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Jim Landers

One of Sierra Leone's biggest employers has Dallas ties

07:47 AM CDT on Wednesday, June 18, 2008

By JIM LANDERS / The Dallas Morning News
jlanders@dallasnews.com

KPANGUMA, Sierra Leone – The world's largest deposits of the ore that makes your walls bright are strip-mined in the tropical forest here by a company whose fortunes are entwined with a group of Dallas characters.

The ore is known as rutile, a glittery black sand that's refined into titanium dioxide. Paint made with titanium dioxide reflects light so that one coat can cover the walls.

Video
Rutile mine in Sierra Leone has Dallas connections (DMN - Video/Editing: Jim Landers)
June 10, 2008
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Sierra Rutile Ltd. mines this ore with huge dredging boats working on man-made ponds.

"The dredges are a block wide and long and six stories tall," said Wayne Malouf, a Dallas attorney who is a director and former chief executive of Titanium Resources Group Limited, Sierra Rutile's parent company, based in the British Virgin Islands.

Sierra Rutile and a sister company nearby that mines bauxite (the raw ingredient for aluminum) are the largest employers in the country, according to mine officials.

The latest United Nations Human Development Index ranks Sierra Leone as the least developed country in the world and says most people there die before the age of 41.

More than 2,000 Sierra Leoneans work at the mines in this country where per-capita income is only $240 a year. Rutile and bauxite from the mines are responsible for 65 percent of Sierra Leone's exports, followed by diamonds.

A civil war that ended in 2002 left much of the housing, schools and medical clinics in this part of Sierra Leone ripped apart and decaying. Rebels and government soldiers at different times used mine housing as barracks, and many of the buildings are vacant shells overgrown with jungle and mold.

Sierra Rutile was shut down for nearly 11 years. The owners sold out to former Dallas entrepreneur Jean-Raymond Boulle (pronounced bool) in chunks between 1999 and 2001.

"The whole object to restart the mines was to restart the economy," Mr. Boulle said.

Dallas friends

Born in the African island nation Mauritius when it was a British colony, Mr. Boulle has pursued diamond and metals mining opportunities all across Africa, and in Canada and Arkansas.

He is best-known in Dallas as the owner of a spectacular $45 million, French-style mansion off Strait Lane near Preston Road that burned to the ground in 2002. Mr. Boulle now lives in Monaco.

While he called Dallas home, Mr. Boulle brought several friends into his African business ventures, including Mr. Malouf and Eric Kimmel, a Dallas fashion designer who now runs a used-clothing business (Freetown Rags) in a village near here.

Melonie Kastman, a Dallas producer of television commercials, grew interested in Sierra Leone through Mr. Kimmel's adventures. She has worked with Half Price Books and other Dallas donors to build a library near the rutile mine out of a gutted YWCA primary school.

Two-thirds of the adults in Sierra Leone are illiterate.

"I decided that education, education, education was the only thing that could save these guys," Ms. Kastman said.

Ms. Kastman's daughter, 12-year-old Ruby Skotchdopole, went with her on one of the trips and suggested a pen pal network that's grown to more than 600 students at schools in Dallas and Sierra Leone.

Challenges and hopes

Since it opened in 1967, Sierra Rutile has gone through a series of mostly American owners, including PPG Industries, Amco Steel, Bethlehem Steel and Nord Resources. In its heyday, the mine produced more than 150,000 metric tons of titanium dioxide a year and accounted for 25 percent of global production.

Dredging design problems limited production at the start and have crept up again in recent months.

Mr. Boulle took Titanium Resources Group public in 2005 on the London Stock Exchange. He remains a large shareholder in the company but said he is no longer active in day-to-day management.

Production at the rutile mine resumed in 2006. Last year, Sierra Rutile produced 82,530 tons of titanium dioxide, or 14.5 percent of the world market. Revenue for the year was $67.8 million.

Sierra Leone President Ernest Koroma was on hand in November to commission a second dredge. But engineers are still working out the kinks in the new vessel, and the company is not likely to reach its goal for this year of 170,000 tons, said engineer Alex Kamara, a non-executive director for Titanium Resources.

Titanium Resources lost $17 million last year largely because of oil price increases. The mining dredges and processing plants operate on expensive diesel-fired electricity. The company hopes to complete a 30-megawatt power plant this year designed to burn heavy fuel oil, which would save it $1 million a month in fuel costs.

Walter Kansteiner, Titanium Resources' chairman and a principal in the Washington consulting firm the Scowcroft Group, said Sierra Rutile is planning to grow palm oil at the mine to make biodiesel for its power plant. That would give it the lowest energy costs of any titanium dioxide producer, he said.

Titanium Resources shareholders haven't seen much return on their investments yet, and neither has the Sierra Leone government. The thinly traded TXR shares have plunged in price this year, from 85 British pence to 35 pence (about $1.70 to 70 cents).

Mr. Kansteiner said the new power plant and smoother operations aboard the new dredger should mean better results over the next year.

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