- A steadily growing number of foreign mining companies is entering Sierra Leone's gold and diamond sector. Only today, a minor Canadian gold and diamond mining company announced it has formed a subsidiary in Freetown.
Mexivada, a junior Vancouver-based mining company, today said it had "formed a new subsidiary to pursue small scale rapid gold and diamond mining opportunities in Sierra Leone." Several fast-track mining opportunities were now being "evaluated" by the company, and the Freetown subsidiary was to "focus on the identification and development of gold placer deposits and alluvial- and kimberlite dike-hosted diamond deposits."
The Canadian company is only one in a line to enter Sierra Leone as the democratically elected government of President Ernest Bai Koroma, in 2007, has managed to rid the country off its "blood diamond" image, created in the brutal 1991-2001 civil war. Sierra Leone's governance has improved dramatically since the conflict, and government has instituted the Kimberley Accord for the mining, sale, and distribution of diamonds.
Among the first to enter the sector was Toronto-based Sierra Gold, which in early 2007 moved to secure gold property in the country. Sierra secured large tracts in the greenstone belt in Sula Mountains, which it said "contains the largest known hard rock gold vein deposit in Sierra Leone."
In August this year, London-listed Cluff Gold announced it had completed the acquisition of the remaining 40 percent stake in the Sierra Leone Baomahun gold project for US$ 22 million. The government of Sierra Leone granted Baomahun Gold Limited, Cluff's 100 percent-owned subsidiary, a mining lease for 25 years.
Sierra Leone indeed is a country rich in minerals, with more than 70 percent of the country underlain by Archaean rocks. The geology is similar and connected to the most yielding rocks of West Africa, including Guinea, Ghana and Mali.
Diamonds, gold, bauxite and platinum are Sierra Leone's main mapped resources, but mining - at least the legal part of the business - came to an abrupt end during the civil war. Since the 1990s, artisanal mining has been dominant, with smugglers taking diamonds and gold to world markets.
"Like its neighbours, Sierra Leone also has the potential to become a significant gold producing country," holds Sierra Gold. But the greatest potential is still believed to be the diamond sector. Before the war, Sierra Leone had yielded more than 100 million carats of alluvial diamonds, and gems up to 968 carats in size - the "Star of Sierra Leone" - have been produced in the country.
Now, as the country is assessed a safe place to invest, foreign companies are lining up to get lucrative properties - despite the global recession that has made mineral prices plummet.
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