The Golden Compass – West Africa in Focus: Cote d’Ivoire

In this multi-part series we’re traveling around the world finding emerging gold regions with untapped potential.

Breaking down the geology, politics, players and potential of countries that have been chronically underexplored and underproduced, but hold world-class potential.

Even though a majority of gold production comes from only a handful of countries, significant gold ounces remain undiscovered outside of these regions. The Golden Compass series will attempt to pinpoint the countries soon to be added to the list of major producers.

Gold Production by Country

The Target: Côte D’Ivoire 

We start our journey in a part of the world well known for being rich in resources, Africa.

West Africa, in particular.

This region is already producing significant ounces of gold, 324 tonnes in 2022 from Mali, Burkina Faso and Ghana, but not all countries in the region have shared in the bounty. Côte d’Ivoire, in particular, has massive potential from a geological perspective but has produced only 48 tonnes in the same period.

A history of the rocks in the region puts the opportunity in focus.

A majority of major gold deposits and most major mines in West Africa have come from Birimian Group rocks. These rocks extend north from the Gulf of Guinea through Ghana, Côte d’Ivoire, Guinea, Mali and Burkina Faso.

Birimian Group Rock Distribution Map (Green) and Gold Deposits


However, even though Côte d’Ivoire is home to 35% of the region’s Birimian Group rocks, the country represents only 7% of gold produced in the region over the past decade. Herein lies the opportunity.

West African Gold Production (2013-2022)


Historically, Côte d’Ivoire has not seen the influx of exploration capital and is significantly underexplored using modern methodologies as compared to its neighbouring countries. Technical concepts applied to Birimian Group rocks have been proven in other West African jurisdictions, which reduces the exploration risk in Côte d’Ivoire as exploration efforts move forward.

For these reasons, Côte d’Ivoire offers a unique opportunity for exploration and development companies to quickly access highly prospective gold resources.

Côte d’Ivoire: A Stable Political Environment and Recent Mining Reforms

Côte d’Ivoire stands out in the region with a stable and improving political, mining and business environment.

The country is a presidential republic with regular elections and a civil law system based on French civil code. There is also a tax convention and foreign investment protection agreement with Canada, making it a particularly attractive jurisdiction for Canadian junior mining investors.

Lastly, a 2014 mining tax code change has made the country a favorable place for gold exploration and resource development.

Economic growth is also brisk, showing 7% growth in 2021 and 2022 with similar growth expected in 2023.

According to the World Bank, Côte d’Ivoire’s ease of doing business is the highest in the region (Lower ranking is better)

Source: World Bank (2020)

The corruption perception ranking also continues to improve while neighbors in West Africa have all seen their rankings decline or flatline.


Activity is Heating Up as Operators Diversify Away from Problem Countries

While there remains political instability in other parts of West Africa, paradoxically, Côte d’Ivoire is now seen as an attractive gold district. Gold companies are buying up assets and expanding exploration in the country to diversify production away from less than desirable jurisdictions elsewhere.

There are already major producing mines in the country, but with a lack of exploration and development spending in the past, these mines are depleting, and the owners will look to potentially acquire additional discoveries to backfill declining production.

Côte d’Ivoire has already seen significant buyouts in recent years including Endeavor Mining purchasing SEMAFO and Teranga Gold for C$1 billion and C$2.4 billion respectively, not to mention Fortuna Silver buying Roxgold for C$1 billion. More recently, Awale Resources Ltd. secured a further US$0.96 million investment from Newmont Corporation in December 2023 to advance its greenfield exploration efforts and a US$0.75 million in Joint Venture funding for the Odienne drilling program slated for 2024.

Small miners who can put together 0.5-3 million oz of potential resource have a significant and growing group of potential buyers.

Côte d’Ivoire Gold Mining Activity Snapshot

Producers and Explorers with Potential

We are hopeful that the above analysis makes it clear than Côte d’Ivoire has some of the best growth potential of any gold mining region in the world.

Favourable geology, stable politics and rising investment set the stage for significant upside potential. The key will be identifying the best positioned public opportunities.

