market overview, page-160

8horse

Thanks for bringing this to our attention. I was not aware that Mali were also putting their hand out for more of the golden cake.

Some of the measures that the DRC has implemented already apply in Mali, ie a 10% government free carried interest in each project (its actually 20% in respect of Syama), an increase in the tax rate from 30% to 35%, which is what Mali and Ghana introduced a few years ago. DRC wants to up the royalties of the various commodities mined there, not sure if that will be different to what Mali already imposes for gold. The additional modification is to have a super profits tax of 50% where the commodity price has risen 25% above what was used in a definitive feasibility study. I think RSG used a USD1200 gold price in its DFS, so the super profits tax (should Mali introduce one similar to DRC) would only come into effect on profits derived above USD1500. We seem to be a long way from USD1500 and given the metrics of Syama there is scope for substantial share price appreciation once the new underground mine is fully operational. There is no point in worrying about future lost profits from a potential super profits tax when those profits may be years away.

But I do take your point seriously that Africa has a lot of country risk, and I would therefore like to see John Welborn giving more focus to investing in other regions (especially Australia), give up the exploration tenements in Egypt as far too risky, and change the name of the Nafolo (means treasure in the local language) gold deposit to something more neutral (just call it mine N0. X).

These measures look less damaging then the thread of Ebola that was raging in west Africa when I was holding RSG shares. It is in the interest of the Mali govt not to kill the golden goose.

loki