RGN Vol 6 Iss 4

RESOURCE Volume 6, Issue 4

GLOBAL NETWORK

Mining, renewable energy and oil & gas worldwide

WEST AFRICA’S GOLD INDUSTRY SHINES THROUGH

FEATURING:

World Gold Council Capital Drilling Roxgold Compass Gold IronRidge Resources RESOURCEGLOBALNETWORK.COM

“Resource Global Network was dedicated to learning the different aspects of our story and integrating them into well-polished feature articles.

It was a pleasure working with them.”

Richard Young, president & CEO, Teranga Gold

MINING | Brookfield Multiplex

WELCOME

Global gold supply ticked up by 1% in 2018 to 4,490 tonnes, supported by record production from mines around the world. However, many analysts have predicted that gold output will start to decline in the coming years, as largescale discoveries become increasingly rare across the world’s established gold centres.

Executive Team Editor Jacob Ambrose Willson

With this in mind, gold investors are now turning towards less-explored regions and one of those is West Africa – long recognised for its geological potential but too often overlooked aside from major historic producer Ghana.

Content Director (APAC and Americas) David Hunter

Investment dynamics are finally shifting in West Africa, with underexplored nations such as Mali, Burkina Faso, Côte d’Ivoire and Guinea receiving greater attention based on their positions straddling the highly fertile Birimian Greenstone Belt – which has yielded approximately 52 million ounces of gold to date.

Creative Director Hugo Currie

Stable governments, attractive mining regimes and appealing economic incentives have further enhanced West Africa’s reputation as an emerging mining hub and one of the fastest growing gold regions in the world.

This issue of RGN introduces a potpourri of contemporary players in West Africa’s gold sector, from exploration companies Roxgold and Compass Gold to drilling outfit Capital Drilling and mining consultancy firm CSA Global. Plus, IGF Mining’s Alec Crawford addresses the challenges posed by artisanal mining across West Africa.

ICT Director Stuart Clark Managing Director Simon Curran

We also interview Alistair Hewitt, head of market intelligence at the World Gold Council. Hewitt explains the key factors supporting the recent meteoric rise in gold prices, as well as the reasons behind increasing global demand for the ‘safe haven’ metal.

You can read this, along with your usual fix of mining, renewable energy and oil & gas stories over the following pages. We hope you enjoy the issue and encourage you to connect with us on email, Twitter and LinkedIn.

Jacob Ambrose Willson, Editor

Jacob Ambrose Willson

RGN is published by Anderson Murray Media: a diverse media and information services company focused on creating and distributing engaging content to business leaders across the globe.

Anderson Murray Media Fulham Green, 69-79 Fulham High Street, Main Reception, Bedford House, London SW6 3JW Tel. +44 (0)207 148 5630

VISIT US ONLINE AT RESOURCEGLOBALNETWORK.COM

CONTENTS

WORLD GOLD COUNCIL

NEWS 8 Global resources news Our selection of mining, oil & gas and renewable energy stories from the last month

ASSOCIATIONS & CHARITIES 16 World Gold Council All that glitters is gold 26 Atlas Foundation Ex-pro Jason Leonard tells RGN about his vision to tackle the bigger issues through rugby

COLUMNS 40 Frank Horton (Mercton Resources) One of the world’s largest gold provinces remains underexplored 48 Alec Crawford (IGF Mining) The formalisation of artisanal mining in West Africa requires widespread collaboration

ATLAS FOUNDATION

FRANK HORTON - MERCTON RESOURCES

CONTENTS

ROXGOLD

WEST AFRICAN MINING 60 Roxgold Canadian mining company goes for gold in West Africa 76 Compass Gold On course for gold discovery in Mali 88 IronRidge Resources Creating value through discovery 98 CSA Global West Africa is a key growth market for this global mining consultancy 112 Capital Drilling Capitalising on rising exploration spending in the West African market 130 Austral African Survey Group Combining Australian leadership with African excellence in project and mine surveying

APPOINTMENTS & EVENTS 144 Appointments Notable appointments in the resources industry from the past month 145 Events Our pick of the top forthcoming mining, oil & gas and renewable energy events happening around the world in the months to come

COMPASS GOLD

CSA GLOBAL

CAPITAL DRILLING

8

NEWS | Brookfield Multiplex MINING

GLOBAL RESO

Our selection of mi renewable energy news

Resource Global Network

OURCES NEWS

ining, oil & gas and s from around the world

9

10

NEWS

WORLD’S BIGGEST MINING COMPANIES CONTINUE TO THRIVE IN 2018: PWC REPORT The world’s 40 largest mining companies enjoyed another year of steady growth in 2018, according to global auditing firm PwC’s annual industry review, titled Mine 2019 report: Resourcing the future.

PwC said that the top 40 consolidated on a stellar performance in 2017, with group revenue increasing by 8% and production rising by 2%. They also boosted cash flows, paid down debt and provided a record US$43 billion dividend return to shareholders.

There was also a significant jump in share buybacks to $15 billion, compared to $4 billion in 2017, with Rio Tinto and BHP accounting for 70% of the total activity returning proceeds of non-core disposals to shareholders.

However, investor sentiment towards the sector remained low, with the total market capitalisation of the top 40 mining firms falling 18% to $757 billion over 2018.

“Mining requires more than good financial performance to continue to create and realise value in a sustainable manner,” said PwC Australia mining leader Chris Dodd.

“We believe that the market has reservations about the mining industry’s ability to respond to the risks and uncertainties of a changing world.”

Resource Global Network 11

GHANA OFFICIALLY OVERTAKES SOUTH AFRICA AS CONTINENT’S LARGEST GOLD PRODUCER Gold output in Ghana jumped by 12% in 2018 to 4.8 million ounces (Moz), eclipsing South Africa’s output of 4.2Moz for the first time and becoming Africa’s largest gold producer in the process.

South Africa’s gold sector has been in gradual decline for several years, with operators forced to dig deeper into maturing mines at escalating costs, while Ghana is benefitting from low cost mines, friendlier policies and new development projects.

The shifting location of Africa’s primary gold hub is best encapsulated by the likes of AngloGold Ashanti and Gold Fields – traditionally known as South African industry

stalwarts – who have decided to move their focus to other countries, including Ghana.

In addition, Sibanye Gold – the largest remaining gold miner in South Africa – is cutting thousands of jobs and diversifying into platinum group metals (PGMs) in a bid to reduce costs.

Meanwhile, some of the world’s biggest gold miners have committed to Ghana’s flourishing gold sector in recent years, including Newmont Goldcorp – the world’s number one producer.

“It’s an important part of our portfolio and, geologically we see really good potential to continue to expand,” said Newmont’s chief executive officer Gary Goldberg.

12

NEWS

WORLD BANK AND PACT PARTNER TO LAUNCH ARTISANAL MINING DATABASE The World Bank and non-profit organisation Pact have published a report on the artisanal and small-scale mining (ASM) sector, which aims to create a ‘global platform’ to better collect accurate and reliable information from the industry.

The report, titled State of the Artisanal and Small-Scale Mining Sector, highlights the extent of a ‘global data gap’ in the global ASM industry and draws from online database Delve, which will collect data from existing reports into the sector.

This data will then be presented in both its raw and graphical form, enabling users to upload their own work to the records.

Delve will also feature a directory of industry

experts to help in understanding the data collected.

“ASM is perhaps the only sector where practitioners and policy makers alike need better access to complete, accurate, and reliable data,” said the report. “Without this, the mission to make ASM understood to a general audience is simply too overwhelming to consider.”

The report found that around 40 million people work in the ASM sector around the world, with the industry particularly common in South Asia and Sub-Saharan Africa.

Resource Global Network 13

RESOLUTE MINING BEGINS TRADING ON LONDON STOCK EXCHANGE Resolute Mining has commenced trading on the London Stock Exchange (LSE) as the African-focused gold miner looks to broaden its global investor base and accelerate its growth plans.

The ASX-listed company’s managing director and CEO John Welborn said London was an obvious choice for its secondary listing due to the large volume of Africa-focused investors operating through London.

“We are delighted to deliver as promised on an important strategic goal for 2019. Today marks an exciting milestone for Resolute as our shares commence trading on the Main Market of the London Stock Exchange,” he said.

Resolute is currently ramping up production from the Syama Underground Mine in Mali, which will become the world’s first fully automated underground gold mine when fully commissioned.

The listing provides a boost to the LSE, which has struggled to attract new flotations during the first half of the year as uncertainty surrounding Britain’s departure from the European Union continues to impact decision-making.

Within the mining space, Resolute’s arrival goes some way to filling the gap left by Randgold Resources, which de-listed in London following its merger with Barrick Gold at the start of the year.

INTEGRATED LOGISTICS SOLUTIONS FOR THE INDUSTRIAL PROJECTS INDUSTRY

A brand of

Building a Multi-Asset Mid-Tier West African Gold Producer

TSX: TGZ OTCQX: TGCDF

16

GOLD | World Gold Council

WORLD GOL

All that glitt

Resource Global Network

LD COUNCIL

ters is gold

17

18

GOLD | World Gold Council

Since the beginning of May gold prices have gained around 9%, breaching the US$1,400 per ounce mark on the way to sixyear highs. This emerging bull run in the gold investment space follows a 7% rise in gold demand during the first quarter of the year, according to the World Gold Council’s (WGC) Gold Demand Trends Q1 2019 report. Speaking to RGN is the WGC’s head of market intelligence Alistair Hewitt, who highlights the combination of factors that are adding sparkle to the portfolios of gold investors and gold mining companies around the world.

The WGC is the world’s global authority on gold, providing key insights to the international gold market, driving innovation and stimulating demand while providing a collective voice to its members.

were 651 tonnes, the highest since the end of

Jacob Ambrose Willson: Alistair, global

statement of intent towards gold, especially

demand for gold rose 7% year-on-year in

given this follows the highest level of annual

Q1 2019. Explain the key factors driving

purchases for 50 years.

Bretton Woods in 1971.

Inflows into gold-backed exchange-traded funds (ETFs) also had a strong start to 2019.

Assets under management (AUM) grew by 40.3 tonnes during Q1, equivalent to US$1.9 billion. Inflows into European gold-backed ETFs have been particularly noteworthy, with assets rising 20 tonnes in Q1. And this is part of a recent trend: since the beginning of 2016, European AUM has grown rapidly and now accounts for 46% of global gold-backed ETF AUM. JAW: A significant portion of gold demand in Q1 came from central banks increasing their holdings of the metal. To what extent does this support the view that gold is an indispensable monetary asset for institutions in the face of turbulent economic conditions?

AH: That’s correct. Central bank demand in Q1 19 grew 68% year-on-year to 145.5 tonnes, the highest level of Q1 net purchases since 2013. This could be viewed as a strong

this recovery in gold demand.

