The last time I interviewed Oliver Andrews was five years ago, just after he had reached the mandatory retirement age at the Africa Finance Corporation (AFC). He had spent more than a decade at the infrastructure-oriented investment organisation, latterly as executive director and chief investment officer, and was widely regarded as one of the institution’s intellectual architects.
He had helped mobilise tens of billions of dollars for roads, ports, power plants, industrial zones and logistics platforms across Africa. Many assumed he would step back, take advisory roles, perhaps join boards. Andrews himself sounded unconvinced.
“I was never going to be put out to pasture,” he says now, with a mischievous smile. “I’m one of those horses that had to jump the fence.”
When we met again in January, the setting could not be more different. Andrews is no longer speaking from the vantage point of a continental development finance institution, but from the front line of a nascent mining project in one of Africa’s least understood jurisdictions.
In December FG Gold, the company he founded and leads, announced that it had achieved financial close and first drawdown on a $330m senior debt package to develop the Baomahun Gold Project in Sierra Leone. The deal, anchored by AFC and the African Export–Import Bank (Afreximbank), is the largest project finance mining transaction in the country’s history.
On the face of it, the timing looks propitious. Gold prices have risen relentlessly over the past decade, breaking through the $2,000 per ounce barrier in 2020 and continuing upwards amid geopolitical volatility, inflationary pressures and renewed interest in safe-haven assets. By mid-January, gold spot prices were around $4,700 an ounce. One might reasonably assume that financing a gold mine in such an environment would be straightforward.
“And you would be very wrong,” Andrews says.
Why high prices are not enough
What Baomahun demonstrates, he argues, is that commodity prices alone do not finance mines. Structure, credibility, patience and trust matter far more – particularly in Africa. The financing journey for Baomahun stretched over four years, involved scores of potential financiers, and required an unusually intricate blend of instruments more commonly associated with large infrastructure projects than with junior mining companies.
To understand why, Oliver Andrews believes, it is necessary to confront an uncomfortable truth about how mining is typically financed on the continent.
“The junior mining model has not served Africa particularly well,” he says. “You find an asset, you list the company, and then you keep going back to the market for equity.
“Every time you do that, you dilute ownership, you dilute accountability, and you move the centre of gravity further and further from the asset itself.”
In many cases, by the time a mine reaches production, control has shifted decisively offshore. Capital is distant, communities are marginalised, and governments struggle to extract long-term value beyond royalties and taxes. For frontier jurisdictions, the model often breaks down entirely. Risk appetite evaporates, equity markets turn, and promising projects stall.
Sierra Leone, with its history of civil war, Ebola and an artisanal mining legacy, sits firmly in the category of places most investors prefer to avoid. “Country risk comes up immediately,” Andrews says. “Then development risk. Then jurisdictional unfamiliarity. You add logistics, terrain, political risk, regulatory risk, a high interest-rate environment, and suddenly you have a very long list of reasons not to proceed.”
FG Gold encountered all of them. Andrews estimates that dozens of investor doors were knocked on. Many closed quickly. Others stayed open just long enough for credit committees to decide that the accumulation of risks was too great. “Any two or three of those risks would have been enough for most sponsors to walk away,” he says. “But walking away was never my instinct.”
Oliver Andrews: a career built on making the improbable bankable
That instinct was shaped by a long career spent making improbable projects bankable. Oliver Andrews began his professional life in engineering and finance before gravitating towards project development – the discipline of taking complex, capital-intensive assets from concept to operation.
Over four decades, he has been involved in power plants, wind farms, ports, toll roads, industrial platforms and logistics corridors across the continent. At AFC, he was at the centre of efforts to create an African institution capable of crowding in global capital on African terms.
Those years left him with a particular view of mining. “Mining in Africa, frankly, has often not been done well,” he says. “Communities have not really benefited, governments have not fully benefited, and the environment has suffered. And when that happens, you get social tension, political instability, sometimes conflict.”
He sketches a mental map. Overlay Africa’s mining belts with hotspots of unrest, he suggests, and the correlation is striking. The problem, in his view, is not mining per se, but how it is financed, owned and governed. “We export our wealth,” he says. “We export ownership. We export skills. And then we wonder why there is resentment.”
Designing a different kind of mining project
Baomahun was conceived as an attempt to do things differently. The deposit lies around 200 kilometres east of Freetown, in an area with a long history of artisanal mining but no modern commercial operation. When the Sierra Leone government issued an invitation to tender, Oliver Andrews established a consortium, which bid for the licence, and he began visiting the site.
