Mali To Take Control Of Morila Gold Mine From Australian Company

Joy ChukwuNovember 22, 20241 Mins read808

The Malian government is set to take control of the Morila gold mine following the resolution of a dispute involving Australian mining company Firefinch and local subcontractor Entreprise Générale Traoré et Frères SARL (EGTF).

It will be recalled that on May 8, Firefinch sold the Morila gold mine to the state government’s Société de Recherche et d’Exploitation des Ressources Minérales du Mali (SOREM-SA) for a symbolic dollar, due to a lack of cash to support the mine’s operations.

However, the transaction was halted following an arbitration procedure launched by EGTF against Firefinch to recover 12.84 billion FCFA ($20.7 million) in unpaid debts.

Firefinch announced on Wednesday, November 20, that EGTF has withdrawn its arbitration complaint, enabling the transaction to proceed.

According to Firefinch’s chairman Brett Fraser, the company had consistently maintained that EGTF’s claim was without merit and had been prepared to defend its position. He said the withdrawal would allow Firefinch to focus on completing the sale of Morila and returning its assets to shareholders.

Through its mining company SOREM-SA, the government is now expected to take ownership of the mine, which has delivered over 7.5 million ounces of gold in the past two decades.

This comes shortly after the transitional government of Mali, led by Assimi Goïta, fully took over the Yatela gold mine from foreign companies, AngloGold and IAMGOLD.

The acquisition aligns with Mali’s efforts to strengthen its control over the mining sector.

Under the country’s new mining code adopted in 2023, the government increased its stake in mining projects to 30 per cent, up from the previous 20 per cent. Authorities said this would help boost mining’s contribution to the economy, which currently represents 10 per cent of GDP and a quarter of government revenue.

Read More: