South Africa to Open First New Underground Gold Mine in 15 Years with Qala Shallows Project

South Africa is set to open its first new underground gold mine in 15 years, West Wits Mining Ltd.'s Qala Shallows. The $90 million investment will yield a modest annual output of 70,000 ounces. The mine's opening marks a rare event in a country that was once the world's largest gold producer, whose production has slumped by over 70% in the past 20 years due to high costs and competition from other producing countries.

South Africa is poised to re-enter the underground gold mining sector after a 15-year hiatus, with West Wits Mining Ltd. set to commence operations at its Qala Shallows mine next year. The $90 million investment, which will yield an annual output of 70,000 ounces, marks a significant milestone for the country's dwindling gold sector [1].

The Qala Shallows mine, located on the western fringe of Johannesburg, is a previously untapped section of a concession that was closed in 2000 after operating for over a century. The project, which will have a maximum depth of 850 meters, is projected to generate $2.7 billion over its 17-year life, with costs of less than $1,300 an ounce [1].

West Wits Mining Ltd. secured its mining rights from the South African government four years ago and has been mobilizing contractors to the site since June. The company will utilize the processing capacity of Sibanye, a nearby facility, to process the ore [1].

The mine's opening comes at a time when gold prices have soared, reaching record-breaking levels. In 2025, gold prices have risen by approximately 27% after a similar gain in 2024. This surge in prices has revived international deal-making and investment in new production [1].

South Africa, once the world's largest gold producer, has seen its production slump by more than 70% over the past 20 years. High costs and competition from other producing countries have contributed to this decline. The country's gold industry now employs just under 90,000 people, a fraction of the number that used to power the apartheid economy during the 1980s [1].

Harmony Gold Mining Company Limited, another major player in South Africa's gold sector, produced 1.5 million ounces of gold in 2022/23. The company operates 12 mines in South Africa and one in New Guinea [2].

The opening of Qala Shallows is a bright spot for South Africa's gold sector, which has been struggling to compete with other producing countries. The mine's success could pave the way for further investments and revive the country's gold industry.

References:
[1] https://www.bloomberg.com/news/articles/2025-08-21/south-africa-set-to-open-first-underground-gold-mine-in-15-years
[2] https://www.marketscreener.com/news/harmony-gold-mining-says-australian-firb-approves-acquisition-of-mac-copper-ce7c51ddd980f72c