Introduction
MASI operates its gold mining concessions through its subsidiary, “Mingo Gold”. Mingo Gold (MG) is organized under Senegalese law (registration number SN-DKR-2013-B-17644) and structured similarly to a US LLC. Mingo Gold holds its own individual Exploration and Prospection authorization and permit. The company’s five mining concessions consist of the “Seekoto Benkanto” Concession,the” Sining Kang” concession, the Bencoutou Concession, The Book Voon Concession and the Diakha Gold and Diamond Mine Concession. MASI has tentative agreements for additional concessions to be signed in the very near future and mining expansion plans in the DRC, Liberia and Guinea.
Property Description and Location
The Seekoto Benkanto, Bencoutou, the Sining Kang and Book Voon Mining Concessions are located in the Southeastern corner of Senegal in the Kedougou Region. The concessions are 20 kilometers north of the city of Kedougou. Both concessions are located side by side, separated by 50 meters as depicted on the map below. (Figure 2.1) Each Concession measures 50 hectares each.
Access to the property is gained using a dirt road at kilometer marker 17 of the major road way N-7. N-7 is a major road that runs from the Capital City or Dakar to the City of Kedougou and access into Mali. The Benkanto and Sining Kang Mines are located 3 kilometers east of N-7.
The Diakha Gold and Diamond Mine is located in the eastern region of Kedougou, accessible by dirt road from Ntional highway 7 some 10 km fro the village of Bousankhoba.
Tenure History
The Seekoto Benkanto GIE, (Group Interest Economic) applied for and was granted GIE status on October 10, 2008 under registration number SNBTC 2008 C 594. The GIE is similar to a LLC in the US but with less protections. The Seekot Benkanto applied for and was granted the Gold Mining Concession from the Director of Mines and Geology on January 22, 2010. The Seekoto Benkanto GIE and MASI signed a Joint Venture Agreement on March 26, 2013 giving MASI the exclusive rights to the Mining Concessions under the Senegalese Mining Code.
The Sining Kang GIE (Group Interest Economic) applied for and was granted GIE Status on November 24th, 2008 under registration number SNTBC 2008 C 668. The Sining Kang GIE (Group Interest Economic) applied for and was granted the Gold Mining Concession from the Director of Mines and Geology on January 25th, 2010. The Sining Kang and MASI signed a Joint Venture Agreement on April 30th, 2013, giving MASI the exclusive rights to the Mining Concessions under the Senegalese Mining Code.
The Bencoutou GIE, (Group Interest Economic) applied for and was granted GIE status on October 10, 2008 under registration number SNTBC 2008. The GIE is similar to a LLC in the US but with less protection. The Bencoutou applied for and was granted the Gold Mining Concession from the Director of Mines and Geology on January 22, 2010. The Bencoutou GIE and MASI signed a Joint Venture Agreement on March 21, 2014 giving MASI the exclusive rights to the Mining Concessions under the Senegalese Mining Code.
The Diakha Gold and Diamond Mine applied for and was granted was granted a concession license on July 29th 2010, registration number 06899/MMIAPME/DMG. MASI and Diakha signed a Joint Venture agreement giving MASI ehe exclusive rights to the Mining Concession under the Senegalese Mining Code on March 9th, 2015.
Royalties
Under the JV agreement between MASI and Seekoto Benkanto GIE, MASI agrees to pay Seekoto Benkanto 25% of the total NET profits from the gold sales generated from the project.
Under the JV agreement between MASI and Sining Kang GIE, MASI agrees to pay Sining Kang 25% of the total NET profits from the gold sales generated from the project.
Under the JV agreement between MASI and Bencoutou GIE, MASI agrees to pay Sining Kang 25% of the total NET profits from the gold sales generated from the Project.
Under the JV agreement between MASI and Book Voon GIE, MASI agrees to pay Book Boon 25% of the total NET profits from the gold sales generated from the Project.
