London, England — MININGREVIEW.COM — 30 June 2010 – The government of gold-rich Burkina Faso says the country’s output of the precious metal will surge 60% to 20 metric tonnes in 2010 as it seeks to lure foreign mining companies, including Newmont Mining Corporation and Vale SA.
Revenue from gold mining taxes will rise to US$150 million (R1.1 billion) in five years from US$30 million (R225 million) last year,” mining and energy minister Abdoulaye Abdoulkader Cisse said in an interview in London, where he briefed bankers on the country’s reserves.
“Burkina Faso, with six gold mines now, will add another five over the next five years,” Cisse added. “Cluff Gold Plc and Iamgold Corporation, which operate in the country, are in talks over new licences,” he said. “The government is also in early stage discussions with Vale, the biggest iron-ore producer in the world, on a manganese deposit in the southeast.”
“The country is very prospective from a geological point of view,” Charles Kernot, an analyst at Evolution Securities in London, said by phone. “It’s almost a clean sheet as far as companies are concerned and that could increase the chance of finding things where other people haven’t looked.”
“The government is planning to make changes in September to the mining code drawn up in 2003, and may increase royalty rates paid by resource companies,” Cisse revealed. “It also plans to cut the time it takes to begin feasibility work after getting licences to 18 months from six, as some companies get the approvals and then speculate on their value without starting production,” he explained.
By December 800 companies had sought exploration licences in Burkina Faso”’ double the number the government had forecast. More than 30 companies had received permits.