Top quality gemstones are now being legally exported through the Kimberly Process.

SIERRA Leone is blessed with incredible mineral wealth, including major deposits of diamonds and gold. Now that peace and political stability have been reestablished, the government has formulated policies to attract investment to the mining sector, especially for industrial minerals such as rutile, bauxite, and iron ore.

A dramatic increase in legal exports of diamonds—from virtually nothing in 1999 to US$150 million in 2005—has been a result of the Kimberley Process, a UN-approved export certification system which excludes conflict or illicit rough diamonds from the international gemstone industry.

The trade in “blood diamonds” arose in Sierra Leone, Angola and the Democratic Republic of Congo (DRC) when rebel groups utilized diamond resources to wage war on the government, committing terrible atrocities against citizens in the process. Today, however, diamonds are produced under licenses provided by a recognized democratically elected government and exported with full Kimberly Process certification.

The challenge now is to ensure that the country’s diamond production benefits its people. In 2001, with the help of the U.S. Agency for International Development (USAID), the government created the Diamond Area Community Development Fund, which returns a portion of diamond export taxes to diamond mining communities. Hopefully, this spending, as well as ongoing public awareness campaigns, will reduce smuggling.

At present, Koidu Holdings is Sierra Leone’s only operational Kimberlite mine, but Minister of Mineral Resources Alhaji Deen is confident about the sector’s prospects. He says, “In the next four or five years, we hope to see at least two or three diamond mining companies, several diamond-cutting and polishing companies, gold mines, and more activities in rutile and bauxite.”

Jean-Raymond Boulle (INTERVIEW), majority owner of the Titanium Resources Group (TRG), agrees. He speaks of a “compelling commercial attraction” to Sierra Leone’s high quality mineral resources.

If one company represents the revival of Sierra Leone’s fortunes it is TRG, which is set to restart production in the first quarter of this year.

Before their destruction in a rebel attack in 1995, the group’s Sierra Rutile Mine and SML Bauxite Mine were the country’s major employers and main sources of government revenue, accounting for 75 percent of exports. Production at the rutile mine previously represented 30 percent of the world’s annual supply of natural rutile.

Mr. Boulle says, “TRG will be one of the lowest cash cost producers of rutile in the world, with huge reserves for the future already defined.”

President Kabbah describes the reopening of the mines—backed by a US$30million EU grant and a loan guarantee for US$25million from the U.S. Overseas Private Investment Corporation—as “a clear signal that Sierra Leone is again an attractive destination for investment.”

Elsewhere, exploration by Mano River Resources and its joint venture partner, Golden Star Resources, has revealed new gold zones, and follow-up drilling will commence in the second quarter of this year.

Tom Elder, Mano’s President and CEO, says, “Our efforts over several years are now beginning to deliver the results that we always believed would be forthcoming from these projects.”