Endeavour Mining PLC (TSE: EDV) (OTCMKTS: EDVMF) has been the latest company to have the rug pulled out from underneath them in terms of its gold mining operations in Guinea.
The Guinea government has so far pulled 129 exploration permits covering bauxite, diamonds, iron and gold, from companies including Resolute Mining (ASX: RSG) (OTCMKTS: RMGGF) and AngloGold Ashanti (NYSE: AU), among others. The African country has continued to reclaim both inactive and non-compliant mining rights.
Guinea granted the four exploration licenses in 2020 but has not renewed them, Mines Minister Bouna Sylla said Monday. He made the statement on state-broadcaster Radio Television Guineenne.
Endeavour Mining’s spokesperson declined to comment.
Meanwhile, the world’s top bauxite producer continues to press mining companies to meet the terms of their licenses. It wants to unlock the sector’s full economic potential.
As part of this push, Guinea has ordered a unit of Emirates Global Aluminium to begin building an refinery. Otherwise, Endeavour may lose its bauxite mine to state control.
Junta leader Mamady Doumbouya has pushed for tighter control over the sector since seizing power in a September 2021 coup. The new decree also orders the withdrawal of permits from companies that fail to follow Guinea’s mining code.
Authorities have not explained the decision.
Foreign firms now have until the end of May to propose plans for building refineries. The move aims to ensure bauxite is processed locally rather than exported raw.
Despite its rich resources, Guinea remains one of the world’s poorest countries.
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Multiple risks for doing business in Africa
In a May 29 statement, Resolute Mining said it had not received official notice from Guinean authorities about its permit revocations.
However, the company learned about the cancellation of three of its exploration permits through local media.
Resolute Mining said it became aware of media reports suggesting that a large number of exploration permits may be revoked in Guinea.
The company noted that a local Guinean television report earlier in the week mentioned its permits among those potentially affected.
This is one of the risks resource companies run when dealing with natural resources in Africa.
Tensions between ruling juntas and foreign mining companies are rising across West Africa, where governments seek greater control over natural resources. In Mali, Barrick Mining Corp (TSE: ABX) (NYSE: B) has faced repeated challenges under the military-led government, which has pushed for more revenue and local ownership.
Neighbouring Burkina Faso, also under military rule, has seen similar crackdowns, including stricter enforcement of mining codes and suspensions of permits.
These regimes often frame such actions as moves toward sovereignty and economic justice. However, critics argue they create instability and deter investment.
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