Active in West Africa, where it owns three mining sites, the Australian junior company Perseus Mining published on Monday 30 March an updated mining plan for its Ghanaian Edikan gold project. According to the new estimates communicated by the mining company, the site should produce from July onwards more than 1.3 million ounces over the remaining life of the mine (6 years), i.e. almost double the previous estimates. The upward revision is due to Perseus’ expansion of the open pit and the re-evaluation of the resources of the Esuajah South underground deposit. In addition, company management has indicated a 5% decrease in the overall cost of production to between $870 and $890 per ounce.
Owning all of its mining assets in South Africa, Canadian company Eastern Platinum (Eastplats) published on Friday, March 27, significantly improved financial results for 2019. Specializing in the exploitation of platinum and chromium, the company significantly reduced its losses during the past fiscal year, from $21.8 million in 2018 to $0.1 million in 2019. A significant improvement that Eastplats’ management has attributed to the first full year of operation of the Crocodile River mine tailings reprocessing project, where the company produced a record 598 tonnes of 38.6% chromium concentrate in 2019. Eastern Platinum stated that its current cash flow is sufficient to cover all of its projected operating expenses for 2020.
In a press release issued on Monday, March 30, mining conglomerate Anglo American announced that its diamond subsidiary De Beers Group will not be holding its third sales cycle of the year due to containment measures in Botswana, South Africa and India to contain the coronavirus pandemic. This new sales cycle was scheduled to take place from 30 March to 3 April. However, Anglo American said that De Beers will allow « sightholders » – hand-picked buyers (polishers, gem dealers, etc.) who can inspect the diamonds – to defer 100% of their allocations to later in the year.
Like similar measures already taken elsewhere on the continent, Namibia – in its fight against the coronavirus pandemic – on Saturday ordered mining companies to cease operations for three weeks as the country began its first day of partial containment, which will last until April 16. This is a heavy blow to the players in the sector, which generates about 50% of the export earnings of this southern African nation. According to the latest figures provided by the Namibian authorities, eight people have tested positive for Covid-19 in the country.
Hit like the rest of the world by the Covid-19 pandemic with 97 confirmed cases, Nigeria over the weekend ordered oil and gas companies to reduce their offshore workforce and move to 28-day rotations (down from 14 days previously) as part of measures to curb the spread of the coronavirus. The government circular, addressed to the companies concerned, further specified that « non-essential personnel currently at offshore sites should be removed with immediate effect ». All these measures reflect the desire of the populous African country to protect its oil production as best it can, since black gold provides 90% of the country’s foreign exchange.
Announced on Wednesday 25 March, the Vietnamese authorities’ decision to stop signing new rice export contracts until further notice has been a bombshell. And for good reason, as the world’s third largest exporter of rice (6.37 million tonnes in 2019) behind Thailand and India, the Southeast Asian country is a major player in the supply…
On 25 March, the US multinational oil company announced that it had achieved a net income of 21.5 billion CFA francs for the year 2019, with production of 3,476 barrels/day. In view of the strong increase recorded since the last quarter of 2019, the outlook for 2020 looks even better, with estimates of around 4,400 to 5,000 barrels/day. Cary Bounds, Vaalco’s CEO, said the company is in « a healthy financial position with strong cash flow, increased production from our successful drilling program, and approximately one-third of our production hedged to June 2020 at an average price of $66.70 per barrel. » To achieve this result, « we successfully completed a drilling and reclamation program for 2019-20, which began in September 2019 and was financed with free cash flow and operating cash flow, » he said. In addition, Vaalco Energy said it « successfully drilled two development wells that exceeded production expectations and two appraisal wells. A third development well is also expected to add production when it is completed and commissioned by this month. To date, operations have not been significantly disrupted by the current global VIDOC-19 crisis and Vaalco has been able to overcome the logistical challenges induced since the outbreak.
Liberian company Conex Oil and Gas Holdings announced on Wednesday March 25 that it has signed an agreement with Total to acquire the Liberian and Sierra Leonean operations of the French oil and gas giant. However, Conex did not specify the terms of the agreement or the amount of the transaction. As for Total, its management has not commented on this announcement for the time being. The European group started operations in Liberia in 2005 and operates about 30 service stations in this West African country.
