AngloGold Ashanti (NYSE:AU), Gold Fields (NYSE:GFI) Looking to Go Even Deeper at South African Mines

AngloGold Ashanti (NYSE:AU) and Gold Fields (NYSE:GFI) are looking to dig even deeper in their quest for gold in South Africa, with AngloGold looking to go 1,000 meters lower than the 4,000 meters they're down already for its Mponeng mine.

There have been few major, new gold discoveries recently, and other their acquiring other gold miners, which would sell at a premium because of scarcity and valuations, the other option is to expand organically, and in South Africe that means deeper and wider.

AngloGold CEO Mark Cutifani says, "The most critical challenges for all of us in South Africa are depths and depletion of reserves."

To that end, he said he has no reason not to dig another 1,000 meters down at Mponeng to extract more gold.

Cutifani said if the digging at Mponeng ends up being successful, it could add up to 3 decades of mining life to the mine, and at competitive costs. It will take a minimum of fiver years to complete the digging.

"There's another 100 million ounces in our areas, and our thinking now is how do we get it. It's too big a prize to walk away from. Even if the gold price were lower, we would still do it," Cutifani asserted.

According to Gold Fields CEO Nicholas Holland, the company has an estmated 25 million ounces of gold close to where they're at now, and drilling a little deeper will given them access to it. One of those is the Driefontein mine, which they may only have to go down another 300 meters below the 3,500 meters down the company is working at now.

Holland said, "We can maintain production at existing mines for at least the next five to 10 years."

Gold Fields closed Wednesday at $16.58, gaining $0.42, or 2.60 percent. AngloGold closed at $46.26, rising $0.35, or 0.76 percent.