The mining code adopted in 2023 grants Mali up to a 35% stake in its mines, compared to a maximum of 20% under the previous framework. This reform is projected to generate $500 million annually in additional mining revenue for the government and is being gradually applied across the country’s gold mines.

The Malian government has secured a mining agreement guaranteeing a 35% national interest in the future Kobada gold mine. Canadian company Toubani Resources, which owns the project, announced the deal on Monday, March 31, emphasizing that it aligns with Mali’s 2023 mining code.

The new law allows the State to acquire a free 10% stake in the project and purchase an additional 20%. National investors can also buy a 5% stake. However, details about the conditions for acquiring this paid 25% interest remain unclear. Toubani will pay a corporate tax rate of 25% during Kobada’s first five years of operation, increasing to 30% afterward.

According to Phil Russo, CEO of Toubani, the company is glad to be consolidating its partnership with Mali and values the State’s “continued support for the development of the Kobada goldproject”. “As one of the premier oxide gold development assets in West Africa, Kobada's exceptional technical profile has enabled us to successfully finalise key fiscal terms with the State of Mali while preserving significant value for Toubani shareholders," he added.

The reform contrasts sharply with Mali’s previous mining code, which capped state stakes at 20%. The government aims to boost annual mining revenues by $500 million through increased shareholding. Authorities hope this change will ensure more profits benefit the state and national investors, echoing their vision to “make gold shine for Malians.”

Despite Mali’s 35% interest in Kobada, this does not equate to receiving 35% of the mine’s revenues. Kobada’s earnings are estimated at $4.47 billion over nine years if gold sells at $3,000 per ounce. In a less optimistic scenario where gold prices drop to $2,200 per ounce, revenues could fall to $3.28 billion. Under such conditions, Mali would receive only 14% of revenues through royalties and taxes.

According to Kobada’s October 2024 feasibility study, the mine could produce 162,000 ounces of gold annually over its estimated lifespan of 9.2 years, totaling 1.49 million ounces (42 tonnes). Realizing this potential requires an initial investment of $216 million.

This article was initially published in French by Emiliano Tossou

Edited in English by Ange Jason Quenum