West Africa – the growth region for mineral resources (Gold, Iron Ore and Diamonds)
West Africa – mineral resources
Canadian, South African and Australian based gold mining companies are increasingly moving their exploration budget in to West Africa and not only to the countries where they have been present historically. Additional monies are being allocated to projects in Ghana and Guinea as well as on new potential deposits in Ivory Coast, Burkina Faso, Niger and Mali. Many of the traditional mining houses are acquiring junior miners in West Africa. In some cases, however, these newly structured companies are required to proceed only if they enter into some type of partnership with the Government.
One of the well-known mining commentators at the Paydirt Gold Conference held in Perth, Australia in late 2010, Rick Yeates, explained why he thought the future of gold mining is on the up and up. “The element of risk in West Africa today is relatively low,” said Rick. He explained that the historical problems of instability are those that people remember, without really understanding that many of these issues have been resolved and that the countries have evolved. Australia was slow to recognize changes, while the Canadian and British investors were more receptive. The British are perfectly comfortable with West Africa. Yeates said a number of major mining companies were burned by their early involvement in West Africa but they are now back in force.
Diamond mining is alive and well in Sierra Leone. Diamond exports rose 28 percent in 2010 to 109 million dollars (80 million euros) over 2009 showing real recovery after being hit by the global recession. Diamond licence holders continue to invest in the mineral-rich country, which has worked hard to clean up its diamond industry after illegal trading of conflict-funding “blood diamonds” fuelled a decade-long civil war which ended in 2002.
Rising iron ore prices driven by surging demand for steel in China have encouraged mining companies to search for new deposits in under-explored regions in Central and West Africa. BHP Billiton has recently signed a US 3 billion dollar deal with Liberia for a major project to develop iron ore mines. The company is the latest in a series of exploration companies that have concluded agreements to mine for iron ore in West Africa – sometimes regarded as a politically unstable region. However it is home to some of the world’s last large undeveloped mineral deposits which is making it extremely attractive to miners with deep pockets.
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