A ROCKY FUTURE 30 METERS DOWN--MORE THAN GOLD IN

UNCLAS BAMAKO 000161 SIPDIS SIPDIS E.O. 12958: N/A TAGS: EMIN EFIN ECON ML SUBJECT: A ROCKY FUTURE 30 METERS DOWN--MORE THAN GOLD IN MALI'S HILLS ¶1. SUMMARY: The Kayes region of western Mali offers significant mining opportunities beyond the gold reserves already under production, but for the moment exploitation rests with artisanal miners producing small quantities of Garnet, Prehnite, and Agate. The Ministry of Mines has encouraged these small operators to form an organization to consolidate shipments of raw stones for finishing in Thailand. The organization now hopes to buy equipment to allow them to access better deposits in deeper soil, as well as process the stones and add value locally. In addition to semiprecious stones, significant mineral deposits in Mali include iron, manganese, uranium, and bauxite, as well smaller quantities of lead and zinc. ¶2. Western Mali's gold deposits have proven to be a boon to the Malian government's bottom line (septel),but other significant mineral deposits have yet to be exploited in industrial quantities. Mali is already Africa's third largest exporter of gold, but other less glamorous materials, ranging from iron to uranium, exist in abundance. In addition to smaller but commercially viable deposits of lead, zinc, diamonds, and uranium, the Ministry of Mines estimates exploitable reserves of the following: Bauxite--1.2 billion tons of reserves Iron--1.36 billion tons Phosphates--20 million tons Manganese--100 million tons Limestone--122 million tons Marble--60 million tons ¶3. With the exception of the phosphate deposits found in northern Mali, the majority of these deposits are located in western Mali, south and south west of the capital of Bamako. Exploitation of these deposits remain underdeveloped in large part because the infrastructure in the Kayes region is poor. Only a limited network of unpaved roads, an inefficient narrow gauge railroad, and either expensive and limited - or nonexistent - electrical power generation sources are in place, none sufficient to support mining efforts without additional investment. ¶4. For now, mineral exploitation rests with small scale miners focusing on semiprecious stones. The Ministry of Mines has helped by spurring the formation of a collective to consolidate shipping and finishing costs. The "Integrated Development Association of Yelimane" (AIDY) sends out ten 20 foot containers per year to Thailand, mostly of bucket-loads of Prehnite (a green, semiprecious stone useful in jewelry or for collectors),Garnets (not the traditional red stones, but mostly varieties of Melanite, of interest to collectors, with some naturally occurring crystals reaching the size of baseballs),and agates of various colors (useful for jewelry or crafts after cutting and polishing). Association members complain that margins are limited by high shipping and finishing costs, but note the market seems to soak up nearly all of what they can dig out of the ground. Many of the deposits start at 30 meters below the surface, and miners are looking for equipment to help them reach higher quality deposits deeper underground. The association is also looking for polishing and grinding equipment to finish stones in Mali and add further value by manufacturing jewelry locally. ¶5. COMMENT: Infrastructure limitations will continue to limit the attraction of industrial-sized operations while capital and equipment costs will inhibit smaller producers. However, with the race for access to raw materials in Africa picking up speed, it is unlikely Mali-and its occasional baseball-sized garnets-will be overlooked for much longer. McCulley