B2Gold says Mali’s new code won’t affect its Fekola mine

Mid-tier Canadian miner B2Gold (TSX, NYSE: BTO) said Tuesday its Fekola mine won’t be affected by a new mining code the country’s government is planning to draft as the asset is governed by a finalized and enforceable mining convention valid for the lifespan of the mine.

The Vancouver-based company, which poured first gold at Fekola late last year, said media reports claiming Mali will move to implement a new law unilaterally if no compromise with miners is reached are erroneous, adding that comments made by the Minister of Economy and Finance were taken out of context.

Fekola is governed by a finalized and enforceable mining convention valid for the lifespan of the mine, B2Gold  says.

The company was referring to a Reuters article, which claimed minister Boubou Cisse had said the plan was to reduce a 30-year protection from changes to the fiscal regime many mines in Mali have, to just each mine’s life.

“The company believes its interests in Fekola are protected and that any contemplated amendments in a new mining code will not apply to Fekola without B2Gold's agreement,” President and Chief Executive Officer Clive T. Johnson said in the statement. “No Malian government representative has informed any B2Gold representatives in Mali or elsewhere that the government does not agree with the company's position.”

The company noted it has a strong business relationship with the Mali government, which has inked deals that grants it a 20% ownership in Fekola. Those purchase agreements, B2Gold said, have been signed and approved by the relevant ministers and are now subject only to final ratification by the Mali National Assembly, expected to happen in April.

The miner says Fekola, near Mali’s border with Senegal, and about 520 km from the country’s capital, Bamako, has the potential to host additional Fekola-style gold deposits, and surface exploration, regional drilling and geophysics have identified a number of targets.

Between October and December last year, the mine was expected to generate between 100,000 and 110,000 ounces of gold and between 400,000 to 410,000 ounces in 2018.

Other companies with stakes in gold mines in Mali — Africa’s third-largest producer of the metal, include Randgold, AngloGold Ashanti and Hummingbird Resources.