The Barrick Gold Corporation logo at the Prospectors and Developers Association of Canada (PDAC) convention in 2019.Chris Helgren/Reuters
Barrick Mining Corp. ABX-T is asking Mali to resume talks to end a bitter dispute that threatens to wrest away control of its massive gold mining operations in the country.
The Canadian miner was forced to shut down its Loulo-Gounkoto complex in January amid an escalating fracas with Mali over dividing the economic benefits.
On June 2, a Mali court is expected to rule on whether to grant the government the authority to take over the mine after hearing submissions last week from Barrick.
“Barrick believes there is no basis – either in law or in practice – for the day-to-day operations at Loulo-Gounkoto to be handed over to a court-appointed interim administrator,” the company said in a release on Monday.
The West African country, which is under military junta rule, jailed four Barrick executives in November and issued an arrest warrant for chief executive officer Mark Bristow in December, accusing him of money laundering.
Barrick last week wrote to Mali’s minister of economy and finances to reiterate that it is available to start talks again, with the objective of reaching an agreement around releasing its detained employees and the resumption of mining.
The Loulo-Gounkoto mining complex is 80-per-cent owned by Barrick and 20-per-cent by Mali. It used to account for about 15 per cent of Barrick’s production and was by far its biggest operation in Africa. Toronto-based Barrick inherited its Malian operations after it bought Randgold Resources Ltd. in 2019.
As Barrick holds out hope for an agreement with Mali, it is also pursuing international arbitration against the country. Mali has demanded at least US$417-million from Barrick for allegedly not paying its fair share of taxes.
Barrick on several occasions has reached a provisional agreement with the country only for hitches to occur that prevented ratification of a pact.
Mr. Bristow has blamed the incompetence of Mali’s negotiators for fumbling the talks, claiming they don’t understand basic economics.
“We would get there in a heartbeat if Mali were to appoint a competent set of advisers,” he said in an interview earlier this month.
After the junta came to power in Mali, it cancelled a security agreement with France, expelled the United Nations peacekeeping mission and withdrew from the West African bloc of countries.
Before the dispute with Mali flared up, Barrick under Mr. Bristow successfully settled similar fiscal disputes with Tanzania and Papua New Guinea, although both took multiyear efforts.
But if Barrick is forced to stick with arbitration to fix the Mali impasse, the process could take even longer. In 2011, the Canadian miner and its partner launched arbitration proceedings against Pakistan in a dispute over the undeveloped Reko Diq copper and gold project. It took seven years for Barrick to be awarded a multibillion-dollar payout. In lieu of paying the cash penalty, Pakistan elected to allow Barrick to move forward on the project.
Mali is employing similar hardball tactics that it used against another gold mining company last year. Malian authorities in November arrested three employees of Australia’s Resolute Mining Ltd., including CEO Terence Holohan, and held them for more than a week. They were released only after Resolute promised to pay the junta government US$160-million to resolve tax charges.
“It emboldened these people to just keep asking for more,” Mr. Bristow said.
Barrick’s shares have underperformed its peers in part because of the continuing tensions in Mali. Last year, Agnico Eagle Mines Ltd. bypassed Barrick to become Canada’s most valuable gold mining company.