ESSAKANE Shutdown Costs in 2027/2028 In my mining career, I’ve had some experience with mine closures and I’d like to elaborate and share some additional thoughts related to the subject matter.
IMO, there is no way that the Burkina Faso government would want to jeopardize the relationship with their outstanding corporate citizen JV Partner IAMGOLD with only a few years remaining in ESSAKANE’s mine life.
In my experience, when a mine is facing the end of its mining life, there looms significant shutdown costs including maintenance and restoration costs of the environment written in the contract that must be absorb by the operating mining company. This liability may become a significant issue especially for a foreign company. A company doesn’t just walk without fulfilling their contractual mining responsibilities.
The Burkina Faso government must be well aware of these expensive closing mining costs that would be in the millions of dollars so why would they even contemplate breaking the contract!
Under these circumstances, the government will do whatever it takes to ride out the existing JV agreement and get as much as they can extract from the legal arrangement. These issues are costly and must be resolved between parties.
Does anyone have any comments regarding the impact of shutdown costs including maintenance and restoration costs of the environment?