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Randgold Surges As Production Forecast Remains Unchanged Despite Mali Unrest

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4/10/2012 3:35 AM ET

Shares of Randgold Resources Ltd (GOLD: Quote, RRS.L) are surging over 8 percent on the London Stock Exchange after the miner welcomed a political settlement in Mali and maintained its production forecast.

Rebel military officials, led by Captain Amadou Sanogo, had taken control of Mali on March 21, and announced dissolution of the government led by President Toure. The coup was triggered by dissatisfaction among a large section of the military over the government's failure to address their demands for better supplies and arms to tackle the Tuareg uprising.

Earlier this week, Mali's coup leaders entered into an agreement with the West African regional grouping, ECOWAS, to return power to the civilian government in exchange for end of sanctions against the military junta. President Amadou Toumani Toure has formally resigned as part of a power transition agreement.

Mali's ECOWAS neighbours have lifted the sanctions they had imposed and committed to actively support the restoration of stability in Mali.

The company's chief executive Mark Bristow said today that the announced resolution of the political crisis had strengthened the miner's confidence in the political maturity of the West African region and its ability to settle conflict situations without external involvement.

Randgold said the disruptions that followed last month's military coup had not materially affected its gold production in that country. Randgold owns and operates the Loulo/Gounkoto mine complex in Mali and also operates Morila, a joint venture with AngloGold Ashanti.

"During this period these operations continued to operate without any material disruption...Our production guidance for 2012 remains unchanged, although we have not completed our assessment of the impact this situation has had on costs," Bristow said.

RRS.L is currently trading at 5,581.91 pence, up 426.91 pence or 8.28 percent, on a volume of 74,701 shares.

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by RTT Staff Writer

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