Mali wants to boost its mining revenues, especially from gold, by leveraging its new mining code adopted in 2023. The code, however, poses issues for mining companies currently operating or planning to establish mines in the country.

Toubani Resources is in talks with the government to finalize a mining convention for its Kobada gold project. According to a document released on September 9 for investors, the discussions will focus on the tax regime for this future mine, which is expected to produce at least 34 tonnes of gold.

Since 2015, the Kobada project has held a mining permit valid until 2045. However, Mali’s mining landscape has changed with the new mining code. The latter has increased the State's stake in mining projects and introduced a 5% stake for local investors.

Investor Presentation | September 2024
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— Toubani Resources (@toubani_gold) September 9, 2024

Although Toubani believes that existing mining permits should retain their rights under the new code, the company has chosen to "proactively engage with the Malian state." Since the new code was adopted, there has been no official communication regarding the status of existing mines or projects with current permits.

Recently, the Malian government applied the new mining code to the Goulamina lithium project, securing a 30% stake in the country's first lithium mine. On September 3, Canada’s Allied Gold announced an agreement in principle with authorities to apply the new code to its Sadiola gold mine, which has been in production for decades and recently applied for a ten-year permit renewal.

These developments show the Malian government's determination to maximize revenues from the mining sector. The new code is expected to generate an additional  CFA500 billion (about $850 million) each year. In 2021, the mining sector accounted for around 20% of government revenues, 80% of exports, and over 9% of GDP.

Emiliano Tossou