With the Covid-19 pandemic, many raw materials have seen their prices plummet. A devastating situation that mechanically affected African commodity stocks. Ressources looks back at the five listed companies1 that have lost the most value on the stock market since the beginning of the year. A list exclusively… South African, with the Johannesburg financial centre…
Already very active in West Africa (Côte d’Ivoire, Burkina Faso and Mali), the gold group Endeavour Mining will further strengthen its presence in the region with the takeover of the Canadian company Semafo. Announced on Tuesday, March 24, the merger-acquisition transaction, supported by the management of the two mining companies, will be carried out entirely…
On Monday, South African President Cyril Ramaphosa announced a three-week population containment to limit the spread of Covid-19. This will take effect from midnight on Thursday. That same day, South Africa recorded 400 confirmed cases, the highest rate to date on the continent. As a result, all non-essential services essential to the country’s survival will be closed as of this Thursday, including all active mines in the territory, which will be serviced and maintained only by mining companies. While the Rainbow Nation provides 75% of the world’s platinum supply and 38% of the world’s palladium supply, this decision is expected to worsen the deficit, while maintaining the soaring prices of these platinoids. This measure is also expected to impact the operating and financial results of the companies, thereby reducing government revenues. The intensity of the impact will depend primarily on the duration of the pandemic, but, in the words of the President, « The action we are taking now will have lasting economic costs, but to do nothing would have much higher costs. »
For advocates of cannabis legalization in Africa, this is another symbolic victory. In Ghana, Parliament legalized the use of agricultural hemp for therapeutic purposes on Friday 20 March by passing the Narcotics Control Commission Bill. Concretely, the legislation will authorize the Ministry of Home Affairs to grant licenses to grow cannabis on the national territory with a tetrahydrocannabinol (THC) content not exceeding 0.3%. The new law also specifies that the existing Narcotics Control Board (Nacob) will be transformed into a commission with enhanced powers to supervise the actual use of cannabis. Ghana thus becomes the fifth African country, and the first in West Africa, to legalize the use of hemp.
deposit in the DRC
Shares of Amani Gold Limited, an Australian Securities Exchange (ASX) listed gold explorer and developer, doubled Thursday morning after the company announced a substantial upgrade of the Kebigada gold deposit, part of the Giro gold project in the Democratic Republic of Congo. The mineral potential of the site now stands at 124 million tonnes yielding 1.03 g/t gold for 4.1 million ounces of gold at a cut-off grade of 0.5 g/t gold. This new estimate represents an increase of 28% (800,000 ounces of gold) over the previous figures of 75 million tonnes at 1.18 g/t gold for 2.9 million ounces of gold at a cut-off grade of 0.6 g/t gold. The company continues to undertake exploration on the Giro project in order to continue to expand the scale of the project. A 6,000-m core drilling program (12 cores each 500 m long) along the strike is planned to begin by May or June.
In the context of the global health crisis linked to the Covid-19 pandemic, African banana companies, through the Afruibana association – which brings together several producers and exporters from Côte d’Ivoire, Cameroon and Ghana, three countries that produced just over 600,000 tonnes of bananas in 2018 – have mobilized to rigorously implement all the instructions issued by the governments of producing countries. For the sector, the priority is twofold: to ensure a continuous supply of quality bananas to distribution centres (nearly 90% of African banana production is destined for the European market), and to guarantee the health safety of workers. To date, no cases of disease have been recorded, and whether in the banana plantations, packing stations or the various African port sites, the technical teams scrupulously apply the hygiene instructions. Particular attention is paid to transporters, pilots and mechanics, who are essential to the smooth running of operations. The sector is organised to limit as much as possible the risk of impact on its logistics chains, to prevent additional costs or longer delivery times. All strategic stocks (cardboard boxes, packaging and phytosanitary products) have been increased to offset any possible shortages in the coming weeks. The European Commission’s Directorate-General for Agriculture and Rural Development (DG AGRI) has announced that the free movement of goods and commodities will be maintained during the epidemic. To date, the European Food Safety Authority (EFSA) considers that there is no evidence that food is a route or source of transmission of the disease.
The Chinese energy company Sinohydro has won the tender for the construction of the Guinea-Bissau solar power plant in Gardete, it was announced on Thursday 19 March. The call for expressions of interest was launched in March 2019 by the African Biofuel and Renewable Energy Co. (Abrec), a pan-African organisation which promotes renewable energy on the continent. In detail, the project as a whole includes the Gardete power station, which will have a capacity of 20 megawatts (MW), but also two mini-solar power stations of 1 MW capacity each to be located in Gabu and Canchungo. As for financing, the West African Development Bank has allocated a loan of 42.9 million Dollars.
Sao Tome and Principe and Equatorial Guinea have confirmed the creation of a special maritime zone for joint exploration to develop transboundary oil and gas reserves, it was reported on Wednesday, 18 March. The decision was taken during a meeting this week in Malabo between the Minister of Public Works, Infrastructures, Natural Resources and Environment of São Tomé and Príncipe, Osvaldo Abreu, and the Minister of Mines and Hydrocarbons of Equatorial Guinea, Gabriel Mbaga Obiang Lima. This is a step forward that reinforces the cooperation efforts of the two countries, which initiated the first contacts in this direction in the early 2000s. According to the indicative timetable communicated, offshore exploration operations could start as early as October 2020.
Africa’s leading gold producer, Ghana could soon see the arrival on its soil of a major player in the gold industry, Russia’s Nordgold, which wants to buy out the mining portfolio of Australia’s Cardinal Resources. Interested in particular in the Ghanaian gold project of Namdini, the mining group – controlled by the billionaire Alexei Mordashov,…
US oil and gas number two, Chevron, has signed a memorandum of understanding with Algeria’s state-owned hydrocarbon giant Sonatrach to engage in joint discussions on partnership opportunities in the hydrocarbon industry. The agreement, concluded on 12 March and made public this week, comes shortly after the adoption of a new petroleum code, which aims to relax and simplify the sector’s legal and fiscal regime. A development that suggests that the Algerian authorities’ efforts to attract foreign investors may finally be paying off. The local media have also reported in recent days that other major players in the sector, such as Exxon Mobil, are currently in talks with Algiers.
