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10 things to know about gold mining in Africa.

Whether you are an investor who wants to know about gold mining in Africa or you are just someone looking for knowledge on gold mining in Africa. This article will satisfy your curiosity as it exposes you to new knowledge about the gold mining industry in Africa. 

Gold is one of the rarest elements in the world. It makes up just 0.003 parts per million of the earth’s crust. Despite its rareness, Africa has an abundance of this element.

If you are wondering why gold is so precious, it is because of its uses. Gold has been used as far back as the 1870s where it was used as an exchange for goods and services. 

Ancient Egyptians used gold to craft jewelry. Even today, we still use gold to craft jewelry and other objects used for decoration. 

In fact, about 50% of gold produced worldwide goes to the production of jewelry, 40% goes to investment, and 10% in industry.

Gold mining in Africa

Gold mining is the process of extracting gold by mining. 

Africa has a strong history in gold mining, just like other mineral resources, Africa has gold in abundance. 

The gold mining industry is a huge revenue generator for Africa countries yet there is still huge potential for investors and anyone really as miners keep discovering more gold reserves. 

Miners use different methods to mine gold from rocks. Some of these methods include panning, dredging, sluicing, hard-rock mining, and by-product mining. 

Countries like South Africa where gold mining is important to the economy use the hard-rock mining method, this is because it is the most effective method, and gold reserves are located in deep underground rock. 

The hard-rock method involves three important steps,

Exploration.

This involves the location and evaluation of gold. There are several methods involved in the exploration process. 

There is the survey method, where miners try to identify conditions indicating the potential of gold. 

There is also drilling which is done only when the conditions identified in the survey method look promising and there is a clear possibility of gold. 

Lastly, there is the seismic survey which is based on shock waves produced by a small explosive detonated around the area of the survey. The wave will help indicate the existence of gold in that area. 

Extraction 

Extraction involves removing the gold deposits from the rock or ground. There are also two types of extraction which are surface mining and underground mining. To get the large gold deposits, miners go for underground mining. 

Beneficiation 

This is the processing of the gold to separate it from waste. Before beneficiation, the gold deposit will be reduced in size through a process called crushing. 

There is a lot more that goes into these three mining methods, it is quite a lot of work and it takes months before finally getting gold that is refined and used commercially. 

Back to the reason you’re here. 

Here are ten things you should know about gold mining in Africa

Gold was first discovered in Africa in South Africa .

No one would mention gold in Africa without mentioning South Africa. The country has a very strong history in everything gold mining. 

In between the years 1800 and 1889, different gold discoveries happened along the line. The first discovery of gold in South Africa was recorded in 1852 in the Pardekraal farm by an English miner J.H. Davis.

Although there were other minor discoveries after that, another significant one happened in 1884 by a Dutch explorer named Jan Gerrit Bantjes. 

Jan Gerrit Bantjes was the original discoverer of the Witwatersrand reef in June 1884. Although controversies ensued later that the gold reef discovery should be attributed to a British named George Harrison. 

The attempt to hand over the claim to Harrison was one of the factors that led to the Anglo Boer war in 1899. 

The discovery of gold led to the development of one of the largest city in South Africa.

After Jan Gerrit Bantjes discovered the gold reef, news quickly spread across the continent to countries like. They quickly started migrating and gradually Johannesburg was developed into the biggest city in South Africa 

Ghana is the largest gold producer in Africa.

South Africa used to be the largest producer of gold in Africa until 2019 when Ghana took over. Ghana overtook South Africa to become the largest gold producer in Africa. 

It was recorded that Ghana produced 142.2 tonnes of gold that year and South Africa produced 118.2 tonnes making them the second-largest producer in Africa. 

Not only did this make corporate gold mining companies like AngloGold Ashanti shift focus from South Africa to Ghana but also made Ghana’s deposits cheaper. 

The world largest known gold reserve is the Witwatersrand Basin.

