Sarama Resources (TSXV: SWA) has been dealt a significant blow as the Ministry of Energy, Mines and Quarries of Burkina Faso has officially revoked the company’s rights to the highly promising Tankoro 2 exploration permit. This decision, conveyed through a formal notification, has cast a shadow over Sarama’s multi-million-ounce Sanutura Project, which hinges on the exploration of the Tankoro Deposit.
The Tankoro 2 permit, wholly owned by Sarama, boasts an impressive mineral resource of 0.6 million ounces of gold indicated and 1.9 million ounces inferred. The Sanutura Project’s preliminary economic assessment, scheduled for imminent release, has been abruptly suspended following the receipt of this notification.
The company’s shares declined by more than 45% following the news, falling to an all-time low for the company.
Sarama has been actively engaged in the development of the Tankoro 2 permit for the past 12 years. Notably, its mineral tenure was reaffirmed with the permit’s grant on November 24, 2021, by then-Minister of Energy, Mines and Quarries, Minister Dr. Bachir Ouédraogo. The company further demonstrated its commitment by promptly paying the required issuance fees on November 29, 2021, as detailed in a news release on December 1, 2021.
According to Burkina Faso’s legal framework, the government issues an arrêté (or license certificate) following the grant of an exploration permit, as part of an administrative process. Sarama has successfully navigated this process on multiple occasions, with the most recent instance being on August 3, 2023, for the Ouangoro 2 exploration permit.
The sudden notification from the Ministry of Energy, Mines and Quarries stating that the company’s application for the permit was unsuccessful has left Sarama in a state of disbelief. This decision is at odds with and contradicts formal correspondence previously received from the government. Sarama vehemently opposes the withdrawal of its rights and intends to explore all available avenues for appealing this decision.
Despite this setback, Sarama retains full ownership of its other issued permits in Burkina Faso, including the Djarkadougou 2 exploration permit, which was reissued on July 30, 2021. Additionally, the company maintains an 18 percent interest in the Karankasso Project JV, where an inferred mineral resource of 0.7 million ounces of gold is located.
Information for this briefing was found via Sedar and the sources mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
