Impacted by a recent civil war history, Sudan has not attracted the mining investment of many other African countries. This has led to Sudan’s mining officials rating the country as Africa’s “Next Major Gold Mining Destination”.
While most the country’s mineral reserves remain underdeveloped, mining in Sudan contributes about 90t of gold to the global market per annum, making it the 10th largest gold producer in the world. Most of this is mined in the Hassai Gold Mine, where iron ore and base metals are also mined.
Despite riches of gold, iron ore, chromite, zinc, aluminium, nickel, and many other minerals, mining in Sudan contributes just 4% to the country’s GDP, with the precious metal being the main driver.
Recognizing this, the Sudanese government has been active in promoting the country’s riches since international borders have started opening following the COVID-19 peak. Recently, a large delegation of Sudanese officials visited Australia to promote the country’s minerals potential.
Republic of Sudan Minister for Minerals H.E Mr Mohamed Basher told delegates at the Africa Downunder conference in Perth this summer that cooperation between his country and Australia had continued to develop strategically in various fields, with a number of Australian companies currently invested in mining projects in Sudan.
Minister Basher said his country’s delegation had travelled to Australia to explore mutually beneficial opportunities and share ideas with participants from both public and private institutions.
“Sudan in rich in diverse mineral resources and enjoys huge mineral reserves. We are one of the richest countries in Africa. Some of these minerals have already been discovered and production is under way on a very large scale, in gold for example,” he said.
“You are welcome with full confidence to Sudan to invest in the Sudanese mining sector, where we have attractive laws and a large number of international companies now working.”
Several Australian companies have already taken up significant positions in Sudan or have turned their eyes towards the country.
Perseus Mining
Leading the way is Perseus Mining (ASX: PRU), which is in the process of developing a significant Sudanese gold project. The company describes Sudan as a highly prospective, under-explored, an attractive mineral province, and one of Africa’s largest producers of gold.
African specialist, Perseus, says Sudan has an emerging economy and is transitioning to a democratic form of government, with new investment laws designed to attract foreign capital, highlighted by strong government support for the development of a formal mining sector.
Perseus managing director and CEO, Jeff Quartermaine, said the company’s journey to Sudan has already seen it build and operate the Edikan gold mine in Ghana, and the Sissingué and Yaouré gold mines in Côte d’Ivoire.
The company is on its way to achieve gold production of more than 500,000oz in total in 2022 and is now pursuing the Block 14 development project in Sudan.
“One thing that sets Perseus apart from its peers is that we do have a very strong social licence to operate in Africa based on some very sound ESG principles,” Mr Quartermaine said.
“In that respect, what we do is we listen very carefully to our hosts and we work collaboratively with both the governments and the communities to develop a genuine win-win situation. We have found this has stood us in good stead in the countries where we have operated.
“We are very well positioned to fund our future growth into countries such as Sudan and we can do that without having to rely on capital markets to achieve what we are seeking to do.”
Mr Quartermaine said it was very clear that Sudan was a very highly prospective, under explored country and a very attractive mineral province.
“Sudan has been largely overlooked by Western mining companies as a place to invest. However, this is slowly changing.
“Sudan is located at the crossroads of the African and Arab worlds and with this comes challenges, but the potential rewards far outweigh the risks.
“In the context of Perseus’s portfolio approach to risk diversification, Sudan is an outstanding location for our next, large scale gold mining operation.
“We are looking forward to collaborating closely with the government of Sudan to unlock the significant benefits of offer for all our stakeholders.”
He said Perseus will construct and operate a world-class commercial gold mine at Block 14 including a fully self-sufficient mine, processing plant, power station, accommodation, fuel depot, workshops, and administration building in the remote Sahara Desert location.
Perseus describes its Block 14 Project as “near development ready”. The project is fully permitted including mining lease, royalty agreement, and water permit.
Favourable fiscal terms have been negotiated with the Sudanese government and incorporated into the terms of the mining lease. An original feasibility study of Block 14 Project completed in September 2020 by Orca Gold Inc. demonstrated:
- Large and simple orebody expected to support robust development with a competitive cost profile
- Probable Reserves of 79.9Mt @ 1.11g/t Au for 2.85Moz Au
- Significant potential to expand mineral resource and reserve with upcoming infill ad sterilization drilling programme
Perseus has elected to review previous engineering studies and contacted Lycopodium (ASX: LYL) to assist in any updated as required in a comprehensive FEED study. A Final Investment Decision (FID) is likely in H2 2023, with 24 months construction and commissioning period to follow, the company says.
Pan African Resources
Another fan of Sudan’s potential is Pan African Resources (AIM: PAF). Pan African has a strong African background which has seen it put together a robust production portfolio with strong, sustainable assets has been a central strategic pillar that’s enabled it to cement itself as one of the lowest-cost gold producers in Africa.
Now the group is assessing several exciting prospects in Sudan to add further production growth to its project pipeline on the back of promising rock samples yielding an average grade of 13.6g/t obtained during site reconnaissance.
These assets include:
- Five prospecting concessions
- 1100km2 in the Nakasib Suture Zone (NSZ)
- 70km2 northwest of Port Sudan
- Awarded by Sudan’s Ministry of Minerals for three years, renewable for a further two years
The company has budgeted US$7M for Sudanese investment during the first four years. The five prospecting concessions secured in Block 12, a +/- 1 100km2 area in the NSZ, about 70km northwest of Port Sudan, a regional trading and shipping hub.
Block 12 is located on the same suture zone as the Hassai Gold Mine, the largest gold mine in Sudan with historic production of some 100 000oz per year. Exploration commenced in the second quarter of 2022, when results for the initial identified targets will be verified.
“Our management team has been visiting Sudan for the last two years to identify prospective gold mining sites. We believe that the Block 12 concessions are highly prospective, and we look forward to reporting exploration results from these properties,” Pan African Resources’ CEO, Cobus Loots, recently stated.
