EQUINOX PARTNERS TARGETS ‘TROUBLING DECLINE’ IN INSIDER OWNERSHIP ON BOARDS / 3 Geotech_Earlug_2016_Alt2.pdf 1 2016-06-24 4:27:20 PM
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Burkina Faso’s second military coup of 2022 raises risks for miners SECURITY
| Speculation arises about Russian involvement
Lessons from Great Bear’s smashing $2B success at Dixie GMS
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Endeavour Mining says “business as usual” at its Burkina Faso operations following last week’s coup d’état. ENDEAVOUR MINING
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BY HENRY LAZENBY
urkina Faso-focused miners say operations have not been affected following a second coup d’état on Sept. 30 that saw the country’s president Lt.-Col. Paul Henri Sandaogo Damiba overthrown after only nine months in power. While local mining operators face growing security, logistical and financing issues, they appear to remain bullish on the jurisdiction, with no announcements emerging of reduced exploration and mine development budgets to date. Burkina Faso is Africa’s fourth-largest gold producer, and gold makes up a significant part of its GDP and national exports. The change of leadership appears to have its roots in a disagreement within the Burkina Faso military on security issues in the north and east of the country, areas which have been hard-hit by Islamic-associated terrorist insurgencies in recent years. The nation’s new military leader, Captain Ibrahim Traoré, said on Oct. 2 that the country was facing an emergency in every sector, “from security to defence, to health, to social action, to infrastructure,” and it was time for the government to “abandon the unnecessary red tape.” An analyst with global risk con-
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sultancy Control Risks says that, at first glance, the development is unlikely to directly impact the mining sector from a regulatory perspective. The current leadership has gone so far as to say no additional constraints will be placed on the mining sector, given its economic importance. “The succession of coups in Burkina Faso, and more broadly persistent discontent in the armed forces, is driven by worsening militancy and repeated failure of successive governments to improve security,” said analyst Tristan Gueret in response to emailed questions. Since 2015 Islamist militants have made significant gains across the country, expanding their influence in rural areas and carrying out frequent and deadly attacks against civilians and security forces. According to Gueret, the Burkinabe security apparatus has long suffered from capacity issues,
“SUCCESSIVE COUPS, ALONGSIDE DETERIORATING SECURITY, ARE LIKELY TO CONTINUE DAMPENING INVESTOR CONFIDENCE IN BURKINA FASO.” TRISTAN GUERET, ANALYST WITH CONTROL RISKS
including manpower, air support, intelligence, and personal equipment. Such challenges were also made worse by divisions and rivalry between different branches of the security forces. “Deteriorating militancy, high casualty rates among troops, capacity issues, and grievances in the rank-and-file, both against the political class and senior officers who are seen as out of touch and disconnected from the day-to-day realities of the counterinsurgency, have been the main drivers of discontent,” Gueret said. Before the coup against PresiSee BURKINA FASO / 6
| Chris Taylor shares his playbook
BY ALISHA HIYATE
ne of the most exciting gold exploration stories in recent years has been Great Bear Resources and its Dixie gold project near Red Lake, Ont. The company was acquired by Kinross Gold (TSX: K; NYSE: KGC) in February — even before it had a chance to compile an initial resource for the high-grade, large-scale project. In September, Royal Gold (NASDAQ: RGLD) bought Great Bear Resources — a spinout of Great Bear whose only asset was a 2% net smelter return royalty on Dixie — for $200 million, bringing the total value of Great Bear’s assets to $2 billion. Great Bear Resources’ former president and CEO Chris Taylor joined The Northern Miner’s Q3 Global Mining Symposium on Sept. 29 to discuss the company’s success, and what other exploration companies can learn from it. Taylor was previously named The Northern Miner‘s 2021 Person of the Year.
Former Great Bear Resources president and CEO Chris Taylor.
Follow the data While Red Lake is a historic gold mining camp, Great Bear’s discovery was in an area that wasn’t thought to be prospective and in host rocks that weren’t supposed to carry gold. “In the Red Lake camp, you’re not going to be looking for a major gold system in the area that See TAYLOR / 16 PM40069240
Be prepared for personal sacrifice Great Bear’s story is a classic one of an exploration discovery, entailing years of hard work and personal sacrifice to reach the prize. Taylor, a structural and economic geologist, financed the project personally in the early days when investors were skeptical and it was difficult to raise money. He racked up $300,000 worth of personal debt on his line of credit, because he believed in the project. “If you have a story you really believe in, you have to be able to stick with your guns,” he said. For him and his family, that meant many years of “paying more into the company than you ever take out of it.” While the slumps in the industry are difficult, they are great times to pick up projects, he noted. “The Dixie acquisition, now the Great Bear project, was about a $200,000 total acquisition that ended up with a $2 billion total valuation only seven years later. This is the kind of thing that can happen in a bad market. So stick with it… (and) look for those opportunities.”
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