In a press release issued Monday, March 16, Canadian mining group Endeavour Mining reported that an employee at its mine in Houndé, Burkina Faso, tested positive for the coronavirus and was placed in quarantine. The employee, who had returned from the UK, reportedly « experienced mild symptoms within hours of arriving at the site » and « in accordance with the protocol and COVID-19 procedures put in place by Endeavour Mining, the Burkina Faso health authorities were immediately informed », the company said, adding that its « mining and exploration activities have not been interrupted ». This is the first confirmed case of coronavirus at a mine site in Africa. Burkina Faso reported its first two cases of coronavirus on 9 March, and is now reported to have 15 identified cases.
First announced in December 2019, the sale by Australian Paladin Energy of its Kayelekera uranium project in Malawi to its compatriot Lotus Resources has now been completed. A transaction that Paladin CEO Ian Purdy sees as « a positive step forward, which will bring significant financial benefits to the company », in a press release published on Friday 13 March. As a reminder, Lotus has agreed to pay AUD$5 million (US$3.1 million) to acquire a 65% interest in the project. Paladin will nonetheless retain a 3.5% royalty on revenues generated by the mine.
Regularly criticized for its operational problems, Zesco, Zambia’s state-owned electricity generation and distribution company, acknowledged on Friday 13 March that its overall electricity supply deficit had increased by nearly 20% since September, despite massive price hikes and government support for green energy projects to combat drought-induced electricity shortages. The information was given by Zesco’s Director of General Services, Patrick Mwila, who was present at a press conference and who also said that the electricity deficit had increased to 810 megawatts, compared to 690 megawatts in September. However, the country’s major mining operators, such as First Quantum Minerals, Barrick Gold Corp and Glencore, should not be affected by these difficulties, the Zambian official said.
The mining group, listed on the London Stock Exchange and already active in lithium in Ghana, has just broadened its portfolio of projects by acquiring 100% of the capital of Joy Transporters. In return, the company will issue 2.36 million of its shares at a price of 22.5 pence each, a significant premium to its current share price. This acquisition gives the group full control of the Cape Coast project as well as access to the new Saltpond project. This is a particularly promising land package adjacent to the Ewoyaa area, which hosts a mineral resource of 14.5 million tonnes grading 1.31% lithium oxide (Li2O) and where the group is currently conducting drilling operations. Low-cost regional exploration programs are also underway (reconnaissance mapping, trenching in the Saltpond permit, environmental and social studies, etc.) in this part of the Ghanaian coast, which is also ideally served and equipped with infrastructure. Thanks to this high-potential acquisition, the company could eventually integrate all of its assets into a large lithium complex.
Sasol plans to increase its capital in the face of market turbulenceThe management of the South African petrochemical group Sasol announced that it is considering a capital increase and the acceleration of its current asset disposal programme, following the collapse of its share price by more than 80% as a result of the coronavirus epidemic…
This is what the executive director in charge of research at the Central Bank of Uganda told Reuters on Wednesday, attributing the sharp increase (from $514.8 million exported in 2018, Uganda has risen to $1.25 billion in 2019) to the growing demand for bullion – gold remains a safe haven – and an increase in the country’s refining capacity (which has a total of four refineries), especially since the commissioning of the Africa Gold Refinery in 2016. As a reminder, in 2018 gold overtook coffee as Uganda’s largest export and source of foreign exchange for the first time. The country is expected to continue to record a significant increase in gold exports, as despite low domestic production (equivalent to US$50 million), it is establishing itself as a regional hub for the trade in this precious metal, which is mostly imported from the entire Great Lakes region of Africa and southern Sudan, as well as from Venezuela last year.
This is what the executive announced on Wednesday 11 March in the Council of Ministers, presenting the new roadmap of its National Rice Development Strategy (NRDS), rescheduled over the period running from 2020 to 2030 (the first NRDS, launched in 2012, aimed at rice self-sufficiency in 2020 with a production of 2 million tonnes, but after a jump from 984,000 tonnes to 1.4 million tonnes between 2012 and 2015, Ivorian production has stagnated for several years at 1.3 million tonnes). Objective: rice self-sufficiency by 2025, and the country’s accession to the rank of major African exporter by 2030. To achieve this, the authorities are considering adopting several measures, including high-yield seed production, full mechanization of the rice value chain and irrigated rice cultivation. An investment of 150 billion CFA francs will also be made in the rehabilitation and development of 64 dams and 55,000 hectares of rice-growing land, in order to « gradually switch from traditional, unprofitable subsistence rice cultivation to market-oriented, competitive and environmentally friendly rice cultivation, » according to the government. The strategy aims to help the country reduce its rice imports, which are estimated at 300 billion CFA francs.