Announcement of IFC to Invest in Gold Mine Rehabilitation Project in Ghana November 23, 1987

Monday, November 23, 1987 Monique Amaudry Press Release No. 88/20 (202) 676-9331 IFC INVESTS IN GOLD MINE REHABILITATION PROJECT IN GHANA The International Finance Corporation has acquired a 9 percent interest in the share capital of Canadian Bogosu Resources Ltd., a Ghanaian gold mining company. The Company's program to increase the concession's proven reserves position and finish pre-production engineering work will be completed by 1988. The Company's share capital will also be distributed among three Canadian mining companies: Sikaman Gold Resources Ltd. (40.5 percent), Denison Mines Ltd. (27 percent), Exall Resources Ltd. (13.5 percent) and the Government of Ghana (10 percent). Bogosu Resources Ltd. was established in 1985 to explore and develop the Bogosu concession which has a geological reserve base of some 5.8 million ounces with 1.8 million in the proven and probable categories. Production is forecast to start in early 1989 at a rate of 75-100,000 ounces per year costing $135 per ounce. The Bogosu concession has a good history of gold production. Between 1936 and 1955, it produced nearly 1 million ounces of gold, but was abandoned in 1956 and remained idle until late 1985. Ghana's minerals sector is one of the key export sectors of the economy. It employs 26,000 persons and is the second largest source of foreign exchange for Ghana after cocoa, accounting for approximately 20 percent of all foreign exchange earnings. Gold represents 85 percent of the value of all mineral exports and is one of the most promising opportunities for boosting the country's export performance. - MORE - - 2 - As part of its Economic Recovery Program, Ghana has placed increased emphasis on reviving the private sector and rehabilitating its mineral sector. IFC supports this Program through its Foreign Investment Advisory Service, which provides recommendations and advice to the Government on removing barriers and impediments to new private investment. In the mineral sector, IFC arranged a $55 million loan in 1984 to finance the expansion of Ashanti Goldfields Corporation Ltd., which provides 80 percent of Ghana's gold output. IFC, an affiliate of the World Bank, is the leading private sector agency which provides equity financing and long-term loans without government guarantees to private enterprises in developing countries. - END -