By Toby Collins

October 30, 2011 (LONDON) – The Sudanese government and 50 private companies signed contracts to explore gold and other minerals in six states on Sunday.

A Sudanese merchant weighs gold in al-Shirik, Sudan (AFP)

The signing ceremony, held in Khartoum, was attended by President Omar al-Bashir; Minister of Minerals, Abdel-Bagi Aljailani; governors and representatives from gold exploration and mining companies.

Aljailani announced that more than 50 contracts were signed to permit mining in Qadarif, North Kordofan, South Kordofan, Kassala, Red Sea and Northern and Nahral-Neil States.

He announced that three Jordanian, Chinese and Turkish companies have started gold production, increasing the number of gold producing firms to seven. He further said that the construction of a gold refinery would begin in 2012.

In 2010 Sudan signed contracts with five mining companies in response to what the then Mining and Energy Minister, Al-Zubair Ahmed Al-Hassan, described as a “gold rush.”

With the secession of South Sudan in July, Khartoum lost access to a large proportion of its revenue stream in the oil fields which are now the other side of a state border – diversification is therefore essential to sustain the faltering Sudanese economy.

Sudan has been a significant gold producing country since 1991, after signing an exploration contract with the French BRGM in 1990, one year after general Bashir’s putsch.

The joint venture, Ariab, exported just 982 kg in 1991. However, its production has increased to an average of over 3 tons per year since 1999.

Speaking to parliament in April 2011, Bashir said gold revenues in 2010 reached US$1.4 billion and pledged to double it to US$3 billion in 2011, to compensate the loss of oil revenue after the secession of the South Sudan.

(ST)