Negotiations over tax payments between Barrick Gold and the Mali government are rumoured to start back up again after the gold miner suspended production from its Loulo-Guintoko gold complex, in retaliation for the seizure of US$250 million (A$399.68 million) in bullion from the mine.
Two sources familiar with the matter told media outlet Reuters that negotiations would restart today on how to best resolve the dispute, with Mali’s government demanding US$199 million in back taxes and for Barrick (GOLD.US) to agree to the country’s new mining code.
For its trouble, the US$28 billion Canadian miner would get back its seized gold.
Mali had previously demanded US$500 million and there’s purportedly still a warrant out for Barrick CEO Mark Bristow, yet the company denies the allegations.
Barrick has been working on a solution since September 30 last year to finalise a memorandum of understanding with the West African nation’s military junta - which seized power in 2020 - yet to no avail.
With the mine being shut, analysis from investment banker Jeffries reckons Barrick’s revenue could take an 11% hit as the 57Mt at 3.99g/t gold Loulo-Guintoko churns about 540-570,000oz per annum.
It’s not the first time Mali’s current leadership has attempted to force a foreign gold miner operating in the country to cough up money.
Late last year Australia's Resolute Mining (ASX : RSG) ended up paying US$160 million to settle its own tax issues after the junta kidnapped CEO Terry Holohan and two employees.
Barrick shares remained flat at C$23, down by 0.2% by close of trade on the Toronto Stock Exchange on Monday.