Essakane Gold Project
|Date SPG disclosed||April 25, 2008|
|Projected Board date||June 26, 2008|
This summary covers an investment by Orezone Essakane Ltd. of the British Virgin Islands in the Essakane Gold Project in Burkina Faso. Orezone Essakane Ltd. is owned by Orezone Resources Inc. (Canada). The investor has applied for a MIGA guarantee of approximately $190 million for a period of up to 10 years against the risks of transfer restriction, expropriation, war and civil disturbance and breach of contract.
The project—located on the Gorouol River in northeast Burkina Faso—is the largest private sector investment in the country’s mining sector. The investment involves mining and gold deposit processing operations, including the establishment of an overburden storage facility, a gold processing plant and a tailings storage facility. Other infrastructure to be built as part of the project includes a village for mine employees, a mining fleet, plant maintenance facilities, and power generation and water supplies.
The project is a Category A under MIGA’s environmental review procedures. Click here to view the Environmental and Social Impact Assessment, and here to access the Environmental and Social Review Summary.
The project is expected to help alleviate poverty in Burkina Faso by creating local employment and economic spin-offs; contributing physical and social infrastructure; and transferring technical know-how.
Burkina Faso is a poor, landlocked, sub-Saharan country with limited natural resources and an economy that is strongly dependent on cotton exports (accounting for 55-70 percent of export earnings), and therefore vulnerable to external and climatic shocks. This project is expected to contribute towards diversifying Burkina Faso’s economy.
An estimated 750 Burkinabè people are expected to be employed during the construction phase of the project. Another 500 direct and 300 indirect jobs, reserved for locals, are expected to be created during the operation of the mine.
The project sponsors are planning to implement a training and apprenticeship program for local staff. Training of unskilled workers will focus on skills and trades that are needed at the mine site and transferable to other jobs following mine closure, such as welding, vehicle maintenance and office administration skills.
Burkina Faso is an IDA-eligible country, which is among the world’s poorest. The World Bank Group’s country assistance strategy for Burkina Faso seeks to accelerate growth; improve access to basic social services; increase employment and income opportunities for the poor; and promote better governance with greater decentralization. MIGA’s role in this project will complement the World Bank’s efforts in this regard.