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Randgold Resources was able to start up production at its Tongon mine once again, following several work stoppages that plagued the mine in Q1 2018.

Randgold Resources’ (LSE:RRS) Tongon gold mine in Côte d’lvoire has resumed production following multiple work stoppages that negatively effected Q1 production, the company announced on Monday (April 30).

Randgold said that the work stoppages began with the employees of its mining contractor, and then spread to other operations.

The company noted that it took every measure to rectify the situation.

“The history of Tongon has reflected the occasionally turbulent socio-political nature of its environment and a misunderstanding of the mining business which is a new activity in the country, but management has dealt effectively with the challenges that have come their way,” said Chief Executive Mark Bristow.

“The mine is managed by a majority Ivorian team and of its 1700 employees, only 40 are expatriates. Their record speaks for itself: since it was commissioned in 2010 Tongon has produced 2.7 million ounces of gold and in 2017 it posted record results, despite the slow start to the year,” he added.

Management noted that the decrease in working hours will impact the mine’s production guidance of 290,000 ounces for 2018.

In 2017, the mine produced 288,680 ounces of gold, a 9.7-percent increase year-on-year, as a result of an 11.6-percent improvement in tonnes processed. That resulted in an improvement in recoveries and a slightly higher head grade.

Despite the losses, the company has vowed to recover most of its lost output, stating, “to mitigate the downtime effect and lost plant throughput, Tongon processed ore from the run-of-mine and scats stockpiles during the stoppages and also used the opportunity to upgrade parts of the plant to achieve a higher and more consistent throughput going forward.”

Randgold noted that management at the mine was supported in resolving the situation by the highest level of government, as well as parliamentary members and local authorities. In addition to these parties, the workers and union leadership have also “agreed on a constructive process to workshop solutions and prevent similar issues in future.”

“Tongon has three-and-a-half years of life left as things stand but we are actively looking for means to extend this and a number of exciting near-mine opportunities are currently being evaluated by the exploration team. We’re also exploring for new gold discoveries elsewhere in our large permit portfolio in Côte d’Ivoire, where we intend to retain a long term presence,” said Bristow.

As of 1:01 p.m. EST on Monday, Randgold’s share price was down 0.34 percent, trading at GBX 5,893.83

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Securities Disclosure: I, Nicole Rashotte, hold no direct investment interest in any company mentioned in this article.

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