Burkina Faso: Inaugurates First Gold Refinery RAFFINOR-BF

• Burkina Faso has launched its first gold refinery, RAFFINOR-BF, in Ouagadougou, inaugurated by military leader Ibrahim Traore.
• The refinery, costing over $19 million, has an initial annual capacity of 164 tonnes and aims to process gold to 99.9% purity.
• This initiative is part of a national strategy to reduce dependence on raw material exports and establish a complete gold value chain domestically.
• The government plans to expand the refinery's capacity to 515 tonnes and position Burkina Faso as a regional gold-refining hub.
• Increased state control over the mining sector is also intended to combat illicit gold trafficking, which has been linked to financing armed Islamist groups.

The inauguration marks a pivotal moment in Burkina Faso's strategy to gain greater control over its valuable mineral resources and retain more of the economic benefits within the country.

Burkina Faso has officially launched its inaugural gold refinery, RAFFINOR-BF, marking a significant stride towards economic self-reliance. The facility, situated in the capital city of Ouagadougou, was inaugurated on Monday by military leader Ibrahim Traore, who hailed the event as a "historic milestone" in the nation's pursuit of economic independence. This initiative is a core component of the administration's broader strategy to diminish its reliance on the export of raw materials.

The RAFFINOR-BF refinery represents a substantial investment, costing over $19 million to establish. It boasts an initial annual refining capacity of 164 tonnes of gold, designed to process dore gold into fine-gold bars with a purity of 99.9 percent, meeting international standards. The project was financed by the state through the National Precious Substances Company (SONASP), in collaboration with various private-sector partners.

This move by the Burkinabe government underscores a profound ambition to process all of its metals domestically and establish a complete gold value chain within its borders. Burkina Faso stands as Africa's fourth-leading gold producer, trailing Ghana, Mali, and South Africa, with projections from the World Gold Council indicating an output exceeding 94 tonnes by 2025. Despite its significant production, the landlocked nation has grappled with the challenges of regulating its informal mining sector, which is plagued by weak enforcement, persistent insecurity, and rampant illicit gold trafficking.

The administration led by Ibrahim Traore has actively sought to increase state involvement in the mining sector since coming to power. This includes an increase last year in the state's ownership stake in mining projects, from 10 percent to 15 percent, alongside the creation of a national gold reserve. A critical aspect of this policy shift is the government's concern that illegally traded gold has been used to finance armed Islamist groups operating within the country, making the formalization of the gold sector a matter of national security.

The establishment of RAFFINOR-BF is envisioned as a catalyst to transform Burkina Faso into a prominent regional gold-refining hub within the Sahel. Minister of Mines, Yacouba Gouba, articulated plans to significantly expand the refinery's capacity in the coming years, aiming for an impressive 515 tonnes. This expansion is not only intended to accommodate domestic production but also to process gold sourced from other nations in the region, further solidifying Burkina Faso's role in the regional gold value chain.

This strategic initiative reflects a broader governmental philosophy articulated by Mr. Traore, who emphasized that the country is "taking back the keys to our own house." The underlying sentiment is that Burkina Faso's gold should no longer primarily generate added value for external entities while its own populace remains in need. The RAFFINOR-BF launch in Ouagadougou is a tangible manifestation of this commitment to national economic empowerment and enhanced oversight of the nation's precious resources.

Lawyers advising mining companies, commodity traders, or investors in Burkina Faso and the broader Sahel region should monitor the regulatory implications of increased state control over the gold value chain, potential new compliance requirements for local processing, and enhanced scrutiny on gold sourcing to combat illicit trade and financing.

Source: Original reporting via Premium Times