Mali Mining Code Update Sparks Uncertainty for Kodal Minerals and Bougouni Lithium Mine

2023-09-22 16:45:00

(Ecofin Agency) – The adoption in August of a new mining code in Mali created a climate of uncertainty for companies holding a mining permit in accordance with the old law. Among them, we find Kodal Minerals which obtained authorization in 2021 to exploit lithium 180 km south of Bamako.

In Mali, the mining permit granted in 2021 for the future Bougouni lithium mine will remain subject to the legislation in force at that time, in this case the 2019 mining code. This was the announcement made on September 22 by Kodal Minerals, British owner of the project, which specifies that it obtained confirmation this week from the National Directorate of Geology and Mines (DNGM).

This announcement comes in a particular context in Mali, where relative uncertainty remains regarding the mining permits granted before the adoption of a new code last month. Promulgated on August 28 by the President of the Transition Assimi Goïta, the new law increases State participation in mining projects to 30%, compared to a maximum of 20% in the old code. A 5% participation is also reserved for local investors, a clause not provided for by previous laws.

Gold producers present in the country, Hummingbird Resources, Resolute Mining, Barrick Gold and B2Gold, are optimistic about maintaining the rules in force before the adoption of the new code. As for the Australian Leo Lithium, on track to commission Mali’s first lithium mine, it suspended its presence on the stock market this week, after receiving correspondence from the Malian government relating to the application of the new mining code to his project.

As a reminder, Kodal Minerals concluded an agreement at the beginning of the year with the Chinese Hainan Mining to finance the construction of the Bougouni mine. According to a feasibility study published in 2020, the asset can deliver nearly 2 million tonnes of spodumene concentrate over 8.5 years.

Emiliano Tossou

Also read:

08/31/2023 – Mali: financing to build the Bougouni lithium mine on track to be completed by the end of September 2023

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