The ongoing tension between the Malian government and Barrick Gold has entered a critical phase, as the authorities have closed the Canadian mining firm’s office in Bamako. On Tuesday, Barrick Gold reported that the military junta governing Mali warned of potential control over its assets unless operations at the Loulo-Gounkoto gold-mining complex resume, coupled with the payment of taxes.

Background on the Conflict

Last year, Barrick, a leader in the global gold mining sector, faced increased scrutiny as part of a broader pattern of targeting of Western companies by the Malian authorities. Despite some firms successfully negotiating terms to continue their business in the region, Barrick’s personnel encountered significant obstacles, including arrests of executives and staff.

Operational Suspension and Government Actions

In January, Barrick was forced to suspend its operations in Mali following the government’s seizure of its gold. The company described the decision as a regrettable necessity, citing systemic barriers that prevented the export of gold from its key mining site.

Importance of the Loulo-Gounkoto Complex

The Loulo-Gounkoto complex is vital to Barrick’s portfolio, noted for being the second-largest source of gold output after its operations in Nevada. However, recent developments have magnified concerns about the future of mining in Mali.

Current Developments

Barrick indicated that the recent escalation occurred despite reaching an agreement with the Malian government concerning the complex earlier this year. This agreement was reportedly accepted by the ministry of finance in February, although the specific terms remain undisclosed.

“Although Barrick signed the agreement presented by the government as requested in February, the government has failed to execute it,” stated Barrick. The company expressed its willingness to uphold the accord, noting, “It is regrettable that the government continues to obstruct gold exports while simultaneously demanding tax payments on revenue it has actively prevented from being realised.”

Potential Legal Actions

In light of the standoff, Barrick has signaled its readiness to pursue legal recourse if a satisfactory resolution cannot be negotiated with the government. The military administration has not yet provided a public response to these allegations.

Mali’s Mining Landscape

According to analysts at Peel Hunt, Mali’s updated mining code has reportedly enhanced the country’s tax revenues in 2024, despite a noted decline in gold production last year. This context adds a layer of complexity to the apparent tensions between the Malian government and Barrick Gold.