Mali Gold Production Declines Significantly Amid Regulatory Challenges

Mali’s gold production fell 23% in 2024, totaling 51 metric tons. This decline is attributed to disputes with Barrick Gold over mining laws and operational suspensions. The new mining code raises taxes and state ownership, making investment challenging. The overall outlook for the production, including artisanal mining, remains low at 58.7 tons.

Mali’s industrial gold production experienced a significant decline of 23% in 2024, totaling 51 metric tons compared to 66.5 tons in 2023, as reported by the country’s mines ministry. As one of Africa’s leading gold producers, Mali hosts major international mining companies, including Barrick Gold, B2Gold Corp, Resolute Mining, and Hummingbird Resources.

The reported output figure does not account for Barrick Gold’s December production due to ongoing disputes with Mali’s military-led government related to new mining legislation. Following a seizure of its gold reserves by helicopter, Barrick halted operations at its Loulo-Gounkoto site, with four of its staff detained on serious charges, which the company denies.

The new mining code imposed by Mali’s government, which increases taxes and mandates significant state ownership in mining assets, has disincentivized investment in new mining projects. Executives from various mining firms indicated this legislation undermines the economic viability of operating in Mali. The government has asserted that mining companies like Barrick are failing to contribute their fair share of taxes.

For the first time in over three years, Mali’s gold production fell below 60 tons. The total might have reached 52.7 tons had Barrick adhered to its forecasted December production of 1.7 tons. The ministry has not elaborated on the reason for the production decline.

An insider from the mines ministry speculated that the ongoing disputes between the government and mining companies contributed to the reduced output, indicating a crisis of confidence in the sector exacerbated by the demand for foreign companies to adapt to the new mining code and recent arrests of employees and executives. Current data lists Barrick Gold as the largest producer in Mali, with 19.4 tons produced in 2024, excluding December figures, followed by B2Gold with 13.7 tons and Resolute Mining with 7.2 tons. Including artisanal mining, the total gold production for Mali in 2024 is projected to be 58.7 tons, according to the ministry’s estimates.

In summary, Mali’s gold production has faced a substantial decline due to various factors, including the implementation of a challenging new mining code, operational halts of major mining companies, and ongoing conflicts with the government. The overall production fell below the significant threshold of 60 tons for the first time in three years, indicating a potential crisis in the sector that may affect future investments and outputs.

Original Source: www.marketscreener.com