Miner aims to focus on new mines after failed Yamana Gold buy
Gold Fields seeks new deposits as some mines get depleted
CEO plans to start Canada's Windfall gold project in 2026
By Felix Njini and Nelson Banya
NAIROBI, June 29 (Reuters) - Gold Fields said it would pursue growth by building new mines and searching for new gold deposits after a bid to rapidly expand through a $6.7-billion acquisition of Yamana Gold was foiled by rivals.
The gold miner is now opting to investing in new operations, "building one mine at a time" in regions such as Canada and Latin America, where there are more lucrative gold deposits, Martin Preece, its interim chief executive, said.
Gold Fields could still pursue smaller acquisitions, but it lost appetite for large deals after the Yamana bid also provoked angst among investors who balked at the premium offered to the Canadian miner and the subsequent share dilution, Preece said.
"Our going back to basics is we find the right mine and build it, we know how to build mines," he told Reuters.
"I think the advantage of building mines is you find them at early stage and you can get in at a reasonable cost and you can enjoy the upside."
Gold Fields, like its Johannesburg-based rival AngloGold Ashanti, has shifted focus from its home country to more profitable mines in Ghana, Australia and the Americas region.
While the gold miner founded by Cecil John Rhodes in 1887 still runs South Deep operation in South Africa, mining in the country has become more difficult as the geological challenges of extracting bullion from the world's deepest deposits are worsened by severe power outages and crime.
Gold Fields plans to start a new mine at its Windfall project by 2026 targeting about 300,000 ounces of gold at full production, Preece said.
The Canadian project, being jointly developed with Osisko Mining, offers Gold Fields a renewed push into Canada's mining sector even after it failed to bag Yamana, Preece said.
The partnership with Osisko Mining offers new opportunities to search for deposits in areas adjacent to the Windfall project, ensuring Gold Fields' presence in Canada for "a long time", Preece said.
The new mines are needed as some of the company's assets, such as the Damang and Cerro Corona mines in Ghana and Peru, respectively, run out of commercially viable ore.
The miner's Salares Norte mine in Chile will start producing in the fourth quarter and will help Gold Fields' output peak at about 2.8 million ounces by 2025 from a level of about 2.3 million now, the CEO said.
"Certainly, in Canada we want to strengthen our foothold, look for the right opportunities," Preece said. "Canada is underexplored and there is still huge potential." (Reporting by Felix Njini in Nairobi and Nelson Banya in Harare; Editing by Clarence Fernandez)