West Africa Mining Report

Providing expert analysis, independent forecasts and competitive intelligence on the mining.

Report includes: BMI Industry View, Industry SWOT Analysis, Industry Forecasts, BMI's Petrochemicals Risk Reward Index, Economic Forecasts, Company Profiles and Global, Regional and Country Industry Overviews.

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West Africa Mining Report
Product Price
$1,295.00

BMI View: West Africa's growth outlook will remain weak due to both low mineral prices and countries' inadequate infrastructure over the coming quarters. T he region's long-term growth outlook remains promising due to countries' vast untapped mineral reserves, positive foreign investment outlook and infrastructure developments.

Select Countries - Mining Industry Forecast
2015e 2016f 2017f 2018f 2019f 2020f
e/f = BMI estimate/forecast. Source: National sources, BMI
Ghana Mining Industry Value, USDbn 3.77 3.85 3.83 3.83 3.84 3.93
Ghana Mining Industry Value, USDbn, % y-o-y 2.00 2.00 -1.00 0.00 0.00 2.00
Guinea Mining Industry Value, USDbn 1.40 1.40 1.50 1.70 1.80 2.00
Guinea Mining Industry Value, USDbn, % y-o-y -2.00 4.00 10.00 10.00 8.00 7.00
Liberia Mining Industry Value, USDbn 0.20 0.20 0.10 0.20 0.20 0.20
Liberia Mining Industry Value, USDbn, % y-o-y -26.60 -20.50 -4.30 6.60 5.90 6.00
Mali Mining Industry Value, USDbn 0.70 0.80 0.90 0.90 1.00 1.10
Mali Mining Industry Value, USDbn, % y-o-y -4.00 8.00 10.00 8.00 9.00 10.00
Mauritania Mining Industry Value, USDbn 0.50 0.40 0.40 0.40 0.50 0.50
Mauritania Mining Industry Value, USDbn, % y-o-y -24.00 -16.00 -4.00 4.00 4.00 5.00
Sierra Leone Mining Industry Value, USDbn 0.69 0.54 0.55 0.56 0.57 0.59
Sierra Leone Mining Industry Value, USDbn, % y-o-y -33.00 -22.00 2.00 2.00 2.00 2.00

Latest Developments & Structural Trends

  • Guinea: We expect three-month LME aluminium prices to respect lows around USD1,400/tonne as the metal continues to stabilise in 2016, supported by the winding down of the US dollar bull run and capacity cuts by major producers. We expect aluminium to trade continue to trade between USD1,500-1,700/tonne over the coming months, averaging USD1,600/tonne over the year. Our forecast implies a relatively neutral near-term view, with spot prices on July 13 at USD1,670/tonne. On the one hand, US dollar weakness will support a recovery in metal prices, while the beginning of a new Chinese yuan bear market will keep a lid on prices over the coming quarters.

  • Guinea: In Q416, iron ore prices will trade between USD50-65/tonne as prices will be supported by sustained demand from steel mills restocking iron ore. However, in 2017, prices will find re-test lows due to an over-supplied seaborne ore market, driven by strong production growth in Australia and Brazil, and weakening consumption growth in China.

  • Guinea: In October 2016 the World Banks's International Finance Corporation announced its intention to sell the organisations 4.6% stake in the Simandou iron ore project in Guinea. This follows from Rio Tinto's announcement in July that their flagship Simandou iron ore project - a massive USD20.0bn project - will be shelved will preclude significant growth prospect for Guinea. The sheer size of the investment, in relation to nominal GDP of USD6.4bn, would have doubled the size of Guinea's economy over the next decade according to government reports, but has been set aside due to low commodity prices and global oversupply of iron ore. Furthermore, investor sentiment towards Guinea will be hampered as tensions in the country rise. Indeed, we believe that indications that President Alpha Conde will attempt to run for a third term in 2020 will raise social instability in the years ahead.

  • Sierra Leone: Political risk will rise in Sierra Leone over the next 18 months owing to high unemployment and perceptions that the president is seeking to extend his time in office beyond his constitutional mandate. This will weigh on the economy through deterring investment and tourists ( see: 'Political Risk Will Deter Investment And Tourists' , September 6).

  • Mauritania Gold: We expect gold prices to continue edging higher in the coming quarters, as weak economic growth and higher inflation keep real interest rates low in major developed markets. We have slightly raised our 2017 average price forecast from USD1,350/oz to USD1,400/oz.

  • Cote d'Ivoire: remains our Country Risk team's growth pick for Sub-Saharan Africa, as reforms to the business environment will continue to encourage investment. Upon completion, infrastructure projects under development will also support growth over the longer term. The September 14 removal of US sanctions against Cote d'Ivoire will send a positive signal to international investors that the country is cementing its recovery from its 2010/11 civil war. There remain salient risks to security in both the near- and longer-term timeframes, but the overall picture is one of increasing stability.

