MINING IN AFRICA SPECIAL — West Africa attracts interest of

During the past year, one of the foreign regions most attractive to Canadian miners has been West Africa.

Senior and junior companies alike have been lured to the area by the prospect of discovering rich deposits of gold, diamonds and base metals. Additional incentives have resulted from attempts to reform outdated mining acts and stabilize local economies.

Many of these initiatives were triggered by developments in Ghana, where the government has privatized many state-operated mining operations. Ghana has also updated its Mining Act, making the country more inviting to foreign investors.

Last year, the Ghanaian government sold a minority stake in the Ashanti gold mine which produces about 1 million oz. per year. Also privatized were the Tarkwa, Prestea and Dunkwa mines.

In 1994, Ghana produced 48 tonnes of gold, half of which came from the Ashanti. Most of the remaining production came from three foreign-managed mines: Teberebie, Iduapriem and Boguso.

Canadian companies, while not as quick off the mark as those from South Africa, England and Australia, are attempting to catch up by acquiring prospective ground.

Several Canadian juniors, including International Gold Resources (TSE), Echo Bay Mines (TSE), Opawica Explorations (TSE), Mutual Resources (VSE), Birimian Goldfields (CDN), Pacific Comox (VSE), Fairstar Explorations and Patrician Gold Mines (ASE), have staked large concessions and are carrying out regional exploration in an effort to bring Ghana’s next gold mine into production. Mutual holds a 5% indirect participating interest in the Tarkwa concession, which includes the gold mine of the same name, from which 4.5 million oz. have been produced since 1912. The mine is hosted within the Banket conglomerate, which also hosts the Teberebie and Iduapriem mines. Mutual is earning a 54% interest in the 34-sq.-km Sewum Tokosea concession, in the famous Bibiani belt, by spending $1.75 million on exploration. Airborne geophysics are under way, as are trenching and drilling, in an effort to define gold deposits.

Meanwhile, Mutual has negotiated interests in the Oda River, Kent and Bilpraw concessions and is looking at other properties along the Konongo, Obuasi and Bokitsi gold belts.

International Gold Resources (IGR) holds six concessions in Ghana, including five which are part of a joint-venture agreement with Echo Bay. Under the terms of the joint venture, Echo Bay has paid US$1.5 million to IGR and must spend US$19 million on exploration and development during the next four years. IGR is also exploring the Bibiani concession, which hosts the past-producing gold mine of the same name. Consultants have estimated a reserve of 10.5 million tons averaging 0.092 oz. gold per ton underground, plus 8.3 million tons averaging 0.039 oz. within the tailings. Exploration continues to define reserves below the 500-ft. level, and a feasibility study is due in April. Neighboring countries, seeing the influx of foreign capital, are also reforming their mining acts and creating a business climate conducive to mining.

Since the Mining Act of Burkina Faso was revised in 1993, that country has seen a marked increase in interest from foreign companies.

Last year, the only operating gold mine in Burkina Faso was the Poura, situated in the south-central region. However, most of the 3 to 4 tonnes of gold produced in the country came from artisanal miners in the northwest. Many Canadian juniors, including Channel Resources (TSE), High River Gold Mines (TSE), InterStar Mining (CDN), Messeguay Mines (ME) and Loubel Exploration (ME), as well as IGR and Mutual, are seeking to change this. Channel holds four concessions covering 6,200 sq. km. At last report, 106 reverse-circulation holes had been drilled, and 10 of 12 targets had intersected gold mineralization. Notable results include 59 ft. which averaged 0.18 oz. and 112 ft. of 0.05 oz. on the Bombore concession, and 26 ft. averaging 0.25 oz. and 72 ft. of 0.04 oz. on the Somifa concession. In 1994, Ivory Coast produced two tonnes of gold from two operating mines, one of which is controlled by Eden Roc Mineral (TSE), an affiliate of TSE-listed Marshall Minerals. At last report, Eden Roc had outlined a gold reserve of 1.45 million oz. and was working on delineating additional oxide and sulphide reserves.

Ivory Coast also hosts a large lateritic nickel property, which is being developed by Falconbridge and Trillion Resources (TSE). These companies, along with a state-owned mining agency, have outlined seven nickel deposits which could potentially host more than 110 million tons averaging 2% nickel. Lesser known to Canadian explorationists are the deposits of Guinea, Mauritania, Niger, Nigeria, Senegal and Sierra Leone. Combined, these countries have produced about 6 tonnes of gold, yet they have received little attention on an individual basis. Perhaps as economic and regulatory reforms occur, more interest will be directed towards these relatively unknown and little-explored nations.