January 11, 2022
GoviEx Uranium Inc.’s (TSXV:GXU, BUY, C$0.60 target, David A. Talbot) Falea project may not be heavily impacted by the recent geopolitical news coming from Mali at the moment, but that could change. The country shut its borders and recalled several ambassadors after West Africa’s economic bloc imposed sanctions on the gold-producing country for refusing to hold elections next month, according to Bloomberg News. On Sunday, Ecowas, as the bloc is known, froze Malian assets at the region’s central bank and commercial lenders in member states, suspended non-essential financial transactions, and ordered land borders to be closed. We note that this announcement came a week after the military-dominated government proposed a five-year transition period, in defiance of international pressure to prepare a return to civilian rule the next month. Red Cloud recently spoke to GoviEx management, learning that there are no issues for the company just yet. However, its drill contractor is concerned about getting certain materials into the country, such as PVC piping. GXU is monitoring the situation and does see consumables as a potential issue. We expect the mining industry to be impacted, for things including diesel and others. Air France has also stopped all flights, and other commercial and cargo airlines may be impacted. It is unsure how materials might exit the country, although we know Mali is dependant on that (tax) revenue and some producers have indicated business as usual. Similarly, GoviEx will try to operate its Falea exploration drilling program as planned, but we anticipate potential for project delays. We note that this is the third project in GXU’s project portfolio, with most attention on Madaouela in Niger, and then Mutanga in Zambia. Thus, we don’t expect this news to impact GXU significantly. Read more here and here