Sudan expects 20 more firms to start producing gold this year

KHARTOUM: Sudan expects 20 more companies to start producing gold this year and will allocate more land for investors for mineral exploration, its mining minister told state news agency SUNA on Monday.

Sudan has licensed almost 100 companies to search and produce gold as it seeks to boost output of minerals to gain new sources of state income and of foreign currency needed to fund imports.

Gold has now become Sudan's biggest export product, partially replacing oil revenues which made up more than 50 percent of state income until 2011 when South Sudan took away most oil reserves with its independence.

A total of 20 firms would start producing gold in 2013 after completing exploration studies, Mining Minister Kamal Abdel-Latif said, according to SUNA. Until now, only 13 firms have reached the production stage, he said.

The government eyes a gold output of around 50 tonnes in 2013, worth around $2.5 billion, which would potentially make it Africa's third largest gold miner behind South Africa and Ghana, and push it into the top 15 producers globally.

Sudan's gold production is expected to be flat compared with last year's 50 tonnes but without the latest push, it would drop because its main mine Ariab Mining Co, a joint venture of Canada's La Mancha Resources and the government, is expecting a fall in output as it has exhausted reserves near the surface. It is now undertaking investments to tap deeper reservoirs which will take time to pay off.

Much of Sudan's gold output comes from artisanal searchers - some 750,000 ordinary Sudanese search for gold at 106 sites across the African country, Abdel-Latif said.

The government will allocate six more blocks for investors to search for minerals, he said, naming areas north of the capital Khartoum and in South Kordofan, a strife-torn region near the border with South Sudan.

Last week, the mining ministry said it had granted nine Russian companies a license to search for gold, chrome and ore, without giving details.