Despite negative headlines, Gold production in Mali to double over the next 5 years

POSTED ON June 10, 2013 BY Gianni Kovacevic
CATEGORY Africa, Mali, Mineral Exploration, Regions,

Map of Mali and the Sadiola gold mining region. Photo: Iamgold

Mali, West Africa is the third largest gold producer on the African continent. Mali's world-class mines were discovered in the 1990's and 2000's by companies such as BHP, AngloGold Ashanti & Randgold plus a handful of juniors, all of which have had their share prices suffer tremendously in the wake of last year's military coup. Most of the doubts regarding Mali's gold miners, perhaps warranted at the time, have now been answered by facts: increased production numbers, M & A activity (the best demonstration of confidence), and the steadfast guidance of Mali's government.

Just this past week Mali's Mines Minister, Amadou Baba Sy, was in London to report that overall gold production for 2012 was 50 tonnes, up 15% from 2011, and projections are for 57 tonnes this year as new mines come online. He also noted that Mali plans to double output to 100 tonnes by 2018 as a dozen new mines move towards full commercial production. Mali also offers investors tax breaks and other perks as mentioned in the above linked Reuters article.

Over the past 20 years, no other gold mining country has had as much success as Mali with respect to discoveries leading to actual production. In Mali there are at minimum *7 large mines ~5M oz, some are greater than 10M oz, that have been discovered, and more importantly, put into full commercial production in the past couple of decades.

In the 15 months since the coup, Endeavour Mining has taken over the Tabakoto Gold Mine, Randgold's Gounkoto is now part of the Loulo complex, and Sadiola (owned by IAMGOLD, AngloGold & SEMOS) obtained the permit for the deeper sulphides. Not only has it been business as usual in Mali, there continues to be confidence in Mali's mining industry by numerous participants, new and old.

Most investors seem unaware of Mali's jurisdictional advantage, where research (exploration) permits become exploitation permits on a straightforward and transparent timeline, with the government as a reasonable and consistent 18%-20% partner in each case. With the country expecting to double gold production by 2018, a group of investors that I am involved with are betting that the appetite for Mali focused gold shares will improve.

LGN May 29, 2013 Corporate Presentation

Legend Gold Corp (TSX.v - LGN) is completing a deal to consolidate one of the largest land packages in West Africa, contiguous to large operating mines and predominantly focused in Mali. Legend's exploration and property assessments will be led by accomplished mine-finders credited with numerous discoveries in West Africa. Additionally the company is being financed by well known natural resource investors including Sprott Global.

Mali's evolution as a world-class gold mining address is only a couple of decades underway, and has been largely unaffected by the headlines of last year. I am proud to be involved with Mali, and Legend, for the future benefit of all stakeholders.

* Yatela, Sadiola, Tabakoto (only sub 5Moz mine), Loulo, Gounkoto, Morila & Syama.

Disclosure: J. Gianni Kovacevic is a large shareholder in LGN. This is not investment advice. All facts to be verified by the reader. We seek safe harbour.

Gianni Kovacevic

onqsystems@gmail.com

Gianni Kovacevic

onqsystems@gmail.com

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