  • Liberia: Whoever wins the 2017 presidential elections in Liberia, we expect no major deviation in terms of policy, with both the likely winners in favour of continued free-market policies. We believe that the race will ultimately be fought out between current Vice-President Joseph Nyuma Boakai, and Benoni Urey, a millionaire businessman involved in telecoms and rubber, and that Boakai will prove victor, likely following a second-round run-off. Whatever the outcome, Liberia will remain a fairly high-risk operating environment, with elevated levels of political risk. Corruption and land rights reform are two highly contentious issues at present, and we expect that they will feature heavily in electoral campaigning.

  • Mali: During 2015, Mali's gold exports grew significantly to 2.1million ounces (moz), up from 1.6moz in 2014, becoming Africa's third largest gold producer behind South Africa and Ghana. However, this was largely the result of a pickup in artisanal mining output, rather than that of mining firms operating within the country.

  • Ghana: On July 13, Gulf Shores Resources announced the signing of a Letter of Intent with Goldplat PLC for the right to earn 75% of Goldplat's interest in the Anumso gold project by spending USD3.0mn on exploration over 2.5 years. On April 12, Cardinal Resources Ltd (Cardinal) added two more drill rigs at the firm's Namdini project ahead of a Q3 2016 exploration target announcement. Currently, Cardinal has three projects in Ghana, namely the Namdini, Bolgatanga and Subranum mines.

BMI Industry View
7
Table: Select Countries - Mining Industry Forecast
7
Latest Developments & Structural Trends
7
SWOT
9
Industry Forecast
11
Guinea Bauxite: Pipeline To Support Growth
11
Latest Developments
11
Table: Guinea - Bauxite Production & Growth
12
Table: Guinea - New Projects
12
Structural Trends
14
Political Risks To Outlook
15
Guinea Iron Ore: Simandou Shelving To Dent Growth In The Long Term
17
Latest Developments
17
Table: Guinea - Iron Ore Production & Growth
17
Table: Guinea - New Iron Ore Projects
18
Structural Trends
18
Sierra Leone: Growth To Slowly Pick Up Steam
22
Latest Developments
22
Table: Sierra Leone - Iron Ore Mine Production
22
Structural Trends
22
Table: Sierra Leone - Key Infrastructure Projects
26
Mauritania: Muted Growth Ahead
28
Latest Developments
28
Table: Mauritania - Mine Production & Growth
29
Table: Mauritania - New Iron Ore Mining Projects
30
Structural Trends
31
Price Weakness To Subdue Investment Outlook
32
Infrastructure Weakness To Dampen Growth Outlook
33
C-te d'Ivoire Gold: New Projects To Support Growth
35
Latest Developments
35
Table: Cote d'Ivoire - Gold Production Forecast
35
Table: C-te d'Ivoire - Largest Gold Projects
35
Structural Trends
36
Liberia Iron Ore: Low Prices And Inadequate Infrastructure To Curb Growth
39
Latest Developments
39
Table: Liberia - Iron Ore Production Forecast & Growth
39
Table: Liberia - New Iron Ore Projects
40
Structural Trends
41
Business Environment To Remain Relatively Stable
43
Mali Gold: Growth To Pick Up
44
Latest Developments
44
Table: Mali - Gold Production Forecast
44
Table: Mali - Mining Ministry Gold Production Forecast
44
Structural Trends
45
Ghana Gold: Modest Growth In Coming Years
49
Latest Developments
49
Table: Ghana - Gold Production & Growth
49
Structural Trends
50
Government Shows No Sign of Easing Taxes
53
Industry Risk Reward Ratings
56
Guinea - Mining Risk/Reward Index
56
Rewards
56
Industry Rewards
56
Country Rewards
56
Risks
56
Industry Risks
56
Country Risks
56
Liberia Risk/Reward Index
57
Rewards
57
Industry Rewards
57
Country Rewards
57
Risks
57
Industry Risks
57
Country Risks
58
Africa - Risk/Reward Index
58
Key Takeaways
58
Latest Revisions
59
Table: Africa - Mining Risk/Reward Indices
60
Regulatory Development
61
Commodities Forecast
64
Commodities Outlook
64
Table: BMI Commodities Price Forecasts
64
Competitive Landscape
66
Table: West Africa: Key Mining Companies' Financial Metrics
67
Structural Trends:
67
Company Profile
68
Global Company Strategy - AngloGold Ashanti - Q4 2016
68
Table: Gold Price Forecast
70
Company Strategy
72
Table: AngloGold Ashanti - Key Financial Data
74
Global Company Strategy - Randgold Resources - Q4 2016
75
Table: Gold Price Forecast
77
Company Analysis
77
Table: Select Gold Companies Data
79
Latest Financial Results
81
Table: Randgold Resources - Key Financial Data
83
Global Company Strategy - Rio Tinto
84
Table: Select Commodities - Price Forecasts
86
Company Analysis
86
Table: Select Companies - Key Data
90
Table: Rio Tinto - Key Projects
93
Table: Rio Tinto - Key Financial Data
94
Regional Overview
95
Sub-Saharan Africa Overview
95
Table: SSA - Government Involvement In Mining Sector
101
Methodology
103
Industry Forecast Methodology
103
Sources
104
Risk/Reward Index Methodology
105
Table: Weighting Of Indicators
106

