MENA Mining (IV): Morocco (1)

THIS POST WAS ORIGINALLY PUBLISHED JULY 09, 2011

MENA Mining (IV): Morocco (1)

In these short overview posts I am talking about the Kingdom of Morocco – the country that is strategically located, with coasts on the Atlantic on on the Mediterranean. All Internet resources note that Morocco is the home to 90+ mining companies that produce about 20 different mineral products. Mineral industry produces 35% of foreign trade, and about 75% of Morocco’s exports and 6% of the GDP. However, this industry is dominated by phosphates - 92% of all production. The country is rich in deposits of iron and non-ferrous minerals – lead, barite, manganese, cobalt, copper, coal, iron and zinc ores – plus uranium. 

In fact, extremely low volume of news comes from Morocco on the issue. This morning Google news search MOROCCO MINING resulted in 37 entries only. But this is more, as compared to 19 entries for MENA Mining. Just compare with 1,834 for AFRICAN Mining.... This adds more considerations to the potential of mining business?

A very detailed report on activities of mining companies in Morocco is presented at this page of Federation de l’Industrie Minerale (in French, but readable thanks to Google translate). Here is the mineral wealth of the country:

 Source: Ministry of Energy and Mines

A rather comprehensive report on mining industry in the country can be downloaded from the Website of the Ministry of Energy and Mines. 

 According to this report, (as of 2010 – but data relevant to 2009) there are:

4287 licenses issued, including

·                  Operating licenses: 563

·                  Exploration licenses: 3647

·                  Concessions: 77

It also has some statistical data on production:

Thus, the major developed minerals in Morocco are: phosphates, barite, salt, manganese and silver. Hence, here is a huge potential for other minerals.

No matter how important the phosphates are, a great attention is geared towards other mineral assets. For this purpose, the ONHYM - National Office of Hydrocarbons and Mines – is established.

• It represents the public interest in exploration and production of hydrocarbons and mineral resources.

• ONHYM ‘s mission is :

· To explore and exploit hydrocarbons and the mineral resources (except phosphates),

· Enter into partnership/joint venture with national and international companies in the oil & gas and mineral industry to explore its resources

· Conduct hydrocarbon and mining research.

ONHYM provides:

• Regional and detailed geology, metallogeny, geochemistry, geophysics

• Exploration Permits with good prospectivity

• Freely accessible rich database with GIS

• ISO certified laboratories support (chemistry, processing, etc.)

• Optimize exploration using advanced techniques: Remote sensing, hyperspectral imaging, airborne geophysics.

• Extensive prospecting (sampling, drilling, resource assessment)

• Ability to work with national, provincial and local authorities on environmental and social impact

In this English version of the website there is a lot of valuable information.

Managem is the largest private sector mining company in Morocco. This is the holding company for the mining projects of the ONA group; the following companies are managed:

- Cie Minière des Guemassa (CMG – zinc, lead and copper),

- Cie de Tifnout Tiranimine (CTT - cobalt),

- Samine (fluorspar)

- Soc. Metallurgique d’Imiter (SMI – silver)

- Cie Metallurgique Bou-Azzer (CMBA – cobalt recovery)

- Techsub (exploration drilling)

- Reminex (engineering/technology)

Just a very brief overview of minerals. Note: This is NOT a comprehensive report – just a pinpoint to some important (IMHO) issues.

Phosphate mining

Principal operator is the state-owned OCP Group (formerly Office Cherifien des Phosphates). According to the available data the proven reserves for phosphates are about 11bn tons; with probable reserves about 58 bn tons – this approximately one third of world. This impressive table is reproduced from thecompany's brochure:

All detailed information on OCP is provided in the corporate 2009 annual report.

Iron ore

Interesting to note, that exactly 100 years ago, in 1911, the Moroccan iron ore sparkled notorious ‘gunboat diplomacy’ precedent and the Agadir Crisis.German companies engaged with the French ones who claimed huge iron ore resources. That eventually led to the treaty of Fez and establishment of French protectorate over Morocco. As it obvious from the above Table, the production of iron ore is a small fraction, as compared to phosphates – and mostly used for domestic consumption. However, one should note that in the nearest proximity to Morocco there are two iron ore deposits in Algeria: Gara Djebilet and Mechri Abdelaziz with reserves of approximately 3 bn tons having 50%+ Fe.

Cobalt

Managem SA, - subsidiary of Omnium Nord African (ONA) conducts mining of cobalt ore at the Bou-Azzer underground mine located 35 kilometers (km) south of Ouarzazate in southern Morocco - the world’s only deposit where cobalt is mined as a primary product.

Copper

Odyssey Resources Limited - a Canadian exploration company holds an interest in several exploration permits in Morocco. Although historically there were a number of reports regarding these projects (example: TECHNICAL REPORT AND RESOURCE ESTIMATE ON THE ALOUS COPPER-SILVERPROPERTY MOROCCO For ODYSSEY RESOURCES LIMITED – very detailed description) – very little recent information on the progress can be found.

Gold

Maya Gold and Silver Inc. of Canada is developing the Amizmiz gold property, about 60 km south of Marrakech. Technical Report on the Aït Bou-Haddou Project has all relevant data, while corporate presentation has a detailed description, including some financial data:

British Agricola Resources plc has two gold exploration licenses in Tan Tan Province, Guelmin-Es Semara region of Southern Morocco. Ain Kerma Gold Prospect Geologist Report provides all necessary data.

Kasbah Resources Ltd. has 100% ownership of the Tamlalt gold deposit, located at the eastern end of the Moroccan High Atlas Mountains, about 300 km south of the town of Oujda. The Tamlalt gold deposit mining property is covered by eight exploration permits covering a total surface area of 128 km2.

Uranium

Morocco’s three main areas under investigation include Haute Moulouya, Sirwa (Zgounder) and Wafaga. This data is reproduced from a very detailed presentation by ONHYM - Uranium Exploration in Morocco :

There are deposits of uranium, some of them include:

·                  Wafaga (1977-1982): Resource - estimation of 500 tons at 700 ppm U3O8

·                  Azgour Mine: Extracted 1 ton of uranium in 1957-1960

·                  Argana: Geological resources are estimated to 1.53 tons of uranium and 58.4 tons of copper

Toro Energy Ltd. of Australia (a uranium explorer formed through the amalgamation of the uranium interests of Oxiana Ltd and Minotaur Exploration Ltd) had signed MOU to acquire uranium interests in Morocco. Research shows that the latest data about these activities related to 2007; the latest corporate presentation does not mention Morocco – probably the company suspended the project. It was also mentioned that in 2007 Areva signed MOU to study feasibility of uranium extraction from phosphates in Morocco

That allows to make an assumption that currently there are no visible foreign entities involved with uranium in Morocco.

Tin

Kasbah Resources Ltd. has an exclusive right to acquire a 100% interest in the Achmmach Tin Project - one of the largest undeveloped tin deposits in the world. As of August 10, 2010 the project has inferred resource of 4.8 million tons of tin. The corporate presentation, besides detailed analysis of tin market has description of the project:

Zinc

Douar Hajar Mine, (the Guemassa massif 35 km, south of Marrakesh) is the largest mine operated by Compagnie Minière des Guemassa (CMG).