Coalition force clears Sierra Leone of military junta

The cloud hanging over political, social and economic life in Sierra Leone appears to be clearing, paving the way for mining companies to rebuild and restart their operations.

In mid-February, a Nigerian-led military force ousted the rebel leaders who seized power in a 1997 coup. A peacekeeping force with troops from Ghana, Mali, Niger and Senegal is expected to remain indefinitely.

On Feb. 21, the World Food Program delivered 850 tons of donated food to Sierra Leone. And on March 10, Sierra Leone’s president, Ahmed Tejan Kabbah, received a warm welcome when he returned to the capital, Freetown. Rebel leader Johnny Koroma remains at large.

News of the coalition force’s victory sparked new interest in Nord Resources (NRD-N), whose share price doubled from about US$1 to US$2 in heavy trading.

Nord holds a 50% stake in Sierra Leone-based Sierra Rutile, which runs the largest high-quality rutile mine in the world.

The rutile mine was stormed and looted by rebel soldiers in January 1995, when civil unrest swept the country. Hopes were high for reopening of the mine when the nation elected Kabbah in 1996, but were shattered when his government was sent into exile by a military coup in May 1997.

Nord believes the operation can only return to production if there is a stable government and if satisfactory security provisions and proper financing can be arranged. Over the next few weeks, the company plans to discuss the possible reopening of the mine with the Kabbah government.

Meanwhile, other juniors with interests in Sierra Leone are preparing for the resumption of work.

*DiamondWorks (DMW-T), which owns the Koidu diamond project, plans to meet with the Kabbah government to restart operations, though spokesman William Trenaman points out that no action will be taken until the company is assured of the safety of its personnel.

DiamondWorks was in the midst of taking a 20,000-tonne bulk sample at Koidu when the coup stopped work.

The company had reported sporadic fighting in the Koidu area after the junta was ousted, but the project area escaped significant damage.

*Rex Diamond Mining (RXD-T) does not expect to return to Sierra Leone until conditions improve further. When it does return, the company’s first priority is the resumption of work at its Zimmi alluvial diamond concession on the border with Liberia.

*Prospex Mining (PRM-V) can’t get back into Sierra Leone fast enough, says Chairman Steve Fletchner. The company expects to begin exploration at the Nimini Hills gold project as soon as peace is restored and funding is available.