Mineral Deposits (MDL on ASX) hits in Senegal
Senegal success as junior gets lucky
Robin Bromby -- The Australian
September 09, 2005
A LARGE gold deposit in a remote part of Senegal looks as if it was worth fighting for.
After 10 years of dispute and delay, with a cast of characters that included Robert Champion de Crespigny, drilling at the Sabodala prospect has produced what the new owner has described as "outstanding" results.
Melbourne-based junior Mineral Deposits has reported a number of high-grade hits in its quest to prove up a million ounce reserve.
One hole contained near-continuous mineralisation from 13m below ground to a depth of 101m. Others returned 57m at 4.76 grams a tonne and 18m at 14.34g/t -- results that would leave investors ecstatic if they occurred near Kalgoorlie.
The company is now on track to produce gold in 2007 with the comfort of owning 100 per cent of the project -- with the backing of the Senegalese Government.
Its drilling success ends a 10-year saga surrounding Sabodala -- one that brought another Australian junior, Paget Mining, to its knees.
Paget in 1994 signed a deal to buy 51 per cent of Sabodala from the French government body, Bureau de Recherches Geologique et Miniere.
But before the new mining licence was issued by the Government, BRGM joined forces with Mr de Crespigny's Normandy Mining to launch a new metals vehicle, LaSource. Sabodala was then sold into LaSource, leaving Paget out in the cold. Paget and Normandy fought it out, with the matter ending up in arbitration at the International Chamber of Commerce.
Meanwhile, a Senegalese company took matters into its own hands and started mining Sabodala without a licence.
In the end, Paget ran out of money. It is now a listed biomedical company Solagran. Normandy was taken out by Newmont Mining. The illegal mining stopped -- and then Senegal put the project up for tender.
Mineral Deposits won the race against competing bids from AngloGold, Newmont Mining, Gold Fields of South Africa, Placer Dome, Randgold and others.
But it wasn't just a case of plucky little Melbourne company beats global giants.
Mineral Deposits was already at work in Senegal on a mineral sands deposit and its managing director, Jeffrey Williams, already had many dealings with the country's mines minister and top officials.
"I knew them well," he said.
So well, in fact, that the Senegal Government asked Mr Williams to tender for Sabodala.
He makes sure that this relationship continues and makes frequent visits to Dakar.
Now Mr Williams is aiming at finishing drilling in early 2006, completing financing mid-year and to be getting gold out of the ground by next year.
Sabodala is located 450km inland near the Mali border.
