Wedoany.com Report-May 5, Burkina Faso has granted an industrial mining licence to Nordgold, a Russian mining company, for the Niou gold deposit in Kourweogo province, located in the Plateau-Central region. The initiative seeks to leverage elevated gold prices to strengthen the nation’s economy, which has faced challenges due to ongoing security issues.

The Niou gold project in Burkina’s Plateau-Central region spans 52.8km² within Jilbey Burkina’s exploration licence area.

As a prominent gold producer, Burkina Faso generated over 57 tonnes of gold in 2023, according to Swissaid. Gold prices have risen by more than 25% this year, driven by global market dynamics, creating a favorable environment for new mining projects like Niou.

Covering 52.8 square kilometers within Jilbey Burkina’s exploration area, now under Nordgold’s ownership, the Niou project adds to Nordgold’s existing operations at the Bissa and Bouly mines in the region. The Council of Ministers projects the Niou mine will yield approximately 20.22 tonnes of gold over eight years.

Under Burkina Faso’s updated mining regulations, Jilbey Burkina retains an 85% stake in the project, while the government holds a 15% share without financial contribution. The project is expected to contribute 51.5 billion CFA francs ($89.2 million) to the state budget and 7.06 billion CFA francs to the nation’s mineral wealth fund over its lifespan.

Ulf Laessing, head of the Sahel programme at Germany’s Konrad Adenauer Foundation, commented: “The cooperation with Nordgold and other industrial mines is important as the country faces a budget crunch.” However, he also cautioned that the project could affect local artisanal miners by limiting their access to traditional mining sites.

The government anticipates the Niou mine will create 204 jobs and support employment at the nearby Bissa Gold SA mine, fostering economic growth in the region. This development follows recent industry activity, including Fortuna Mining’s agreement to sell its stake in Roxgold Sanu, operator of the Yaramoko gold mine, to Soleil Resources International for $130 million (C$180.57 million).

The Niou project underscores Burkina Faso’s efforts to enhance its mining sector, a key economic driver, while navigating economic and security challenges. By expanding its collaboration with Nordgold, the country aims to boost revenue and job opportunities, contributing to long-term economic stability.