Gold Fields has agreed to form a joint venture (JV) with AngloGold Ashanti to create what they claim to be Africa’s biggest gold mine.

The JV will combine Gold Fields’ Tarkwa gold mine and AngloGold Ashanti’s adjacent Iduapriem gold mine. The two mines are located near the town of Tarkwa in Ghana’s Western Region.

Gold Fields currently owns a 90% stake in Gold Fields Ghana, which owns the Tarkwa Mine. The balance stake in Gold Fields Ghana is held by the Government of Ghana (GoG).

AngloGold Ashanti holds a 100% stake in the Iduapriem Mine.

Gold Fields and AngloGold have agreed on the key terms of the proposed JV and started constructive engagements.

AngloGold said that the proposed JV would create one of the world’s largest gold mines, which is supported by a substantial mineral grant. It will have an initial operational life of almost two decades.

Gold Fields interim CEO Martin Preece said: “The proposed joint venture is an exciting opportunity to combine mining operations that are essentially part of the same mineral deposit and is something that Gold Fields and AngloGold Ashanti have discussed many times before over the years.”

The JV is expected to produce an annual average of 900,000oz in gold production over the first five years. It will then stand at 600,000oz over the estimated life of the operation.

Gold Fields will hold a two-thirds interest and AngloGold a one-third interest in the JV. The remaining stake will be held by the GoG.

The JV finalisation is subject to approval by the GoG, as well as other precedent conditions.