Under the JV agreement between MASI and Diakha Gold and Diamond Mine, MASI agrees to Diakha 25% of the total NET profits from the gold and diamond sales generated from the project.
Taxes
The Ministry of Mines and Geology assesses an annual mining fee of 3% of the market value of gold production tile-mine based on the average price of an ounce of gold on the London Gold Fixing during the year.
Under the JV agreement with Seekoto Benkanto, Sining Kang, Bencoutou and Book Voon, MASI agrees to pay l.5% of the fee and Seekoto Benkanto, Sining Kang, Bencoutou and Book Voon agrees to pay 1.5% of the fee.
Under the JV agreement with Diakha Gold Mine, MASI agrees to pay 1.5% of the fee and Diakha Gold Mine agrees to pay 1.5% of the fee.
Tenure
The mining license and authorizations is renewable every three years up to the exhaustion of the reserves if the beneficiary has respected its obligations and fulfilled its commitments within the frame work of the so called authorization of exploitation and has duly applied for it each time.
Surface Rights
Article 73 of the Senegalese mining code states, subject to the respect of specific legislative clauses applicable to each of the following cases hereafter indicated, the holding of a mining title confers a right of occupation within the entire Territory of the Republic of Senegal.
This right of occupation entails, inside and outside the perimeter attributed, the authorization to:
- Occupy the lands necessary to carry out exploration and exploitation works and related activities as well as building housing for the staff working in the site.
- Carry out or make carry out the infrastructure works necessary to the realization , in normal economic condition and according to the book operations related to exploration and exploitation notably to transport of supplies, materials equipment and extracted products.
- Carry out the soundings and the works requited for water supply to the staff, the operations and the installations.
- Search for and extract building materials and metals or viability necessary for the operations.
- Cut necessary wood for works.
- Use for its works unused or reserved waterfalls.
The works listed hereafter are considered to be part of the exploration and exploitation works;
- The preparation, the washing, the concentration, the mechanic, metallurgic, chemical or metallurgic processing of extracted mineral substances, the compressing, the carbonization, the distillation of combustibles;
- The stocking and the dumping of products and wastes;
- The constructions destined to housing, hygiene and medical care of the workers;
- The establishing of all communication means, notably the roads, railways, canals, pipes, escort ships/security guards, air transport, ports and telecommunication networks;
- The setting up of limits and boundary markers;
- Setting up and exploitation of electric power station, post, lines and telecommunication networks.
The works listed hereafter are considered to be part of the exploration and exploitation works;
- The preparation, the washing, the concentration, the mechanic, metallurgic, chemical or metallurgic processing of extracted mineral substances, the compressing, the carbonization, the distillation of combustibles.
- The stocking and the dumping of products and wastes.
- The constructions destined to housing, hygiene and medical care of the workers.
- The establishing of all communication means, notably the roads, railways, canals, pipes, escort ships/security guards, air transport, ports and telecommunication networks.
- The setting up of limits and boundary markers.
- Setting up and exploitation of electric power station, post, lines and telecommunication networks.
Water Access
Access to the mining site is gained from the Gambian river which is located 2.8 kilometers east of the mine site. Article 73 of the Senegalese Mining Code gives holders of mining titles the right to extract water from the river.
Customs Exemptions
Article 59 of the Senegalese Mining Code states; the holder of an exploration permit for mineral substances is exempt from all royalties and custom duties included value-added tax (TVA) and the deductions of the Senegalese Council Shippers (COSEC) for:
- The materials, building materials, supplies, machines, engines and equipment, commercial vehicles includes in the approved program, as well as spare parts and consumable products and materials not produced nor made in Senegal, destined specifically and definitively to mining research, operations and of which the importation is indispensable for the realization of the research program.
- The fuels and lubricants supplying the fixed installations, drilling materials, machines and other equipment destined to exploration operations on the attributed permit.
- The petroleum products used to produce energy for the realization of the exploration program.
- The parts and the spare parts destined to recognized machines and equipment destined specifically to the realization of the approved research program.