The West Africa Mining Report has been researched at source and features BMI Research's mining and commodity forecasts for metals, minerals and gems, covering all major indicators including reserves, production, exports and values. The report also analyses trends and prospects, national and multinational companies and changes in the regulatory environment.

BMI's West Africa Mining Report provides industry strategists, service companies, company analysts and consultants, government departments, trade associations and regulatory bodies with BMI's independent forecasts and competitive intelligence on the mining industry in Ghana, Cote d`Ivoire, Mauritania, Sierra Leone, Liberia, Mali, Guinea.

Key Benefits

  • Use BMI's independent industry forecasts on Ghana, Cote d`Ivoire, Mauritania, Sierra Leone, Liberia, Mali, Guinea to test other views - a key input for successful budgeting and planning in this mining market.
  • Target business opportunities and risks in Ghana, Cote d`Ivoire, Mauritania, Sierra Leone, Liberia, Mali, Guinea's mining sector through our reviews of latest mining industry trends, regulatory changes and major deals, projects and investments in Ghana, Cote d`Ivoire, Mauritania, Sierra Leone, Liberia, Mali, Guinea.
  • Assess the activities, strategy and market position of your competitors, partners and clients via our Company Profiles (inc. KPIs and latest activity), Key Projects Tables and Competitive Landscape Tables.

Coverage

BMI Industry View

Summary of BMI’s key forecasts and industry analysis, covering mining reserves, supply, demand and prices, plus analysis of landmark company developments and key changes in the regulatory environment.

Industry SWOT analysis

Analysis of the major Strengths, Weaknesses, Opportunities and Threats within the mining sector and within the broader political, economic and business environment.

BMI Industry Forecasts

Historic data series (2009-2013) and forecasts to end-2019 for key industry and economic indicators, supported by explicit assumptions, plus analysis of key risks to the main forecasts. Indicators include:

  • Mining industry: Industry size (USDmn), real growth (%), % of GDP, employment (‘000), workforce as % of total workforce, average wage (USD).
  • Output: Production volumes (‘000 tonnes, carats etc.) for all major metals, minerals, ores and gems mined in each state, including bauxite, copper, gold, coal, lead, silver, tin, titanium, uranium, zinc etc.
  • Exports: Value of exports (USDmn) for all major metals, minerals, ores and gems mined in each state.
  • Commodity markets: Global demand, supply, stocks and benchmark prices (USD) for aluminium, copper, lead, nickel, tin, zinc, gold and steel.

BMI’s Mining Risk Reward Index

BMI’s Risk Reward Indices provide investors (mining companies and support service providers) looking for opportunities in the region with a clear country-comparative assessment of a market’s risks and potential rewards. Each of the country markets are scored using a sophisticated model that includes more than 40 industry, economic and demographic data points to provide indices of highest to lowest appeal to investors, with each position explained.

Competitive Landscape Tables & Analysis

Comparative company analyses and tables detailing USD sales, % share of total sales, number of employees, year established, market cap/NAV, ownership structure, production and % market share.

Key Projects

Details and analysis of all current and planned developments (new ventures, capacity expansion and other investments) across the sector broken down by metal/ore.

Company Profiles*

Examines the competitive positioning and short- to medium-term business strategies of key industry players. Strategy is examined within the context of BMI’s industry forecasts, our macroeconomic views and our understanding of the wider competitive landscape. The latest financial and operating statistics and key company developments are also incorporated within the company profiles, enabling a full evaluation of recent company performance and future growth prospects.

Sources

The Mining reports are based on an extensive network of primary sources, such as multilateral organisations (UN, WB, IMF), national chambers of commerce and industry, national statistical offices, government ministries and central banks, and multinational companies.

*Company profiles are not available for every country. Those reports instead contain information on the current activities of prominent companies operating in the market.