Sudan Sees Gold Output Stable

Sudan could produce as much as 74 tons of gold this year, putting it well above industry estimates since most of it is mined unofficially by small-scale prospectors, the minerals minister told Reuters.

Sudan is in the middle of a gold rush that has prompted tens of thousands to undertake hazardous expeditions across remote desert areas to search for gold, which has reached record highs this year above $1,476 an ounce.

The government has also stepped up focus on the gold sector in a bid to diversify the economy as its oil-producing south prepares for independence in July.

Gold output in Sudan stood at 36 tons last year according to official estimates, but production totalled more than 70 tons if gold smuggled out of the country by unofficial "artisanal" gold seekers is included, the minister said.

"I would say this year we expect to mine 74 tons of gold. . .but the majority—60 or more than 60 tons will be produced from the artisanal sector," Abdelbagi Gailani Ahmed said in an interview at his ministry overlooking the Nile.

Gailani's forecasts are well above industry estimates for the country—which put gold output at four tons in 2009 based on mine supply data from consultancy GFMS—but the minister said that was because the vast amount of gold mined by local gold-seekers was not being taken into account.

If Sudan's gold output reached 74 tons, it would make the country the tenth largest producer and Africa's third largest, behind South Africa and Ghana.

The government is now drawing up incentives to offer local gold-hunters to prevent them from taking gold out of the country and selling it in places such as Dubai or Beirut, he said.