Africa Mining Forum’s second live webinar focused on the opportunities and more particularly the current success stories in the emerging mining markets of West Africa.
In partnership with Mining Review Africa the discussions also gave some insights into questions around safety, working under COVID-19 conditions and why the region is seen as the “new gold frontier”.
Positive experience in West Africa
“We’ve been in West Africa for a number of years now because of the rich endowment in minerals that part of the world has,” says Jeff Quartermaine, CEO of Perseus Mining.
“We’re a gold mining company and there are some very, very big deposits there, many largely unexplored so there is a very high potential for more discovery very much into the future. So, great potential for large and junior companies.”
Perseus Mining has two gold mines, Edikan in Ghana and Sissingué in Côte d’Ivoire and is developing its third operation, Yaouré, also in Côte d’Ivoire.
“Foreign investment in this region is generally very well encouraged,” says Jeff Quartermaine, adding: “That’s not to say that each country doesn’t want its pound of flesh, it does. What is required is nothing out of the normal, it’s no different from any other part of the world, and if anything it’s actually very reasonable.”
According to the Perseus CEO, in both Ghana and Côte d’Ivoire the governance frameworks are “generally sound. It’s not perfect, but it is generally sound.”
He says both countries are robust democracies, the government institutions work reasonably well and both countries have traditional leadership that provide strong moral authority. “So we’ve had a very positive experience in West Africa, ever since the company went there, and very happy to be a West African gold miner.”
“Being in Burkina Faso, we have an amazing relationship with our community. I just love the way we are welcomed.” This is according to Ricus Grimbeek, CEO of Trevali Mining Corporation, which owns a 90% stake in the Perkoa zinc mine, which is also its biggest operation.
Well known for its gold deposits, Perkoa is the only base metals mine in the country, mining what he terms, “one of the richest zinc ore bodies in the world.”
“Also, what I am very passionate about, is sustainability in mining,” says Grimbeek, “being able to show making a difference in the local community. We have already donated some classrooms to a local school in Perkoa and you feel the warmth and welcoming of the community and you see kids getting opportunities that would not have happened if it wasn’t for mining.”
During the live webinar Grimbeek, admitted that the security situation in Burkina Faso was “one of the first questions investors ask. I have personally never felt unsafe in Burkina Faso. You have to be clever about what you do, you have to work closely with local authorities, government and the community. I really do love the place and the people.”
Emma Priestley, CEO of Goldstone Resources, who has worked in several African countries, says they are “hoping to be one of the next gold producers in Ghana” with their Akrokeri-Homase Project.
She decribes Ghana as one of the most attractive countries to work in, due to the political stability and ease of working in the country. “The Ghanaians are exceedingly helpful. And certainly in mining. There is a Minerals Commission there and really, you can knock on their door at any stage in the development of your project time. The shareholders that I brought in backed me because of our postcode. Ghana is endowed with the Ashanti Gold Belt.”
Currently she says gold in excess of 200-million ounces has been discovered in Ghana so far. “We are next door to Obuasi (AngloGold Ashanti), which is 70-million (ounces) of that, they’ve obviously mined about 40-million of it, and I think their current resources sit at about 36-million ounces. So really, from the geology, Ghana speaks for itself. With our neighbour getting back into full production is a great incentive for us because it obviously assists with all the infrastructure and getting all the service suppliers to assist us.”
Increase in demand from UK exporters
“We cover 15 countries in the region and cover many markets,” says Steven Grey, Country Manager for West Africa UK Export Finance, representing the UK’s Export Credit Agency. “In terms of mining, we have supported transactions in the mining sector, particularly in Ghana in the past. But we are seeing an increase in demand across West Africa for support from the UK exporters to supply into the mining sector.”
“One of the interesting markets that we’re seeing is Ghana, with the investments that they are making into the railway infrastructure in the western region. The aspirations around developing an aluminium industry and a steel and iron industry, you can see that there are the start of the building blocks to really create a much larger mining industry in Ghana and increasing the emphasis not just on gold but also on other minerals there.“
“The resources that are in West Africa are clearly world class with West Africa producing the most gold out of the African continent. These have attracted huge investments.” He says the pandemic this year has created further dynamics in the market, pushing new investments into the gold sector.
From a regulatory standpoint Steven says, local content has become increasingly important, not just in terms of supply chains but also in terms of local participation.
The miners agreed that energy supply or the lack of it in the West African remained a challenging factor. “Thank goodness for generators,” said Emma Priestley, “we all need them, no matter where we are.”
Steven Grey said that while Ghana outperforms its energy demand in production, it faces a T&D challenge but that UK companies were starting to provide renewable solar solutions.
None of the mines represented during the webinar were seriously affected by the COVID-19 pandemic.
“We hardly missed a beat actually”, said Jeff Quartermaine of Perseus Mining, “the biggest issue was expatriates being unable to travel in and out. We’ve operated pretty well under the circumstances.”
He said one of the things he was particularly proud of was the construction in Côte d’Ivoire of “a fairly large mine in Yaouré, we’re about 85% through now. We’re boring first gold at the end of this year and we’ve done that with the COVID backdrop and I think that is a major achievement.”
“We’re really in a sweet space at the moment, our timing has been very good. To be able to sell gold at current prices means that we are generating a lot of cash, so the company has never been in better shape and long may that continue.”
“We’ve been very fortunate,” said Emma Priestley, “Ghana was quite affected and closed its borders very quickly, but we managed to keep things going. All miners have their expatriates to thank who stayed in country. The mining industry has managed it well. We have to deal with lots of pandemics in the past, such as ebola.”
“The mining industry as a whole has done an amazing job to keep things going during the pandemic,” says Trevali Mining’s Ricus Grimbeek.
The company was recently included in Microsoft’s 2020 Great Canadian Innovators Book for using artificial intelligence and business intelligence to run remote sites efficiently. Ricus explains: “I think if you are building a mine today and you are not thinking digitally, you are making a big mistake. We have to be able to guarantee people’s safety.”
“And using data, using digital, using the latest technology and automation is all part of creating a mining industry where we will be able to do that. We will also be able to use less of the resources like water and electricity by operating more efficiently.”
Ghana wins it!
During the webinar the audience was asked to participate in an opinion poll, regarding their views on the most promising mining investment destination in West Africa. Below are the results of the poll.
To listen to the full webinar recording, click here.
The next Africa Mining Forum webinar takes place on 20 October and will focus on: “Your guide to investing in Southern African mining post COVID-19”. Click here to register.
Africa Mining Forum (formerly East & Central Africa Mining Forum) is organised by Clarion Events Africa in collaboration with our media partner, Mining Review Africa and the official event host, the Rwanda Mines, Petroleum and Gas Board.”
Clarion Events Africa is a leading Cape Town-based and multi-award winning organiser of exhibitions and conferences across the continent in the infrastructure, energy and mining sectors. Other well-known events by Clarion Events Africa include DRC Mining Week, Nigeria Mining Week, African Utility Week & POWERGEN Africa, Utility CEO Forums, Future Energy East Africa and Future Energy Nigeria. The company is part of the UK-based Clarion Events Group.
African Mining Forum dates and location:
Webinar series (online): Next: 20 October
Digital event: 16-20 November 2020
Onsite event in Kigali: November 2021