A Canadian mineral exploration company, Thor Explorations, aims to bring Nigeria’s first large-scale gold mine online in early 2020, as the West African country seeks to diversify its economy away from oil and gas, Reuters reported.
“Thor is currently developing the country’s most advanced gold mine,” said Segun Lawson, the company’s CEO, revealing that, equipped with a mining and exploration license, Thor Explorations was considering options for raising $72 million to kick-start production.
Following the commodity price crash of 2015-16, the World Bank in April 2017 said it was providing funds to help the Nigerian government develop its neglected mining sector.
“Thor is currently developing the country’s most advanced gold mine,” says Segun Lawson, the company’s CEO, revealing that, equipped with a mining and exploration license, Thor Explorations is considering options for raising $72 million to kick-start production.
Thor Explorations Segilola Gold Project is located in Osun State. According to Lawson, the mining project is envisaged to produce gold in the first quarter of 2020 and has probable gold reserves of around 500,000 ounces.
Lawson bought the Segilola project in 2016 for $3.1 million in cash plus $6 million in Thor shares. He expects rapid payback on the investment once production starts.
Thor Exploration’s stock has climbed 50 percent this year while gold prices have only risen around 1 percent.
The World Bank has provided around $150 million to the Nigerian government to kickstart non-oil sectors after the economy was hit by a fall in oil prices, which are now recovering.
The Bank’s funding is meant to help the government formalise the artisanal mining sector, improve environmental practices and support infrastructure improvements for larger scale mines.
Mining provides only around 0.5 percent of GDP, according to World Bank figures, as the sector has struggled to attract foreign investment and to meet domestic needs, forcing costly imports.
The oil sector accounts for an estimated 8.7 percent of GDP and is critical for foreign exchange and fiscal revenue.