In the wake of the global financial crisis, Alistair Hewitt: The standout positive in

central banks rediscovered the importance

the markets is central bank gold demand,

of holding gold as part of a well-diversified

which at 145.5 tonnes was nearly 60 tonnes

reserve portfolio. Given the slow recovery of

higher than in the first quarter of 2018. This

the global economy since that event, and new

builds on the strength seen in 2018 when

uncertainty being introduced more recently

we estimate central bank gold purchases

in the shape of global trade tensions, central

Resource Global Network

19

20

GOLD | World Gold Council banks accumulated gold and bolstered their

JAW: After global gold supply ticked up by

ability to weather these risks.

just 1% last year, does the WGC expect production to plateau in 2019, given

Not only have we seen significant levels of

the slowing rate of new gold deposit

buying each year since 2010 – especially

discoveries? How important will gold

from emerging market banks – but we have

recycling be to future supply?

also seen a lack of selling by their developed market counterparts. Given these risks will

AH: Global gold mine production has hit

remain for the foreseeable future, our belief

record levels in the last couple of years, and

is that this strong central bank buying will

Q1 19 was the highest level of first quarter

continue.

output on record. While discoveries have

Resource Global Network slowed to a trickle in recent years, there

Recycled gold supply accounts for around

is still optimism around the production

a quarter of annual total gold supply and

pipeline. Intermediate and junior companies

will continue to support mine production in

– whose projects greatly outnumber those of

feeding the gold market.

the major miners – have been successful in accessing new capital, helping to drive project JAW: Which underexplored regions, development. And we’ve seen the continued

outside of established gold centres

ramp-up of significant projects in Canada and in China, Russia, Australia and North Russia, as well as exploration spending reach

America, offer the biggest opportunities

multi-year highs in Australia in 2018.

for discovery?

21

22

GOLD | World Gold Council

Alistair Hewitt - director of market intelligence at the World Gold Council AH: Last year we saw notable production growth in Canada, Russia and Australia.

Canadian and Russian miners are benefiting from recent ramping up on new projects.

In the former, projects such as Brucejack and Rainy River boosted output, while in

“Geographically-speaking, g a key strength of the gold m market is less susceptible to

the latter the ramp-up of Natalka made a sizeable contribution of national production.

And Australia is currently going through

tonnes in 2010 to around 410 tonnes in

something of an exploration renaissance. As

2018, an annual growth rate of about 8%.

we noted in our Full Year 2018 Gold Demand

According to Metals Focus, our primary

Trends report, exploration spending in

supply and demand data supplier, Ghana,

Australia reached multi-year highs in 2018.

Mali and Burkina Faso all featured in the top 20 gold producing countries in 2018.

West Africa is an important gold producing region that has seen rapid gold production

It’s very possible that we will continue to see

growth over the past decade as well, with

further growth from West Africa too. And

mine supply increasing from about 225

in Africa more broadly, we have also recent

ResourceGlobal GlobalNetwork Network 23 Resource

gold mine production is more diversified than ever and this is market. Given the global spread of gold mining, supply to the o regional shocks and therefore far more stable than in some other metals� Alistair Hewitt seen the reassessment of artisanal and small- AH: I think West Africa is likely to be the scale mining (ASM) which suggests this is

engine of growth for African gold production,

larger than previously thought and growing

with a number of projects ramping up

swiftly.

recently. And while South Africa is no longer the leading producer in the continent, it will

JAW: Is it fair to call West Africa the new

play a significant role in gold production for

capital of gold production in Africa, after

several years.

Ghana overtook South Africa as the continent’s largest producer?

Geographically-speaking, gold mine production is more diversified than ever. Not

24

GOLD | World Gold Council

much has changed since 2010 in terms of

of experience that will be of significant

gold production’s geographic split. And this is

value, and look forward to working with the

a key strength of the gold market. Given the

Council and its members to improve the

global spread of gold mining, supply to the

understanding of the gold industry, reinforce

market is less susceptible to regional shocks

trust and set global standards.

and therefore far more stable than in some other metals.

JAW: To what extent does the addition of these West African mining companies to

JAW: The WGC recently welcomed

the WGC’s membership reflect the rising

West African stalwarts Teranga Gold

importance of the region to the global

and Endeavour Mining to its board of

gold industry

members. How will these companies contribute to the work of the WGC?

AH: West Africa is an important gold producing region, with gold output stretching

AH: Both Teranga Gold and Endeavour

back before recorded history in countries like

Mining play an important role in the

Ghana and Mali to name but two.

production and exploration of gold across West Africa and bring with them a wealth

Resource Global Network

It is a region that has seen rapid gold

AH: Gold will remain an important part of

production growth over the past decade as

digital innovation. It is a shrewd investment

well, with mine supply increasing from about

and is deeply ebbed in cultures and customs

225 tonnes in 2010 to around 410 tonnes

around the world.

in 2018, an annual growth rate of about 8%. Ghana surpassed South Africa as the

But what is exciting is how technology

continent’s largest gold producer in 2018, a

can create new ways for people to access

position I suspect it will keep hold of in the

gold. There are several innovative fintech

near term if not for longer.

companies exploring how blockchain technology can make it easier to people trade

JAW: Finally, can you provide your

gold, as well as increasing the transparency

thoughts on the role of gold in today’s

of the global gold supply chain.

digitally innovative world and within a shifting global economy?

All imagery © World Gold Council

a jb

25

26

CHARITY | Atlas Foundation

Resource Global Network

ATLAS FOUNDATION Ex-pro Jason Leonard tells about his vision to tackle the bigger issues through rugby

27

28

CHARITY | Atlas Foundation For Former England Rugby Union international and World Cup winner Jason Leonard, rugby is so much more than a game. It’s an international family that teaches important life skills and values: Education, teamwork, discipline and camaraderie to name a few. So, when Leonard decided to channel his charitable activities into a new vehicle, he turned to the power of rugby and set up the Atlas Foundation in 2014.

Simon Curran: Can you describe the

The organisation aims to improve the lives of the poorest people on earth through teaching rugby, primarily focusing on children in underprivileged areas. For instance, the Atlas All Schools project focuses on education, employment and crime reduction by teaching rugby to children at schools in deprived areas around the world, including in South Africa, Argentina, India, Cambodia and Israel. The project has delivered excellent results in each location, helping to improve the prospects of thousands of students.

and from there we have doubled in size

Today, Atlas is engaged on over 20 projects in 16 countries around the world, helping around 24,000 children on a weekly basis. The work of the foundation is supported by a full annual calendar of fundraising events, which include rugby legend dinners, cycle and golf events and one-off fundraisers such as Leonard’s recent trek through the Himalayas. Atlas’ founder talks to RGN’s managing director Simon Curran about the journey the Foundation has been on since its creation.

journey the Atlas Foundation has been on since you founded the charity in 2014?

Jason Leonard: We started with a small, trusted team of ex-international rugby players, added in a CEO (Sally Pettipher) who had done great work with me at the RFU, and we benefited from a large annual fundraiser that I had been running for 10 years by then.

That gave us a strong financial foundation every year and raised our first £1 million in our third year. We’re now in our fourth year and we will raise £1 million per year from 2020. We currently help 24,000 children on a weekly basis in 16 countries around the world, and that will double in the next three years.

Resource Global Network

29

30

CHARITY | Atlas Foundation

Jason Leonard and Michael Whitfield in Zimbabwe

Resource Global Network SC: What motivated you to set up the foundation and what made you believe that the game of rugby could make a difference to the lives of deprived and vulnerable children around the world?

JL: I have done a lot of charity work over the years and I saw a lot of my rugby mates doing charitable things around the world. I wanted a platform for us all to get together - a kind of virtual scrum - where the strength of working together makes more of a difference than doing smaller things on our own.

I know rugby helps kids because I was that kid. It helped me, not just through the values and the discipline it imparts, but through the friendships and the contact network. I’d never be in the position I am now without a heap of people from all walks of life giving me a leg up. That’s what our people do for the kids we work with, its so much more than just the rugby.

SC: How do you continue to leverage off legends of the rugby world in order to improve lives in some of the poorest regions around the world?

JL: Firstly, Atlas’ global network of Rugby Champions are our eyes and ears, our police force and our marketing team. They make sure our work is delivered as it should be, and all our donors’ money is spent properly.

Secondly, they help with fundraising and looking after donors, and with media work around the world. Thirdly, our corporate friends cover much of our operating costs,

31

32

CHARITY | Atlas Foundation

Resource Global Network

33

34

CHARITY | Atlas Foundation

“I wanted a platform for us all to get together - a kind of virtual scrum - where the strength of working together makes more of a difference than doing smaller things on our own” Jason Leonard, Atlas Foundation founder

help with fundraising and provide work

JL: We’ve created a couple more projects

placements for kids coming out of the top of

with some schools in and around Cape Town.

our programmes.

One of the schools is in Atlantis, which is a very poor area, and another is in Ocean

SC: Tell me about some of the

View. Like many parts of Africa, kids of a

Foundation’s recent work in Africa? Atlas

young age are being dragged into gangs and

has a presence in Kenya, Malawi, South

find themselves in perilous situations. For

Africa and Lesotho to name a few.

the children, being part of a gang is about belonging to something, but they are part

JL: Atlas is rolling out a global programme

of the wrong crowd. Rugby is another gang,

called ‘All Schools’ that makes sure that

another team. We just want to get them out

kids in school, and those that can’t attend

of the wrong gang and put them in the right

school, get a basic education and access to

gang through rugby.

the teamwork and discipline of rugby. By combining rugby values with basic education,

The great work that Atlas SA has initiated in

we create strong, honest, hardworking young

Cape Town extends to the Gauteng region

people who are a pleasure to have in your

where we now have 123 township schools

company. In Africa, we work with Rugby

in the Atlas project, and 87 of those schools

Champions and trusted NGO partners to

teach girls rugby. Our focus on girls rugby

deliver this programme in urban and rural

in the township development started four

locations from Morocco right down to South

years ago with only 12 schools and has now

Africa.

expanded to become a massive project with over 2,000 girls playing rugby in this region.

SC: In 2018, Atlas established an office in South Africa, which was formally launched

Support in South Africa has been exceptional

earlier this year when you visited Cape

since the Atlas SA launch earlier this year,

Town. What did you get up to during your

with buy in from government officials,

time there?

consulates, corporates and sporting legends alike - a powerful alignment of stakeholders.

ResourceGlobal GlobalNetwork Network 35 Resource

36

CHARITY | Atlas Foundation

Jason Leonard with England internationals Danny Care and Billy Vunipola at Atlas Foundation’s 2018 dinner SC: How successful have previous

11th being our largest of the year, and we

fundraising events been and how excited

had our cycle ride on June 2nd and a golf day

are you for the 2019 & 2020 events?

on June 28th. See our events page for more details and do please come and meet us and

JL: As I said before, our fundraising is growing rapidly. We stick to four main events in the UK, with our annual dinner on September

have some fun with it.Â

Resource Global Network have a regular US fundraiser, along with one in Singapore. These teams help with raising money but also in investigating where we can start programmes to most benefit kids in their regions.

SC: What does the future hold for the Atlas Foundation? How will you continue to grow the charity in order to help transform more lives?

JL: We have just launched our ‘Front Row Club’ which is a way of lots of people being able to support Atlas, while receiving a host of benefits that are only usually available to our very wealthy supporters.

Membership with the Front Row Club provides the opportunity to enter our ballot for international tickets, get free places at our events, and even a free trip to Japan for the Rugby World Cup final, and dinner with me while you’re there. By building a large membership of rugby people across the world, we protect Atlas, and the kids we help, against the possibility of a big event being cancelled. It also means we can meet supporters across the world and get involved with them face-to-face if we’re in that country visiting the kids in our projects.

Our Atlas branches in France and South Africa are also now starting to raise money and oversee our charity programme, and we

a b

37

Capital Drilling, a leading full service drilling provider in Africa, is proud to partner with Hummingbird Resources to deliver their drilling projects in Mali.

From greenfields exploration to mine site drilling requirements, Capital Drilling has one of the largest diversified drill fleets across Africa.

