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| Dr. Fuh Calistu |
What are the stakes of this second edition of the Cameroon International Mining Exhibition and Conference (CIMEC 2015)?
The organization of CIMEC 2015 on the central theme “The Sustainable Development of the Mining Sector in Central Africa", is aimed at promoting the local development of mining industries in Cameroon through exchanges between national and international experts of the mining and related sectors, lawyers, economists, environmentalists, university lecturers where each stakeholder has a part to play, so that the mining sector contributes effectively towards the country’s growth. The stakes are in the short and medium term.
In the short term, it is intended to encourage mining industries and related activities (geophysical survey companies, drilling companies, assay laboratories, expert firms, etc.) with proven experience, to settle in Cameroon in order to develop local deposits and those of the CEMAC Sub-region.
It is also intended to showcase mining projects which are expected to go into production in the short term such as the Borguené Gold Project developed by CAMINCO S.A and the Kribi iron ore project operated by SINOSTEELCAM S.A.
It therefore contributes towards promoting and developing the Cameroonian mining sector in particular, and that of CEMAC zone, in general, so that it may support more effectively, policies aimed at boosting growth, alleviating poverty, reducing unemployment and improving the livelihood of the population.
In the medium term, it is intended to position Cameroon as a catalyst of the extractive industry, a regional platform for promoting, trading and making transactions in the mining industry and related activities, just as INDABA in South Africa or PDAC in Toronto in Canada.
What were the innovations in CIMEC 2015 vis-a-vis the 2013 edition?
During CIMEC 2013 which lasted for three days, experts came forth with resolutions aimed amongst others at encouraging public private partnership by organizing other image-enhancing events, encouraging the establishment of assay laboratories for rocks and minerals, setting up a composite structure in charge of implementing the resolutions of the conference. In fact, the first recommendation was to make CIMEC a permanent activity, coming up every two years.
It was in this light that we deemed it important to organize the second edition which will enable us to consolidate and improve on the invaluable assets of the past edition, in terms of the caliber, quality and variety of participants, exhibitors and experts.
The expected results include arousing interest, encouraging and supporting the establishment of related structures among others. The interest here is to reduce considerably charges in terms of time, energy and means for the benefit of operators of the geological and mining industry. For example in Ghana, there are laboratories in the rural area. Each prospector can analyze rocks or ore samples directly in these rural laboratories and send the results to the international financial market in order to seek reliable partners to further research on the said ore.
The main players concerned are mining companies involved in exploration, mining and processing, assay laboratories for rocks and ores, survey, equipment and mining logistics companies of the mining industry, law firms, consultancy firms specialized in finance and research, as well as training institutes specialized in the mining sector.
Therefore, from 27 to 29 May, the Yaounde Conference Centre is expected to receive close to 800 participants and 200 officials and operators of the mining industry and related activities, coming from CEMAC countries and from about thirty other countries with proven experience in the area, in particular from North America, Europe, Asia, West and South Africa.
Two years after the organization of the first edition of CIMEC, the expected benefits notably the attraction of foreign direct investments in the mining sector, are not clearly visible. What has changed since 2013 in the mining sector in Cameroon thanks to that event?
The most outstanding outcomes from the implementation of the above mentioned recommendations include the following:
Some companies with a poor performance record had their mining titles withdrawn. The said mining titles were letter advertised for international expression of interest including specifications with precise deadlines. The intention is to select companies with proven technical and financial capabilities. that is the case of the Akonolinga rutile and Fongo Tongo bauxite deposits;
nIncrease in national gold production through the mastery, by the authorities, of the mechanized artisanal mining process as well as the channeling of their related products in the formal circuits of the economy. By restoring order in this branch of industry we have been able to collect approximately 70 Kg of unrefined gold on behalf of the State within six months;
nThe imminent start of the industrial mining of the gold deposit in the East by CAMINCO SA and the iron ore deposit in the South by SINOSTEELLCAM S.A;
nCameroon’s accession to the Kimberley Process;
nCameroon admission to the Extractive Industries Transparency Initiative (EITI);
nAfter CIMEC 2013, several companies, some of which are supported by their embassies, came to Cameroon to request for new licences.
