Mali seeks US$500M from Barrick for past taxes, dividends: Reuters

Mali’s military government is seeking at least 300 billion CFA (US$512 million) in outstanding taxes and dividends from Barrick Gold (TSX: ABX)(NYSE: GOLD), Reuters news agency reported on Tuesday.

Barrick, which runs the Loulo-Gounkoto mines in western Mali with an 80% stake, was presented a bill for at least 300 billion CFA, three sources in the country’s mining industry told Reuters. One of the sources said the amount concerns 2020 to 2022 taxes. Another said the amount may be as high as 500 million CFA. 

A Barrick spokesman declined to comment on the amount but said the company was negotiating with the government, Reuters reported. 

Authorities in Mali briefly detained four Malian staff members working for Barrick last month. On Sept. 30, Barrick stated it had agreed with the government to resolve existing claims and disputes.

There have been two coups in the landlocked West African nation since 2020, along with similar putsches in neighbouring Niger and Burkina Faso. The latest junta in Mali approved a new mining code last year that allows for state ownership of up to 35% from 20%. 

Mining audit

The demands on Barrick follow an audit of mining contracts last year and a subsequent push by Mali to renegotiate agreements with mining firms, including B2GOLD (TSX: BTO), Resolute Mining (ASX, LON: RSG) and Allied Gold (TSX: AAUC) to channel more revenue into state coffers under the new mining code.

In Barrick’s 2023 annual report, the miner noted it had received tax collection notices at the end of Nov. 2023 for about US$417 million relating to value added tax credit balances that had offset taxes and royalties but were subsequently disallowed by Malian authorities.

Barrick argued that the tax bills were “without merit” but confirmed it had paid US$17 million as part of a six-month stay on enforcement.

Barrick CEO Mark Bristow recently said the company is aiming to grow its presence in the country to ensure the long-term sustainability of its Loulo-Gounkoto operation.

The Loulo-Gounkoto complex holds proven and probable gold reserves estimated at 6.7 million oz., with measured and indicated gold resources totalling 9.1 million ounces. It produced 683,000 oz. gold in 2023 and is on track to meet its production guidance for the current quarter and the year.

Shares of Barrick Gold closed 1% lower on Tuesday in Toronto at $26.83 apiece. The miner has a market capitalization of $47 billion.