Cameroon targets $10 bln mines investment
Fri 25 Jul 2008, 13:45 GMT
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By Tansa Musa
YAOUNDE (Reuters) - Cameroon is luring a flood of new
mining investors who it hopes will invest over $10 billion and create over
27,000 jobs in the central African nation over the next few years, a top mines
ministry official said.
Rich in an array of minerals -- including bauxite,
iron ore, cobalt, nickle and uranium -- but long troubled by poor
infrastructure, red tape and costly corruption, Cameroon is now attracting the
attention of some major new companies.
They are spurred on by soaring global commodity prices
and friendly mining legislation offering tax holidays in country. The
government says the 63 mining exploration permits it has handed out over two
years are proof of the levels of interest.
"With all these, the Ministry of Industry, Mines
and Technological Development estimates foreign direct investments in the
sector in the next few years to stand at some 4,377 billion CFA francs,"
said Oscar Matip, the ministry's director of mines and geology.
"All these investments will boost economic
development needed to create about 27,300 jobs, raise incomes, fight poverty
and improve the standards of living of the people," he told Reuters in an
interview this week.
Cameroon is the world's fifth largest cocoa producer
and last year pumped just over 30 million barrels of oil, though reserves have
diminished fast since peak production in the 1980s.
Cameroon's Prime Minister said this month that
economic growth was accelerating due to mining and infrastructure projects and
should reach 6-6.5 percent in 2009.
But the country has not escaped the social crises
sparked by escalating food and fuel prices. In February, at least 24 people were killed
in protests sparked by the rising cost of living and by efforts by the
president to extend his 25-year rule.
INVESTORS
POURING IN
Matip
said fresh interest was partly due to the country's 2001 mining code, which
gives investors incentives such as a five-year tax break and free transfer of
capital out of the country.
Of
the four exploitation licences already handed out, he said the most exciting
was a nickel-cobalt-manganese project in Nkamouna, which is 60 percent owned by
Toronto-listed Geovic Cameroon and due to start producing in 2010.
Geovic
expects to produce 4,200 tonnes of cobalt per year, which would make it the
world's second largest producer of the metal, as well as 2,100 tonnes of nickle
every year for 21 years.
Cameroon's
untapped bauxite reserves have enticed U.S. company Hydromine Inc into signing
an exploration permit for two deposits. According to a 2007 U.S. State
Department report, the firm will invest $4 billion to 5 billion in the bauxite
mining and refining sector.
Although
Cameroon has no history of iron ore mining, Australia's Sundance Resources Ltd
has an exploration permit for the Mbalam deposits which the ministry believes
may contain 567 million tonnes of ore with a 60 percent iron content.
Meanhwile,
Nu Energy Corporation Cameroon, a 92 percent subsidiary of Canada's Mega
Uranium Ltd, is exploring for uranium at two sites in the north and south of
the country.
Major
constraints in electricity supply, transport within the country and shipping
products abroad are being tackled by major new port, hydro and railway projects
totalling hundreds of millions of dollars, Matip said.
Andrew
C. Hoffman, CFA
V.P.,
Investor Relations
Geovic
Mining Corp.
Direct
(720) 350-4130
Toll-Free
(888) 350-4130
ahoffman@geovic.net