Randgold Resources    Annual Report 2005 19
MORILA MINE
The company’s major producing asset since October
2000 has been the Morila mine. Morila was discovered
and developed by Randgold Resources between 1996
and 2000 and is now owned by a Malian company,
Morila SA, which in turn is owned 80% by Morila Limited
and 20% by the state of Mali. Morila Limited is jointly
owned by Randgold Resources and AngloGold Ashanti.
The mine is controlled by a 50:50 joint venture
management committee with day to day operations
being the responsibility of AngloGold Ashanti Mali SA
(“Anser”), a Malian subsidiary of AngloGold Ashanti,
under an operating agreement. During the year, Anser
underwent a major restructuring and senior staff changes
were implemented. An independent CEO was appointed
who answers directly to the Morila SA board.
From the start of production in October 2000 through
December 2005, Morila has produced approximately
3.8 million ounces of gold at a total cash cost of
US$125 per ounce, and Morila SA has paid total
dividends to its shareholders of US$428.8 million.
Morila produced 651 110 ounces of gold for the year,
outstripping 2004’s production by some 140 000 ounces.
Slightly higher grade than budgeted as well as increased
recoveries combined with an increased milling rate led
to earlier forecasts being exceeded.
The year started poorly with the plant failing to reach
design capacity. Working together with its partner, the
company addressed the various issues with the goal of
achieving consistent and sustainable production. While
the plant was still not operating at full expanded capacity
by year end, monthly throughput in the second half of
the year increased by almost 10% over the first half,
indicating that the remedial action was taking effect.
Costs were reasonably well contained given prevailing
increases in input costs. Cash operating costs, before
adjusting for exceptional costs relating to provisions and
indirect taxes, were US$189 per ounce, up from last
year’s costs of US$158 per ounce. Total cash costs
were US$221 per ounce for the year after year end
accounting adjustments and indirect tax provisions.
Good mining performance in the last quarter allowed
the mine to catch up the production lost in the third
quarter as a result of an unprocedural strike by the
mining contractor’s employees.
Below is a summary of the salient production and financial
statistics as well as a comparison with the previous
year’s results:
MORILA RESULTS
2005
2004
Total mined tonnes
(million tonnes)
24.6
26.6
Ore tonnes mined
(million tonnes)
7.0
5.3
Mined grade (g/t)
4.3
4.3
Ore tonnes milled
(million tonnes)
3.8
3.5
Head grade (g/t)
5.9
5.2
Recovery (%)
91.7
87.9
Ounces produced
(oz)
651 110       510 485
Average gold price
received (US$/oz)
US$449        US$382
Cash operating cost
(excluding royalty)*
(US$/oz)
US$189        US$158
Total cash cost
(US$/oz)*
US$221        US$184
Profit from mining
(US$ million)*
US$158.5      US$89.8
Attributable
(40% proportionately
consolidated)
Gold revenue
(US$ million)
US$120.8      US$73.3
Ounces produced
(oz)
260 444      204 194
Profit from mining
(US$ million)*
US$63.3      US$35.9
* Refer to note 25: Notes to the consolidated financial
statements page 63.