(Ecofin Agency) - Senegal’s minister of Mining awarded an exploration permit to Bassari Resources for the Makabingui project. The permit, which is renewable, is valid for 5 years. An exploitation firm will be formed, with the Senegal government to get a 10% noncontributory interest in its capital.

Bassari said it has been exempted from a number of taxes, for three years. These include export, value added, property, and services taxes. Past exploration expenses incurred by the firm will be presented to Senegalese authorities, and will be classified as contracted debt for the new exploitation company. They will be reimbursed in respect with the country’s Mining Convention.

In return for the new exploration permit, the company will pay on a quarterly basis a 5% royalty on gold sold and invest $100,000 in the region’s social development during predevelopment and 0.5% of gold sales thereafter. The project will also contribute $150,000/yr for the training and development of Senegalese in the mining sector.

Makabingui holds a mineral resource of 11.9 million tonnes, grading 2.6g/t of gold for 1 million ounces of gold, thus 336,000 ounces of indicated gold in 2.6Mt at 4g/t and 669,000 of inferred gold in 9.3Mt at 2.2g/t.

Louis-Nino Kansoun