The Witwatersrand Basin in Johannesburg, South Africa is the world’s largest known gold reserve. It has produced over 40,000 metric tons of gold that is 1.5 billion ounces. 

Names like Jan Gerrit Bantjes and George Harrison come up when we talk about the history of the gold reef in the Witwatersrand Basin. 

The largest gold mine in the world is the South Deep gold mine in South Africa.

A gold mine is where gold is mined and the largest gold mine in the world is the South Deep gold mine in the Witwatersrand Basin. 

It is located about 45km south-west of Johannesburg, South Africa in the Witwatersrand Basin. 

It might interest you to know that the South Deep gold mine is the seventh deepest in the world. It is over 2000m depth below the surface

  • The biggest operating gold refinery in Africa is the African Gold Refinery (AGR) in Uganda 

Uganda is one of the countries with the least developed gold reserves. There are unlimited natural resources and gold is one of them but it is poorly managed. 

However, the country has done well for itself by building the biggest operating gold refinery in Africa. According to data, the refinery has the capacity to refine up to 219 trillion gold a year. 

Since its founding in 2014, the AGR has offered refined gold of its highest quality. The Aldango refinery in Rwanda comes second in operation. The refinery can process up to 73 trillion a year. 

  • Gold production in Africa is growing stronger despite Covid 19

In 2019, Africa recorded strong growth in gold production but by the second quarter of 2020, there was a drastic drop in gold production as well as export due to the coronavirus lockdown across the world. 

South Africa suspended operations in 35 out of 56 gold mines in the country and Ghana’s production reduced by almost 8% by the end of 2020.

The good news however is that the gold mining industry is gaining its feet again. Statistics have shown that gold production especially in Western African countries like Ghana will increase by 2.7% in 2021. 

  • Gold is among the top 3 most exported commodity in Africa

Africa is blessed with so many resources and these resources are exported to boost the economy of the continent. 

Gold alongside diamond and oil are the top three most exported commodities in Africa. Ghana earns over 6bn dollars from mineral exports in 2019. 

  • Gold was once the largest part of South Africa’s economy

The discovery of gold in South Africa played an important role in the development of the country’s economy. In the early days of gold mining in South Africa, the industry was able to attract wealth and immigrants from around the world. 

It also provided enough revenue to complete federal projects like constructing bridges, repairing roads, and providing welfare for its citizens. 

  • Africa possesses the best investment opportunity in the gold mining industry

Africa is blessed in natural resources and there is still so much untapped potential in the continent. The gold mining industry in Africa poses the best investment opportunity in the world. 

The total gold production in Africa is expected to reach up to 730,000 kilograms by 2021 and as more African countries are discovering gold reserves, there is a possibility of an increase in that number. 

The Gambia for instance still has a very small mining industry. Gold reserves have been found in some areas but there is a lot of potentials to find more gold reserves in the country. 

Keep in mind that all of the lands are owned by the government and illegal mining is strictly frowned upon. If you are thinking about investing in gold mining in Africa, you should reach out to Shikana group for advice on how to go about that legally and profitably.

Investment opportunities in the gold mining industry in Africa

The Africa continent is blessed with numerous natural resources which include gold. Gold has been one of the biggest magnets that attract foreign investors to the continent.

The gold mining industry in Africa is a booming one with huge potential to keep growing since more countries are discovering more gold. Gold mining in the East Africa region presents a really hot opportunity for investors. 

Tanzania for instance is the fourth gold miner in Africa and Kenya’s gold mining industry is still really young and under-explored.

But as an investor, you should never jump to investing in something especially when it is an industry you know nothing about. 

You need to learn about the gold mining industry, understand the legal and commercial risks involved, and even the cost of operation. 

While these data are largely unavailable online due to a dearth of proper data management in Africa, firms like shikana group have taken it upon themselves to research into these industries, extract facts and data from people who are big into this industry. 

Talking to them is a no-brainer and will surely save you a lot of time and money.

Shikana group is a legal and investment advisory firm that provides you with guidance and offers you support for investments in Africa.

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