Barrick Gold Corp. (TSX:ABX, NYSE:GOLD) continues to grapple with escalating tensions in Mali, where unresolved disputes with the government over its 80%-owned Loulo-Gounkoto gold mine have led to a suspension of gold shipments and the imprisonment of several local employees.
The company warned that operations at the mine could be halted if shipments remain blocked, marking a critical juncture in its negotiations with the Malian government.
Jefferies analysts, who maintain a ‘Buy’ rating on Barrick with a price target of $28—67% above its current share price of $16.78—acknowledged the mounting frustrations surrounding the Mali situation.
“A resolution in Mali remains elusive, and gold shipments from Loulo-Gounkoto are now blocked. We view the market as already expecting challenging negotiations for GOLD in Mali, given its peers with operations in-country appeared to have agreed to settle at the Malian government’s terms,” analysts wrote.
The conflict stems from the Malian government’s push to apply the country’s 2023 Mining Code to Loulo-Gounkoto, despite the mine’s current operations falling under a different framework. Negotiations over the past year have failed to yield a resolution, with the government rejecting Barrick’s proposed memorandum of understanding.
Adding to the turmoil, several Malian employees, including members of the mine’s local management team, have been imprisoned since November 25 without formal charges. The government has also threatened not to renew the Gounkoto permit, which expires in 2026.
The Loulo-Gounkoto mine is a vital asset for Barrick, contributing approximately $3.2 billion to the company’s net asset value (NAV) and accounting for about 14% of its estimated 2025 gold production. Jefferies estimates that a complete halt to operations at the mine in 2025 could result in an 11% reduction to Barrick’s expected EBITDA, lowering it from $9.98 billion to $8.84 billion.
Other gold miners operating in Mali have also faced government pressure. B2Gold reached an agreement in September 2024 to keep its Fekola Mine under the 2012 Mining Code, while new projects in the Fekola complex will adhere to the 2023 code.
Similarly, Resolute Mining agreed to pay $160 million to settle a tax dispute after its executives were detained.