Guinea orders AngloGold to shut Siguiri over trivial matter

Some military junta chiefs sure can be sticklers for etiquette.

Take Guinea’s Captain Moussa Dadis Camara.

The young junta chief demanded that AngloGold Ashanti (AU-N, AGD-l) close its Siguiri gold mine in the country because one of the company’s directors had skipped a meeting of mining executives that Camara had convened.

“The director of [the company] is not superior to all the other directors who are here,” Reuters news agency quoted Camara as saying in a state television broadcast.

AngloGold’s Siguiri is the biggest mine the country. AngloGold has a 85% stake in the mine and the state holds the remaining 15%.

“Discussions are underway between AngloGold Ashanti and the Government of Guinea,” Alan Fine, the company’s Johannesburg-based public affairs manager, said in a telephone interview. “There is a meeting scheduled later this afternoon between my colleagues in Conakry and the president.”

Fine told The Northern Miner that the director who had missed the meeting was one of AngloGold’s operational managers. “Obviously he has a lot of work to do at the mine and I’m sure it wasn’t known that his particular presence would be missed.”

The junta seized power December 23 after the death of 74-year-old president Lansana Conte, who had ruled the country for 24 years.

NGOs call the mineral-rich country (bauxite, alumina, gold, diamonds) one of the poorest and most corrupt nations in the world.

Camara, a 45-year-old former army captain who took power after Lansana Conte’s death, had convened the meeting.

“The government has been trying to get to grips with the economic and management issues of the country and we have been in conversation with the government at various levels and as far as I know that would have been the general purpose of the meeting,” Fine explained.

Camara has vowed to fight corruption and improve living conditions in the impoverished West African country.

After taking power, Reuters reported that Camara said his government “would review the state’s contracts with resources firms, a line that was later toned down.”

When asked about what changes might be in the offing, Fine did not offer any specifics. But he said “our preference would be that any changes are balanced and mutually acceptable.”

“It is a country where private sector mining is a relatively new thing, well, maybe a decade to a decade and a half old, and there was some uncertainty in the couple of years before the death of President Lansana Conte,” Fine noted.

Since coming to power Camara has said that national elections will be held before December 2010. But polls could be held sooner.

“Obviously we’re hoping that the new government, which has promised elections, will hold those elections within a reasonable period of time and that a normal democratic system will be operational by then because in our experience democratic political systems tend to be more stable,” Fine said.

When asked if the incident had soured AngloGold’s view of political risk in the country, Fine said the company faced challenges at all of its operations.

“We’re a mining company and we face challenges everywhere we operate, from Guinea to Colorado in the U.S. and everywhere in between. That is one of the facts of life of operating any mining company.”

But he conceded he hoped that the mine closure would be resolved “quite soon.”

“In our view Siguiri is a very good asset with a lot of potential and it’s an operation we would very much like to develop to the best of our ability so we are hopeful we will be able to sort this out.”

Attributable production from Siguiri in the fourth quarter of 2008 totalled 81,000 ounces of gold, with full-year production of 333,000 ounces, Fine said.