Barrick Gold Edges Closer to New Mining Code Agreement in Mali

Barrick Gold CEO Mark Bristow expressed optimism about finalizing negotiations with Mali’s ruling government on a revised mining code before year’s end. Discussions regarding regulatory updates for the Loulo-Gounkoto mining complex—a major gold site in Mali—have been ongoing for several months. As the government seeks to bolster revenue from the mining industry, it has reportedly requested approximately $500 million from Barrick in back taxes.

In addressing the negotiations, Bristow mentioned that Barrick has proposed allowing Mali a 55% share of the economic benefits from the Loulo-Gounkoto operations, a structure similar to an agreement established with Tanzania five years prior. However, he refrained from commenting directly on Mali’s monetary demands or alleged outstanding taxes and penalties.

Bristow indicated Barrick’s willingness to allocate additional economic benefits to Mali, emphasizing the importance of preserving the asset’s long-term value. He noted that increasing fundamental costs could jeopardize the project’s longevity, potentially affecting Mali’s economy. Despite offering a larger share of the economic gains, Barrick intends to maintain responsibility for the project’s capital risk.

On Thursday, Barrick confirmed that the Loulo-Gounkoto complex is on track to reach the higher end of its annual production target, with a projected output of 560,000 ounces. The mine currently holds 6.7 million ounces in gold reserves, with a total measured and indicated resource of 9.1 million ounces. Loulo-Gounkoto produced 683,000 ounces of gold in 2023.

Despite this strong performance, Barrick missed Wall Street’s third-quarter profit expectations, attributing the shortfall to increased costs and lower production at its Nevada operations. Gold output at Nevada Gold Mines fell to 385,000 ounces in the third quarter from 401,000 ounces in the previous quarter, while all-in sustaining costs (AISC) for gold rose to $1,507 per ounce from $1,255 per ounce a year ago. Copper AISC also saw a year-over-year increase of 10.5%, though it showed improvement from the prior quarter.

Barrick projects improved results in the fourth quarter, aiming to meet its 2024 production target of 3.9-4.3 million ounces of gold. Shares of Barrick dropped 1.2% as of 12:10 p.m. EDT on Thursday, leaving the Toronto-based miner with a market capitalization of $32.1 billion.

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