating costs below $200 per ounce,” it added.
Ashanti said the background to the cuts was “the drastic fall in the gold price” exacerbated by the UK gold sales programme that began this month.
“Ashanti has renewed its efforts in reducing operating costs across all of its mines, and in particular is critically reviewing the future of the Obuasi surface mine, which is currently the highest cost mine in the group,” it said.
The union said Ashanti had already made some 500 casual workers redundant.
Ashanti’s statement mention 3/4
