Robex Resources (TSXV: RBX), which has been producing gold at the Nampala mine in Mali since 2017, says the key to its goal of becoming a mid-tier West African producer now lies in neighbouring Guinea.
The Montreal-based junior said in June that it would sell Nampala and all of its assets in Mali, as part of a strategic plan to become a new Guinean pure play developer and accelerate the development of its Kiniero gold project, where it expects to pour first gold in the fourth quarter of 2025.
Tensions between Mali and foreign miners have soared in recent months, with the military-backed government issuing an arrest warrant for Mark Bristow, the chief executive of Barrick Gold (TSX: ABX; NYSE: GOLD) on Dec. 3 and the detention in November of four Barrick employees at the company’s Loulo-Gounkoto mining complex in the country’s west. The government also held Resolute Mining (ASX: RSG; LSE: RSG) CEO Terry Holohan and two other employees for 12 days last month, releasing them only after the Australian miner agreed to pay the government about $160 million to settle a tax dispute.
Robex reached an agreement in September with Mali that raised the government’s stake in the mine to 20% to conform with the country’s new mining code and said it had settled all tax and customs claims before 2024. But it warned that “due to the geopolitical context for investments in Mali, the market for potential buyers is currently very limited.”
Robex did not return emailed requests for comment before press time.
Mali, one of the world’s poorest countries, is among several nations pushing for a greater share of their minerals in recent years. But the cash-strapped nation, which has been under military rule since a 2020 coup, also needs funds to fight al-Qaeda and Islamic State-linked fighters and has hired Russian mercenaries for security and to fight militants.
Robex’s decision to exit Mali “makes sense” says Remi Dodd, an analyst at geopolitical consulting group RANE, noting that the security and operational environment for foreign miners in the country has significantly worsened in recent years.
“Nampala is relatively close to Mali’s border with Burkina Faso, where there is significant al-Qaeda-affiliated activity,” he said in an interview from London. “While an attack on Barrick’s Loulo-Gounkoto mine appears unlikely in the next six months, I would not say that of the Nampala mine. Robex seems to be at a higher risk given the mine’s location.”
“We don’t have strong evidence of jihadist activity in Guinea—there haven’t been any notable jihadist attacks there in recent years, meaning the security threat is significantly lower than in Mali, where they happen on a weekly basis.”
As for growing resource nationalism, he adds, “we can’t rule (it) out in Guinea, but there is less of an imperative for military rulers to strong-arm funds from miners, unlike Mali, which urgently needs financial resources to respond to the jihadist attacks.”
As part of Robex’ strategic plan released in June, the company appointed seasoned mine builder Matthew Wilcox as CEO. Most recently the managing director and CEO of Tietto, Wilcox led construction of its Abujar mine in Côte d’Ivoire before the company was acquired by China’s Zijin Mining. Prior to that, Wilcox oversaw construction of West African Resources’ (ASX: WAF) Sanbrado gold mine in Burkina Faso; served as project director for Nordgold’s Bissa and Bouly gold projects, also in Burkina Faso, among other mine builds in Africa.
Kiniero, a past-producing mine in eastern Guinea, 546 km from the capital of Conakry, operated from 2002 to 2014, producing 418,000 oz. gold before it was put on care and maintenance.
Robex acquired the Kiniero project in April 2022 through its business combination with Sycamore Mining.
The company plans to restart the mine as an open pit with a new 3 million tonne per year carbon-in-leach (CIL) processing plant.
A feasibility study in June 2023 envisioned a 9.5-year mine life with average annual production of 90,000 oz. (100,000 oz. annually during the first seven years) for total life-of-mine production of 851,000 ounces.
The study outlined an after-tax net present value (at a 5% discount rate) of $170 million and an internal rate of return of 31% based on a gold price of $1,650 per ounce. Initial capex of $160 million could be repaid in 4.3 years.
Robex believes there is opportunity to add economic near-surface oxide ounces to the mine plan through infill and exploration drilling. The project lies in the prospective Siguiri Basin, which is situated in northeastern Guinea and extends into central Mali. Geologically, the Siguiri Basin is part of the West Africa Birimian Greenstone Belt.
At least 47 gold anomalies have been identified on the 475-sq.km property, of which five clusters of deposits—Sabali, Mansounia, SGA, Jean and Balan—have been explored sufficiently for resource estimates.
Highlights from infill drilling priority targets at Mansounia include 16 metres grading 8.06 grams gold per tonne from 27 metres downhole in drillhole MRC23-038; 10 metres of 4.91 grams gold from 52 metres in MRC23-091; and 25 metres of 3.61 grams gold from 18 metres in MRC23-080.
Indicated resources for Kiniero’s shallow open pit deposits measure 52.5 million tonnes grading 1.05 grams gold for 1.78 million oz. contained gold. Inferred resources add 35.7 million tonnes grading 1.17 grams gold for 1.35 million ounces.
SCP Resource Finance analyst Justin Chan said Robex is one of his top picks after a recent site visit to the project, noting that the market “will be positively surprised with how quickly production commences” and that the build team is “very experienced and have worked together at multiple mine builds.”
Chan also pointed out that the economic impact of Rio Tinto’s (ASX: RIO; TSX: RIO; NYSE: RIO) $15 billion Simandou iron ore project was evident—from large advertising signs in the domestic and international airports and significant numbers of international arrivals.
“We think this is a key reason to rank Guinea with Côte d’Ivoire as a top West African jurisdiction—the economy has other sources of growth which reduces the fiscal pressure on gold miners,” he said in a Dec. 5 research note. The analyst also pointed out that Guinea “exceeded” his expectations compared to SCP’s previous visit, and that the country appeared to be “moving in the right direction.”
SCP has a buy rating on the stock and a one-year price target of C$4.00 per share. At press time in Toronto Robex was trading at C$2.12 per share, giving it a market cap of about C$320 million. Over the last year the company has traded in a range of C$1.15 and C$3.00 per share. Institutional shareholders include the Cohen Group with 26% and BlackRock with 7%.
“We left the site visit very positive on the mining industry in Guinea,” Chan concluded. “Simandou is forecast to add 25% to the country’s GDP and we think the Siguiri Basin is starting to feel like the new Hounde Belt with multiple new discoveries processing to mine build, mid-tiers moving to acquire available exploration tenure and established producers in need to diversify from Mali and Burkina Fasto given increased security and fiscal pressures.”