- The subcontractor companies including the GEO servicing companies such as the companies for drilling geophysics, analyses and chemical test intervening in the realization of the approved mining exploration works program, with the approval of the Minister in charge of mines benefit from the royalties and custom taxes for the realization of their services.
Geological Setting
The area is located within the boundaries of a wide corridor of deformation, birimian, parallel to that of the Sabodala deep fault zones. The Interior of this corridor, developed shears-areas, made up of veins and veins of quartz, of different sizes and directions.
SEDIMENTARY BASIN
The Senegal Basin occupies the central part of the Northwest African Coastal Basin (MSGBC Basin), which extends from the Reguibat ridge at the north end of the Guinean fault. It is typical passive margin opening westward to the Atlantic Ocean and whose eastern limit is represented by the Mauritanides chains. The Senegal Sedimentary Basin is a Mesozoic Basin. It has gone through a complex history in relation to the pre-rift (Upper Proterozoic to Paleozoic), the Syn-rift (Permian to Triassic) and the Post-rift (Central Jurassic to Holocene) at different stages of development of the Basin. Most of the outcrops of the basin are composed of recent sandy covers. Maestrichian and Eocene formations outcrop, however, in the peninsula of Cape Verde while Eocene outcrop in the valley of Senegal River. The description and knowledge of the Basin have been made possible largely thanks to hydraulic and oil drilling data.
The Secondary formations include Palaeocene zoogenic limestone exploited at Bandia and Pout by cement plants and aggregates producers. They include also Maestrichian sands, clays and sandstones. Paleocene and Maestrichian formations are also known to be major aquifers that contribute significantly to the water supply for cities and villages in the basin. Tertiary formations hold into the Eocene compartment, significant resources of phosphates, limestone, attapulgite, clay and ceramics, solid fuels, etc. A major part of the basin is covered with superficial Quaternary formations, which in the middle and recent parts are characterized by fixed red sand dunes, semi-fixed or alive yellow and white dunes. These dunes, often exploited as building materials around urban centres, constitute also important reservoirs of heavy minerals.
PRECAMBRIAN BASEMENT
The Precambrian basement formations are constituted at the west by the Mauritanides range bordering the eastern part of the Sedimentary Basin and in the east by the Palaeoproterozoic volcano-sedimentary sequences of the Kedougou- Kenieba inlier.
The formations of the Mauritanides chain are Herycian age and constitute one of the mobile areas of the West African craton. They are known for their numerous copper and chromium occurrences which, in Mauritania, constitute the important copper deposits of the Akjout Region. The Palaeoproterozoic volcano-sedimentary sequences, mostly known as Birimian formations, are of great metallogenic importance, as far as they contain the major ore deposits discovered in the region. The Kedougou-Kenieba inlier is limited to the west by the Mauritanides chain, and on all other sides by the Upper Proterozoic and Cambrian sediments of the Basin of Taoudenni. The Kedougou-Kenieba inlier is interpreted as an accretion of north-easterly trending Birimian age volcanic terrains. It includes two major geological structures, the Senegal-omalian Fault and the Main Trans-current Zone (MTZ) to which gold mineralization is associated.
Recent combination of geological studies including field work, and structural modelling,and of detailed core logging have improved the understanding of the geological structure of the MTZ. Two main zones of mineralization have been further refined based on the latest geological model. Geological studies suggest that mineralization in the prospective Sabodala volcano-sedimentary belt and the Senegal-Malian shear zone is associated with an altered and sulphidised gabbro, which has intruded along the main structure, and a typical shear zone hosted, where a structure has developed at the contact between a package of volcaniclastics and sediments. A lapilli tuff acts as a prominent marker horizon in the hangingwall of mineralisation. The inlier is divided into three main stratigraphic units from west to east: the Mako Super group, the Diale Super group and the Daléma Super group.
