Barrick Gold (ABX.TO) has announced the suspension of its mining operations in Mali following the government’s seizure of gold stocks from its Loulo-Gounkoto complex. The gold, estimated to be around three metric tons and valued at approximately $245 million, was removed by helicopter over the weekend.
Key Highlights:
Seizure Details:
The gold was taken from the mining complex on Saturday, with eyewitnesses reporting two separate helicopter loads.
The seized gold will be transferred to the Banque Malienne de Solidarite (BMS) in Bamako.
Impact on Operations:
Barrick stated in a letter to the Malian government that the seizure obliges the company to temporarily suspend mining at the Loulo and Gounkoto mines.
The company mentioned that the seizure means the gold is no longer insured under Barrick’s policy and is awaiting confirmation of the gold’s arrival at BMS.
Legal Context:
A court order issued by Judge Boubacar Moussa Diarra last week authorized the seizure, citing a claim from Mali’s economy ministry that Barrick owes $5.5 billion to the government—significantly higher than previous estimates.
Barrick has been embroiled in a dispute with the Malian government since 2023 regarding new mining regulations and had previously faced detentions of senior executives, including an arrest warrant for CEO Mark Bristow.
Financial Implications:
Barrick shares fell by 1.9% on the Toronto stock exchange shortly before the market closed on Monday.
Analysts at Jefferies estimate that halting production could reduce Barrick’s earnings before interest, tax, and amortization by 11% in 2025.
Ongoing Disputes:
Barrick has requested arbitration proceedings against Mali through the International Centre for Settlement of Investment Disputes.
The Malian government has previously demanded around $500 million in unpaid taxes from Barrick, which the company denies, asserting that it paid $85 million to the government in October.
Regional Context:
Military governments in Mali, Burkina Faso, and Niger are seeking to renegotiate contracts to secure a larger share of mining revenues amid rising gold prices.