Burkina Faso, a landlocked country in West Africa, is set to become one of the continent’s leading gold producers, thanks to the development of the Kiaka Gold Project by West African Resources (WAF). The project, which is located about 45 km south of WAF’s existing Sanbrado Gold Mine, has received the first tranche of a $265 million loan from Sprott Resource Lending Corp. and Coris Bank International.
The loan facility, which was secured in November 2023, will cover the majority of the $430 million capital cost of the project, which is expected to produce an average of 219,000 ounces of gold annually for 18.5 years, starting from 2025. WAF said the first drawdown of $100 million will be used for early construction, design, and planning activities, as well as the procurement of project mills.
WAF’s managing director, Richard Hyde, said the project is well underway and on track for first gold in the second half of 2025. “The build is well underway and on track for first gold in the second half of 2025,” he said. “We are very pleased to have secured this financing arrangement, which ensures we are fully funded for the completion of Kiaka’s development to commercial production, relying on the loan facility, existing cash, and internal cash flow from Sanbrado.”
The Kiaka Gold Project is based on conventional open-pit mining methods, with run-of-mine ore being directly fed to the crushing circuit and carbon in leach extraction technology. The project has a proven and probable reserve of 4.8 million ounces of gold, grading 1.04 grams per tonne, and a measured and indicated resource of 7.9 million ounces of gold, grading 0.96 grams per tonne.
The project is expected to generate significant economic and social benefits for Burkina Faso, which is one of the poorest countries in the world, with a GDP per capita of $790 in 2023, according to the World Bank. The project will create about 1,500 direct jobs during construction and 750 permanent jobs during operation, as well as contribute to the government’s revenue through taxes and royalties.
The project will also support the country’s efforts to diversify its economy and reduce its dependence on cotton, which accounts for about 60% of its exports. Gold mining has emerged as a key sector in Burkina Faso, with the country becoming Africa’s fifth-largest gold producer in 2023, behind South Africa, Ghana, Mali, and Sudan, according to the US Geological Survey.
The development of the Kiaka Gold Project comes amid a challenging security situation in Burkina Faso, which has been facing a surge of jihadist violence since 2015, displacing more than 1.2 million people and killing thousands. The country also experienced a military coup in 2022, which ousted President Paul-Henri Sandaogo Damiba and installed Captain Ibrahim Traoré as the new leader.
Traoré has pledged to restore stability and democracy in the country, as well as to strengthen its relations with Russia, which reopened its embassy in Burkina Faso in December 2023 after a 30-year absence. Russia has expressed its interest in investing in the country’s mining sector, as well as providing military and humanitarian assistance to combat the insurgency.
WAF said it is committed to operating in a safe and responsible manner in Burkina Faso and has implemented various security measures to protect its staff and assets. The company also said it is working closely with the local communities and authorities to ensure the project’s sustainability and social license.
Hyde said the company is confident that the Kiaka Gold Project will be a success story for Burkina Faso and its people. “We are very excited about the potential of this project, which will be one of the largest and lowest-cost gold mines in West Africa,” he said. “We believe that this project will create lasting value for our shareholders, our stakeholders, and the country as a whole.”
Source: Miningmx
