Ecograf
On the rise: Tanzania is one of the best investment addresses in Africa
For many years, doing business in Tanzania was fraught with great difficulties for foreign raw material companies. Even gold giant Barrick Gold (WKN 870450) had to fight and did not settle a long-standing tax dispute with the government of the East African country until 2019. Since then, however, the situation has fundamentally changed, so that Tanzania is now one of the best investment destinations in Africa, according to the Absa Africa Financial Markets Index 2022. So a good prerequisite for the companies observed by Goldinvest.de that are active there!
The criteria set by the Absa report include market depth, access to the foreign exchange market and market transparency. In addition, there are the tax and legal environment, the capacity of local investors, macroeconomic possibilities as well as the legality and enforceability of standard framework agreements for financial markets. And according to the report, the country, which is said to be one of the fastest growing economies in the region in the coming years, met five of these six requirements well.
Tanzania's Deputy Secretary of State for Finance and Planning also recently reaffirmed the government's commitment to ensuring stability, continuity and predictability of the environment in which economic decisions are made to create a favorable environment for sustainable investment - extremely important conditions for international companies that want to operate in the country or already are.
Tembo Gold: Active again in Tanzania after a long break
Among the companies we observe at Goldinvest.de, this includes in particular the Canadian gold explorer Tembo Gold (WKN A2P9RS / TSXV TEM), which has been exploring its extremely promising project of the same name for a long time - with a break of several years. Even before this interruption, Tembo Gold had already drilled 26.0 meters with 22.8 g/t gold, 11.1 meters with 8.2 g/t gold and 25.9 meters with 3.1 g/t gold on the property, which is located in the immediate vicinity of Barrick Gold's Bulyanhulu mine with its deposits of 13 million. There is an ounce of gold.
And before the start of a new drilling campaign in the middle of the year in its core areas, Tembo concluded a spectacular deal with its much larger neighbor Barrick at the beginning of the year. For 6 million In the US dollar, the company sold some licenses, which are in the neighborhood of the Bulyanhulu mine but not the focus of Tembo's interest, to the industry giant. Barrick also acquired a 5.5% stake in Tembo and paid another 1.5 million for it. Dollar, which is to be regarded as a strong proof of confidence of the Canadian group.
In the meantime, the first results of the drilling carried out in June have been obtained and, among other things, 12.96 g/t gold has been detected! However, the real purpose of the drilling was to better understand the course of the basic geological controls in the licensing area and to optimally prepare the resource drilling planned for the coming year. They seem to have fulfilled this purpose. This makes a necessary intermediate step on the way to determining a future gold resource.
EcoGraf: Advanced graphite project Epanko
Also represented in Tanzania for quite some time is the Australian graphite company EcoGraf (WKN A2PW0M / ASX EGR), which also has a second mainstay (processing from natural graphite to battery graphite) in Australia.
Here, too, there were long delays after EcoGraf had already advanced the Epanko graphite project far. Because the profitability of the project was already proven years ago in even two feasibility studies and Epanko is also the only African graphite project that meets the strict investment requirements of the so-called equator principles. Which would also make it affordable for European institutions.
And after the long forced break in Tanzania, the management now apparently now sees the concrete chance that Epanko could actually be built. Because only recently, EcoGraf sent an unequivocal signal in this direction with the personnel reinforcement by the South African specialist for the construction and operation of mines Chrisjan Van Wyk.
The Absa Index examines 26 countries in Africa, with Tanzania ranked eleventh as it did last year. In the East Africa region, the country comes in third place behind Kenya and Uganda. Throughout Africa, South Africa, Mauritius and Nigeria are at the forefront. The improved conditions in Tanzania are apparently already paying off for both companies and will hopefully continue to pay off in the future.