The Hon. Aly Ngouille Ndiaye, Minister of Industry and Mines, Senegal

Senegal puts forward ambitious plans for its mining industry.

Aly-Ngouille-Ndiaye-BLOGWhat are the ministry’s upcoming objectives in terms of your policies for the mining industry in the next year?

ANN: The Ministry would like to see some projects come into production, especially in the phosphate area for next year. We are expecting the beginning of the phosphate mine of Matam, with a capacity of 1.15 million mt, by the end of the semester. We may also have results from research coming from the phosphate area in the area of Lamlam in 2014. In 2015 and beyond, we will see some gold projects starting, with the beginning for development for Golouma project by the start of 2014. By 2014, we may also have a contract agreement with a company for the Faleme iron ore project and the beginning of development.

What development scenarios are you examining for the Faleme iron ore project, now under government control?

ANN: For Faleme to begin, we need to have the mine, as well as 750 km of rail transport, built. For a very large capacity, we will also need to have a port. We want to have companies that do not just extract the ore and send it abroad, but who want also to develop in the region all of the needs to transform this iron ore. With these three projects, we could be looking at the coming years for the mine development.

Currently the mining industry accounts for 3% of GDP. Given these projects in the, what is the role that you envision the sector playing within the growth of the national economy going forward?

ANN: The mining sector is considered as one of the sectors that may help Senegal in the development of the country to meet our goal of at least 7% to 8% growth in the next 10 years. It may help us also to decrease our dependence on the balance of payments, which is negative right now. Products from mines could contribute at least 34% to exports and mining could also contribute a lot to GDP. For this, we have to develop three sectors: iron ore, phosphate and phosphate derivatives, and gold. The total increase of mining to GDP could be one-third in the next ten years.

With the 2012 grant that government has received from the World Bank to study the legal and fiscal framework for mining in Senegal, what are the goals and timeline for reform?

ANN: We started the process of reviewing the mining law in March. We organized meetings with mining companies and shared the report from the review of the mining convention in terms of its economic and social impact and from there we set up a committee where we have representations from all stakeholders: mining companies, the parliament, and the Chamber of Mines. Now we are engaging in discussions on fiscal terms and government-private partnerships, the environment, and social aspects. We hope by the first quarter of 2014 we will have the first draft ready to present before the cabinet and then later to the parliament. We want a code whichgives a fair share to the Senegalese people and the mining companies who are investing. We also want a mining code that will protect our environment.

How will the discussion over ECOWAS mining code harmonization influence Senegal’s mining reform process?

ANN: From the beginning, Senegal has been a very active member of the regional harmonization process. Senegal is one of the first countries to gather this directive and align it with the new mining code. We will make sure that the mining committee will take into account all of the principles of harmonization in our code.

It has been a difficult year for the mining industry in terms of financing; what steps is the government taking to improve the investment climate?

ANN: What the government can do is create the mining and geological infrastructure to provide databases where exploration or preliminary studies have already been done and can be made available to investors. We are also working to have a transparent mining cadaster system so that investors can have access to information and apply for license.

SMEs in Senegal have been challenged in finding financing. With the establishment of the National Economic Development Bank (BNDE) at the start of 2014, how do you envision that this could open up a new area for local mining service providers?

ANN: Our finance sector is not used to financing the mining industry. They do not know it well and they are not used to the risk. BNDE should have impact on the sector, together with FONGIP, which is a fund that will guarantee funding for small companies and give them guarantees so that they may leverage money from the finance sector. With these developments from just a few months ago, we think we may have more input from the small mining services companies.

Electricity is another key issue for mining here in Senegal. Could you tell us more about the planned transmission lines that will reach mining areas?

ANN: Most of the mining companies looking at iron ore and gold are located in the far east of Senegal, where the transport network does not reach. We have involved foreign companies in the plan for interconnection the mine fields and we are awaiting the responses from the mining companies. In three years, we will have production.

Do you have a final message about Senegal as a mining jurisdiction for our readers at Indaba™?

ANN: Senegal is a hub in terms of infrastructure and accessing West Africa. We have skilled people, engineers and geologists. Most mining companies that are working here have managers who have been trained here. We are a politically stable country and we have goods and services provided already in the country. We have been seeing the outsourcing of services, with more SMEs, companies from Canada and Australia incorporated here in Senegal to provide services to mining companies in all of the West African countries. We welcome foreign investors into the mining sector and we are working to make our reform process transparent and our investment code attractive.

This interview was conducted as part of the research conducted on African mining jurisdictions by Global Business Reports (GBR) as part of our partnership with African Mining Indaba LLC. The aim of this partnership is the production of the single most comprehensive intelligence report on the continent’s mineral sector. The Official Mining in Africa Country Investment Guide, will be launched next February 2014, as the only official publication providing country-specific information at Africa’s top mining event, the 2014 Investing in Africa Mining Indaba™ held in Cape Town, South Africa.

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s