The year 2022 is a difficult year for the national mining sector. There has been a resurgence of terrorist attacks throughout the country and several security incidents have been reported on roads leading to mining sites. To address an answer to this concern, the Burkinabe Council of Mines, Geology and Careers (CBMGC), in collaboration with the newspaper minesactu.info, chose to hold a public conference on 18 November 2022 on the theme: “The mining sector facing the security challenge: state of the art and perspectives”.
It emerged from the conference that in 2022, various research projects are currently closed because the areas have become inaccessible. The closure of research projects is not likely to ensure a bright future for the mining sector.
Six 6 mining projects in operation have been closed. This is the case of the Ouaré mine of the company Avesoro, which was attacked on 30 January 2022. Yet it was the mineral from this mine that was supposed to supply the Youga plant, whose mineral had expired. Youga was waiting for this mineral and Nietiana was under construction in an underground mine. Following the Ouaré attack, Avesoro decided to suspend the activities of the three mining permits.
Nordgold has also suspended operations at its Taparko/Bouroum mine in April 2022. Nordgold justifies this suspension by terrorist incursions on the site and problems with access to the site. In early October 2022, Bouroum, a satellite site of Taparko, was attacked and four people were killed. The Riverstone Karma mine was attacked on 9 June 2022. Two people were killed in the attack. The mine suspended operations. Karma experienced two more attacks in October 2020.
This has had a number of consequences for the mining sector, including additional investments in securing mine sites, investments in transporting workers by air, revising worker rotation times, and spending on securing overland supply convoys. All of these investments increase mine operating expenses and reduce taxable margins.
On the social front, we have seen workers put on short-time working, workers dismissed, fixed-term contracts not renewed and new recruitment stopped.
The aim of these measures is to reduce wage costs as much as possible.
In economic terms, Burkina Faso must expect losses of revenue for the national budget (lower taxes, fees, royalties, duties, etc.), losses of revenue for local authority budgets (surface tax, patent, local development mining fund), inestimable losses of revenue for subcontractors (national, local), etc.
The loss of earnings in terms of jobs is 2,257 jobs. The loss of revenue to the state budget is estimated at 24.788 billion FCFA.
As for the closure of mines due to insecurity, the Perkoa mine closed after the flood of 16 April 2022. The mines of Samtenga and Boueré are at a standstill because exploitation has ended.
In 2022, the number of mines in Burkina Faso dropped from 17 to 8 operating mines.
This situation has resulted in a drop in gold production. Between January and September 2022, Burkina Faso produced 43.651 tonnes compared to 50.126 tonnes for the same period in 2019, a 13.4% drop between 2022 and 2021.
However, the high exchange rate of the dollar favours producing mines that sell their gold in dollars. The average rate of the dollar in the third quarter of 2022 is 651.6 CFA francs. The high gold price (1,729.9 US dollars) favours gold sellers.
This conference was a framework for exchange and sharing between several mining and security actors. They formulated recommendations that will be transmitted to the government so that the mining sector retains its place in the socio-economic development of Burkina Faso. The main recommendation addressed to the government is the organisation of a general assembly of the mining sector in order to find consensual solutions to implement.
Pierre Balma
#Mines_Actu_Burkina