SERVICES INCLUDE: •

Blast hole

•

Directional

•

Exploration and delineation

•

Grade control

•

Underground drilling

Egypt Mauritania

Mali

Operational bases across Africa

Burkina Faso Guinea

Ethiopia

Cote d’Ivoire Ghana

Kenya

*Democratic Republic of the Congo

DRC*

Tanzania

We can mobilise quickly from our extensive network of offices located throughout Africa.

Zambia Namibia

Botswana

Contact us to discuss how our knowledge and experience can help your project. www.capdrill.com | info@capdrill.com

40

COLUMNS | Frank Horton

WEST

One of the world’s largest go

Resource Global Network

AFRICA – THE NEW GOLD HOUSE

old provinces remains underexplored - by Frank Horton, Mercton Resources

41

COLUMNS||Ian Frank Thomson Horton 42 COLUMNS

There is no place on this planet that has not been explored, at least to some extent, for gold. However, there are some other places that have not been explored much. West Africa has become the target for gold exploration by mining companies and a tremendous number of new discoveries have been made in recent years. The main goldfields being explored in West Africa lie within the Proterozoic rocks which is part of the West African Craton – a body of old rocks composed of granitic gneisses and greenstone belts.

Mauritania, Senegal, Niger, Liberia and Côte d’Ivoire are also experiencing a significant increase in gold production. West Africa has a thriving unexploited mineral reserve that, if properly regulated, could unlock the fortunes of the region.

West Africa has now become the continent’s

The underutilised gold house

gold hub after its total production of gold

There are major contributing factors as to

recently surpassed that of Southern Africa.

why West Africa’s mineral deposit remains

While global gold production has been

underexploited. Up until the early 1990s,

declining, West Africa’s has been growing and

when the broad transition towards multi-

Ghana is currently the largest gold producer

party democratic systems started occurring

on the continent.

across the region, several countries had been politically unstable since independence.

Mali is Africa’s third largest gold producing country behind Ghana and South Africa

In a number of cases, the power vacuum

while Burkina Faso emerges fourth. Guinea,

caused by the departure of colonial powers

ResourceGlobal GlobalNetwork Network 43 Resource

led to the re-emergence of competing interests along previous political and tribal lines.

The emergence of political parties led to dictatorship and oppression of opposition as well as military coups. These developments scared investors and mining firms that didn’t want to risk their investment due to political instability.

Things have, however, changed in recent years as two or three countries in the region are counted among the fastest growing economies in the world. Indeed, there has been a rapid transformation in the region.

Mineral-endowed countries in the region have recognised that they can benefit

FRANK HORTON

Frank Horton is an engineer and chief executive at Mercton Resources armed with decades of experience, knowledge and a strong drive to develop international standards out of mining support services in West Africa.

He is also a mineral analyst with wide experience in business development in the mining industry and believes mineral wealth endowed beneath Africa has all it takes to transform the continent with the right policies that leverage wealth and human capacity to create impact

44

COLUMNS | Frank Horton

“In the belly of Africa are a plethora of minerals. West Africa, especially, is pregnant with large reserves of mineral deposits.

To date, the most productive gold-bearing zone in the region has been the Ashanti gold belt in Ghana” Frank Horton, Mercton Resources chief executive from orderly development of their natural

West Africa, is currently faced with human

resources with stable democracy. Currently,

rights, environmental, public health and

the region has attracted the world’s attention

safety, power generation, weak governance,

as mining companies and exploration firms

corruption, poverty and security challenges.

are setting up and taking a real interest in the area.

New discoveries Teranga Gold has recently announced two

Minerals are very essential to the existence of

new gold discoveries from its exploration

humanity, especially considering how mining

programme at Golden Hill project, located

has become part of our daily lives. The

within Houndé Greenstone belt. A nickel-

utmost advantage it brings to people is that

copper deposit at Yepleu has been

it makes life better for them – economically,

discovered by Sama Resources, while large

physically and even socially.

graphite reserves discovered at Lola in Guinea by Sama Resources are currently

Economically, it creates shared value for

under development. Birimian Ltd. is making

sustainable development. As a matter

significant development in large hard rock

of fact, wealth made through mining is

lithium deposits at the Goulamina project in

very significant for countries in Africa.

Mali.

Unfortunately, the industry, especially in

ResourceGlobal GlobalNetwork Network 45 Resource

Underexplored belts In the belly of Africa are a plethora of minerals. West Africa, especially, is pregnant with large reserves of mineral deposits. To date, the most productive gold-bearing zone in the region has been the Ashanti gold belt in Ghana.

The Obuasi mine owned by AngloGold Ashanti has produced over 33 million ounces (Moz) of gold since 1897 and currently hosts resources of approximately 28Moz of gold. Birimian Greenstone remains the underexplored belt within West Africa, with major sources of gold deposits that extend through Niger, Burkina Faso, Ghana, Côte d’Ivoire, Guinea, Mali and Senegal. The two billion-year old rock formation plays Azumah Resources is also developing rapidly their gold deposits in Ghana with exciting

host to some of the richest gold deposits in the world.

results. IronRidge Resources in Ghana is also making progress on their Cape Coast lithium

With more of the Greenstone belt running

discovery. Sama Resources is comfortably

through Côte d’Ivoire than any other West

exploring the South Houndé, Threebee and

African country, it is widely believed that

Karankasso gold deposits on the famous

there may be more gold under Ivorian soil

Houndé Greenstone belt in Burkina Faso.

than neighboring Ghana. The country holds

Hummingbird Resources is planning on

35% of the famous Birimian Greenstone belt,

developing the Dugbe gold project in Liberia.

compared to Ghana’s 19%. In the future, it is possible Côte d’Ivoire can become the major

AG Vision Mining has also discovered a high

gold producer in Africa.

grade quality platinum group metals deposit in Nigeria. Avesoro Resources’ New Liberty

The Banfora Greenstone belt and Houndé

gold mine has been chalking great successes

belt in Burkina Faso hold major unexploited

after a turnaround there, and the company

reserves of gold. Major, junior and

has made new discoveries at its Ndablama

exploration firms have gained licence to

gold project in Liberia.

explore the belt and discoveries from there

46

COLUMNS | Frank Horton

Resource Global Network never cease to amaze industry players.

with less than three years of commercial

Niger is endowed with a host of Greenstone

production at Nkran and the Eaase deposit in

gold belts in the region. The three belts -

Ghana.

namely Sirba belt, Goroul belt and Liptako belt - remain underexplored. The country

New commodities

continues to be the world’s fourth largest

Over the years, these minerals have been

uranium producer, with much larger reserves

highly sought for because of the uncountable

in the Agadez region untapped.

benefits they bring to mankind. Apart from gold’s dominance on the Birimian greenstone

Apart from its rich history of phosphate

belts, West Africa is also endowed with stores

deposits in Thies region and Feleme iron ore

of minerals such as lithium, iron ore, bauxite,

deposits, Senegal’s Birimian Greenstone gold

limestone, gypsum, diamond, phosphate,

belt remains underexplored with remarkable

graphite, copper, nickel, uranium and coltan

gold reserves. Guinea holds the world’s

among others.

largest high grade bauxite reserves in the world, estimated at over 40 billion tonnes.

Over 75% of the region’s exploration is

Boke region deposits also host vast untapped

focused on gold. This means that gold is

reserves.

recognised as the future of West Africa, yet

New companies

necessary commitment should be made to unify the vision for the prosperity that

West African Resources has commenced

leverages wealth and human capacity to

construction of its Sabrado Gold project, a

create impact.

high grade discovery in Burkina Faso. Bassari Resources is also focused on bringing its Makabingui Gold project in Senegal into production. As Trevali Mining Corporation is growing steadily on its Perkoa Zinc project in Burkina Faso, SEMAFO Corporation is also producing gold efficiently in both its Boungou and Mana gold projects in Burkina Faso.

Endeavour Mining is keen on developing its assets at the Kalana project in Mali. Asanko Gold is proving to be a force to be reckoned with in the West African mining industry,

aj

47

48

COLUMNS | Alec Crawford

DIGGING O

The formalisation of artisanal Intergovernmen

Resource Global Network

OUT OF POVERTY IN WEST AFRICA

l mining in West Africa requires widespread collaboration, by Alec Crawford ntal Forum on Mining, Minerals, Metals and Sustainable Development (IGF)

49

COLUMNS||Ian Alec Thomson Crawford 50 COLUMNS

It happened seemingly overnight. Mauritania did not have a history of artisanal and small-scale mining (ASM). This West African country, perched on the edge of the continent where the Sahara meets the Atlantic, has a vast territory, low population density, harsh climate and low levels of surface water. These factors seemed to ensure that ASM would continue to be limited.

As a result, the government had not developed much in the way of legal and institutional mechanisms for dealing with ASM. Traditionally, it had not been part of the country’s mining sector.

This changed in March 2016. Industrial gold

With little training and no environmental or

mining was already well established in the

health safeguards, the miners began digging

Inchiri region, Northeast of the capital of

on lands adjacent to and overlapping with

Nouakchott. However in a matter of days that

existing mining titles, generating tensions

March, a gold rush sent an estimated 20,000

with those operating legally in the area. The

ASM miners – from both Mauritania and

result was a landscape pockmarked with

neighbouring countries – to the area around

deserted small mines and the remnants of

the large-scale mining concession in search

camps abandoned as quickly as they were

of riches.

established. The scale of the operation was immense and completely unplanned.

ResourceGlobal GlobalNetwork Network 51 Resource

ALEC CRAWFORD Alec Crawford is a Senior Researcher with IISD whose work with the IGF focuses on programme delivery, including the implementation of Mining Policy Framework assessments and the design and delivery of demand-driven training programmes. He also leads IISD’s work on Environment, Conflict and Peace building, and works extensively on climate change adaptation.

The government – specifically the Ministry of Petroleum, Energy and Mining – had to react quickly. Government officials implemented an emergency response plan and began developing a more comprehensive strategy and legal framework for formalising ASM in Mauritania, to ensure livelihoods are supported and the environment is protected while existing concessions are also respected.

Alec has been involved in all of the MPF assessments to date, as well as in the development of the IGF Guidance for Governments on Managing Artisanal and Small-scale Mining, and the design and delivery of associated training programmes.

Alec has a Master of Environment and Development at the London School of Economics and a Bachelor of Commerce at Queen’s University. He speaks English and French, and is based in Toronto, Canada.

52

COLUMNS | Alec Crawford

While an extreme example, what happened

This compares to seven million people

in Mauritania illustrates many of the

working in industrial mines. When support

challenges and opportunities presented by

services and families are counted, an

ASM in West Africa and beyond. Globally, the

estimated 150 million people, spread across

sector is experiencing explosive growth: the

80 countries, are thought to depend on

IGF estimates that approximately 40.5 million

ASM. This accounts for a significant portion

people were directly engaged in ASM in 2017,

of some key mineral supply chains: 20% of

up from just six million in 1993.

global gold supply; 80% of all sapphires;

ResourceGlobal GlobalNetwork Network 53 Resource 20% of all diamonds; and a quarter of global supplies for both tin and tantalum.

ASM is particularly important in West Africa. Rough estimates from key producing countries in the region illustrate the scale of the sector from a livelihoods perspective, with close to 20 million people either directly or indirectly dependent upon ASM across a selection of countries in the region.

For ASM in West Africa, gold and diamonds are king, but miners are exploiting a range of minerals, from precious metals and stones to construction materials. The sector is a key source of household income, livelihood and economic development for the region, but is also a significant source of environmental damage and social stress.

