AFRICA — Fighting in Sierra Leone foils Nord’s production efforts

Nord Resources (NRD-N) has broken off negotiations with the government of Sierra Leone for the reopening of the Sierra Rutile operation after a rebel offensive on the capital city of Freetown plunged the West African nation back into civil war.

The attack came as a surprise, as the rebels appeared vanquished in March 1998, when ECOMOG forces (the military arm of the Economic Community of West African States) took control of the country. However, many of the rebels, who call themselves the Revolutionary United Front (RUF), fled east to Liberia to gather strength for another round.

The RUF has concentrated its recent attacks on Freetown. The region around the Sierra Rutile mine, in southern Sierra Leone, is undisturbed, says Rex Loesby, Nord’s director of investor relations. Nonetheless, plans to return the mineral sands operation to production after four years of civil war were suspended following the recent attack.

At its peak, Sierra Rutile was one of Sierra Leone’s largest employers and represented half of the country’s foreign exchange earnings. It is also said to be the largest and the highest-grade natural rutile deposit in the world. Natural rutile is almost pure titanium dioxide, with a small amount of ilmenite impurity.

Ownership of the mine is split equally between Nord and Consolidated Rutile. The former had been trying to raise financing for a reopening.

“We’re in no position to resume operations until this all gets settled,” says Max McGarvie, Nord’s chief executive officer

Meanwhile, ECOMOG has beefed up its troops to counter the rebel offensive, At presstime, RUF rebels had offered a cease-fire agreement, which was refused by ECOMOG and the ruling government.