Bottom Is In, page-88

IMO there are, and generally remain, two types of risk in Africa.

First is that violence, war, regime change or simply the tyranny of logistics to some of these deposits are prohibitive. DRC carries this risk as do many African countries. This risk is often not catastrophic but incremental, and such risk very much depends the country operating in and the geographical location of the project relative to said trouble. My stance is well known, I don't think the violence or terrorism in BF will bring about regime change or disrupt WAF's mining operation given it's location. Many other gold mines operating in the bad parts of BF, Mali and Cote D'Voir etc are evidence that such violence and terrorist activities do not materially effect gold mining activities or profitability.

The second risk is what scares me, project nationalisation. Be it via taking the mine off it's owners, the more usual demands of higher and higher free carried interest for the government, or increased royalties and taxes etc, this type of risk can come out of nowhere and is catastrophic for one's investment. DRC, Zim, Sth Africa, Zambia recently, Tanzania a couple of years ago... the list is long and sad. This risk DRC has in spades. Anglo did not spend neary $100M on a deposit adjacent to their on-going mine operations to then simply walk away half way through because of the lower gold price. To voluntarily walked simply defies all logic, Anglo are long-game players.

West Africa, specifically Ghana, Mali, Cot D'Voir, BF have a very solid reputation for not changing the ownership or investment rules, and that has served them very well as companies continue to invest, build mines, provide many jobs and much revenue to the governments concerned. My stance on this is also well known, the unfortunate terrorism/violence has attracted the attention and financial support of the west. Support that the BF government desperately needs to maintain control and push back against the spread of violence. Strategically it just doesn't make sense to alienate the west and stop their support by changing the rules and shitting on western companies working in BF. Don't bite the hand that feeds it, the companies providing jobs and government royalties, or the western governments happy to provide aid and assistance.

As they say, it's an ill wind that blows no good. I'm happy with my BF sovereign risk investment, the DRC however is too risky for even my thick skin despite very attractive geology.

Cheers