Nov. 2 (Bloomberg) -- AngloGold Ashanti Ltd., the world’s third-biggest producer of the metal, cut its 2009 production forecast for the second time this year after suspending output at the TauTona mine in South Africa.

The forecast was lowered to between 4.55 million and 4.6 million ounces, the Johannesburg-based company said in a statement today. AngloGold produced 1.187 million ounces in the third quarter, missing its guidance of 1.2 million ounces.

Lower production is hampering efforts to mitigate the effect of rising costs in South Africa, where wages have risen about 10 percent this year and electricity charges increased by an average 31 percent. AngloGold produces about 40 percent of its output in the country.

The suspension at TauTona will last about two months while the mine undergoes repairs and an examination of infrastructure after a length of steel fell down a shaft. Four workers died in the company’s mines in the third quarter, contributing to safety stoppages that cost 30 full and 18 partial production shifts.

“We’re obviously disappointed and working hard on the issue to ensure we improve our consistency,” Chief Executive Officer Mark Cutifani told reporters on a conference call.

AngloGold rose 10.20 rand, or 3.5 percent, to close at 300.10 rand in Johannesburg trading. The stock has gained 19 percent this year, the most in the five-company FTSE/JSE Africa Gold Mining Index, which has risen 8.1 percent.

Quarterly Loss

Costs in South Africa would rise by between 15 percent and 25 percent should state-run power monopoly Eskom Holdings Ltd. get permission to triple tariffs in the next three years, Cutifani said. That’s “not viable for the industry,” he said, adding that production and employment would be affected.

AngloGold, Africa’s biggest gold producer, posted a third- quarter loss on the cost of reducing commitments to sell the metal below market prices. The loss was 8.3 billion rand ($1.05 billion), compared with net income of 2.3 billion rand in the preceding three months. South African gold analysts compare the previous quarter instead of the year-earlier period.

Cutifani has cut forward sales volumes by two-thirds to 4.3 million ounces since 2007, allowing AngloGold to sell more metal at higher market prices. Forward sales committed the company to selling bullion at prices below current levels.

In July, AngloGold spent $797 million to cut forward sales by 1.4 million ounces. Committed ounces will decline to about 4.1 million by the end of the year, Cutifani said today.

Gold is set for a ninth consecutive annual gain, having risen to a record $1,070.80 an ounce on Oct. 14. The metal traded at an average $960 an ounce in the third quarter, a 4.1 percent increase from the preceding three months.

AngloGold reduced its full-year production forecast to as much as 4.8 million ounces in July from 5 million ounces.

To contact the reporter on this story: Carli Lourens in Johannesburg at clourens@bloomberg.net

Last Updated: November 2, 2009 11:39 EST