Roscan Gold Corp CEO and president Nana Sangmuah describes the TSXV-listed company’s land package in West Mali as one of the most prospective exploration grounds within West Africa’s sprawling Birimian greenstone belt. “We are right smack bang in the middle of about eight producing mines within an 80 km radius and we’ve added more ground this year that brings our total land package to about 346.8 km²,” says the experienced mining executive. The TSXV-listed explorer has already made four discoveries that together comprise the Kandiolé Project, which Roscan is rapidly advancing towards the resource delineation phase. “This is a first order structure, preliminary geophysics have been completed on the ground and they are pointing to some deep-rooted structures here. We are very excited to have this land package and we are very confident that this could become a multi-million-ounce camp,” Sangmuah proclaims.
Trust in Mali
Mali’s credentials as an established, high quality mining jurisdiction are underlined by the proliferation of commercial gold mines in the Southwest of the country. In fact, Mali produced 65.2 tonnes of gold in 2020 – making it the fifth largest producer in Africa – with the formal industrial sector generating huge government revenues and vital employment for the wider population.
However, concerns were raised by investors last year after the incumbent government was removed in a military coup. Sangmuah quickly allays fears relating to Mali’s political instability: “I think it was one of the most peaceful coups I’ve seen, where the will of the people was respected,” he says.
“The democratically elected government was ushered out and a transitional government was brought in without any loss of life. The transitional government is punching above its weight and has virtually taken the reins of government, applied the new mining code, continued with the issuance of permits and it’s been business as usual.
Roscan continued to operate drill rigs at its camp as the political situation played out in August, and the same ‘keep calm and carry on’ mindset was applied when the COVID-19 pandemic hit earlier in 2020.
Mali’s investment status is also often unfairly dented by the presence of Jihadist terror activity, which is mostly concentrated in the Northeastern part of the country – over 1,000 km from the cluster of operating gold mines within Roscan’s radius.
“We have never felt threatened while getting on with our business there. But we also don’t leave anything to chance and make sure that staff are well protected when they are in the bushes. Safety and security is of prime importance to us and you can see that by the fact that we’ve had virtually no safety or security issues since we started with one target, which has now grown to five targets and over 150 people employed.
“It should also be highlighted that there are 86 gold mining and exploration companies operating in country and there has not been a single day of operational disruption due to conflicts or terror related activities. Some of these operators have been operating for over 20 years in Mali since 1996 without any major interruptions, in the case of Randgold Resources (now Barrick Gold).
Successfully navigating the challenges associated with developing gold projects in West Africa requires strong leadership with extensive regional experience, and Roscan has this in buckets. Chairman Sir Samuel Jonah is a serial mine developer best known for growing Ghana-based Ashanti Goldfields into a 10-mine conglomerate. He later became president of AngloGold Ashanti after the 2004 merger created the world’s second largest gold producer at the time.
Former AngloGold CEO Srinivasan Venkatakrishnan (or Mr Venkat as he’s known in the industry) also joined the company in February 2021 as an independent non-executive director, bringing with him unrivalled experience in transitioning junior exploration plays into producing gold companies in Africa.
Roscan’s land package was put together by another serial explorationist and prospector Greg Isenor. The executive vice-chairman has been responsible for the development of several gold projects in Africa and has a great nose for picking out ground, according to Sangmuah.
“That leadership strength provides a lot of guidance to what we are doing and a strong platform to work from. I wouldn’t put growth beyond this platform out of the question and we continue to evaluate several opportunities, but having that leadership helps a lot,” says Sangmuah.
Towards the end of last year, Roscan bolstered the Kandiolé Project with three new discoveries (Kandiole North, Walia and Moussala North) from an AC drilling campaign which confirmed the geochemical anomalies that Roscan had previously detected.
“These discoveries are clear surface expressions of good mineralisation that will be followed up with more AC before we dig deeper with RC and DD to figure out the roots. We’ve also done an extensive geophysical survey that helps us with the deeper targeting and that’s been processed to generate 3D targets.”
