UPDATE 1-Barrick sees deal with Mali over new mining code before year-end

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By Divya Rajagopal and Felix Njini

TORONTO, Nov 7 (Reuters) – Barrick Gold, the world’s No. 2 gold miner, is confident of concluding talks for a new mining code with Mali’s junta-led government before the end of the year, CEO Mark Bristow told Reuters on Thursday.

Talks between Toronto-based Barrick and the authorities in Mali on how to implement new mining rules governing its Loulo-Gounkoto mining complex, one the biggest gold mines in Mali, have dragged on for months.

The West African country is demanding about $500 million in unpaid taxes from Barrick, Reuters reported citing sources, as the government tries to wring more income from the sector, which is dominated by gold miners, to shore up state revenues as prices of the precious metal rally.

Mali has been negotiating with miners in the country how to apply new mining rules, in which the state and local private investors must own 35% interest in mining projects compared with 20% currently.

Bristow said Barrick has offered Mali 55% of the economic benefits from the Loulo-Gounkoto operation, in a deal that he said bears similarities to an agreement the miner

reached with

Tanzania about five years ago. The CEO declined to comment on Mali’s cash demands and accusations of unpaid back taxes and fines.

“We are prepared to give them more of the economic benefits,” Bristow said in an interview. “The key is you don’t want to damage the long last value of the asset. The biggest sufferer will be the country, and any increase in basic cost has an impact on how long the projects will run.” (Reporting by Divya Rajagopal in Toronto and Felix Njini in Johannesburg; Editing by Susan Fenton and Chizu Nomiyama)

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