KEY POINTS
- Mali seizes $245 million worth of gold from Barrick’s mine.
- Barrick files arbitration amid escalating tensions with Mali.
- Military governments seek higher mining revenues as gold prices soar.
Mali’s military-led government has begun seizing gold from Canadian mining giant Barrick Gold’s Loulo-Gounkoto complex, following a court-ordered confiscation last week.
On Saturday, helicopters transported approximately three metric tons of gold, valued at $245 million, to the state-owned Banque Malienne de Solidarité (BMS) in Bamako, sources familiar with the situation said.
This action is the recent upshot of conflict that has persisted between Barrick and the government of Mali over the new mining laws enacted in 2023.
The conflict has scaled up over time; for example, the Malian government detained some executives of Barrick and issued arrest warrants on Bristow, the company’s CEO.
Barrick files arbitration as tensions escalate
In the meantime, Barrick has embarked on an arbitration process by approaching the International Centre for Settlement of Investment Disputes (ICSID) in attempts to have the problems solved.
According to Reuters, the company has warned that the current situation could force it to suspend operations at the Loulo-Gounkoto complex, which Barrick owns 80 percent of, while the Malian government holds the remaining 20 percent.
In a memo to Malian staff, Barrick confirmed the enforcement of the confiscation order and reiterated its concerns about the deteriorating conditions at the site. The company highlighted cases where shipments of bullion were blocked; a number of its staff members were detained for no reason.
Military governments demand bigger share of mining revenues
Mali, along with Burkina Faso and Niger, has increasingly pushed for more significant revenue shares from mining activities, especially with gold prices at record highs.
This indicates a shift in the region’s policy towards renegotiating mining terms to enhance the benefits to local economies.
Mali previously demanded $500 million in unpaid taxes from Barrick, a claim the company denies.
In its quarterly earnings report, Barrick noted paying $85 million to the Malian government in October. Analysts from Jefferies estimate that suspending operations at Loulo-Gounkoto could reduce Barrick’s 2025 earnings by 11 percent.
Despite following up, neither Barrick nor Malian authorities responded to requests for comment on the matter.
