Efforts to improve geological surveys and mapping will encourage new exploration

According to African Development Bank estimates, Gabon’s mining sector is the second-highest-contributing industry after oil and gas, providing 6.3% of GDP and 6% of export receipts in 2012. Yet its continued reliance on manganese and gold leaves a number of potential avenues underexploited. The government aims to quadruple the sector’s contribution to 25% of GDP by 2025, through a combination of exploration projects and value-added local processing.

The sector still faces several obstacles, including bureaucratic overlap among the mining, hydrocarbons and forestry authorities, insufficient communications and transport infrastructure, and difficulties related to the country’s heavily forested terrain. Yet recent studies indicate that Gabon’s mineral resources may be much richer than previously thought. Most recently, the government commissioned a two-year, $25m scoping study of the Bélinga iron ore deposit in the northeast. Previous studies calculated that the site could hold 1bn tonnes of iron ore reserves, but government authorities are betting that research using improved technology could yield even higher estimates.

SYSMIN

A primary obstacle to new mining exploration in the past – limited availability of geological and geophysical data – has seen a marked improvement. The €35m SYSMIN project, financed and jointly led by the EU between 2003 and 2010 under the Eighth European Development Fund, has vastly improved the quality and centralisation of mining data, as well as sector governance and technical capacity.

A second EU-financed project scheduled to begin soon, the Sector Governance Support Programme (Programme d’Appui à la Gouvernance Sectorielle, PAGOS), aims to build on SYSMIN’s progress. Reforms planned under PAGOS should provide vital remaining elements that will help to boost new investment in line with the government’s goals. Beyond this, much of the burden will now fall to private companies to purchase data from the Ministry, generate precise resource estimates and explore their real commercial potential.

Improvements

Prior to the early 2000s, geological research was completed in a piecemeal fashion and was not consistently incorporated into a central database. The first exploitation of Gabon’s manganese resources began toward the end of the colonial period in 1959, and for decades, prospection and data management remained in the hands of private companies. In the last 20 years, the Ministry of Industry and Mines (Ministère de l’Industrie et des Mines, MIM) and its General Directorate of Mines and Geology (Direction Générale des Mines et de la Géologie, DGMG), have worked to ensure that information, mapping and surveys generated by private concession holders are incorporated into a national database after the end of the customary data ownership period, to limited effect.

The SYSMIN project has helped to deepen the pool of available mining data and to overhaul the data management system. Of the EU’s total €35m grant, €15m was dedicated to geological mapping and data systems. The project has made several critical advances, generating geological, geophysical and geochemical data for 65% of the country and a detailed mining inventory for 10% of the territory. South Africa’s CGS and Ireland’s SANDER collected aerial data through magnetometry and spectrometry on 113,000 sq km to support new, more detailed mapping. This data was treated by France’s Bureau of Geological and Mining Research and incorporated into Gabon’s first centralised mining data repository, housed at the DGMG. Project partners also re-analysed existing geophysical data using improved technology and incorporated this into the database, the Geological Information System (Système d’Informations Géologique, SIG).

Strategic Prospection

Prospection was subsequently conducted in seven zones selected due to a lack of prospection data or to their position in geologically favourable areas: Oyem, Makokou and Ngoutou in the north, Fougamou in the interior, and Malinga, Baniaka and Mayumba in the south. According to project reports, the research identified 37 targets with proven mineralisation of gold, molybdenum, tungsten, copper, barium, niobium and rare earths. Further exploration into the commercial potential of these resources will fall to private operators, and the government hopes that the availability of a mining database will attract sufficient investment to do so.

Finally, on the mapping and data collection front, SYSMIN also funded a study to assess the potential of industrial minerals and construction materials. Of a wide range of minerals, the study concluded that Gabon has strong potential for the production of carbonates, potash, barite, kaolin and talc. However, the lack of transport infrastructure will be an obstacle to their development, as most of these minerals were found in the difficult-to-access Nyanga region.

Paying Off

As a result, the quality of Gabon’s geological and geophysical data has leapt ahead in the last decade, providing the basis for a rise in sector activity. According to a third-party project evaluation commissioned by the EU in 2013, “SYSMIN’s initial impact in terms of professional training, equipment supply, geophysical data collection and geologic mapping, mining inventory and strategic exploration bode well for sector development in the near- and medium-term.”

The data collected over the last decade, combined with future additions through the PAGOS programme, will help to diversify away from the sector’s traditional reliance on manganese. The number of active research permits increased four-fold from 12 in 2003 to 51 in 2013, according to the DGMG. A handful of projects that could approach the production phase in the next 10 years were sparked by this new data, a relatively short turnaround for the mining industry. For example, the UK’s GoldStone Resources reported that it moved to obtain the permit for its Ngoutou gold deposit based on potential highlighted in the SYSMIN study; the company began drilling based on data acquired from the SIG database and announced in 2013 that its tests had confirmed the presence of high-grade gold mineralisation. However, despite recent progress, prospection activity remains relatively limited in Gabon. According to the DGMG’s deputy general director, Francis Mayaga Mikolo, “Gabon will need to double the number of research and prospection permits from around 50 to 100 in the coming years, in order to obtain the critical mass necessary to increase the pace of new ore discoveries.”

Next Steps

Much work still remains to be done, particularly with regard to expanding the in-depth mining inventory and firming up resource estimates. For example, only 3000 of the 20,000 alluvial samples collected under SYSMIN were analysed by the DGMG mineral laboratory due to a lack of equipment and primary materials. The next EU-financed programme, PAGOS, will help to expand and strengthen the DGMG’s mining database through the realisation of several new surveys. These include a metallogenic overview and map of the territory, which aim to identify high-potential zones for metal exploration. The project will also oversee a geological and geotechnical study of the Libreville-Owendo area, which has been difficult to assess given the high population density and concentration of economic activity.

Beyond this, ongoing private prospection in new areas, including titanium, copper, phosphates and potash, will be a valuable source of information in the future, provided they can be channelled into openly available platforms. However, much work remains to be done to digitise existing data in the SIG, increase bureaucratic efficiency at the DGMG and incorporate privately collected data into the system.

Good Governance

Efforts to strengthen sector governance will be critical to attracting higher levels of private investment in the future. To this end, the PAGOS programme will also focus on strengthening institutional capacity. The project is still under discussion by EU and Gabonese authorities, but several key objectives have been outlined. First, PAGOS will offer support for the management of artisanal mining, an increasingly important market segment as Gabon looks to build up its gold reserves. European partners will contribute their expertise to the creation of a detailed diagnostic of artisanal mining and the proposition of a legal and regulatory framework that will help to structure artisanal activity and support miners.

More broadly, project partners will also support the definition of a national mining strategy and specific mining policies. Beyond the government’s focus on diversification and local processing, this strategic orientation does not exist today, and the sector’s development has largely been driven by private interest.

Finally, the programme aims to support the creation of a digitised land registry that would identify potential overlap between land used for mining, hydrocarbons, forestry or which is reserved for national parks. No centralised system currently exists, which creates frequent conflicts between the various sectors. Overall, Gabon’s mining sector has made some great strides over the last 10-15 years, and the efforts to further structure the industry and deepen its resource estimates provide ample room for growth going forward.

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The Report: Gabon 2014

Mining & Industry chapter from The Report: Gabon 2014

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