Serious merger and acquisition talks surrounding Ashanti Goldfields appear to have evaporated in favour of a different speech that identifies mine costs, replacement ounces and precious metals diversification as key concerns.

Ashanti's chief executive, Sir Sam Jonah, knows of no approaches by AngloGold or any other gold major for that matter: "It's just speculation," he says, of market intelligence reported by "Mineweb" (a mining website) that the South African major has been on Ashanti's premises lately conducting a due diligence.

Jonah said the only way to prepare for corporate activity was to improve the company's share price, an activity in which the company had been long involved. In fact, much has been achieved in the past year to this end.

Firstly, Ashanti's $219 million bond, aimed at partly saving the company from liquidation, was fully redeemed at par and ahead of schedule. Company gearing has been reduced by three times to $193 million from $693 million, and debt levels at Ashanti are at an eight-year low.

In addition, the company's hedge book counter-parties can no longer make margin calls. In fact, since 1999, the year in which Ashanti Goldfields was almost ruined by its hedge book, there has been a 47% reduction in commitment levels, such that the company is increasingly able to participate in the upside of the gold price.

Now Jonah is talking about operational growth in exploration and reserves at all gold mines as well as new platinum group metals (pgm) operations in South Africa. Jonah, in an interview with "Mineweb", said he was in discussions with other potential pgm partners in South Africa: "We are still seeking pgm opportunities in South Africa and have been approached by a number of parties." Jonah confirmed Ashanti was well placed to help in the development of grassroots pgm exploration projects.

In anticipation of peace in the Democratic Republic of Congo (DRC), Ashanti Goldfields has had its title over gold-bearing prospects expanded in that country.

The Kilomoto prospect, which has produced 5 million ounces of gold in the past, is now 8,000km2 and has some 1 million ounces of gold resources identified. Jonah said the company would like to move into the DRC by the year-end although much depends on whether civil calm can be extended and entrenched in the country.

There are a number of growth plans at existing operations: Geita has lifted the capacity of its plant to 6 million tonnes a year, a development which will lift gold production to about 600,000 ounces a year; Iduapriem and Teberebie have increased the CIL capacity such that gold output will be about 250,000 ounces a year; and an expansion at Siguiri, Ashanti's Guinea operation.

A major challenge for Ashanti in its new financial year is cost containment. Jonah said fuel, power and labour costs were threatening to place pressure on the company such that management will be doing well to contain total cash costs to below $210 per ounce compared to last year's average $199 per ounce.

Meanwhile, the Corporate Affairs Executive, Mr. John Owusu, said that the rights issue is a plan, in which the company has committed to raise $75 million once the annual results have been incorporated into the initial F1 shelf listing. Trevor Schultz, an Ashanti director, said the intention was to continue to lessen the burden on its balance sheet.