■ The Mako super group hosts Sabodala deposits located in an area of intense shearing and silicification associated with pyrite gold mineralization. It forms a north-east tectonic structure, turning to north-west near the border with Mali, in the north. Typical lithologies include basalt flows; often carbonate alterations and minor volcaniclastic intercalations, magnesium basalt or komatiites, ultramafic sub-volcanic intrusions (pyroxenites) and numerous massive biotite and amphibole granitoids. These granitoid intrusions are suspected to have been ‘heat engines’ which sparked off the deep mineralized magmatic fluids related to the belated mineralisation in the Kédougou-Kéniéba inlier.
■ The Diale Super group, located between the Mako Super group and the western edge of the Saraya granite is weakly metamorphic. It includes extensively folded formations, deposited after those of the Mako Super group and consisting of shale, greywacke, quartzite and volcano détritic rocks.
■ The Dalema Super group, located between the Saraya granite and the Faleme river, continues to Mali in its eastern part but disappears in the South under the Segou Madina Kouta the series. It is composed of volcano-sedimentary schist and grauwacke rocks. These Birimian formations are affected by syn, late and post-tectonic granite intrusions.
The Precambrian basement is a metallogenic province of major importance for Senegal, which hosts numerous deposits and anomalies of gold, iron, uranium, lithium, tin, molybdenum and nickel in Birimian formations, and copper and chromium in the Mauritanides range. In addition to these metal resources, there are large marble and other ornamental rocks deposits, but also non metallic indices and deposits of barytes, kaolin, (See Figure 4.0.C).
The perimeter of Tinkoto Sou, occupies an area laterite eluvionnaire, where you can watch pieces and blocks of veins and veins dismantled and decayed. The Mineralogical study, performed on this ore by PASMI (Mining Sector Support Program) for gold panning and the Director of Mines and Geology Laboratory (Senegal), had enabled us to obtain the following results:
_The gold ore is of nature per, greyish, bluish to brownish; eye is composed mainly of quartz, plagioclase, chlorite, oxides and iron hydroxides and carbonates;
_The content of total gold for the sample analyzed is 4.82 g/t, while that of the different fractions, varies between 1.99 and 15,22 g/t; (See Figure 4.0.A & 4.0.B)
_ Crushing and quartz ore spraying occurred without noticeable strain. Although the quartz is generally hard and abrasive, the development of systems of cracks (micro-tectonic) in the ore, significantly reduces grinding efforts. The gold quality and weight is 22/ 23 carats.
_The substratum of the Senegalese territory is made up of two major geological domains: the Sedimentary Basin, which occupies more than 75% of the territory, and the Precambrian basement, representing the country’s south east.
The Senegal Basin is the central part of the Mauritania-Senegal-Gambia-Bissau-Conarky (MSGBC) basin which stretches from Mauritania to Guinea Bissau along the coast of West Africa. Under the EU funded PASMI, the government of Senegal is presently undergoing detailed geological mapping of this basin. This mapping project aims to produce a standard, print-on-demand geological map of this geologically complex and highly prospective Palaeozoic basin. Maps will be available in 1:500,000 for the whole basin, in 1:200,000 for the northern part and for the Cap Vert peninsula, in 1:50,000 multi-layers map sheets for the west of the meridian 16°40’W and in 1:20,000 multilayers map sheets for the west of the meridian 17°10’W. Midway reports indicate many significant changes and enhancements to the understanding of local and regional geology. This very ambitious geological mapping program, from data collection to providing several final deliverable map quadrangles, will take about 24 months and is scheduled to deliver final products by end-March 2009.
This important project started in May 2008, and aims to update, through a geographical information system, the geologic and metalogenic cartography of south-eastern Senegal (last updated in 1960). This revision will take into account the numerous and important data accumulated through mineral exploration programs and works carried out by researchers and academics since then. At the end of the project in 2010, geological and structural maps will be available in a 1:200,000 map sheet covering the whole Precambrian basement, and in 1:500,000 metalrgenic map sheet for the same terrains. These maps to which will be annexed the explanatory notes will be of a certain contribution for the mining exploration of south-eastern Senegal.