What were the expected spin-offs of this second edition?
The main awaited benefits, include arousing interest, encouraging and supporting the establishment of related structures. The interest here is to reduce considerably charges in terms of time, energy and means for the benefit of operators of the geological and mining industry. Pursue international calls for expression of interest on concessions which have been withdrawn from companies which have not been performing well in order to grant them to companies which have shown some interest during this edition and which have proven technical and financial capabilities.
One of the issues which will certainly be addressed during this conference is Cameroon’s mining potential and the numerous opportunities that it offers for Cameroon’s economy if exploited. Is it not timely to proceed to action by resuming all these mining projects which seem to have fallen into oblivion?
It should be stressed that the Government took the bull by the horns by devising short-term mineral development strategies. It can be observed that mining activities during the last five years have witnessed significant progress due to a particularly attractive legal and legislative framework. The State ensures a regulatory role and grants administrative facilities, given that exploration and mining are the prerogative of the private operators. In terms of potential, some thirty substances have been discovered. They include:
a) Base metals
1. Iron: Mbalam (CAMIRON) in the East with 220 Million tons of rich ores of more than 60% iron, 2,4 billion of average ores between 25 and 60%. Other deposits (iron of Mamelles in the South (SINOSTEELCAM) with 350 MT of an average content of 30% iron. The iron-bearing resources of Nkout (South) (2,7milliards T), operated by CAMINEX-AFFERO MINING and the iron of Esaka (CAMINA).
2. Bauxite (Aluminium): Mini-Martap with 1.116 Billion tons with 43.7% alumina and 1.8% silica, Ngaoundal (Adamawa)(120 Million Tons) operated by CAMEROON ALUMINA LIMITED (CAL), Fongo-Tongo (46 Million tons extensible to 70 Million tons), in Foumban (Western) (428 Million tons).
3. Cobalt - Nickel - Manganese: the lateritic deposits of cobalt, nickel, manganese in the East Region operated by GEOVIC, it is one of the most significant surface deposits worldwide.
4. Titanium: the Akonolinga, Nanga-Eboko, Otélé deposit gave a partial evaluation of more than 300 million tons of ore whose potential is likely to make it the second largest rutile reserve worldwide.
5. Tin: the Mayo-Darlé deposit which is an old artisanal mining site with 6 500 tons of cassiterite extracted from 1933 to 1968.
b) Precious and semi-precious substances
1. Gold, Diamond and Saphir which are exploited by artisan miners in the East, Adamawa, North, Far-North, South Regions.
c) Building, development and decorative materials
1. Marble: One (1) marble deposit of 2.5 million tons in Bidzar and Biou, exploited for more than 40 years now by ROCAGLIA;
2. Limestone: the Figuil deposit with 600 000 tons, which is used for the CIMENCAM cement factory, the Mungo, Logbadjeck, Kompina, Mintom deposits;
3. Pozzolana: a pozzolana deposit is currently being exploited at Djoungo (between Douala and Nkongsamba);
4. River sand and gravel: Manoka (maritime coast) deposit exploited by SOCAVER for bottle production.
Unfortunately, numerous malfunctions have been observed in the field of artisanal mining such as:
- the proliferation of clandestine mining sites due to the gold rush;
- the rampant degradation of the
environment;
- the artisanal mining authorizations granted are used for speculation purposes between owners and their technical and financial partners
We deplore the fact that in the case of industrial mining most holders of prospecting permits are unable to move to the production phase. Some permits are used for speculation.
To redress this situation, government took appropriate measures, which include:
a) Improving geological and mining information
With the assistance of the World Bank, PRECASEM launched a campaign of airborne geophysical surveys. Following the campaign, thirteen (13) geological maps will be drawn therefore increasing the number to fourteen (14).
b) Reducing speculation and searching for reliable strategic partners
n In order to fight against negative speculation to the detriment of the country’s interest, two international calls for expression of interest were launched to promote the bauxitic block of Fongo Tongo and the rutile bearing block of Akonolinga in a bid to get reliable strategic partners capable in the short term to into production.
