Shares digital

Côte d’Ivoire hopes that Randgold Resources’ (RRS) plans to develop the Tongon gold project will convince the world’s major metals and minerals producers that the country is safe to do business following a civil war between 2002 and 2007.

Leon Monnet, Ivorian minister of mining and energy, told Shares that Tongon will become one of the West African country’s most important mining projects when it starts production in 2010. ‘Randgold has stuck with Côte d’Ivoire through its five-year crisis. I hope this commitment will attract investors in the country,’ he said.

Brock Salier, an analyst at stockbroker Ambrian, said the country has ‘lots of undeveloped mines and really good geology’. Several gold projects have already been greenlit, including Randgold’s Tongon deposit, which holds an estimated 3.1 million ounces of gold. Cluff Gold (CLF:AIM) recently started production at the Angovia mine, while Tata Steel has a joint venture with state-owned mining group Sodemi to develop the Mount Nimba iron ore deposits.

Nickel could become the country’s main attraction, Salier claimed. Xstrata (XTA) owns the Touba-Biankouma nickel project in Côte d’Ivoire. The project has been under force majeure since civil unrest started in 2002 but Xstrata said it was ‘closely monitoring’ the country’s security situation with a view to potentially restarting operations.

Shares says: Opinion is still divided on political stability but the presence of Tata will no doubt attract more mining activity in Côte d’Ivoire.

BUY Xstrata

HOLD Cluff Gold, Randgold Resources

by: Dan Coatsworth