Mining deposits of Ngaoundal and Makan: battles between Chinese and Australians for control of bauxite

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Mining deposits of Ngaoundal and Makan: battles between Chinese and Australians for control of bauxite

The cancellation of the Memorandum of Understanding signed between Sonamines and China Railway N°5 Engineering Group Co, has brought to light a latent war for the control of one of the most important mining deposits in Cameroon.

Cedrick JIONGO March 1, 2022

**riel Dodo Ndoke did not want his decision to pass in silence. Quite the contrary! It was at the national post that it was read, before being widely shared on all web platforms. On February 21, the Minmidt took it upon itself to cancel the memorandum of understanding (MoU) signed between Serges Hervé Boyogueno, CEO of the National Mining Company (Sonamines) and Zhao Shihai, the boss of the China Railway 5 Engineering group Co (Crec5), a subsidiary of the Chinese giant China Railway Group LTD. The member of the government justifies his decision by multiple shortcomings that would contain this agreement, without really being precise. “The act thus incriminated is canceled for violation of Cameroonian mining legislation in terms of the allocation of mining titles, the conclusion and signing of contracts, pre-contracts,

Created in December 2020 by President Paul Biya, Sonamines' mission is to develop and promote the mining sector in Cameroon, as well as to manage the interests of the State in this area. Through this MoU, the state-owned company intended to forge its very first strategic partnership to exploit the bauxite deposits of Ngaoundal and Makan in the Adamaoua region. Pending the signing of a more binding agreement, Sonamines undertook through this MoU to make available to its partner "all the information, data, documents and information necessary for the execution of its mission, to ensure a frank collaboration with Crec 5, on all aspects relating to the mining and industrial projects to be carried out…”. To fulfill its part of the contract, the company had already submitted an application to its supervisory ministry to obtain an exploration permit for the two mining sites mentioned above. “After this MOU, the binding agreements had to follow, the last step before the actual start of the work in the field. All this is obviously conditioned by obtaining all the titles relating thereto ”indicates a source close to the file.

Makan and Ngaoundal, lands of covetousness

Taken aback by the ministerial act, Sonamines acknowledges the blow and categorically refuses to comment. But according to our information, to fully understand what is happening, we have to go back to the period when the current director general of Sonamines, Serge Hervé Boyogueno, held the position of deputy director of mining activities. “He is the one who knows the mining map of the country from gold to quarries to all the mineral resources you can imagine. He is also the one who knows the geography of the operators in this sector in Cameroon, their real technical capacities and their financial standing, he is also the one who prepared the contracts, pre-contracts, conventions, exploration or exploitation permits. So he masters the field like no one else, ”explains a source familiar with the matter.

Having become Director of Mines, many operators will benefit from the granting of exploration permits for several minerals. Indeed, in 2018 after the withdrawal of Cameroon Aluminum (CAL), the Australian mining junior had inherited the exploration permits for the Minim-Martap, Ngaoundal and Makan deposits. in the Adamaoua region for a period of 3 years. With a potential estimated at more than 2 billion tons of bauxite, these Cameroonian deposits are ranked among the largest in the world, at levels comparable to those of the bauxite plateaus of Guinea, which holds more than 2/3 of the world's reserves. ore. Only, 3 years later, the operator will submit to the Minmidt a request for an operating permit on the Minim Martap site. For the other two, Camalco is instead requesting an extension of exploration for a period of two years. Request naturally rejected by the member of the government because of the non-renewable nature of this permit, but who is ready to make an exception for the company on one condition: "the extension may be granted, on an exceptional basis,

Unfavorable balloting

Contrary to what might seem, Camalco has not yet managed to convince the State of Cameroon of its real ability to operate the Minim-Martap mine. Meeting in November 2021 at the Bengo hotel in Ebolowa, to study the company's technical exploitation project on this deposit, opinions are divided. Around the table, officials from Sonamines and those from the Ministry of Mines. Sonamines will argue about the incapacities of the operator and will go on to demonstrate Camalco's shortcomings and shortcomings. For its part, the ministry will not allow itself to be counted. The debates are lively and stumble on the refusal of Sonamines to renew the mining agreement. The outcry of officials from the Ministry of Mines will lead the Secretary of State to this ministerial department to reframe each other. “We now have to get used to the independent contributions of Sonamines. It is a company with public capital which manages the interests of the State, it is not a question of a direction of the ministry of Mines , slice Fuh Calistus Gentry who calls at the same time the ones and the others to avoid to the country the mistakes of the past.

At the start of the meeting, Sonamines, the Inspector General and the Director of Mines expressed serious reservations about the technical presentation made by Camalco on its passage to Minim Martap. In fact, all in chorus, question the existence of the audit brandished by the company, the quality and the expertise of the firm that carried it out. For many managers, this audit is not reliable and contains many deficiencies. "Things happened as if Camalco had gone into a room and had laid his document", explains a source familiar with the matter. This will lead the Secretary of State to recall that “the audit must be carried out by an approved and recognized firm”.

In addition to doubts about the sincerity and regularity of the audit, the finding of the absence of an environmental compliance certificate presented by the company will also be noted. In the meantime, the minister will ask Camalco to provide him with the documents needed to finalize the mining agreement file. This is the audit of the work carried out by a firm approved by the State, the signing of a binding agreement with the Chinese MCC-CIE which would include in particular the acquisition of shares by MCC-CIE in the capital of Camalco with a view to justifying the technical and financial capacities, the overall feasibility study of the project taking into account all the mining and infrastructure components; the plan with the implementation costs, restoration and closure of the mining site and the schedule for carrying out feasibility studies for the actual construction of the bauxite processing unit. At the time of going to press, the Australian company has yet to submit said documents to the government. Worse still, his request for an environmental compliance certificate was rejected by the Minister of the Environment, Nature Protection and Sustainable Development (Minepded). “In view of the importance of the above observations, your report cannot be approved as it stands. Also, I ask you to review it in the light of the said observations and to return to me for examination ”wrote Nana Aboubakar Djalloh, Minister Delegate to Minepded, in a correspondence addressed on December 13, 2021 to the CEO of Canyon Resources.

And to add to the misfortunes of the Australian mining junior, an organization bringing together within it the living forces and civil society entities of the district of Martap in the department of Vina, will, at the end of December, write to the head of the State to oppose the continuation of the project. A succession of unfortunate events which, if they manage to exclude Canyon Resources from the exploitation of Minim Martap, would in fact exclude it from Makan and Ngaoundal.

China on the lookout

Road partner of Sonamines, Crec 5 presents itself as a serious alternative to the realization of mining projects in Cameroon. For Ngaoundal and Makan, the company has made a commitment, through the MoU, to mobilize all the financing relating to the implementation of these two projects, including providing the matching funds from Sonamines. It also pledged to facilitate the participation of major Chinese companies and agencies in investment, financing and project start-up and operation where appropriate. “It is not excluded, given the financial capacity, that the company is also eyeing Minim Martap, in the event of the Australians running out of steam.

Beyond this battle of interest, it is a first missed meeting for Cameroon through Sonamines which is taking shape. Because the act of cancellation could well be perceived as a bad signal with these investors. At Sonamines, we denounce a quasi complacency of the minister for the Australian company which a priori experiences difficulties in making the project work. “Some ministry officials are therefore holding Sonamines back to prevent its permit application files from moving forward on these mining sites, so as to give them back to Camalco when its file has finally been completed. Is this even fair or even understandable when it comes to state enterprise? asks our interlocutor.

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