(Ecofin Agency) - Côte d'Ivoire aims to produce 55 tonnes of gold this year. Two of the companies that should significantly contribute to this goal, with over 16 tonnes coming from four gold mines, faced power cuts in the past quarter.

Allied Gold’s Q2 2024 output in Côte d’Ivoire was below its expectations. The firm recently reported that it failed to produce an additional 8,625 ounces of gold during the period, due to intermittent power outages. Allied Gold consequently lost about $20.9 million. The loss was calculated based on August 9 gold price of approximately $2,432 per ounce.

Allied Gold operates the Agbaou and Bonikro mines and is not alone in facing challenges from the country's power supply issues. Endeavour Mining, which owns Côte d'Ivoire's largest gold mine, the Ity mine, also reported increased costs due to power cuts. 

In its Q2 report, Endeavour noted that it had to generate electricity on-site, costing an average of $0.28 per kWh, compared to $0.18 per kWh from the national grid. This situation also affected Endeavour's operations at its Houndé and Mana mines in Burkina Faso, leading to a $52 per ounce increase in overall gold production costs.

Allied Gold resorted to generators at its Ivorian operations to address the outage situation. The company is also in talks with a supplier of solar energy solutions to reduce reliance on the national grid. 

Meanwhile, mining companies in Mali were not affected by load shedding in Q1 2024, as they have independent power solutions, including solar and generator power.

The power supply issues in Côte d'Ivoire have primarily stemmed from technical problems at the Azito thermal power plant and the Compagnie Ivoirienne de Production d'Électricité (CIPREL), which together account for 75% of the country's electricity production. However, Endeavour reported that the situation is improving with the return of the rainy season, which is boosting hydroelectric production.

Côte d'Ivoire produced 51 tonnes of gold in 2023 and is aiming for at least 55 tonnes in 2024. Endeavour's Ity mine and the new Lafigué gold mine are projected to produce between 10.2 and 11.6 tonnes this year, accounting for up to 21% of the national target. Meanwhile, Allied Gold aims to produce between 180,000 and 200,000 ounces in 2024 from its two Ivorian mines. In Q1 2024, the mines had delivered 73,198 ounces.

Emiliano Tossou