Shortly after Australian Mark Cutifani arrived at AngloGold Ashanti, he was forced to wear a Springbok rugby jersey for two days as his colleagues celebrated the Boks’ World Cup victory.
Cutifani describes the event as ‘an absolute tragedy”, but despite this trauma, he appears relaxed and smiling when we meet at the mining house’s head offices in the refurbished Turbine Hall in downtown Johannesburg. ‘Culturally, South Africa is closer to Australia than Canada [where Cutifani previously worked] — there’s the weather, rugby and cricket. Clearly the big difference is the transformation process, which is unique anywhere in the world. It’s very exciting and great to be part of,” he says.
He might have been in the job only six months, but already AngloGold’s new chief executive is facing probably one of the toughest tests of his career. Mining, more than most other industries, depends on a ready supply of power. At AngloGold 60% of the power supply is used to ventilate the shafts, pump water, cool air, keep lights on and transport operational equipment — and that’s before one ounce of gold is produced. ‘If we’re operating on 10% less power, that has a 25% impact,” he says.
This quarter AngloGold will lose 200 000 ounces of production due to the mining shutdown in January and the power rationing that followed. For the rest of the year 65 000 ounces will be lost each quarter because of continued power rationing.
But Cutifani’s not giving up just yet. ‘Our objective is to be back at 100% production on 90% power within six months. We don’t know how to get that yet. But we’ve got to find a way. We’ve got great ideas already and people band together in a crisis.”
Power can’t always be guaranteed in other countries where AngloGold operates. In Ghana, for example, the group entered into joint ventures with other mining groups to supply power. But in South Africa diesel-supply constraints make that option less viable. ‘We have to work through Eskom. We have a very good relationship with Eskom,” he says, although he admits that some harsh words might have been exchanged recently. ‘A lovers’ tiff,” he says with a smile.
Nevertheless, safety, not power, is Cutifani’s top priority. ‘I have a fundamental belief that every accident is preventable. It might take us five years, or 15 years, but we will continually work on getting there. Safety is a belief. It’s something that sits within everything I do.”
South Africa has some of the world’s most challenging mines, because of the depth and the nature of the mineral formations, which together create seismic risk. ‘We have the best deep-mining skills in the world. But, even with the best skills in the world, we still have accidents,” Cutifani says. Depth doesn’t have to be dangerous. Cutifani says he was responsible for the deepest base-metal mines in Canada, where he was chief operating officer for CRVD Inco, and his mines were the safest in the country.
He’s keen to avoid further divisiveness when working on an issue as emotional as that of safety and says the concerns raised by government and the unions are legitimate.
‘First we have to acknowledge the great work done by everyone here. We need to learn from what worked and what hasn’t worked. We’ve got to do it together and as partners in the future,” he says.
Cutifani himself is a union man, having started right at the bottom as a coalminer for CRA, while studying part-time for a degree in mine engineering at the University of Woollongong. He’s worked on five continents. Now that he’s with Anglo-Gold, Africa is the sixth.
Getting international relations right is another area to work on. In a global company it’s important to understand cultures which, Cutifani says, the mining industry has not always done well. ‘One of the lessons we’ve learned is that every country is different. We’ve assumed all countries are like South Africa. They’re not. We need to understand the cultures; we’re guests in other countries we need to work with other cultures to be successful. We haven’t done that as well as we could have it was a mistake and we need to rethink our approach.”
This isn’t only a criticism of Anglo-Gold or the South African industry. ‘This is no different to an Australian company going to Indonesia. It’s a criticism of the mining industry in general. We tend to recreate our own culture.
‘In Ghana we merged with Ashanti and conducted our operations as though we were in South Africa. We don’t have as strong a relationship with the Ghanaian people and our operations are not performing as well as they could. We have to take full accountability for our successes and failures in the country and we’re not blaming anyone else.
‘It’s different wherever you go — the people, the technology, the social and community issues. You have to learn to be flexible, learn to listen. There’s the old adage that you have two ears and one mouth, and you should use them in that proportion.”