The Government of Burkina Faso granted a gold mining permit to Nordgold in December against prevailing economic sanctions in Russia due to its ongoing invasion of Ukraine.
The mines minister for Burkina Faso denied awarding a mining permit to the mining firm for geopolitical reasons on Monday, repudiating western criticism that the ruling party is attempting to draw ties with Moscow.
“We do not give permits to people because they are from Russia, or from the United States. We give permits to companies that pay taxes and respect our laws,” said Simon-Pierre Boussim, Minister of Energy, Mines and Quarries of Burkina Faso.
Nordgold runs the Bissa and Bouly mines in the north of the West African country. Additionally, it owns and operates the Taparko mine, which has been shut down since April due to security concerns.
Nordgold applied for a mining permit for Yimiougou in 2017, according to Boussim. The mine is in the Centre-Nord region’s Sanmatenga province. Additionally, the company expects the mine to yield 2.53 tonnes over its four-year lifespan.
The mine aims to start production later this year.
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Burkino Faso denies paying mercenaries in mine rights
Ghanaian President Nana Akudo-Addo stated in December that Burkina Faso hired mercenaries from Russia’s Wagner group to help fight Islamist militants, and was paying them through a mine. Burkino Faso denied paying mercenaries by giving them rights to a mine. Although it has neither confirmed nor denied the allegation of an arrangement with Wagner.
Burkina Faso isn’t the first West African country to hire Wagner’s services either. Its neighbour, Mali, hired Wagner last year to help it fight insurgents, according to Akufo-Addo.
The mercenary group’s expanding presence in Africa has troubled France and the United States, who stated that it has a record of committing human rights abuses and exploiting mineral resources where it operates.
The conflict in Burkina Faso’s north to date has dampened gold production and caused several mines to shut down, according to Akudo–Addo.
As a result of the conflict, Endeavour Mining‘s (TSX: EDV) Boungou gold mine production is down 35 per cent in the first three quarters of 2022 compared to 2021. The mine suffered productivity losses due to a lack of convoy security in the country’s east, the company stated.
Gold production will increase and the government will control the security situation in the coming months, Boussim said.
“A mine cannot be safe unless the country itself is safe,” Boussim said.
The country intends on building a gold refinery to optimize the value it gets from mineral resources. The government is undecided about whether the refinery will process gold from industrial mines or from the country’s artisanal mining sector.
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