Below we’ve highlighted two operators, one producer and one explorer, which look particularly interesting. Though this is in no way an exhaustive list of gold investment opportunities, Côte d’Ivoire has to offer.

Kobo Resources (TSXV:KRI): A New High-Grade Gold Discovery with an Expected Path to Monetization

Kobo offers investors exposure to a new gold exploration discovery, which screened well during our research due to its early trenching and drilling success. What sets this company apart is its location near major mining infrastructure and the largest gold producing mine in Côte d’Ivoire. Given its location and access advantage, an investor might consider this new gold discovery to be effectively “head frame” exploration.

Kobo’s flagship asset, the Kossou Gold Project is located approximately 6-7 kilometers from Perseus Mining’s Yaoure Gold Mine, the largest producing mine in Côte d’Ivoire.

Kobo Concession Map

Source: Kobo Resources

Kobo recently completed approximately 6,000 meters of drilling and more than 5,600 m trenching on three separate zones (Jagger, Zone, Road Cut Zone and Kadie Zone) returning wide intercepts grading 2 g/t Au with higher grade intercepts greater than 10 g/t Au.

Importantly, the geology at the Kossou Gold Project is extremely similar to what is found at the producing Yaoure Gold Mine nearby according to Kobo. The Kossou exploration permit is the largest unexplored gold geochemical anomaly in the region.

A successful geological analogue significantly de-risks exploration risk for Kobo.

Over 9 km of Geochemical Anomalies to be Explored

Source: Kobo Resources

As Kobo has only conducted limited drilling on two of the three prospective targets, the opportunity remains very attractive.

Management has identified over 25,000 m of drilled targets on their wish list and will begin a 5,000 m diamond drilling program in March.

Considering the company’s excellent geology, strong infrastructure, high-grade gold mineralization, upcoming exploration catalysts, and proximity to a major gold mine in Côte d’Ivoire, Kobo appears to be a promising exploration play.

Perseus Mining: (TSE:PRU, ASX:PRU): Low-Cost Production and a Strong Growth Pipeline

Perseus stood out as essentially the one pure play Côte d’Ivoire gold producer. Owner of Yaoure, the largest producing mine in the country, Perseus generates 65% of production in country.

Perseus also operates at a very low production cost, $1,000/oz, generating significant cashflow at current gold prices around $2,000/oz with stable production.

Perseus Production History and Production Costs

Source: Perseus Mining

Another metric we particularly like is that the company trades at a big discount to global mining peers. Trading at 3.6x price to cashflow vs 6.6x for peers, a 45% discount.

Interestingly for Kobo, Perseus will see declining production at Yaouré, a mine only 6 -7  kilometers away, over the next three years. If Perseus isn’t able to successfully replace production with the new pit and underground expansion, Kobo could serve as a discounted infill resource for the Perseus given its close proximity.

Perseus has indicated publicly that it is on the hunt for additional gold resources in Africa.

Perseus Gold Production Outlook from Yaoure Mine

Source: Perseus Mining

Conclusion: Look Through the Risk to the Future Reward

Gold mining has always been about managing risk. With large developed market deposits largely produced, there are few gold discoveries in countries with squeaky clean records left.

The name of the game today is finding high-grade deposits in underexplored regions with a stable or improving political environment.

From all of our research, Côte d’Ivoire certainly checks the boxes.

√ Free elections

√ Improving business environment

√ mining friendly tax code

√ high grade gold deposits

√ Rising exploration activity

√ Prospective geology, but low historical production

We think mining investors will be rewarded this gold cycle by branching outside well known gold hubs in favor or regions with high potential geology, but a current lack of development capital.

Côte d’Ivore is one of those regions.

Kobo Resources is a market awareness client of Capital 10X. For more information, including potential conflicts of interest please see our Content Disclaimer.

Duane Hope is a Partner at Capital 10X, he brings over 15 years of communications and research experience to the firm. His research and writing have appeared in publications for North American, European and Asian audiences.


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