Barrick Gold and AngloGold Ashanti to sell stakes in Morila Mine in Mali
AngloGold Ashanti and Barrick Gold announced that they will sell their respective stake in the Morila Gold Mine in the West African nation of Mali following political unrest that includes soldiers taking over the government in an armed coup.
Combined, AngloGold Ashanti and Barrick will be selling 80 percent ownership in the mine.
Reuters reported that Australian company Mali Lithium will buy the firm that holds the two miners’ stakes in the mine – the other 20 percent of which is owned by the government of Mali – for a fee estimated at between $22 million and $27 million, Barrick Gold and AngloGold Ashanti said.
AngloGold expects its share of the net consideration for the purchase to be roughly $10 million or less and Barrick said the move would allow it to focus on its strategy of “discovering, developing, owning and operating Tier One assets.”
The acquisition of Morila will turn Mali Lithium into a cash-generating gold producer.
The Morila gold mine poured its first gold in October 2000 and became the foundation stone of African gold giant Randgold Resources, now part of Barrick.
Mali’s President Ibrahim Boubacar Keita resigned and dissolved parliament earlier in August, hours after soldiers held him at gunpoint and seized power in a coup.
The crisis caused the closure of the country’s borders, in a nation where miners typically fly their gold out to be refined.
It also raised the risk of further political turmoil in Mali, which, in common with other countries in the region, faces a growing threat from Islamist militants.
Barrick Gold said the mine, known in its heyday as “Morila the Gorilla,” had produced 6.9 million ounces of gold, generated more than $2.5 billion for its stakeholders in taxes and dividends, and served as its legacy firm’s base for expansion elsewhere in Africa. However it was forecast to close in 2021.
Mali Lithium said it was excited and privileged to acquire one of “West Africa’s great gold mines.”
It added it wants to ramp up operations at the mine as soon as possible.
The deal remains subject to Mali Lithium finding funding and the government of Mali allowing it to go through. The parties aim to complete the transaction by October.