n The progressive bonus is from now on applicable on transactions carried out on the mining titles. For example, the progressive bonus applied to the title of the transaction between INTERNATIONAL MINING & INFRASTRUCTURE CORPORATION PLC (IMIC) and AFFERO MINING (CAMINEX) S.A for the development of the Ntem permit is 3 281 210 515 (three billion two hundred and eighty one million two hundred and ten thousand five hundred and fifteen) CFA F, payable directly to the Public Treasury.
c) Computerizing the Mining Register within the framework of the simplification of procedures so that all Cameroonians and mining operators are informed on the free national mining area.
d) Suspending the issuance, renewal and transactions on artisanal mining authorizations. After this suspension decision, a complete inventory of fixtures was made, the fine cartography of mining sites as well as the inventory of the equipment of operators involved in the sector. Today it can be observed that the State has resumed control over mechanized artisanal mining activity.
e) Sharing production within the framework of mechanized artisanal mining, instituted by Decree No. 2014/2349/PM of 1st August 2014. This deduction is fixed at 15% and is carried out by the CAPAM. These measures enabled to increase State revenue. So far, MINMIDT has collected approximately 70Kg of unrefined gold on behalf of the State.
What is the contribution of mining to the Cameroonian economy today?
It is not superfluous to recall that apart from artisanal mining, the exploitation of building materials and mineral water, the exploitation of concessible substances has not yet begun in Cameroon. The revenues generated from the above-mentioned exploitations are expressed in terms of fixed fees on applications for the granting or renewal of mining titles, purchase and marketing agencies, smelting units, jewelries, export taxes for diamonds and gold, surface rentals, extraction taxes and ad valorem tax. With the introduction of the principle of production sharing within the framework of the mechanization of artisanal mining, the State recovered 52kg of gold ingots representing approximately 1.79 billion within six months. This means that by the end of the year, this activity can only generate close to 2.200 billion CFAF. It is worth noting that the above figures do not include fixed fees. These gold ingots will be used to reinforce Cameroon’s gold reserves. It should be stressed that the size of the mining projects currently under development shows that the generated revenues from taxes could be higher than oil revenues.
In spite of the enabling environment currently put in place by the government to attract investors, mining companies are responding rather slowly. What is responsible for this?
We cannot affirm that the investors are slow in responding. We can point out that this situation is due to the fact that mining projects, as you know, require a relatively longer time to mature. In Cameroon, projects which are at the most advanced stages require the construction of related infrastructures for the effective start of the mine. If we take the case of the Mbalam iron, we need to build approximately 580Km of railroad between Nabeba and Kribi, to convey ore to the Kribi Deep Sea Port where an ore tanker terminal will be built for shipment purposes. Negotiations are underway and the State has just decided to position itself as operator to construct these related infrastructures. Chinese partners have been identified to carry out these works following the BOT (build-operate-transfer) model. You agree with me that investors are interested by mining projects in Cameroon. It should be mentioned that oil projects currently under exploitation went through the same stages, but they were very discrete owing to the fact that they were carried out offshore and far from the public notice.
Within the context marked by a drop in the prices of crude oil and raw materials on the international market, what actions could be taken in the short term to benefit from the numerous ores which the Cameroonian subsoil is endowed with?
I mentioned earlier that the State has taken the bull by the horns by undertaking the following actions:
1. Selection of reference companies through an international call for expression of interest containing specifications and precise deadlines in order to put into production in the short term projects belonging to companies that are not performing well.
2. Results of work by PRECASEM, carried out with World Bank assistance, will enable improve coverage and knowledge of the Cameroonian subsoil from 40% to 70%. The new anomalies detected will not be placed at the disposal of the companies in the form of prospecting permit but rather will be proposed to reference companies with specifications and precise deadlines.
3. Reinforcing bilateral co-operation in order to construct infrastructures related to raw material mining. Hence, the State through financing from Exim Bank of China, will build the railroad and ore tanker terminal at the Kribi deep sea port.
4. Reinforcing the country’s energy supply by constructing hydroelectric dams and valorizing gas resources to compensate for the energy deficit.
5. Local processing of at least 15% of raw materials as provided for by the Mining Code, will contribute significantly towards creating added value and increasing the gross domestic product.
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