Rangold Resources has terminated contract for redeveloping AngloGold Ashanti‘s Obuasi mine in Ghana.

When the companies announced a deal in September 2015 to form a JV to redevelop and operate the gold mine, Randgold agreed to lead and fund a development plan designed to rebuild it.

The latest decision announced by Rangold follows efforts put in by both companies to improve the project’s returns.

"In the current environment, we believe it is prudent to conserve our resources."

The companies were also awaiting approval from the Government of Ghana, which would have allowed taking a feasibility decision on the mine redevelopment in early 2016.

During the first quarter of 2016, the Ghana’s Minister of Lands and Natural Resources approved continuation of Obuasi’s limited operating phase.

AngloGold Ashanti CEO Srinivasan Venkatakrishnan said: "We have made a concerted effort to unlock a new opportunity for Obuasi, and the work we have done lays a good foundation for the operation in the long-term.

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"But in the current environment, we believe it is prudent to conserve our resources and to revisit this opportunity when market conditions improve."

Image: Obuasi mine has proven and probable ore reserves of 24.53Mt at 6.70g/t for 5.29Moz. Photo: courtesy of Randgold Resources Limited.