When integrated into formal legal and economic systems, ASM can be a great tool for sustainable development and poverty reduction. However, the challenges associated with ASM can be daunting, and while the sector is complex and diverse in West Africa, some common trends can be identified.

54

COLUMNS | Alec Crawford

Resource Global Network

Senegal offers an indicative example of

the enforcement of laws and policies

many of these trends. Here, artisanal gold

difficult; the same is true of efforts to

mining remains largely informal despite the

increase the capacities of miners on efficient,

government’s constant efforts to formalise

environmentally-friendly techniques.

the sector. This has resulted in lost revenues

Mercury use remains relatively widespread,

to the state and considerable difficulty in

and the negative health impacts are often

enforcing laws relating to environmental

borne by women and children working in

protection and occupational health and

the sector. Conflicts have emerged between

safety.

communities and large-scale mining in the region over both mineral deposits and arable

The sector is concentrated in the Southeast

land.

of the country, in the Kédougou region, and porous borders mean that efforts to

Governments across the region, including

formalise the national ASM workforce are

Senegal and Mauritania but also Burkina

often undercut by the arrival of miners from

Faso, Côte d’Ivoire, Mali, Ghana, Guinea, and

neighbouring countries operating outside of

Niger, continue to struggle with many of

the law.

these challenges, with the sense of urgency growing as the sector expands. Initiatives –

The inaccessibility of the region also makes

from projects and programmes to laws and

55

56

COLUMNS | Alec Crawford

strategies – are many, and success can be

In Mauritania, the government has – among

difficult to achieve.

other things – established authorised rockcrushing sites in two major districts as well

On the legislative side, many of the efforts to

as a mercury treatment centre, all close to

formalise artisanal mining have been flawed,

the ASM sites to mitigate health and safety

unimplemented or unenforced. A variety

risks, prevent water contamination and help

of strategies to address ASM challenges

monitor production.

and ensure ASM supports sustainable development have been developed. In

In Burkina Faso, the issue of ASM

Senegal and Ghana, among others, plans

management is now so critical that the

have included the establishment of ASM

country became the first to create a

corridors or zones available for small-scale

government agency solely dedicated to

mining only.

improving the management of the sector.

In most countries across West Africa,

It is clear that many West African

governments have tried issuing authorisation

governments are actively trying to

cards to those ASM miners seeking to

manage ASM within their borders in a

operate legally in the sector. Many countries

way that addresses the sector’s negative

have also tried to establish government-run

environmental and social impacts, while

purchasing counters for artisanally-mined

optimising its contribution to sustainable

gold.

development.

Resource Global Network

These strategies must reflect the diversity

counters, for example), Ghana (on access

and complexity often inherent in ASM, which

to finance and formalisation), and Burkina

can differ considerably across commodities,

Faso (on the allocation of administrative

regions, or levels of mechanisation. Such

resources and budget) can be applied to an

efforts also have to be designed and

ASM management strategy in neighbouring

implemented in collaboration with key

countries?

partners if they are going to succeed.

The formalisation of ASM in West Africa This includes the miners themselves, of

will not happen overnight; it will be a long,

course, but also their communities, local

difficult road. But while the challenge is

authorities, large-scale mining companies,

considerable, it must be embraced by

responsible sourcing initiatives, international

governments across the region. Without

organisations, and development partners,

further progress, the negative impacts of

among others.

ASM could continue to act as a break on development and a threat to the well-being

It also includes governments from across

of communities and individuals. But if they

the region sharing experiences with and

can get it right, it could offer a brighter future

learning from each other; what lessons

for millions.

from decades of ASM in Mali (on purchasing

ab

57

Delivering drill hole data We understand it’s about more than just drilling the hole – it’s also vital to obtain quality samples and data from every drill hole.

At Capital Drilling, we know how important this information is to our clients. We have our own Q&A teams on all production crews and ensure our drillers and offsiders are trained to follow our sampling systems and processes to deliver quality samples.

After all, what’s the drill hole really for?

Capital have earned a reputation for our excellent service delivery throughout East Africa. We are now providing this same quality service across West Africa. info@capdrill.com | www.capdrill.com

Conveying Excellence with High-End Conveyor Belts Every conveyor belt, every climate zone and every topography calls for perfect conveyor belt technology.

ContiTech provides knowledge, experience, a globally encompassing and competent network and a broad product range to give your conveyor belt applications a technological lead. More than 140 years of rubber expertise make us a strong partner, enabling our customers to benefit from the synergies within the Continental corporation. We implement innovative conveyor belt technology reliably, sustainably and safely from development to commissioning and after-sales service.

conveying excellence

+27 (0) 11 248 9300 www.contitech.co.za

60

MINING | Roxgold

Resource Global Network

ROXGOLD Canadian mining company goes for gold in West Africa

61

62

MINING | Roxgold

Roxgold started life as a junior gold explorer with a joint venture earn-in agreement for the Yaramoko property, located within the gold-rich HoundÊ greenstone belt in Burkina Faso. The company began exploring the property in 2011 and eventually made a discovery with the 55th drill hole of the programme; hence the name 55 Zone. After taking the project through the first rounds of exploration, the 55 Zone emerged as a high grade discovery and a very coherent deposit according to Roxgold’s president and CEO John Dorward. A feasibility study for an underground mine followed in 2014 and commercial production was declared in October 2016. During the last three and a half years of production, the project has consistently delivered a high return on capital, based on double digit grades and low costs.

A premier gold jurisdiction “We have gone from a virgin drill hole discovery to having a producing gold mine in five years. There are very few jurisdictions

Resource Global Network

63

64

MINING | Roxgold

Resource Global Network where you can legitimately achieve that in that amount of time,” says Dorward.

This reference is a testament to Burkina Faso’s rising status as a premier gold mining jurisdiction on the African continent.

The industry has been booming in recent years, becoming Africa’s fourth largest gold producer in 2017 and Burkina Faso expects to announce another record year of gold output for 2018.

During its time in Burkina Faso, Roxgold has experienced a jurisdiction with a pro-mining and pro-foreign investment stance, along with a permitting process that is clearly established, articulated and not bound in superfluous red tape.

John Dorward, Roxgold president & CEO

Recent security challenges are a genuine concern for Roxgold and the country’s

going to be Roxgold’s next gold mine in West

mining investors, however Dorward remains

Africa.”

steadfast in his belief that Burkina Faso is a premier gold mining jurisdiction.

Roxgold has already started exploration drilling at Séguéla’s Antenna deposit and

Since becoming a cash generative company

has a number of satellite targets that will be

via gold production from 55 Zone, Roxgold

drilled, with the aim of increasing resources

has been able to pay down a significant

and ultimately compiling a preliminary

portion of its project finance debt, while also

economic assessment and a feasibility study

turning to additional developments, most

for Séguéla.

notably making its first acquisition in April.

“We acquired the Séguéla gold project in Côte

2018 operational performance

d’Ivoire from Newcrest for $20 million and

In 2018, the company was able to increase

are in the process of updating the resource

year-on-year gold production by 4% to

statement to be 43-101 compliant. We like

132,656 ounces, with an average head grade

what we’ve seen so far and definitely think it’s

of 13.5 g/t from a record 307,591 tonnes of

65

66

MINING | Roxgold

AUMS advert April-18.indd 1

29-Apr-19 8:09:16 PM

processed ore. Dorward puts this improved

This year, Roxgold’s gold output is set to be

operational performance down to increased

further boosted by the arrival of a second

efficiencies at the mine and mill.

gold producing mine within the Yaramoko project. First ore was produced at Bagassi

“The mill has consistently run above

South in October 2018 and it’s expected to

nameplate capacity. We did a few things in

reach commercial production in Q2 2019.

the original design, such as installing a larger motor in our SAG mill, which has helped us

The successful development of Bagassi South

sustain a higher than nameplate throughput

has been coupled with an expansion of the

capacity.

processing plant at Yaramoko, which was completed in December 2018 and increased

“We have also invested a significant

capacity by nearly 50% from 750 tonnes per

amount of capital upfront in underground

day (tpd) to 1,100 tpd.

development of the mine. Contrary to a lot of underground mines, we are well in front

“This is a significant milestone for us and a

of where we need to be. If there is an issue in

very important addition to the Yaramoko

one part of the mine, there are other areas

mine. Not only does it enable us to support

we can work in and maintain our productivity

the expansion of the processing facility, it

levels. I think it’s been a productivity driven

also brings mutual mitigation to the story.

story,” says Dorward.

ResourceGlobal GlobalNetwork Network 67 Resource

“Underground mining can be a challenging

Services (AUMS) – a division of Australian

business and having a second deposit lowers

contractor Ausdrill.

the overall risk of the project.”

AUMS have been active in the African Roxgold has also identified further resource

underground mining sphere for many

growth potential at both 55 Zone and Bagassi

years and were in fact initial investors into

South, which it will look to explore in the near

Roxgold, participating in equity financing for

term. At 55 Zone, the company has drilled the

the Yaramoko mine. As a result, AUMS and

shoot to a depth of over 1,000 metres and

Roxgold have a strong relationship and a

will publish an updated resource at the end

good alignment of interests.

of Q2. Meanwhile, Roxgold will focus on near surface infill drilling at Bagassi South in the

“They recently won a contract for Bagassi

coming months.

South, which was a 12-month extension

Strong partnerships

of the overall Yaramoko mining contract.

We saw quite a decent reduction in costs

Roxgold has worked closely with a number

to reflect that ongoing relationship and

of service providers in the development

the increased volumes. AUMS are by

and operation of its facilities at Yaramoko,

far our biggest contractor and are quite

including African Underground Mining

embedded with us in terms of the operating procedures.”

68

MINING | Roxgold

Resource Global Network In addition, Roxgold has also used Geodrill for exploration work and drilling in Burkina Faso and now in Côte d’Ivoire as well. ATS is Roxgold’s camp and catering contractor, while various construction services have been provided by DRA and Group Five out of South Africa.

“We’ve had a number of significant contractual arrangements and by and large they’ve all been positive for us. We’ve had good interaction with our partners,” Dorward declares.

Local expertise At the Yaramoko mine, Roxgold has made a concerted effort to build a workforce of primarily Burkina Faso nationals, in a show of support to the country which welcomed its arrival into the mining sector.

“We run with a very low level of expatriates and over 90% of our workforce is Burkinabé, many of whom hold senior positions within the operating team.

“There is not a very long history of underground mining in Burkina Faso, so there weren’t as many underground mining engineers in Burkina, but we are now starting to see that develop,” Dorward continues.

During the permitting process, Roxgold also committed to training and hiring locals from around the mine site, running an apprentice programme for youths from the local village.

The apprentices were sent to work with one

69

70

MINING | Roxgold

Resource Global Network

of the company’s construction contractors,

more investment in terms of commercial

gaining valuable skills of the trade. The

activities, shops and small businesses being

apprentices were then hired by Roxgold to

established.”

become a key part of the plant processing and maintenance team.

In addition to bringing lucrative employment opportunities, Roxgold has also organised

Dorward believes that, in addition to local

several community investment programmes

procurement practices, the most important

in the local area, including teacher

single contribution that the company

training, agricultural workshops and solar

has made to the local communities has

electrification for medical centres.

come in the shape of secure full-time jobs.

“We’ve brought a large number of well-paid

“I think as a responsible mining company

permanent positions. They work a full week

and a good neighbour, we are making

and earn significantly higher incomes than

a very positive contribution in the local

what they otherwise would.

communities.”

