Sudan: New gold refinery opened – may help replace lost oil revenues

Workers processing gold at the new Sudan Gold Refinery. PHOTO/Reuters

(Reuters) – Sudan opened its first gold refinery on Wednesday as it seeks to improve the quality of its rising gold exports and offset the economic damage inflicted by the loss of most of its oil revenues.

The country is increasing its gold production after losing three quarters of its oil output when South Sudan became independent in July last year.

The government hopes the new refinery in the capital Khartoum will help it to produce gold to international standards and reduce the amount of gold smuggling to overseas markets such as Dubai. Producers would receive more money for the higher-quality gold, thereby reducing the incentive to smuggle.

The refinery will have a daily production capacity of 900kg of gold and 200kg of silver. This more than doubles the previous forecast for the refinery’s annual gold capacity, to 328 tonnes from 150 tonnes.

Sudan hopes to sell gold worth up to US$3 billion this year, double last year’s gold revenue. Central bank governor Mohamed Kheir al-Zubeir told said on Wednesday that had sold 58 tonnes of gold worth US$2.6 billion over the past 16 months.

Though Sudan has great mining potential, it is hard to verify overall production figures because unofficial gold seekers account for a large part of the country’s gold industry