Wednesday, February 21, 2018

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New Gabon mining code in effect by year-end

Fabrice Nzé-Békalé tells Mining Weekly

“This new mining code, which is being scrutinised by Parliament, will replace the existing mining code, which was promulgated in 2000. It should come into effect by the end of this year,” he says.

Another important development is the construction of the Moanda Metallurgical Complex (MMC) by French mining company Eramet’s Gabon-based subsidiary, Comilog, in which SEM holds a 29% stake. It is situated in the Haut Ogooué province of Gabon.

Nzé-Békalé says the MMC structure will be completely operational by September and will include a 65 000 t/y silicomanganese plant and a 20 000 t/y metal manganese plant.

“The MMC is expected to create 500 jobs, which is in line with our goal to develop local transformation. The total capital expenditure for the project is €150-million.”

Nzé-Békalé points out that Gabon-based manganese mining company Nouvelle Gabon (NoGa) Mining, in which SEM also holds a minority stake, is developing a 60-million-ton, 40%-grade manganese project in the City of Franceville.

“The project was initially developed by mining giant BHP Billiton before the company exited the project in 2012, when it decided to withdraw from new projects in Africa. However, NoGa Mining has subsequently continued with the development of the project and manganese production at the Franceville project is expected to start by the end of 2015,” says Nzé-Békalé.

SEM is also finalising a joint venture (JV) with another strategic partner to develop a manganese deposit, with estimated reserves of 23-million tons at a grade of 30%, in the town of Okondja, in Haut-Ogooué province.

“The final announcement will be made within the next two to three months. This is another project that BHP Billiton withdrew from. It lags a bit behind Franceville, as some additional exploration has to be conducted,” Nzé-Békalé explains.

He emphasises that the Franceville and Okondja projects are economically viable, have sufficient resources and are located near to existing railways, which will assist in exporting ores from the projects.

“NoGa Mining is committed to locally beneficiate a significant portion of its manganese production. We are discussing the same kind of commitment with our partner for the Okondja project,” he adds.

In terms of additional deposits, Nzé-Békalé notes that, in December 2013, the Gabon government bought Chinese construction and engineering company China Machinery Engineering Corporation’s exploration rights for the Bélinga iron-ore deposit, in Ogooué-Ivindo province, “owing to the company’s lack of progress in developing the project”.

“The reserves of the Bélinga deposit are estimated at one-billion tons, with a grade of 60% iron, which, [after Rio Tinto’s Simandou iron-ore project, in Guinea], makes it the second-largest iron deposit in Africa,” Nzé-Békalé points out.

Further, he notes that SEM in February contracted multidisciplinary engineering consultancy SRK Consulting to certify Bélinga’s reserves.

He says the first results of SRK’s testing will be made public at the 2015 Investing in African Mining Indaba, which will take place in Cape Town from February 9 to 12.

“Our intention is to complete the project before we auction the project to interested companies, but we are ready to engage interested and serious parties immediately,” states Nzé-Békalé.

Additionally, he says, SEM is in the process of signing a JV agreement with a major miner for the exploration of the Milingui iron-ore deposit, which is located in the province of Ogooué-Lolo.

“The Milingui deposit has proven resources of 40-million tons at 40% to 45% iron. We hope to . . . make an announcement on the development of this project within the next three months,” says Nzé-Békalé.

Moreover, he notes that Comilog subsidiary company Maboumine is developing the Mabounié rare earths mining project, in the province of Moyen-Ogooué.

“Mabounié has significant potential with regard to rare-earth metals, as it contains about 5% of the world’s rare-earth reserves, including 30% niobium reserves, 10% tantalum and rare earths, as well as uranium and phosphates,” says Nzé-Békalé.

Further, Comilog and SEM are currently finalising a decision about whether to start the construction of a €150-million pilot processing plant in the next two to three months.

“Without prejudging the decision of the various boards, should a decision be made soon to start construction of the plant, it will be operational by 2015 and will create about 200 new jobs,” Nzé-Békalé concludes.

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