“That flows through the community and

West African expansion

helps households. It’s a much more

After establishing itself in Burkina Faso,

vibrant community now, you see a lot

Roxgold is now excited to be moving into

71

72

MINING | Roxgold

Côte d’Ivoire with the acquisition of the

“The terrain is very fertile for gold discoveries

Séguéla project. Dorward believes that Côte

and there are several examples of large gold

d’Ivoire has been historically underexplored

deposits in Côte d’Ivoire such as those owned

despite having extensive greenstone belts

by Randgold Resources [now part of Barrick

that run down from Burkina Faso, Mali and

Gold]. We think the property we acquired has

Ghana.

a lot of upside.

Resource Global Network

73

“We have gone from a virgin drill hole discovery to having a producing gold mine in five years. There are very few jurisdictions where you can legitimately achieve that in that amount of time” John Dorward, president and CEO, Roxgold that we are starting to drill. The potential is there to bring those into resource status and ultimately into production. It should be a low capex, high returning operation and will sit very nicely next to Yaramoko.”

After expanding into Côte d’Ivoire, Dorward feels that the company is right at home in West Africa, with a management team that is highly experienced in the region and wellequipped to take on additional projects further down the track.

“West Africa is the most logical area for us to be looking, but good projects are hard to find so we keep an open mind as to what might be available. We stand to benefit from the skill of our team and the significant amount of cash that Yaramoko will be generating in the coming years,” he concludes.

“At Séguéla, the Antenna deposit will get larger but I think the main story will be around the large number of satellite targets

TSX:ROXG OTC:ROGFF

j

Specialist Bank

Bringing security to frontier markets

INVESTEC INVESTEC

From Pakistan to Thailand, Bangladesh and practically everywhere in between, it’s never been easier to trade in frontier market securities.

Investec’s Corporate and Institutional Banking division has the research and ability to execute a wide range of local and international security transactions. Our skilled traders, advanced technology and strong,

established relationships, can give your investment the edge in a brand new market.

Call us, and see what we can bring to your table.

Execution

Research

Simon Reid simon.reid@investec.com +27 11 286 4885

Yeukai Gavaza yeukai.gavaza@investec.com +27 11 291 3044

Ryan Bell ryan.bell@investec.com +27 11 286 4732

Kuda Kadungure kudakwashe.kadungure@investec.com +27 11 291 3092

Ziv Okun ziv.okun@investec.com +27 21 416 3337

Anthony Geard anthony.geard@investec.co.za +27 21 416 1431

Sales and Strategy

Chris Becker chris.becker@investec.com +27 11 286 9104

Andrew Schultz andrew.schultz@investec.com +21 24 416 3339

76

MINING | Compass Gold

Resource Global Network

COMPASS GOLD On course for gold discovery in Mali

77

78

MINING | Compass Gold

Compass Gold Corporation was formed in late 2017 through its acquisition of five gold exploration permits in Mali, located within the highly prospective Sikasso region, which contains several multimillion ounce gold projects.

The TSXV-listed company is led by a group of exploration and mining veterans with over 30 years of experience working in Mali, and is tightly owned by the management team along with another 30+ shareholders who collectively control almost 80% of Compass Gold. Not long after securing the five concessions at the Sikasso Property, the company raised $6 million through a private placement and immediately launched its first exploration drilling campaign in December 2017.

Rooted in Mali’s gold sector

Those individuals delivered hugely successful

The leadership of Compass Gold has been

returns for IAMGOLD through the discovery

involved in the Malian exploration sector

of the large scale Sadiola Gold mine, which

since 1989, when several members of the

remains in operation to this day as part of

management team and board of directors

a joint venture agreement with AngloGold

were part of the formation of IAMGOLD

Ashanti.

Corporation - including president and CEO Larry Phillips, who co-founded IAMGOLD.

Another key member of Compass Gold’s leadership team, Dr Madani Diallo, was the general manager of AngloGold’s

Resource Global Network

Mali operations, adding another layer of

“He has had a hand in some of the largest

experience to Compass Gold’s advantage in

deposits that have ever been discovered in

the West African country.

Mali and has corporate experience through the AngloGold years too. Dr Diallo brings not

“Dr Diallo has also worked extensively with

only technical expertise to Compass Gold,

the Mali Chamber of Mines, and in that

but a good reputation with the government,

context he had access to and participated

technical service providers and other

in almost all of the regional work on gold

important subcontractors in-country.”

exploration in Mali,” says Phillips.

79

80

MINING | Compass Gold

“We’re an all-Malian exploration group. We don’t need to be sending expats into the country, so that gives us continuity, tremendous local knowledge technically and a great set of relationships that our team has built in-country for the last 20 years” Larry Phillips, president, CEO and director of Compass Gold

Resource Global Network As the company’s head of exploration, Dr Diallo has also assembled a first-class technical team to drive the exploration campaigns at the Sikasso Property, taking two senior geologists from the Sadiola mine who had been working with the IAMGOLDAngloGold JV for nearly 10 years.

“We’re an all-Malian exploration group.

We don’t need to be sending expats into the country, so that gives us continuity, tremendous local knowledge technically and a great set of relationships that our team has built in-country over the last 20 years.”

During this period, the basic structure of Mali’s mining legislation, including its tax regime and investment benefits, has remained largely the same. This legislative stability has proven to be an attractive proposition for several high-profile investors, including B2 Gold, Resolute Mining and Hummingbird Resources, all of whom have recently commenced production at new gold mines.

These new operations contributed to a 23% increase in gold production to 60.8 tonnes in 2018, which helped Mali enter the top tier of Africa’s gold producers, behind only Ghana and South Africa last year.

Diving into exploration After securing the Sissako exploration permits, Compass Gold wasted no time heading to the market in order to raise funds for exploration. The plan was to raise enough to fund the first year of exploration, and this was achieved through a single $6 million

81

82

MINING | Compass Gold “We made an extraordinary amount of progress in the first year and were able to significantly narrow down our targets for the next phase of drilling. Regardless of the amount of money available, I don’t think this could have been achieved by another group that was not on the ground and ready to go with all the contacts in place.”

Just one month after completing its phase 1 exploration programme, Compass Gold embarked upon phase 2 in December 2018, which involved a first ever bedrock drilling campaign at the Sikasso permits.

Thanks to the identification of drilling targets Larry Phillips, President, CEO and director of Compass Gold

at Farabakoura in the phase 1 programme, the company was able to take a selective approach across the large mineralised zone throughout phase 2. Despite drilling minimal

private placement. This allowed the company

metres in the campaign, the results revealed

to begin its phase 1 exploration programme

broad mineralisation that was enhanced by

in December 2017.

several high grade intercepts.

“We were able to lay out a plan for the year

“We had 60 metre intercepts which averaged

with the money in hand and moved very

1.42 g/t of gold. This is the kind of broad,

aggressively in terms of assembling the right

open pit-able, near surface grades that are

equipment and people. That was where

exactly what we were looking for in our

having the local people and relationships

search for a deposit here in Mali. And, within

played a big part,” notes Phillips.

that same initial zone, we had an intercept of 80 metres at 20.69 g/t, which is extremely

During the campaign, Compass Gold

high grade, especially for an open pit mine.

completed nearly 4,000 metres of auger drilling covering an area of almost 1,000

“The combination of broad mineralisation

km², which identified wide mineralised zones

in the right type of geology, as well as the

and intercepted significant gold grades in

indication that there may be these sweetener

several areas. Most notably, the programme

zones, in terms of high grade structures,

identified 19 bedrock drilling targets within

make it very exciting and that’s where we are

the Oussada and Farabakoura permits.

focusing our next drilling programme.”

ResourceGlobal GlobalNetwork Network 83 Resource

84

MINING | Compass Gold

Now into phase 3 of the drilling campaign

Bamako, with solid ties to the Australian

following on oversubscribed $2.6 million

exploration drilling industry. Since May 2019,

private placement in April 2019, Compass

Compass Gold has used London-listed Capital

Gold hopes to complete 3,000 metres of

Drilling as its new partner of choice.

RC drilling at Farabakoura before the rainy season arrives in late June, when it will

“Capital Drilling is set up with permanent

become difficult to undertake operations

installations in Mali and is very active in both

efficiently and safely.

development and operating projects. They’ve also taken on the role of strategic partner

The aim of this programme is to extend

after they made an investment into Compass

the current known strike length of the

Gold through our most recent private

mineralised zone beyond 700 metres, while

placement,” Phillips says.

also targeting high grade structures to the North of the zone, Phillips reports.

Next steps Following the conclusion of the rainy season

The initial drilling programmes were

at the end of Q3, Compass Gold aims to

conducted by Target Drilling SARL, an

begin resource definition and infill drilling at

independent and well respected exploration

Farabakoura, although this is contingent on

drilling company based in Mali’s capital

the results of the current programme and the analysis conducted in the next few months.

Resource Global Network explorer to developer and finally to becoming a gold producer. However, he warns that this process takes time and comes with a series of challenges.

“One thing to note is that in 1991 there was nobody around us in Mali. Today, we are in the middle of a mining district with multiple mines in close proximity that are operated by quality producers who know us.

“So, we might find ourselves working with a partner that already has infrastructure and capital investment, which offers advantages in terms of how quickly we can bring our discoveries to account for our shareholders.

“It’s too early to tell which direction makes In addition, the company has identified more

the most sense, but I think we can say with

targets within the Sankarani zone, having

confidence that whatever results we are

seen extremely high, near-surface grades at

able to achieve under the ground, we’ll do

the Sodala prospect, as well as in a collection

the right and prudent thing on behalf of the

of artisanal pits at Yanfolila South.

shareholders above the ground.”

“We’d like to see those targets advanced with drilling in the fall after the rainy season and we’d like to get them to the same stage as Farabakoura.”

Looking towards the long term, Phillips believes Compass Gold could potentially replicate the path taken by his former company, IAMGOLD, in progressing from

TSXV:CVB

j

85

GOODYEAR OFF-THE-ROAD ®

MINING & CONSTRUCTION

ALL THE RIGHT TYRES TO DRIVE YOUR SUCCESS

Goodyear OTR tyres can meet the demands of any construction and mining operation.

Products provide high TKPH, durability and strong performance in all operating conditions.

DO MORE WITH LESS

REDUCE YOUR COST PER TONNE WITH PROVEN AUTOMATION SOLUTIONS Whether you need to reduce your cost per tonne of extraction, enhance safety or extend mine life, WesTrac and Cat® have the experience, skills and technology to help implement an equipment automation solution that supports your business goals.

Cat Command for Underground enables remote operation of load-haul dump machines allowing your site to operate more efficiently, more productively and safer, while reducing the cost of equipment ownership.

DO MORE Call 1300 88 10 64 Visit WesTrac.com.au © 2017 Caterpillar. All Rights Reserved. CAT, CATERPILLAR, their respective logos and “Caterpillar Yellow”, and the POWER EDGE trade dress, as well as corporate and product identity used herein, are trademarks of Caterpillar and may not be used without permission.

AFRICA. IN THE PALM OF YOUR HAND.

ONLINE NOW WWW.AFRICANBUSINESSNETWORK.CO.ZA

88

MINING | IronRidge Resources

IRONRIDGE RESOURCES Creating value through discovery

Resource Global Network

89

90

MINING | IronRidge Resources

IronRidge Resources is an AIM-listed junior exploration company that thinks like a major. The Australia-based firm is focused on building a diversified portfolio of mineral assets with large scale tenure positions in African frontier jurisdictions, and to a lesser extent in Australia. “We adhere to this strategy to immunise ourselves against a one project, one company strategy, which is not conducive to multiple wealth accretive discoveries,” says IronRidge CEO Vincent Mascolo. IronRidge’s focus on lithium and gold gives investors exposure to rapidly growing lithium technology markets while hedging prominent global economic uncertainty via a large gold exploration portfolio.

