Burkina Faso moves to expand stake in Kiaka gold mine to 40% amid sector reforms

 

By Olamilekan Okebiorun

Burkina Faso has informed West African Resources Limited that it plans to increase its equity stake in the Kiaka gold mine to 40%, up from 15%, in a move reflecting its broader push for greater state participation in the mining sector.

The proposal, set out in a government decree, comes as the Australian-listed miner continues to project a significant rise in gold production from its West African operations, particularly from Kiaka and the Sanbrado mine.

Following the announcement, shares in West African Resources Limited were placed in a trading halt on the Australian Securities Exchange on Friday, as investors assessed the potential impact of a larger state holding on profitability, governance, and long-term project control.

The development is part of a wider resource policy shift under Burkina Faso’s military-led administration, headed by Captain Ibrahim Traoré, which has introduced reforms allowing the state to increase equity participation in strategic mining assets under revised legislation.

Kiaka, located in the country’s Centre-Est region, began production in June 2025 and is currently 85% owned by West African Resources, with the state holding 15%. Recent policy signals indicate the government is seeking to significantly expand that stake, following earlier discussions that suggested possible increases of up to 50%.

According to earlier disclosures, the company had valued incremental state participation at tens of millions of dollars, depending on final negotiation terms.

Under mining legislation introduced in 2024, Burkina Faso is permitted to acquire additional stakes in mining projects, subject to compensation arrangements, although the exact valuation framework for the proposed increase has not yet been disclosed.

Recent reporting indicates that discussions between the government and the company remain ongoing, with authorities using a state mining entity to negotiate participation terms under the revised mining code.

West African Resources has described the latest development as “potential”, stressing that no final agreement has been reached and that further engagement with authorities is ongoing.

Despite regulatory uncertainty, the company maintains a strong production outlook, projecting total output of between 430,000 and 490,000 ounces of gold in 2026. Kiaka alone is expected to contribute up to 280,000 ounces, reinforcing its importance to Burkina Faso’s mining output.

The company has also indicated plans to maintain competitive production costs, even as global gold markets remain influenced by inflation trends, interest rate pressures, and geopolitical risks.

Further updates are expected as negotiations between both parties progress.