There are no commercial mining operations in Equatorial Guinea. However, some artisinal alluvial gold workings are taking place. Modern exploration techniques in Equatorial Guinea have been non existent and work that has been done has been preliminary, and carried out by foreign geological surveys. However, the country has been relatively well covered with respect to reconnaissance techniques such as stream sediment sampling. However, follow up studies on prospective gold (Coro) and tantalite/columbite (Aconibe) properties, resulted in poor sample size analyses which provided no quantitative information.
In pre-colonial times Equatorial Guinea was known for gold and iron production however there are no records of any commercial production during the Spanish era, which ended in 1968. After independence, early investigations highlighted the potential for gold, base metals, bauxite and pegmatite minerals such as tin, tungsten and columbo-tantalite. Initial systematic surveys were conducted from 1975 by Soviet Union geologists and from 1980-1985 BRGM (France) undertook regional and follow-up alluvial heavy mineral and geochemical exploration. Between 1981-1983 GEMSA (a Spain-Equatorial Guinea joint venture) prospected for gold, iron ore, ornamental stone, molybdenite, columbo-tantalite, bauxite and diamond opportunities.
The government is willing to sign a Mineral Development Agreement (MDA) with interested investors. Terms to be included in a MDA are:
- 7-year exploration term (5 year initial term and two extensions of one year each);
- 25-year development term from commencement of commercial production;
- Relinquishment: 25% after 5th year (excluding production areas), 25% after 6th year (excluding production areas), remainder of exploration area after 7th year (excluding production areas);
- minimum work commitments to be negotiated;
- income tax rate: 30% (defined as gross revenues less all costs and expenses);
- payroll tax: not to exceed 20% of expatriate salaries;
- annual surface rentals: $0.25 per hectare on exploration areas, $1.00 per hectare on production areas;
- royalty: 3% on gold, up to 5% on other minerals;
- foreign mining company has the right to keep proceeds abroad;
- foreign mining company is exempt from import duties;
- foreign mining company may subdivide the contract area or exploration area into not more than 5 subparts.
This mining legislation is presently under review and the government is in the process of drafting a new mining code.