“Our business model is designed for multiple discoveries of globally demanded commodities, that’s where we see the first wave of value accretion for shareholders; in the discovery process and the development to decision to mine.

“Our strategy to concurrently diversify commodities and jurisdictions means that we always have something moving along; advancing projects, adding value and delivering positive news flow is paramount.”

Resource Global Network

91

92

MINING | IronRidge Resources

Resource Global Network Over the last three years, IronRidge has

But if a project does not deliver, we will let it

methodically built its tenure portfolios in

go,” says Mascolo.

three African jurisdictions - Ghana, Côte d’Ivoire and Chad. During this period, the

“Today, we have nine province scale projects

company has also established exploration

at various stages of development with

teams in each jurisdiction.

significant discoveries in Ghana and Chad to date and we expect multiple discoveries in

Teams are comprised of accomplished

the pro-mining jurisdiction of Côte d’Ivoire in

geoscientists and mining professionals with

the next 12 months.”

extensive in-country expertise, whilst the board has significant experience in project

Multiple discoveries

discovery, mine development and operations,

IronRidge has made three discoveries in

debt financing and delivering shareholder

three jurisdictions over the last three years

value.

– a record which very few junior explorers can make claim to. The first discovery was a

The board and management team also have

bauxite deposit back home in Australia, but

significant vested interests in the form of a

deemed not to be a company maker, the

combined 9.3% shareholding to complement

project has effectively been placed on care

a strong institutional shareholder base.

and maintenance.

IronRidge is backed by DGR Global Ltd, Assore Ltd and Sumitomo Corporation –

However, Mascolo calls IronRidge’s second

three global corporates who will support the

recent discovery a ‘spectacular’ lithium

company at each phase of the commodity

project in Ghana, with world class drill

cycle, from discovery and development

intersections from surface, first quartile

through to production and sales.

grades and in close proximity to operational infrastructure.

“We have a strong shareholder base that continues to support the business model

The Cape Coast Lithium Project contains

and we have new investors coming in to

proven high grade spodumene pegmatites

further support the company. They actually

and is significant given the fact that it is

see that the business model is designed for

the first lithium discovery made in Ghana,

exploration success.”

opening up the possibility to establish a new lithium frontier in West Africa.

Shareholders have also been struck by the agility that IronRidge demonstrates when it

“The project has been very well received in

comes to portfolio building. “The idea is to

Ghana, they are calling lithium the new white

spread our wings far and wide, capturing as

gold. We see huge potential for new industry

many highly prospective projects as we can.

there and that’s why the project is supported from the highest levels of office in Ghana.”

93

94

MINING | IronRidge Resources

IronRidge’s third discovery was a large gold

With investor markets still warming to Chad,

mineralised structure in Chad, where there

IronRidge recently made the decision to

has been little or no modern day exploration

acquire the Zaranou Gold Project in Côte

due to a historical focus on oil. Therefore, as

d’Ivoire, further expanding the company’s

the only active minerals explorer in Chad, the

portfolio in the jurisdiction, which is well

company holds first mover advantage with

understood by the investment community.

multiple advanced gold projects and multiple

In addition, the project has the potential to

targets across a 40 km strike

mimic and potentially dwarf what has been discovered in Chad, according to Mascolo.

“The first mover advantage provides the company with the potential to make

Two hot commodities

globally recognised discoveries in largely

Considering its most recent discoveries and

underexplored frontier regions. However,

acquisitions, it becomes clear that gold and

it does take more time to develop these

lithium will be IronRidge’s focus commodities

assets in the first instance and time for the

going forward, with both favoured by the

investment communities to appreciate the

company and the investment community for

opportunity.

different reasons.

ResourceGlobal GlobalNetwork Network 95 Resource

“Gold is a universal currency and it’s the

a lithium concentrate from the spodumene

staple form of traditional currency, which

dominant pegmatite ore at the Cape Coast

we particularly like. In addition, physical

project in Ghana, which would then be fed

gold is a reliable and trustworthy asset and

into the growing battery market worldwide.

is therefore an insurance against economic uncertainty.”

“With the support of the government and the influx of major European car manufacturers

The CEO also recognises the vast exponential

coming into Ghana, we can see there is the

growth story attached to lithium, which

potential to build an industry focus around

is derived from the global process of

a battery grade product, lithium hydroxide

electrification taking place across several

being preferred for the fast-growing electric

industries, most noticeably in the automobile

vehicle industry.”

sector with the rise of electric vehicles and stored energy.

However, this remains a long-term horizon for IronRidge and right now the company

IronRidge is currently investigating small,

is focused on testing several targets at the

medium and large scale methods to produce

project. Around 14,000 metres of drilling

96

MINING | IronRidge Resources

has already taken place across the project,

deep sea port of Takoradi and adjacent to

with recent results delivering multiple high

grid power.

grade lithium pegmatite intersections at the flagship Ewoyaa project and new Abonko

“When you are this close to operational

discovery.

infrastructure, it implies low capital intensity and low operational costs. In summary, the

The results to date and ongoing exploration

lithium project in Ghana has the potential

has identified additional pegmatite

to deliver first quartile lithium grades, first

mineralisation around the peripheries of

quartile capex and first quartile operating

both projects and surrounding projects

costs.”

areas, including the historical Egyasimanku Hill deposit. The company plans to continue

Striking gold

drilling until the end of the year, at which

While the Ghana lithium project is IronRidge’s

point it will produce a maiden resource.

most advanced, the company is also advancing its 900 km² gold portfolio in Chad;

IronRidge is also fortunate enough to be

a potential analogue of the intrusion related

operating within close proximity to world

gold systems in the prolific Yukon-Alaska

class infrastructure. The project is located 1

Tintina Gold Belt.

km from a major highway, 100 km from the

Resource Global Network

“Today, we have nine province scale projects across multiple jurisdictions in Africa and have already made significant discoveries in Ghana and Chad” Vincent Mascolo, CEO IronRidge Resources The main focus across the portfolio in Chad has fallen on the Dorothe Gold discovery, which has extensive artisanal workings with visible gold nuggets at surface, over a 3 km x 1 km footprint.

So far, IronRidge has completed 14,564 metres of trenching at Dorothe, plus regional air magnetics and soil sampling.

“When we drill some holes and get proof

Vincent Mascolo, IronRidge Resources CEO

of concept in the anomalous footprint, we believe it could rival some of the largest

will provide the pipeline of future discoveries

open pit gold mines in the world today,” says

over the next 12 months.”

a confident Mascolo.

To conclude, IronRidge’s African In Côte d’Ivoire, IronRidge has plenty of

diversification strategy has served it well thus

exploration activities to get busy with in the

far, as the company closes in on significant

coming months, including at the Zaranou

lithium and gold discoveries in Ghana, Chad

project after the company’s venture partner

and Côte d’Ivoire. IronRidge’s business model

had the exploration licence granted covering

is designed to return shareholder value

397 km².

through the discovery and development of multiple projects across a diverse commodity

“Côte d’Ivoire is our early stage, greenfields

and jurisdictional portfolio.

exploration jurisdiction, which we believe

AIM:IRR

a j

97

98

MINING | CSA Global

Resource Global Network

CSA GLOBAL

West Africa is a key growth market for this global mining consultancy

99

100

MINING | CSA Global are utilised by clients around the world, and The origins of CSA Group can delivered via CSA Global’s regional teams. be traced to a single mining consultancy team that was “The fundamental unique service proposition formed in Dublin, Ireland back that sets us apart from our competitors is in 1984. Two years later, the that we take a whole company approach. company exported its services We are a group that has teams and offices to the other side of the world all around the world, but we are strongly by setting up a branch in Perth, collaborative at all levels within our business,” Western Australia, before says CSA Global’s Galen White. continuing to expand in the Australian market throughout “The regional teams are fully integrated globally, which allows us to put the very best the 1990s. However, the personnel onto projects wherever they are, group’s reputation was forged and our clients value that. It’s about working back in Ireland after assisting in haloes rather than in silos.” in the discovery of the large scale Lisheen zinc deposit As the company’s director for Europe, in 1990. At the turn of the Middle East and Africa, White’s job is to century, CSA began a wideensure clients are serviced holistically across reaching diversification strategy the region and that the company’s global incorporating new services in standards are being met. new commodities and regions, which spawned the rebranding “I am intimately involved with the majority of of the company to its current our clients in the region and guide our global name CSA Global in 2008. Today, and local expertise into projects over the full the group has 12 offices in eight life of mine. A key part of my job is also to strengthen existing relationships.” countries around the world and provides the full suite of African roots consulting services to mining companies focused on almost all CSA Global has been involved in the African mining industry since its inception in 1984, mineral commodities. and over the last 35 years the company

CSA Global offers a uniquely integrated set

has made a point to continually develop

of services in the areas of corporate, mining,

its understanding of the cultural diversity,

resources, exploration, technology, data and

political background, sovereign risk,

water management. These services cover

workforce and technical capability of the

all aspects of the mining value chain, and

countries it works in.

Resource Global Network

101

102

MINING | CSA Global

CHARTERED ACCOUNTANTS AND BUSINESS ADVISORS POINTING YOU IN THE RIGHT DIRECTION

BUSINESS ADVISORY

AUDIT

CORPORATE

INTERNATIONAL TAX

CAPITAL RAISINGS

Contact Mark Radosevich (Director - Tax) mradosevich@hallchadwickwa.com.au

These factors combine to produce a set

“Clearly these factors pose a challenge to

of challenges that are unique to each

mining companies operating in Africa, but

jurisdiction, and White breaks down these

they take on those challenges because the

challenges into two categories: Technical and continent is so well endowed with minerals. jurisdictional.

We try to provide up-to-date advice for our clients with African projects,” says White.

Technical challenges faced by mining companies on the African continent include

“We service the African continent from

infrastructural deficiencies, extreme weather

multiple offices as our listed clients can be

conditions - such as monsoons and droughts

on the LSE or AIM, the TSX, ASX or elsewhere.

- and a lack of skilled labour in remote

Our Horsham and Dublin offices are heavily

locations.

involved in the West African market and our Johannesburg office is well placed to support

Jurisdictional challenges relate to government our clients across sub-Saharan Africa.” policies, which can change rapidly and dramatically differ from one country to

Thriving in West Africa

the next across Africa. Tax and royalty

During the last five years, West Africa has

rates are a huge consideration for mining

evolved into the continent’s leading region for

companies, along with social policies such as

mining activity. A combination of favourable

sustainability.

Resource Global Network

West African Gold Mines QUARTERLY SUMMARY TO 31 MARCH 2019

WEST AFRICAN GOLD PRODUCTION BY COUNTRY 2. Mali Gold Produced:

6. Mauritania Gold Produced:

Gold Produced:

0.43 Moz

34.3% 0.70 Moz

4. Côte d’Ivoire

3.5%

Gold Produced:

0.07 Moz

Gold Produced:

0.42 Moz

Gold Produced:

0.10 Moz

5. Guinea

20.4%

1. Ghana

5.0%

7. Senegal Gold Produced:

3. Burkina Faso

21.0%

8. Liberia

5.0% 0.10 Moz

Gold Produced:

6.1% 0.13 Moz 1.3%

0.03 Moz

TOP 5 GOLD MINES BY GOLD PRODUCTION FOR THE QUARTER Loulo Mali

160,000 oz

Ahafo Ghana

137,000 oz

Tarkwa Ghana

136,700 oz

Fekola Mali Tasiast Mauritania

110,349 oz 101,358 oz

csaglobal.com

103

104

MINING | CSA Global

geology that is underexplored, pro-mining

base metals, steel minerals, special metals,

governments and decreasing perceived risk

industrial minerals and energy projects.

has seen investor confidence in the region dramatically improve, which has contributed

“West Africa has grown to become a

to impressive exploration and production

significant region of revenue growth for CSA

growth in this time.

