South Africa is preparing to open its first new underground gold mine in 15 years, marking a rare revival in a sector that once dominated global production. West Wits Mining Ltd., an Australia-listed company, is investing US$90 million to develop the Qala Shallows project on Johannesburg’s western fringe, with production expected to start in 2026. Ore will be mined during the three-year construction phase, allowing the company to benefit from record bullion prices, which have surged nearly 27% this year following a similar gain in 2024.
The project represents a modest but symbolic boost for South Africa’s shrinking gold sector. Qala Shallows is expected to produce about 70,000 ounces annually, with a projected 17-year mine life generating US$2.7 billion at costs under US$1,300/oz, compared to current gold prices above US$3,300/oz. The mine will extend to a maximum depth of 850 meters—far shallower than the ultra-deep operations that have made South Africa’s gold industry both world-renowned and prohibitively costly. Financing has been secured through the Industrial Development Corporation and Absa Group Ltd., while ore will be processed at an existing Sibanye facility, reducing capital requirements.
The revival of underground mining at Qala Shallows reflects both the resilience and constraints of South Africa’s gold industry. While the mine’s projected 70,000 ounces per year is modest compared to historical output, leveraging high bullion prices and existing processing infrastructure offers a pathway to keep the sector alive. With employment in gold mining having shrunk to less than one-fifth of its 1980s peak, projects like this carry disproportionate weight for communities that remain economically tied to the industry.