Highlights:
- Exploitation permits for Fekola Regional and approval of exploitation phase of Fekola underground to be expedited: Upon issuance of the exploitation permit for Fekola Regional, mining operations will begin with anticipated gold production starting in early 2025. The addition of Fekola Regional sources is expected to contribute approximately 80,000 to 100,000 ounces of gold per year. Initial gold production from Fekola underground is projected to start in mid-2025.
- Fekola Mine governance and transition under new Mining Code: The Fekola Mine will operate under Mali’s 2012 Mining Code, and the existing Fekola Mining Convention will remain valid until 2040. In contrast, Fekola Regional will be governed by the 2023 Mining Code, signaling a shift in the regulatory framework. The Agreement ensures the stability of ownership, income tax, customs regimes, and dispute resolution rights for the Fekola Mine.
- Clean slate for the Fekola Complex: The Agreement establishes a new economic partnership with the State of Mali. This includes converting the State’s 10% ordinary share interest to a preferred share interest with priority dividends, resolving tax issues, customs disputes, and settling outstanding assessments. This positions the Fekola Complex for future growth and development.
In 2022, the Malian government initiated an audit of the mining sector, leading to the creation of the 2023 Mining Code and a Commission to negotiate mining conventions. The finalization of the Implementation Decree for the 2023 Mining Code in July 2024 set the stage for discussions between B2Gold and the Commission, resulting in the Agreement to address various issues and align with the new regulatory framework.
Agreement Terms and Implications
The Agreement encompasses several key aspects, including the continued governance of the Fekola Mine under the existing regime, the distribution and conversion of the State’s ownership interest, settlement of tax and customs disputes, and acknowledgment of VAT credits. Notably, the Agreement paves the way for the State to receive retained earnings and transitions the ownership structure for future operations.
Operational Changes and Financial Adjustments
Operational adjustments, such as the payment of fuel import taxes and corresponding tax reductions, demonstrate a strategic shift in financial responsibilities between B2Gold and the State. These changes aim to optimize operational efficiency and maintain a balance in tax obligations. Additionally, the Agreement aligns the Fekola Mine with new tax royalties and infrastructure funds introduced under the 2023 Mining Code.
Future Development and Exploration
The Agreement accelerates the development of Fekola Regional, enhancing production capacity and extending the mine life of the Fekola Complex. The upcoming exploration program in Mali underscores B2Gold’s commitment to discovering high-grade mineralization and expanding the resource base. These initiatives position the company for sustainable growth and long-term viability in the region.
About B2Gold
B2Gold, as a global gold producer, is strategically positioned with operating mines in multiple countries and a robust project pipeline. The company’s commitment to operational excellence and responsible mining practices underpins its growth trajectory. With a focus on maximizing value for stakeholders, B2Gold continues to expand its footprint and explore new opportunities in the gold mining sector.