Global, in particular offering opportunities to provide integrated services across the

CSA Global has worked in West Africa

exploration, evaluation, development and

throughout its history, and the region has

operations life cycle,” says White.

continually provided opportunities for diversification and growth. This is dominantly “In the last five years we’ve been able to through the company’s involvement with

develop long-term client relationships and

numerous gold projects located within the

leverage expanded services from early stage

vast Birimian Greenstone belts that snakes

activities such as exploration and resource

through West Africa.

work to mining and feasibility studies. A big part of our activity in the region is providing

But, CSA Global’s work is not limited to

operational support as well as improvement

gold in West Africa and they have worked

works. We have several long-term clients

on a variety of non-gold projects including

there that we continue to help in that space as well.”

Resource Global Network

West African Gold Mines QUARTERLY SUMMARY TO 31 MARCH 2019

GOLD OPERATIONS THAT REPORT ALL-IN SUSTAINING COSTS Burkina Faso

Ghana

1,750

Mali

Côte d’Ivoire

25%

Guinea

Senegal

50%

Liberia

75%

a te es Pr

Sadiola Hill

Nampala

1,000

Ity

1,250

250,000

500,000

750,000

1,000,000

1,250,000

Morila Yanfolila

Siguiri

Youga

Asanko

Bea Mountain Mana

Essakane

Sabodala

Karma

Tarkwa

Edikan

Loulo

Tongon

Ahafo

Iduapriem

Agbaou

Hounde

Yaramoko

Sissingue Wassa

Akyem

Damang

Fekola

Syama

750

Boungou

All-In Sustaining Costs (US$/oz)

1,500

1,500,000

Cumulative Gold Produced (oz) Data Sources: Data was sourced from company quarterly reports and S&P Global Market Intelligence. Cost curve created by Aurum Analytics.

CSA GLOBAL HAS WORKED ON PROJECTS IN

75%

OF AFRICAN COUNTRIES csaglobal.com

105

106

MINING | CSA Global

significant West African gold players over

Future growth opportunities

the last few years. In Ghana, the company

In West Africa, CSA Global takes the view that

provides operational support work to Asanko

the region will continue to grow at a steady

Gold, and provides a suite of services to

rate over the next 10 years, and the company

Avesoro Resources in Burkina Faso and

plans to continue nurturing that growth by

Liberia.

supporting existing clients, strengthening

CSA Global has worked closely with several

relationships and forging new business ties Furthermore, CSA Global has completed

across the region.

exploration procedural reviews and sampling reviews for mid-tier gold producer Endeavour

“We have been quite successful in leveraging

Mining’s operations across the region. The

our experience from the projects that

company’s mining services team has also

we’ve worked on to develop new business

assisted Hummingbird Resources in Mali for

with others operating in the region. We’re

several years now.

continually developing the relationships with the West African junior miners, particularly

“We also do a lot of technical reviews for

those listed in London.”

mergers and acquisitions (M&A) work and technical reporting for juniors listed on the

CSA Global also sees plenty of opportunities

AIM or TSX that operate in West Africa.”

in the central/Southern Africa region,

Resource Global Network

particularly in the Democratic Republic

From a services perspective, the company

of Congo (DRC). The DRC is home to the

plans to further expand its offerings in

world’s largest reserves of copper-cobalt and

water management services, having added

therefore could provide a strong pipeline of

a team of experienced hydrogeologists and

work, as global demand for battery metals

hydrologists last year. CSA Global believes

continues to intensify.

that water management opportunities will

“We’ve got a strong global team supporting operational mines in the areas of mine geology, geometallurgy, mine engineering and hydrogeology. The key to our future growth is being proactive in trying to develop relationships early on and partner with our clients throughout the life of mine process” Galen White, CSA Global

107

108

MINING | CSA Global

CSA Global principal consultant Bill Power with Roxgold’s Brehima Diarra at the Yaramoko mine

Resource Global Network continue to increase, particularly in Africa which has issues both with water scarcity and flooding.

“We’ve got a strong global team supporting operational mines in the areas of mine geology, geometallurgy, mine engineering and hydrogeology. The key to our future growth is being proactive in trying to develop relationships early on and partner with our clients throughout the life of mine process,” says White.

CSA Global’s director for Europe, Middle East and Africa concludes by highlighting the strong fundamentals underpinning the contemporary global mining industry and reaffirms the company’s view of a continued upward trend in the sector.

“There’s certainly been increased spending and increased finance available for good projects. We’ve been seeing an increase in M&A work. Commodity prices are improving, and there is strong investor demand in gold, base metals and battery metals.

“There is still a little way to go in terms of improving on-the-ground spending, but here at CSA Global we’ve improved year-on-year since the downturn and we currently have a strong pipeline of consultancy work around the world.”

a j

109

112

MINING | Capital Drilling

Resource Global Network

CAPITAL DRILLING

Capitalising on rising exploration spending in the West African market

113

114

MINING | Capital Drilling

Capital Drilling Limited provides a full range of drilling and ancillary services, focusing on the African mineral resources market. The London-listed company prides itself on supporting clients through each phase of the mining cycle, from first stage exploration through to production.

Capital Drilling’s range of services includes blast hole, delineation, directional, exploration, grade control and underground drilling and it has a fleet of 91 modern rigs that can be mobilised to mine sites across the continent.

Since establishing its reputation in Tanzania through its work with AngloGold Ashanti which commenced in 2006 and continues today - the company has secured a steady stream of long-term contracts at Tier 1 operations across Africa, including in Egypt with Centamin and across West Africa with Kinross Gold and Resolute Mining. Underpinning these relationships with blue chip miners is Capital Drilling’s unwavering commitment to safety.

Resource Global Network

115

116

MINING | Capital Drilling “In each of our many services we have a

This safety-first philosophy was faultlessly

similar philosophy: To do the job safely and

adhered to in 2018, as the company achieved

efficiently,” says Capital Drilling’s business

an unblemished safety record with a record

development manager – West Africa, Chris

zero lost time to injury over the course of the

Hall. “Everybody needs to come home at the

year.

end of the day without injury having provided an industry leading service for the customer.”

Resource Global Network

Flourishing financials Capital Drilling also flourished from a financial perspective in 2018, recording a significant increase in both profitability and cash levels. The company exceeded the top end of its revenue guidance, despite a 3% decrease year-on-year to US$116 million.

117

118

MINING | Capital Drilling

Resource Global Network

“We are seeing a definite upturn in the amount of capital raisings going on and the junior market is certainly starting to show some signs of life where it’s been slack in the last few years. Capital Drilling is well positioned to take advantage of that trend” Chris Hall, business development manager – West Africa

119

120

MINING | Capital Drilling

Resource Global Network

Earnings before interest, tax, depreciation

The company also declared a full-year

and amortisation (EBITDA) increased 16% to

dividend of 1.5 cents per share, a 25%

$28.3 million in 2018, while net profit after

increase on the 2017 dividend, and pledged

tax (NPAT) rose 48% to $7.7 million and net

to continue its disciplined approach to capital

cash more than doubled to $10.9 million –

management in order to return excess funds

the highest level since Capital Drilling’s listing.

to shareholders through dividends.

121

122

MINING | Capital Drilling

Resource Global Network

Capital Drilling Rig 84 at Hummingbird Resources mine in Mali

Similar strategic contract growth was

and Burkina Faso. To date, approximately 52

achieved by Capital Drilling last year,

million ounces of gold have been discovered

evidenced by multiple wins with current and

across the sprawling formation.

new customers, along with extensions on major existing long-term mine site contracts.

Wading into West Africa

“We have positioned more rigs in West Africa over the last few years and established entities in various countries in response to

In particular, Capital Drilling placed increasing

increasing demand,” says Hall. “We plan to

focus on expanding into the West African

further expand our fleet to take advantage of

market in 2018. The region has developed

the ongoing activity in the region.

into a thriving mining hub and a world-class centre for exploration in recent years, with

“There are other rigs out in the market,

the largest concentration of exploration

but they tend to be less reliable and not

activity taking place in Africa at 45%.

performing to world class standards, so that is really our focus: to provide customers with

The lion’s share of West African exploration

world class rig maintenance, operation and

work takes place across the richly mineralised safety standards. That will give them accurate Birimian Greenstone Belt, which extends

results quickly and efficiently so they can

through Ghana, Côte d’Ivoire, Guinea, Mali

move on to the next phase of the mine cycle.”

123

124

MINING | Capital Drilling

Resource Global Network

In 2018, Capital Drilling doubled its rig

Since increasing its presence in West Africa,

fleet in West Africa to 31 and established

Capital Drilling has seen revenue increase

infrastructure, including offices, warehouses,

from 13% in 2017 to 25% of the group’s total

workshops and accommodation, in Mali and

in the second half of 2018. To continue this

Côte d’Ivoire, adding to existing its facilities in

momentum, Hall has been appointed to

Mauritania.

lead business development and customer

Capturing contracts

relations in West Africa.

In Mali, the company was awarded a contract

“In this role, I make myself available to all

extension with Resolute Mining at its Syama

current and potential customers, making sure

Gold Mine and won new contracts with

we keep in contact so Capital Drilling knows

Hummingbird Resources at its Yanfolila Gold

when tenders are coming and is in a position

Mine. In Mauritania, a maintenance contract

to be on the tender list.”

was secured with Kinross Gold at the Tasiast Mine in addition to existing drilling contracts

Hall previously worked for another

and in Côte d’Ivoire, Capital Drilling secured

global drilling company for over 15 years,

work at Sama Resources’ Samapleu Nickel-

spending eight years looking after business

Copper project.

development of the African business, which was largely focused on West Africa.

125

126

MINING | Capital Drilling

Resource Global Network

“We have acquired more rigs in West Africa over the last few years and established entities in various countries in response to increasing demand” “I have a similar role now with Capital Drilling.

on the strategic and financial progress it

It’s a lot more flexible and I’m able to work on

made in 2018. The thriving West African

a variety of projects in different countries, but

market is set to provide the launchpad for

principally it’s a similar process of managing

further growth this year and beyond.

the key relationships with the customers.”

West African expansion

“We are seeing a definite upturn in the amount of capital raisings going on and the

Looking forward, Hall holds a firm belief that

junior market is certainly starting to show

West Africa will provide the largest regional

some signs of life where it’s been slack in

growth opportunity on the continent and

the last few years. Capital Drilling is well

says the company aims to continue the

positioned to take advantage of that trend.

organic growth process in 2019 in much the same way as last year.

“Our offering is second to none. We are efficient, safe and we have high quality

“We’ve already slated increasing rig numbers

equipment and personnel running that

in at least two West African countries

equipment.

because we see the market growing. We will continue to focus on investing in assets and

“Both the juniors coming to market and the

infrastructure in West Africa and maintaining

majors on-site in West Africa need good

our organic growth in the region.”

quality operations and Capital Drilling will provide that, from exploration through to

After a prolonged four-year downturn,

resource management and production.”

exploration spend across Africa has increased for the last two years, which is a positive sign for Capital Drilling as it looks to consolidate

LSE:CAPD

a j

127

IT’S IN OUR DNA TO WORK HARDER Few mining contractors know Africa like we do. For 25 years, we’ve had the mining fleet, people, safety record and know-how to mine productively anywhere in Africa.

