
BARRICK Gold said on Monday it would have “no choice” but to temporarily suspend Loulo-Gounkoto if Mali’s government failed to lift new restrictions placed on the Mali mine “within the coming week”.
In December, Mali’s military junta imposed an export blockade on gold shipments from Loulo-Gounkoto, a 510,000 to 560,000 ounce a year operation which is considered one of Barrick’s tier one mines. This followed the issue by the government of a warrant for arrest of Mark Bristow, CEO of Barrick Gold.
Barrick said today that in addition to December’s shipping restriction, an interim attachment order had been issued against existing gold stock on site. “Barrick believes the interim attachment order is unwarranted and is in contravention of the agreed dispute resolution mechanisms,” it said.
“If this issue is not resolved within the coming week, Barrick will have no choice but to temporarily suspend operations at Loulo-Gounkoto,” it added. “Such action would be deeply regrettable but necessary as previously reported.”
The dispute turns on the Mali government’s allegations last year that it was owed tax payments by Barrick. The actual amount claimed is unknown but Barrick has already paid about $85m to the government while Reuters said in an article that up to $500m is being demanded by the government. Bloomberg News said Barrick had offered the Government $370m to settle a tax claim arising from the government audit.
Mali’s government legislated a new mining code last year in terms of which mining companies are being asked to apply for licences for new operations, or risk losing existing operating licences if they don’t fall in with tax payment demands.
Resolute Mining fell foul of this action. After attempting to negotiate with the government, its CEO Terry Holohan and two colleagues at Resolute were detained for 10 days. After their release, Resolute agreed to pay the government $160m. Other mining companies such as Allied Gold and B2Gold, both listed in Toronto, have complied with the new code.
Barrick said it remained committed to a negotiated settlement with Mali. It had also initiated arbitration through the International Centre for the Settlement of Investment Disputes.
“In parallel, Barrick continues its efforts to reach an agreement with the Mali government on a memorandum of agreement to resolve the existing disputes, redefine the partnership’s future and increase the State’s share of benefits from the Loulo-Gounkoto complex,” Barrick said.
Loulo Gounkoto accounts for five to 10% of Mali’s GDP and employs 8,000 people. In 2023 Barrick contributed over $1bn to the Malian economy. The government of Mali owns 20% of the mine.