“My first conversations were with the community,” he recalls. “I wanted to understand what partnership would look like.” The villagers asked for a school, an expanded clinic and a community centre. Andrews committed to delivering them regardless of FG Gold ultimately securing the licence. “That wasn’t a negotiation tactic,” he says. “It was a statement of intent.”
From the outset, the project was structured to embed that intent. Boxmoor Hills DMCC was established as a holding and investment vehicle to incubate mining opportunities across Africa. FG Gold was created as a special-purpose vehicle for the Baomahun Gold Project.
By the time the mining licence was granted and the resource certified – approximately 6m potential ounces of gold across open pit and underground – the technical fundamentals were in place. What remained was the hardest part: financing construction in a way that avoided the familiar cycle of serial equity raises and dilution.
“For me, that was a red line,” Andrews says. “If we had gone down the conventional junior miner route, we would have lost control of the project before we ever poured first gold.”
Applying infrastructure discipline to mining
Instead, he turned to project finance – a discipline he knows intimately. Project finance relies on a project’s future cash flows rather than the balance sheet of its sponsors and is commonly used for infrastructure assets such as power plants or ports. Applying it to a new gold mine in a frontier jurisdiction was, in Sierra Leone’s case, unprecedented.
“It meant complexity,” Oliver Andrews says. “There was no way around that. We had to address every real and every perceived risk concern in a very deliberate way.”
The first breakthrough came when AFC agreed to act as cornerstone investor, committing $175m to the quasi-equity and senior debt package. “That was catalytic,” Andrews acknowledges. “AFC’s involvement signalled that this was a serious, well-structured project that had passed rigorous scrutiny.”
Afreximbank followed with a $75m commitment, subject to all other lenders being in place and the inclusion of an investment-grade offtaker. That requirement brought Singapore-headquartered commodity trader Trafigura into the transaction with a $105m offtake financing facility.
“Those discussions took time,” Andrews says. “Trafigura had to get comfortable with the jurisdiction, the product, the structure. Trust had to be built.”
A US-based hedge fund added a further $75m, bringing additional perspectives on political risk, repayment security and risk sharing.
Around this core, a series of innovative instruments were layered. AFC provided gold streaming and “mezzanine” facilities. Insurance facilities wrapped the senior debt to mitigate repayment and political risk and secure preferred creditor status.
The complexity did not end there. CrossBoundary Energy committed $60m in off-balance-sheet financing for a hybrid power solution, essential for mining operations and its largest investment in Sierra Leone.
Komatsu Finance Europe provided $50m in equipment financing through FG Gold’s mining services contractor, marking its first transaction in the country.
Fundo Soberano de Angola (Angolan Sovereign Wealth Fund) took a $20m equity stake, its first investment in Sierra Leone.
“Each component solved a specific problem,” Andrews explains. “Power risk, equipment risk, market risk, political risk. You can’t wish those things away. You have to structure around them.”
Trust as a form of capital
What emerges is less a single financing than an ecosystem of capital, sequenced and aligned. It is also where personal credibility comes into play.
“Deals like this are not just about numbers,” he says.
“They are about relationships. About people believing that you will do what you say you will do and that agreements you enter into will be sacred.”
Those relationships were forged over decades.
At AFC, Oliver Andrews had worked closely with many of the institutions now sitting around the Baomahun table. In an era of heightened geopolitical risk and capital scarcity, that reputation mattered.
“Trust is a form of capital,” he says simply. “It doesn’t show up on a balance sheet, but without it, nothing moves.”
The significance of the transaction extends beyond FG Gold. For Sierra Leone, the backers argue, it establishes a new benchmark, announcing the country as a credible destination for sophisticated project finance.
They also argue that for African mining more broadly it establishes a playbook on assembling inventive hybrid structures to mitigate nuanced financier risks – one that keeps ownership closer to the asset, aligns incentives over the long term, and embeds local participation from the outset.
The mine is developing rapidly. Once operational, Baomahun could, backers say, potentially add up to 10% to Sierra Leone’s GDP, create hundreds of direct jobs and generate substantial fiscal revenue.
The mine
The first gold is expected to be mined at Baomahun this year.
Baomahun village is home to around 7,000 people. The gold project itself, the country’s first large-scale commercial gold mine, covers an area of 124 square kilometres, in the Valunia and Kunike Barina chiefdoms in the Bo and Tonkolili districts respectively.
FG Gold declares that the project is “a milestone” that “unlocks one of the most significant project financing deals in the country’s history, while supporting Sierra Leone’s ambition to responsibly harness its mineral resources for sustainable economic transformation”.
But Andrews says that with innovation, discipline and local commitment, even the most challenging barriers can be overcome.