After strong growth in 2019, gold production in West Africa was damaged by Covid-19 in 2020 due to the temporary suspension of mines such as Hounde in Burkina Faso and Fekola in Mali.
Overall, 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 one-quarter of the region’s gold mines were on hold due to Covid-19 lockdowns. South Africa was particularly affected with operations at 35 gold mines temporarily suspended out of 56 on hold in the region.
Although production in Ghana fell by 7.5% in 2020, the country experienced only a minimal impact on gold mining activities as it was among the first few countries to resume operations after a 21-day mandatory lockdown across major metropolitan cities announced during March 2020.
Production in Mali fell by 5.6% in 2020 due 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 ten days due to new Covid-19 cases.
In contrast, production in Burkina Faso is estimated to have grown by 2.1% in 2020 to 1,941.8koz. 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.
Looking ahead, overall gold production in West Africa’s leading markets – Ghana, Burkina Faso, and Mali – is expected to increase by 2.7% in 2021 to 8moz and grow to 8.4moz by 2024 – a 1.6% CAGR. The majority of this growth is expected to originate from Ghana where the production is expected to reach 3.9moz in 2024 from a forecasted 3.6moz in 2021.
AngloGold’s Obuasi redevelopment project will be a key boost to production. 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 200,000oz gold production capacity and is anticipated to begin in 2021.
Gold production in Burkina Faso is expected to grow at a CAGR of 3.8% supported by 460koz of new gold production capacity. Overall, 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 1,500koz of gold production capacity. These include the Bombore and Kiaka in Burkina Faso, Obuasi Phase 2 in Ghana, and Kobada in Mali.