Three Major Gold Producers Sign Mali’s New Mining Code

Three gold producers, including London-listed Endeavour Mining (EDV.L), have agreed to adopt Mali’s controversial new mining code, Malian government officials announced, marking a shift in the months-long standoff that has rattled the country’s mining sector.

Mali’s Finance Minister Alousseni Sanou and Minister of Mines disclosed the agreement in a televised address late Monday, stating that Somika SA, 80% owned by Endeavour and 20% by the Malian state, along with Faboula Gold and Bagama Mining, have signed a memorandum of understanding to operate under the revised code. The terms of the agreements were not made public, according to Reuters.

In recent years, Mali’s transitional military-led government has sought to tighten its grip on the mining sector, citing ambitions of resource sovereignty and national development.

The revised mining law, enacted in August 2023, boosts state revenue by raising taxes and increasing the government’s ownership stake in mining projects.

It triggered a wave of pushback from miners and has been blamed for a 23% drop in Mali’s gold production last year, which fell to 51 metric tons.

While the three companies represent a small slice of the country’s total output, their compliance marks a notable development. Faboula Gold and Bagama Mining, which began production in 2021 with outputs of just 500 kg each, and Somika’s Kalana project, which has yet to begin production, have largely remained inactive since the code came into force.

Somika Director Abdoul Aziz said mine construction would begin within six months of the agreement signing, with production expected to commence 18 months later.

Minister Sanou said Somika’s mine has a projected 10-year lifespan and is expected to generate 135 billion CFA francs ($238.9 million) in annual revenue.

Faboula and Bagama mines are each projected to operate for five years, with expected annual turnovers of 75 billion CFA francs and 50 billion CFA francs, respectively. All three projects are anticipated to create around 2,000 jobs each.

Meanwhile, Mali’s top gold producer, Barrick Gold (ABX.TO), remains embroiled in a legal battle with the government.

Tensions escalated in January 2025 when Barrick Gold halted operations at its Loulo-Gounkoto complex after the Malian government seized gold stocks stored at the site. Operated by the Canadian firm’s local subsidiary, Loulo-Gounkoto is one of Mali’s most productive gold mines and a key contributor to national export revenues. Prior to the suspension, it accounted for roughly 15% of Barrick’s total gold output.

Barrick has since launched arbitration proceedings with the World Bank’s International Centre for Settlement of Investment Disputes (ICSID).

Last month, Mali officially completed its takeover of the Yatela and Morila gold mines, both previously abandoned by their foreign owners.

Though Mali remains one of Africa’s top gold producers, growing regulatory uncertainty has dampened investor confidence and cut into output.