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Côte d’Ivoire seeking to grow extractive industries’ contribution to GDP

AGBAOU GOLD MINE Exports provide a major source of revenue for Côte d’Ivoire, with the government’s export of 15 000 kg of gold valued at $472-million in 2013

ADAMA TOUNGARA The government of Côte d'Ivoire aims to intensify oil, gas and mining exploration and increase the production of electricity

5th August 2016

By: Ilan Solomons

Creamer Media Staff Writer

  

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The government of Côte d’Ivoire aims to reduce its dependence on cocoa and coffee by developing the oil, gas and mining sectors, says Extractive Industries Transparency Initiative (EITI) Africa regional coordinator Kjerstin Andreasen.

The EITI is a global standard to promote open and accountable management by countries of the revenue generated during the extraction of natural resources.

Côte d’Ivoire Petroleum and Energy Minister Adama Toungara noted in 2013 that government’s plan was to intensify exploration, increase the production of oil, gas and electricity and to improve the transportation and distribution of petroleum products to local communities.

According to the 2013 EITI report (the latest report) the oil, gas and mining sectors contributed $611-million to the country’s economy in that year. Andreasen highlights that this represents less than 9% of the country’s gross domestic product (GDP) and less than 1% of total employment.

She says that, although the mining sector’s contribution to the budget fell by 9% from $45-million in 2012 to $41-million in 2013, gold production increased in 2013 by about 15% to 11.5 t. She notes that gold exports provide a major source of revenue for Côte d’Ivoire. In 2013, government’s export of 15 000 kg of gold was valued at $472-million.

The latest EITI report also reconciles the export amounts reported by companies with the amount reported by government.

Andreasen points out that the removal of the United Nations’ embargo, related to a political coup at the time, on diamond exports from Côte d’Ivoire in April 2014 may also lead to a more formalised and productive artisanal diamond mining sector.

Andreasen comments that oil and gas exports already contribute significantly to the country’s economy. The government declared oil and gas exports of $728-million in 2013, including 7.8-millon barrels of oil. However, she says the contribution of the petroleum sector to the budget fell by 32% from $542-million in 2012 to $368-million in 2013.

“Part of the fall in revenues in the hydrocarbon sector can be attributed to a 15% fall in oil production, 9.1-million barrels in 2013 from 10.8-million barrels in 2012. Gas production, however, increased from 63-million British thermal units (Btu)
to 75-million Btu over the same period.”

Andreasen remarks that the 2013 EITI report provides a detailed description of Côte d’Ivoire’s mining licence register, including permit number, provinces and regions, area, award date and expiry date. However, she notes that the report states that the mining register could be further complemented with consistent reporting on the coordinates linked to mining sites and the date that the application for the permit was received.

Andreasen says that this would help avoid duplication in the awarding of mining licences and would afford government more effective monitoring of the sector.

More Transparency Required

The 2013 EITI report attempts to identify the owners who hold more than 25% ownership of companies that have acquired the rights to extract oil, gas and mineral resources. Three companies were State-owned, namely Petroci (hydrocarbon), Afren (hydrocarbon) and Sodemi (mining).

The EITI report also listed the shareholders for nine companies and physical persons as owners for two companies, namely CNR International (oil and gas) and Yaoure Mining. Côte d’Ivoire has until January 2020, like all EITI implementing countries, to include beneficial ownership in its EITI reporting.

However, Andreasen points out that further work still needs to be done on reporting from State-owned enterprises. She notes that the report highlights that financial accounts are not regularly published for the State-owned companies Petroci and Sodemi.

“It was recommended that this information, as well as the company’s statistics on the State’s share of production, marketing activities and revenue transfers, be published online in an easily accessible format.

The local multistakeholder group continues to follow-up with these bodies so that this information can be published in subsequent EITI reports,” Andreasen concludes.

Edited by Martin Zhuwakinyu
Creamer Media Senior Deputy Editor

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