What's Happening?
Mali has renewed Barrick Mining's Loulo gold mining permit for an additional 10 years, as announced by the country's military leader. This decision follows a resolution of a dispute between Mali and Barrick over profit-sharing and control of the Loulo-Gounkoto gold mining complex. The dispute arose due to Mali's 2023 mining code, which increased taxes and the state's stake in mining projects. The resolution involved Barrick withdrawing its arbitration case at the World Bank's dispute tribunal, while Mali agreed to drop charges against Barrick and return operational control of the complex. Barrick's share price increased by over 5% following the announcement. The Loulo-Gounkoto complex is Mali's largest gold producer and a significant revenue
generator for Barrick.
Why It's Important?
The renewal of the Loulo permit is significant for both Barrick Mining and Mali. For Barrick, it ensures continued access to one of its most profitable mining operations, which generated nearly $900 million in revenue in 2024. This stability is crucial for the company's financial health and investor confidence, as reflected in the surge of its share price. For Mali, the agreement represents a balance between attracting foreign investment and asserting greater control over its natural resources. The resolution of the dispute and the permit renewal could encourage further investment in Mali's mining sector, potentially boosting the country's economy.
What's Next?
With the permit renewed, Barrick is expected to proceed with its mining operations at Loulo-Gounkoto, focusing on the economically viable reserves identified in its recent feasibility study. This includes plans for six years of open-pit mining and 16 years of underground mining. The successful resolution of the dispute may also set a precedent for future negotiations between Mali and other mining companies, potentially leading to more stable and predictable investment conditions in the country.
