Oct 11 2012
Mauritania is located in Western Africa between Western Sahara and Senegal. The total area of the country is 1,030,700 km2, and it has a population of 3,359,185 as of July 2012. The country has a mainly desert-like climate.
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The national flag of Mauritania.
Image Credit: CIA Factbook. |
Since gaining its independence from France in 1960, Mauritania has had to face political and civil instability.
Mauritania’s economy has not progressed at a steady pace because of severe drought and economic mismanagement. However, funds from the IMF, World Bank, and other international donors, and increasing prices for mineral commodities have helped balance the economy to a certain extent. The GDP of Mauritania was $7.184 billion in 2011.
Mauritania is rich in iron ore deposits. However, the country is largely dependent on agriculture and fishing. In the recent past, the government has taken several steps to promote its mining sector and has managed to attract huge foreign investments.
Overview of Resources
In 2010, Mauritania was the second-largest producer of iron ore in Africa, and in terms of volume, it was ranked 15th in the world. The export value of iron ore increased by about 91% to $997 million from $522 million in the previous year.
The country also produced crude oil, gold, cement, quartz, copper, gypsum, salt, and steel in that year.
In 2011, the mining sector of Mauritania generated $375 million in revenue for the country.
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The map of Mauritania. Image Credit: CIA Factbook
Metals
The iron ore metal sector has been thriving in Mauritania. In 2010, Xstrata plc of Switzerland gained 75% interest in Australia’s Sphere Minerals Ltd. which dealt with iron ore mining in Mauritania for more than 10 years.
Société Nationale Industrielle et Minière (SNIM) produced the country’s total iron ore production in 2010, which was 11.5 Mt. The company plans to increase production to 20 Mt/yr by 2014.
Xstrata operates three iron ore projects in Mauritania, namely, the Guelb el Aouj, the Askaf, and the Lebtheinia permits. In order to develop production in 2010, the company planned to invest $6 billion into these projects.
In the same year, the global mining company Kinross acquired Red Back Mining Inc.’s Tasiast gold mine for $7.1 billion. Kinross also owned two other permits, namely, the Ahmeyim-Tijirit and the Karet. The 2010 production statistics of the Tasiast gold mine were 5,765 kg of gold compared to 5,138 kg in 2009. The company had plans to invest $55 million to conduct an exploration drilling program around the Tasiast area.
Mauritanian Copper Mines owned the Guelb Moghrein Mine which produced about 37,000 Mt of copper concentrate in 2010. The mine is said to have 6.5 more years of mining life, and it employed 1,216 people.
The global mining company Gryphon acquired Shield Minerals in 2010 and has begun developing the Sabussiri, the Akjoujt, and Tirijit exploration projects. This will ensure that copper and gold production increases in the next couple of years.
Fossil Fuels
Mauritania has many global companies exploring for uranium. The following are some of the prominent ones:
- Earthstone Resources Ltd. of Indonesia
- Alecto Minerals Plc of UK
- Alba Mineral Resources plc of UK
- Agrineq S.A of Australia
- Aura Energy Ltd. of Australia
- Forte Energy NL of Australia
Forte Energy acquired seven uranium exploration licenses covering 8,103 km2 in the Zedens region. Similarly, Aura Energy Ltd. acquired two more exploration licenses in the Reguibat craton and the Fai covering an area of 8,400 and 2,900 km2, respectively.
Domestic companies dealing with uranium exploration are listed below:
- Mauritania Resources Ltd.
- Lusitania Uranium Mauritania
- Orecorp Mauritania SARL
In 2011, Mauritania had granted seven oil exploration licenses. The revenue from them amounted to $30 million. The Chinguitt offshore oil field alone produced 8,000 to 9,000 bbl/d and it has estimated reserves of about 120 million t.
Investment
Despite the fact that oil prospects have failed to capture many international investments, the iron ore and gold industries have been very successful as several large global mining companies such as Kinross and Xstrata have started investing in them.
The presence of a large number of global companies in Mauritania is due to some of these factors:
- Improvement in infrastructure
- Privatization of economy
- Development of the mining laws
- Conducive investment conditions
- Extension of geologic and metallogenic maps
- Reduction of the poverty level to a certain extent
The government of Mauritania organized the first-ever mining conference and exhibition called ‘Mauritanides 2010’ to showcase its mineral wealth. It was attended by 513 delegates representing nearly 52 companies from 26 countries.
The Department of Mines and Geology of Mauritania implements mining laws and works towards ensuring a favorable atmosphere for foreign investment. According to the mining laws, for the first five years, mining companies are excluded from custom duties for exploration. Experts say that it is likely that the revenue generated by the mining sector of Mauritania will aid in ensuring a more stabilized economy in the years to come.
Disclaimer: The author of this article does not imply any investment recommendation and some content is speculative in nature. The Author is not affiliated in any way with any companies mentioned and all statistical information is publically available.
Sources and Further Reading