AFRICA SPECIAL — Information a valuable commodity for Emerging Africa

Money may make the world of international business go ’round, but Montreal-based Emerging Africa Gold (EAGI-C) is getting ahead in Africa partly through an older form of commerce.

Some of Emerging Africa Gold’s (EAG’s) deals in Africa have involved trading geophysical data, equipment and training to governments in return for mineral exploration rights. This method has helped the company acquire more than 30 properties covering 20,000 sq. km. in such countries as Guinea, Burkina Faso, Ethiopia, Mali, Tanzania and Mozambique.

The company’s geophysical database of Africa, which consists primarily of private and public aeromagnetic surveys performed over the past 30 years, holds value above the information it can provide the company. Since such a database would be relatively expensive for a cash-strapped government to assemble on its own, EAG can use the information as a bargaining tool in acquisition negotiations.

The company offers governments the use of the database, as well the geological computer hardware and software needed to gain access to it. In addition, EAG provides technical training so that these governments, in turn, will be able to provide modern geologic and cartographic services to its citizens and mining companies.

In exchange, EAG seeks unclaimed exploration rights and, as President Raymond Savoie says, “the fast track” through the nation’s bureaucracy for acceptance of the new acquisitions.

This combination of cash and services appears to be working for EAG. Savoie, who served as Quebec’s mines and then revenue minister from 1985 to 1994, says the company is pleased with its experience there thus far.

In Guinea, where EAG has five concessions, the company will provide the government with computer hardware and database training for four civil servants, who will attend classes in Canada. EAG is also working with the Guinean ministry responsible for electrical power generation.

The company’s work in that country appears to be bearing fruit. Drilling at its Jean-Gobele property, an equal joint venture with Montreal-based West Africa Mining Exploration (SMF-M), has delineated a gold resource of 1.6 million tonnes grading 2.7 grams per tonne (see separate story below). Other Guinean properties held by EAG include 43%-owned Sumandou, 21%-owned Apredor, wholly owned Yro-Iran and 33%-owned Kaloum. EAG recently opened an office in the capital city of Conakry.

The company has also opened an office in Burkina Faso’s capital, Ouagadougou.

Its property holdings in that country include the 95%-owned Coalla project, the wholly owned Fada-Tanga, the 80%-owned Piela and the 80%-owned Dama-Nimina-Tigan. Drilling is about to begin at the Piela and Dama-Nimina-Tigan properties.

>From its new office in Addis Ababa, EAG will be directing drilling on its Ethiopian properties beginning this spring. Prospects there include copper, gold and zinc at the wholly held Serkole, and platinum at the 75%-owned Yubdo.

“The system [in Ethiopia] is difficult,” explains Savoie. “But with patience and courage, the country is very interesting.”

EAG has made offers to other countries, including Mauritania, and will resume negotiations with Niger in February. The company also plans to begin work at its properties in Mali, Tanzania and Mozambique, and is seeking more joint ventures, perhaps with Australian companies.

In addition to employing African nationals and some non-Canadian expatriates, EAG employs nine Canadian geologists in Africa, some of whom speak French.

French-speaking Canadians, according to Savoie, are perfectly suited to working in Africa. “The French language advantage in West Africa is important, but the fundamental advantage is being Canadian,” he explains.

“The fact that Canadians do not have a colonial past in Africa helps us a lot. Plus, we arrive with money, new ideas, and a willingness to collaborate.” EAG also works with a Russian consulting geologist who remained in Africa following the collapse of the Soviet Union. He provides the company with maps, knowledge of the terrain and heavy equipment. Although Soviet geologists did not fly many aeromagnetic surveys during their 30-year stay in Africa, Savoie says they gained “great expertise on the ground.” EAG is also active in Africa in another capacity. Through the St. Genevieve Foundation, a philanthropic organization, the company distributes medical supplies to villages that surround EAG’s base camps.

EAG was created last May as a 35%-owned affiliate of Montreal-based St.

Genevieve Resources (SGV-T). A $33-million financing package was recently arranged for EAG.

The company plans to acquire more concessions in several other African nations in the future, and expects to begin gold production in 1998. It also expects to be listed on the Toronto Stock Exchange shortly, after which it will seek listings in Europe and Africa.