Barrick Gold signs agreement with Mali in hope to end dispute
Canadian mining company Barrick Gold has signed an agreement with the Malian government, ending an almost two-year dispute over its mining assets in Mali.
According to Reuters on February 19th, Barrick has signed their part of the agreement, leaving it up to Mali’s government to formally approve the deal, potentially as soon as February 20th. Despite this, sources have expressed concerns that although a deal may be close, last-minute obstacles might still derail it.
Barrick Gold and Mali have been engaged in dispute since 2023 over the implementation of Mali’s new mining code that was set to give the government a larger share in the gold mines.
In the new agreement, Barrick will pay a total of 275 billion CFA or $438 million to the government, in return the Malian government will release detained employees, seized gold, and will restart the operations at the Loulo-Gounkoto mine.
A delegation of over 15 representatives from Malian ministries as well as private consulting firm Iventus Mining undertook a three-day inspection of Barrick’s mining complex on February 19th.
A new agreement with Mali would boost Barrick’s operations during a time when gold prices have hit an all-time high though investors are not seeing a similar return reflected on the company’s share performance.
In an interview the CEO of Barrick, Mark Bristow said that both his company and Mali have been losing out due to the closure of the mine, as Mali also loses its share of the revenue every week the mine remained closed.
Bristow said Barrick paid $460 million to the Mali government last year, suggesting they would have been able to contribute about $550 million to the nation’s treasury this year if operations were not suspended.
Barrick also lowered their gold output forecast this year to between 3.2 million ounces and 3.5 million ounces due to the halt at the mine. Last year, Barrick’s gold output was 3.9 million ounces and 4.1 million ounces in 2023.
After seizing power in 2020, Mali’s Junta pledged to overhaul its mining sector, allowing the state to benefit from gold prices running at all-time highs.
Canadian mining firm, B2Gold has already settled their operation with the Malian government.
Barrick previously launched an arbitration against Mali, making it unclear whether after this new agreement, the company will drop the case.
Reuters, Maghrebi, The Africa Report
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