Nord Gold NV (NORD) expects to produce 100,000 ounces of gold this year at its Bissa mine in Burkina Faso after output started yesterday, Chief Executive Officer Nikolai Zelenski said.
The Amsterdam-based company invested about $250 million in its second gold mine in the landlocked West African nation, he told reporters yesterday at the site, 100 kilometers (62 miles) north of the capital, Ouagadougou. Reserves are estimated at 4.92 million ounces, Zelenski said.
Bissa becomes the seventh mine in production in Burkina Faso, said Mines and Energy Minister Salif Lamoussa Kabore. Increasing output of the metal comes as prices climb amid the European debt crisis and a slow economic recovery in the U.S. Gold futures have gained 7.1 percent over the past six months and traded at $1,689.40 an ounce by 10:47 a.m. in London.
Rising gold production will boost growth to 7 percent this year, faster than the sub-Saharan African average of 5.25 percent, according to the International Monetary Fund.
Open-pit Bissa will have a peak production of 200,000 ounces annually, with a 10-year life span, Zelenski said. The project created 590 permanent jobs, he said.
“With this new mine, gold contribution to GDP will pass from 12 percent to 13 or 14 percent,” Prime Minister Luc Adolphe Tiao said yesterday. Burkina Faso is also working to change its mining code, Kabore said. Policies that take into account the effect of mining on the local population and introduce taxes for environmental restoration will be adopted in the first half of the year by lawmakers, he said.
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