GET TO KNOW US AT AMSGH.COM

BRINGING MORE TO MINING

“It was a pleasure working with the RGN team. The entire process - from the initial interview to the layout and finished piece - was seamless and professional. ” Orlee Wertheim Head of Business Development, Global Mining, Toronto Stock Exchange TSX Venture Exchange

130

MINING | Austral African Survey Group

AUSTRAL AFRICA

Combining Australian leadership with Africa

Resource Global Network

N SURVEY GROUP

an excellence in project and mine surveying

131

132

MINING | Austral African Survey Group

Australian mining businesses have dramatically increased their involvement in the African mineral resources industry over the last three decades since the continent was formally opened up to private foreign investment, following the broad transition to stable, multi-party democracies across Africa during the 1990s.

Today, there are over 200 ASXlisted companies with mining operations in Africa. This sustained Australian influx has transmitted layers of expertise from a mature sector to the high growth African market, while also creating prosperity in regions where little existed prior to the arrival of investment. The story of Austral African Survey Group (AASG) is one of many pertinent case studies that depicts the multi-directional benefits derived from deepening ties between Australia and Africa in the mining sphere.

AASG is a joint venture that was created in 2016 when long-term business partners Brad McGregor and Dela Matanawui decided to combine their respective surveying companies: McGregor Surveys, out of Western Australia, and Matanawui’s Ghanabased MineDev Surveys.

Resource Global Network

133

134

MINING | Austral African Survey Group The 50:50 JV provides professional surveying

Australian leadership

services to clients with mining projects and

McGregor currently resides in Western

operations across Africa, through a unique

Australia along with the firm’s other director

business model that combines remote

Matanawui, but for project start-ups either

project management from Australia with

director will visit the site to set operations up,

African expertise on the ground.

before returning home to manage the project remotely.

One of the company’s first significant contract wins was with Australian engineering During the construction phase, either director group Lycopodium on the Mako Gold Project

will also visit site at critical milestones of the

in Senegal. “From our initial beginnings in

project, to audit the progress of the surveying

Senegal, we have worked in Côte d’Ivoire,

teams.

Burkina Faso and Mali as well,” says McGregor.

Resource Global Network “We set up work instructions, procedures,

African excellence

management plans and get the team to

On the ground, AASG deploys a large team

send back weekly reports which include any

of African project surveyors, all of whom are

issues on-site. On behalf of the client, we also

qualified professionals with the combined

purchase all the latest technologies in survey

experience of working in 10 countries across

equipment and software, which is then

the continent over the past 20 years.

utilised by the team on the ground.”

At a project, these seasoned professionals In the case of any issues arising with the

deliver a wide range of surveying services

equipment on-site, the directors can

based on the pre-arranged management plan

troubleshoot with the team via email, Skype

agreed on by the directors and the client. The

or over the phone. “We provide back-up

firm’s project surveyors also pass on their

support to the teams in Africa from halfway

knowledge to local nationals, offering roles as

around the world here in Australia. I believe

national survey assistants or technicians.

that nobody does this to the extent that we do,” McGregor claims.

“Our teams often train up locals on-site. For

135

136

MINING | Austral African Survey Group

example, at the Mako project in Senegal we

national assistants and technicians are

didn’t have any local national surveyors. We

then transferred over to the operations

recruited unskilled labour from local villages

department to commence their careers in the

and trained them up so they could do basic,

mining operations survey team.”

day-to-day surveying work.

“This certainly helped them, as well as the

Surveying solutions for every phase

mining company and our client. Employing

AASG provides the full suite of surveying

locally is part of government requirements

solutions to clients at every stage of the

to allow mining companies to work in their

mining cycle, starting with exploration. At

country and AASG takes this one step further

this early stage, the firm can set out and pick

by passing on our knowledge of surveying to

up all drill holes, along with grid lines for

our employees.

sampling and contouring.

“AASG has developed a training programme

The construction phase is where AASG finds

to deliver to our national survey team and

the majority of its work, offering a number of

on reaching a certain level, we award our

services including aerial surveys and ground

people with certificates of attainment.

modelling for design purposes, design set

“Once the construction phase is over, our

out, as-built of completed infrastructure and

ResourceGlobal GlobalNetwork Network 137 Resource

auditing checks for concrete and structural steel.

requirements from one company.”

At home in West Africa

“Using the Senegal project as an example,

West Africa is a key region for AASG on the

we had up to three project surveyors on-site

continent, not least because one half of the

at the peak of the works for the $100 million

business is headquartered in Ghana, and it

EPC contract,” reveals McGregor.

has continued to provide a steady stream of work since the firm’s first contract win in

The company can also support clients at the

Senegal.

operations phase of the cycle, with services such as survey control for open pit mining, pit West Africa is one of the fastest growing design set outs, monitoring of excavation, as

regions in the world for gold exploration

well as ore and waste mark out in open pits.

and production, and as a result, AASG has continually gravitated towards the highly

“We like to get in at the exploration phase because that way we can take the project right through to operations. This is a big benefit to the mining company because they’ve sourced all of their surveying

prospective gold provinces of the region.

138

MINING | Austral African Survey Group “We go where the work is, and that happens

East African inroads

to be mostly in West Africa at the moment.

AASG has also assisted clients with projects

Gold projects are cropping up in the

in Democratic Republic of Congo, Zambia

Southeast corner of Senegal right through to

and Tanzania in the past, and is currently

Ghana. That includes the countries of Mali,

negotiating a surveying services contract for

Burkina Faso, Guinea and Côte d’Ivoire.

a graphite mine in Tanzania through a client from Western Australia.

“There is a hell of a lot of work across this section and it’s not only gold, there are all sorts of commodities that are being targeted by mining companies across West Africa.”

Resource Global Network

“We provide back-up support to the teams in Africa from halfway around the world here in Australia.

I believe that nobody else does this to the extent that we do�

Brad McGregor, director Austral African Survey Group

139

140

MINING | Austral African Survey Group

Resource Global Network

The company also hopes to secure further

A packed pipeline

work on the East side of the continent

AASG may secure further work in Ghana

through its ongoing relationship with a

with another engineering company who are

major EPCM consultant, who are involved in

currently conducting a feasibility study on

a substantial mineral sands project on the

a new ’Greenfields Project’ to the Northeast

island of Madagascar.

of the country. AASG are also currently tendering on projects in Côte d’Ivoire and are

In addition to this East African pipeline, AASG confident of winning work and having survey is keeping tabs on several opportunities

teams on the ground in the third quarter of

across the continent, starting in Ghana.

this year.

McGregor and Matanawui worked directly on Newmont’s projects back in 2005/06

“It seems like it’s going to be a busy second

and maintain good relationships with

half of the year for us, and we are due for

management there.

completion on Teranga Gold’s Wahgnion project in Burkina Faso in August. Finally, we

“There is a project coming up for a big

have a strong chance of working on a potash

expansion later this year, so we hope to be

project in the Northeast region of the African

involved in this development and continue

continent, which is one we’ve been following

to build our working relationship with the

for a while.”

project team”, says McGregor.

j

141

142

CLASSIFIED ADVERTISING

MINING SERVICES

DO MORE WITH LESS

REDUCE YOUR COST PER TONNE WITH PROVEN AUTOMATION SOLUTIONS Whether you need to reduce your cost per tonne of extraction, enhance safety or extend mine life, WesTrac and Cat® have the experience, skills and technology to help implement an equipment automation solution that supports your business goals.

Cat Command for Underground enables remote operation of load-haul dump machines allowing your site to operate more efficiently, more productively and safer, while reducing the cost of equipment ownership.

DO MORE Call 1300 88 10 64 Visit WesTrac.com.au © 2017 Caterpillar. All Rights Reserved. CAT, CATERPILLAR, their respective logos and “Caterpillar Yellow”, and the POWER EDGE trade dress, as well as corporate and product identity used herein, are trademarks of Caterpillar and may not be used without permission.

Resource Global Network

DRILLING

CONSULTANTS

DELIVERING INNOVATIVE SOLUTIONS FROM EXPLORATION TO MINE CLOSURE WWW.SGS.COM/MINING

MINERALS@SGS.COM

143

144

APPOINTMENTS & EVENTS

APPOINTMENTS Vestas to appoint new CEO as Anders Runevad steps down Henrik Andersen will become the new CEO of wind turbine manufacturer Vestas on August 1st, following current boss Anders Runevard’s decision to step down.

Andersen is currently group CEO of Danish coatings group Hempel and has been a member of the Vestas board since 2013.

“I’m truly excited by the opportunity to join Vestas and continue the company’s journey to become the global leader in sustainable energy solutions,” said Andersen.

Glencore’s head of oil retires amid US probes Glencore’s head of oil, Alex Beard will retire this month as US regulators continue to investigate the global commodities trader for alleged corrupt practices.

Beard will be replaced as the head of oil marketing by Alex Sanna, who was key in expanding Glencore’s refined products trading in recent years.

Beard is the latest member of Glencore’s senior team to exit the business, following the retirements of Chris Mahoney (head of agriculture) and Aristotelis Mistakidis (head of copper).

FMG deputy chair Sharon Warburton joins Wesfarmers board Wesfarmers has bolstered the resources experience on its board through the appointment of Fortescue Metals Group deputy chair Sharon Warburton.

Warburton has previously held senior management roles with ALDAR Properties PJSC, Citigroup and Rio Tinto.

The Australian conglomerate’s chairman Michael Chaney said he was looking forward to the wealth of experience Warburton would bring to the board.

Wood appoints 40-year oil and gas veteran as new chairman Energy services firm Wood has appointed Roy Franklin as its new chairman, following long-standing current chairman Ian Marchant’s decision to step down.

Franklin has been a non-executive director and the senior independent director of Wood since 2017, having previously spent 18 years at BP. He is currently chairman of Premier Oil and deputy chairman of Equinor ASA, the current term of which will end on June 20 this year.

Resource Global Network 145

EVENTS Our pick of the top mining, oil & gas and renewable energy events happening around the world in the months to come

International Lithium and Battery Metals Conference 2019 July 3-4 Perth Australia Asia Pacific International Mining Exhibition (AIMEX) August 27-29 Sydney Australia 2019 International Renewable Energy Conference (IREC) October 23-26 Seoul South Korea International Mining and Resources Conference + Expo (IMARC) October 28-31 Melbourne Australia

Africa Oil Week November 04-08 Cape Town South Africa

Want to promote your resources event?

Email the editor at editorial@resourceglobalnetwork.com

FEW MINING CONTRACTORS KNOW AFRICA LIKE WE DO, OR HOW TO HELP YOU MINE MORE. There are three things you want in your surface mining contractor: flexibility, efficiency and safety. With African Mining Services you get all three.

Outsource your mining operation to us and get a complete mining lifecycle service without having to finance or maintain a huge mining fleet. You get a company whose single focus is surface mining, who knows African mining conditions and how to mine productively in remote and difficult areas.

Lastly, you get a contractor who has an enviable safety record because it takes the time to care and skill its workforce.

Want more? Contact your nearest AMS office.

GET TO KNOW US AT AMSGH.COM

BRINGING MORE TO MINING

enquiries@amsgh.com