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Morocco - Must visit!
When you lift the lid of the Moroccan tajine, (the traditional cone-shaped cooking pot) the fragrance of rich spices intoxicates your senses and you can’t wait to taste the hearty stew. Moroccan cuisine is world renowned for mouth-watering dishes such as couscous, plump seminola grain heaped with vegetables, or bisteeya, that tasty savoury pastry.
A similar - and delectable - experience is now being offered (for a fair price and on a much larger scale) in Morocco’s resource industry. Foreign companies have been invited to share the country’s rich treasure of minerals (see sidebar). One junior Canadian company with a big appetite, Maya Gold and Silver, (MYA:TSX) is already at the table.
Casablanca is just a six hour direct flight (daily) from New York or Montreal or a quick connect to the capital markets of Europe. Maya’s CEO Guy Goulet, a Montreal based businessman and geological engineer, has made the trip “forty or fifty times”. If you can catch up with him in person, (10K runner as well as global businessman); Goulet radiates high energy, a confident Quebecois charm, and perpetual activity. He retains the missionary enthusiasm of his youthful ambitions and was once described by a Quebec newspaper as a “hurricane”. He was juggling five separate public companies at the time. Over the past 25 years Goulet has raised approximately eighty million dollars of capital for various ventures ranging from gold in Peru to pioneering lithium in northern Quebec in 1996. When the resource industry went south in 1999, Goulet went into water, co-founding H2O Innovation, a water technology company with revenue today of thirty-five million dollars per year. He came back to mining in 2008. “It’s like a drug”, he says. Today his sole business focus is Maya.
Maya Gold and Silver started with a small gold operation in Mexico, (hence the name) but soon linked up with what Goulet describes as Maya’s greatest asset, a Moroccan citizen named Noureddine Mokaddem. Mokaddem is one of the most respected mine-builders in Morocco, and Goulet’s long-time friend. A Professional Engineer, he developed and managed some of the biggest state projects in Morocco for over twenty five years. In just one example of his leadership, he and his team built and put into production the giant Guemassa Mine with a CapEx of $1.2 billion dollars in just eighteen months. He is fluent in Arabic, French, English and a few other languages; highly organized and strategic, deeply connected and committed to advancing the industry - for Maya and for Morocco. He outlined to Goulet the scale of opportunities opening up in his country and became COO of Maya. Mokaddem brings the properties and Goulet brings the capital. Like steel and flint, it’s an effective combination.
The Atlas Mountains, rich in natural resources, form a spine down the backbone of Morocco; from the north-east to south-west separating the Mediterranean and Atlantic coastlines from the Sahara Desert. On the edge of those mountains, red-walled Marrakesh (from the Berber word meaning Land of God) is our base camp for discovery. Just south-east of this romantic ancient capital, Maya has established first mover advantage with some highly prospective properties.
Maya has not wasted a moment here in Morocco for the last three years, conducting due diligence on six properties proposed by Mokaddem and his team of local geologists. They have negotiated and acquired three so far, and have also submitted tenders to the government for others. Their latest – and largest by far came just last month. In September 2011 Maya successfully won a bid for 85% of the highly prized Zgounder silver deposit, mine and mill. The project will be a joint venture with L'Office National des Hydrocarbures et des Mines, (ONHYM). See sidebar. ONHYM awarded the bid after examining a number of competitive international offers. “This confirms the firm intention of Maya to focus on exploration and development in the Kingdom of Morocco”, said Mokaddem.
ONHYM states the Zgounder mine contains historical resources of 7.5 million ounces of silver (582,000 tonnes of ore at 361 g/t Ag) plus another 2.2 million ounces of silver in surface tailings (500,000 tonnes at 125 g/t Ag), using a cut-off of 150 g/t Ag. These figures are NOT 43101 compliant, but still indicate a substantial value. The mine was shut in 1990 due to low silver prices and properly maintained. The normally arid climate has helped keep the equipment in generally good condition. "We think this project is the most attractive silver project available for a company our size", declared Guy Goulet. “Some smart people on our board say Zgounder could be our company maker.”
The overall budget allocated to the transaction for the first 24 months is $20.5 million CAD which includes initial cash payment, exploration, and infrastructure development in addition to mine and site rehabilitation. ONHYM will retain a 3% royalty on sales. The Board will examine different corporate structures following the acquisition, which may include the spinoff of the new subsidiary which would be jointly owned by Maya and its shareholders.
It was just over two years ago that Maya made their first acquisition in Morocco, the Amizmiz Property. The permits cover an area of eighty square-kilometers, easily accessible by paved roads just sixty kilometers south of Marrakech. Amizmiz has good access to power and water. Maya has invested $3.4 million dollars here extending the historic exploration works with airborne magnetic surveys and drilling. The exploration team has developed a Total Inferred Resource of 342,094 ounces, (819,769T@ an average grade of 12.98 g/t Au). The Amizmiz project collectively hosts low-grade bulk-tonnage as well as high grade vein-type gold deposits plus several other metals including copper, molybdenum, tungsten, zinc and lead. The geologic model is not yet clear, but consultants suggest that the gold mineralization could be genetically related to the Azegour metallogenic intrusion system that outcrops just ten kilometers directly south of Amizmiz.
Based on that theory, in March 2011 Maya purchased the Azegour Mine plus its associated sixteen kilometer mining permit. This acquisition strengthened Maya’s land position, setting up a “domain claim” which gives Maya the inside track on related claims in the vicinity. The past producing mine contains molybdenum, copper and tungsten, but has never been investigated for gold and silver. The next step will be to set up an operation at Azegour producing ore from Amizmiz at a rate of 150 tonnes per day. This will provide Maya with cash flow as they continue to define the resource.
Maya’s third acquisition was the property which lies directly south of the Imiter silver mine, the largest silver mine in Africa and one of the ten largest and richest silver mines in the world, producing more than 10 million ounces of silver per year for more than a decade. Maya’s deal conformed to the company’s original acquisition objectives – it’s close to a major deposit and offers a variety of mineralisation types.
The Kingdom of Morocco is a country of multi-ethnic groups with a rich culture and bright future. Through history, the indigenous Berber people and those who followed have traditionally offered a cup of mint tea, a delicious meal, and hospitality to foreigners from all directions, each of which have added spice to the complex flavour of the country. Maya is certainly making the most of their invitation and opportunity to develop the rich natural resources alongside the people of Morocco.
A name change to reflect the company’s focus is inevitable, if not imminent.
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Patrick (Paddy) Moore is a senior multi-media journalist who specializes in the resource industry. He is a frequent contributor to Resource World Magazine and the Creative Director of BTV: Business Television. He may or may not be related to the Medieval Moors of Berber descent who ruled Northern Africa, including Morocco and the Iberian Peninsula, for nearly 800 years. More about Moore at www.mooremedia.ca.
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