B2Gold says strike at Fekola mine will not impact output

B2Gold (TSX: BTO; NYSE: BTG) says that its Fekola mine complex in Mali will continue to operate at full capacity despite an ongoing strike, and there will be no impact on the annual production guidance.

A portion of workers at Fekola have gone on strike primarily as a response to the action B2Gold took against some employees that previously engaged in what it calls “illegal activities detrimental to productivity” at the mine, the Vancouver-based miner said on Monday. These activities include “go slow” actions by the employees and an illegal sit-in at the Fekola management office last August.

Under the notice the Fekola workers’ union served to the company last week, the strike is expected to last seven days, ending on Thursday.

Commenting on the strike notice, B2Gold said it “remains ready and willing” to participate in meetings with the workers union to reach a resolution, and will “continue to adhere to legal procedures, respecting the rights of all its employees, inviting the union to engage in a constructive dialogue, and providing the authorities with all requested information.”

Meanwhile, during this seven-day strike period, the company will continue to operate critical infrastructure and the mill on a reduced roster, maintaining the expected gold production profile during the period.

The Fekola mine is one of B2Gold’s three main producing assets, accounting for over half of last year’s production at about 590,000 ounces. This year, it is still expected to meet its guidance at somewhere between 420,000-450,000 oz. despite the labour action.

Talks with Mali

Also in Monday’s release, B2Gold said it is making progress with the Mali government, which owns 20% of the Fekola mine, on their respective deliverables and implementation of the necessary steps under the memorandum of agreement signed in September 2024. Among those is the issuance of the necessary permits to commence exploration at the Fekola Regional project.

Upon issuance of the permit for Fekola Regional, located 25 km north of the mine, operations will begin with initial gold production expected in early 2025. This would potentially generate around 80,000-100,000 oz. of additional production on an annualized basis through the trucking of open pit ore to the Fekola mill.

The memorandum with Mali’s new regime also laid out terms for the expedited approval of the exploitation phase for the Fekola underground project, where the company expects to begin production after Fekola Regional in mid-2025.

Other miners operating in the west African country have faced challenges recently in dealing with Mali’s military government. Resolute Mining (ASX: RSG; LSE: RSG) last week made a second settlement payment of about US$50 million to the government to help resolve a tax dispute, and the previous week the company paid US$80 million before the military government released three company executives, including CEO Terence Holohan, who had been detained since Nov. 8. Four employees from Barrick Gold’s (TSX: ABX; NYSE: GOLD) Loulo-Gounkoto mine in Mali were arrested and detained there last week, while their trial is pending.

B2Gold’s shares were down by 4.9% to $3.88 apiece on Monday afternoon in Toronto following the strike announcement. The company has a market capitalization of almost $5 billion.