Mali’s gold miners continue to operate as political crisis ensues

Gold mining companies in Mali have reported no changes as their operations despite the resignation of President Ibrahim Boubacar Keita earlier this week in a military coup.

The likes of Barrick Gold, B2Gold, Resolute Mining, AngloGold Ashanti, Hummingbird Resources and Cora Gold said operations and staff were unaffected by the political crisis, although their share prices had all taken a hit following the developments.

Shares in Resolute fell 11.7%, Hummingbird dropped 9.4%, B2Gold fell 8.8%, AngloGold Ashanti lost 4% and Cora Gold shares were down 9.3%. Less exposed Barrick shed 2.7%.

The coup took place in Mali’s capital Bamako, hundreds of kilometres away from the gold operations located in the South and West of the vast, landlocked nation. Many miners similarly continued to operate during a 2012 coup.

However, the Economic Community of West African States has ordered the closure of land and air borders with Mali, which complicates logistics for the mining sector, particularly as gold is typically flown out of the country for refining.

Mali is Africa’s fourth largest gold producer with an output of 71.1 tonnes in 2019. The industry accounted for 9.7% of Mali’s GDP last year and earned the state US$727.7 million in revenue from gold miners.

“In the longer term, there are more clouds for mining investors as this is the second coup in eight years. It will add to an already very high risk premium that people associate with Mali,” said Control Risks analysts Vincent Rouget.