And after adding two significant land packages to the project in the first quarter of 2021, Roscan announced the Mankouke West discovery in March, a new high-grade zone 150 metres West of the initial Mankouke South discovery, which provided a signature hit of 4.78 g/t over 24 metres at surface.
“Following the Mankouke West discovery, we’re going to be doing some exploration chasing additional resources as we build towards the North. This discovery consolidates about 22 km of the magnetic structure we have identified in the land package. We like the exploration upside that we can tap into here and the potential to eventually translate mineralisation into a bigger ounce profile for the company,” Sangmuah proclaims.
The acquisition of the 42 km² Segondo West permit in February resembled another crucial addition to the Kandiolé Project, after Roscan had followed geophysical extensions of the Walia and Moussala discoveries to the Northwest.
Roscan is currently waiting on 3D interpretation and geophysics results in order to complete its prioritisation of key targets within the Segondo West permit, but Sangmuah emphasises that the great thing about picking up extra ground in the vicinity is that all additional resources will feed into a central processing hub once the company reaches the production phase.
Good corporate stewardship is an important part of any company’s licence to operate in West Africa, but Roscan has gone above and beyond in its commitments to the local communities since the COVID-19 crisis, which has thrown up unprecedented public health challenges.
Roscan and its drilling contractor moved quickly to implement strict on-site protocols to prevent the spread of the virus. As a result of these double-lock protocols, there have been no reported incidences of the virus on-site as of March 2021, but Sangmuah assures the company is not letting its guard down and will continue to apply stringent protocol to all individuals visiting the site.
After acquiring PPE for its own employees, Roscan donated excess PPE to several health clinics in the region. This gesture was much appreciated by the community and the Mayor, Sangmuah recalls. “Through the COVID-19 situation, some companies have been pulling back and not doing a lot of work; we never stopped. So, we became a good source of local employment when other work has been hard to come by.
“We were also active during the political transition and that has put us on a good pedestal with the government. They know we are proactive and will put the assets that we acquire into good use, providing employment and also supporting the surrounding communities, which we continue to do despite the fact that we’re just a small exploration company.”
Roscan’s supply chain is also distinctly local. The firm’s in-country strategic partner is Touba Mining SARL, which provides exploration services, including personnel and equipment, to Roscan. In addition, the company gives first priority to local businesses for a range of goods and services – from food supplies to transportation and geological lab support – helping to keep money in the local economy.
A bright future
After bringing in C$15 million via an oversubscribed overnight public offering in March, Roscan is fully funded for its 2021 drilling campaign at the Kandiolé Project, which will focus on advanced targets such as Kabaya and Mankouke South, with a view to announcing a maiden reserve in Q4. The firm has also completed an extensive geophysical survey which will inform further drill testing across the land package.
When asked about Roscan’s long-term ambitions for the Kandiolé Project and beyond, Sangmuah responds by underlining the company’s ultimate goal: To maximise value to shareholders. Whether this is achieved via mine development or an acquisition by a larger player remains to be seen.
Roscan’s market cap has risen from C$15 million in December 2019 to around $135 million today, after reaching the discovery phase sweet spot in Western Mali with not just one but multiple discoveries, where each could become a company maker in their own right, according to Sangmuah.
“Our ground is highly prospective and you can see that projects that have been put into development in that area are trading North of $1-2 billion, compared to our market value heading towards $150 million. So, there’s a value proposition to be had if you go up the value curve. Thankfully, we’ve got a team that can do it.
“However, if there ever comes a point when an offer looks too good to refuse, and shareholders want that as an exit route, then it’s something we will definitely consider.”
Sangmuah also doesn’t rule out the possibility of expansion into the sub-region, where Roscan’s leadership can use its contact base to source out and enhance value for shareholders. With West Africa ranking as the top-ranking region globally for new discoveries, Roscan is perfectly placed to grow into a world-leading gold exploration business.