Barrick Gold CEO Mark Bristow, shown in 2022, didn’t name the two former Barrick employees he accuses of having a conflict of interest in their work for the government of Mali.SHELLEY CHRISTIANS/Reuters
Barrick Gold Corp. chief executive Mark Bristow says former employees are working with the Malian government in a way that he suggests could be damaging for the Canadian gold miner, as its massive operation in the country remains on ice.
Toronto-based Barrick ABX-T, Canada’s second-biggest gold miner by market value, was forced to halt its operations in Mali last month after an escalation of a dispute with the military junta government that had been building for about a year. Mali has demanded at least US$417-million from Barrick to make up for allegedly not paying its fair share of taxes previously.
The Loulo-Gounkoto gold complex is 80 per cent owned by Barrick and 20 per cent by Mali. It produced more than half a million ounces of gold last year, making it by far Barrick’s largest operation in Africa, and the second biggest in Barrick’s vast portfolio that also spans North America, Latin America, Asia Pacific and the Middle East.
In a conference call with analysts on Wednesday, after the release of its fourth-quarter results, Mr. Bristow said that former Barrick workers are feeding information to Mali.
“There are two of our ex-employees who are advising the government, who in our mind have conflicts of interest in many different aspects,” Mr. Bristow said.
He didn’t identify the ex-Barrick people, but he indicated that they may be providing information to the Malian government that could be used against the company.
“They are claiming that the mining industry had not fulfilled its obligations,” Mr. Bristow added.
Mali continues to put Barrick under severe pressure as the Canadian miner tries to salvage a new profit-sharing agreement. In what appeared to be a move to gain leverage in negotiations last September, the junta arrested four Barrick employees, and held them in custody for several days. In November, authorities arrested several more of Barrick’s senior managers, and they remain in prison. Mr. Bristow is unable to set foot in Mali because authorities have an outstanding arrest warrant on him.
Investor nervousness around Mali has weighed heavily on Barrick’s share price. Despite producing significantly less gold than Barrick, Canadian competitor Agnico Eagle Mines Ltd. AEM-T has long since eclipsed Barrick in both its market value and stock-market performance.
But vulnerabilities in Barrick’s portfolio isn’t limited to Mali. Barrick on Wednesday revised downward both its 2025 and longer-term gold-production forecasts. The company said it is on track to produce between 3.15 and 3.5 million ounces this year, down roughly 15 per cent compared with 2024.
Josh Wolfson, analyst at RBC Dominion Securities Inc., in a note to clients called the updated forecast “light,” even after accounting for the exclusion of the shuttered Malian operations. Mr. Wolfson asked executives during the conference call to provide more specifics around the forecast to ascertain where the weakness may be lurking in other parts of Barrick’s operations.
But Barrick declined to give specifics and cast doubt on the legitimacy of even asking about the forecast.
Chief financial officer Graham Shuttleworth replied that the earlier forecast from November was not meant to be precise, and only an indication of the general direction the company was heading.
But Mr. Bristow was more forceful in his answer and tone, admonishing Mr. Wolfson for “trying to nitpick,” about the company’s guidance.
For the mining industry, however, guidance is paramount, and watched closely by analysts and investors alike. It’s a key piece of information when ascertaining the valuation of a company. Mining companies put a huge amount of emphasis on hitting their guidance, and share prices often soar if they beat their forecasts, and vice versa.
While some investors are concerned about Barrick’s 2025 and longer-term guidance, the company managed to hit its numbers in 2024, something it failed to do in 2023.
Barrick on Wednesday revealed that it hit the low end of its guidance range for the year, producing 3.91 million ounces of gold, compared with the range of 3.9 million to 4.3 million it had provided.
Shares in Barrick closed up 6.4 per cent on the Toronto Stock Exchange on Wednesday at $25.97 apiece.