South African based mining giant, Rangold has terminated its joint venture agreement with AngloGold Ashanti over the development of the Obuasi mine.

The conditional investment agreement which was concluded in September this year was called off because Rangold claimed it did not meet their investment criteria.

The decision follows concerted efforts by both companies to improve the project’s returns and also to secure an appropriate set of consents from the Government of Ghana, within an ambitious timeframe that would have allowed for a feasibility decision on the redevelopment of the mine in early 2016.

Although improvements have been identified, these have not been sufficient to commit to a substantial investment under the prevailing conditions.

The Minister of Lands and Natural Resources of Ghana has approved continuation of the Obuasi Gold mine limited operating phase during Quarter one of 2016.

Limited operations will be undertaken at reduced cost, compared to 2015, including maintaining the operations, security, environmental management, optimizing the feasibility study, as well as ongoing sustainability work.

According to the CEO of AngloGold Ashanti,” 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.

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