Mali’s government will lift mining permit suspensions by 15 March, allowing the renewal and transition of permits while new applications remain halted. This move is expected to improve industry conditions, particularly for Toubani Resources and the Kobada Gold Project. The enhanced mining code aims to increase government revenue from mining, aligning with global trends in the sector.
The Government of Mali has announced a partial lifting of the suspension on mining permits scheduled for 15 March, thereby fostering increased certainty within the mining sector. This decision has been warmly received by Toubani Resources, a West Africa-focused exploratory company, which considers the move beneficial for project approvals. While applications to renew existing permits and transition from exploration to exploitation will be allowed, the issuance of new mining permits and transfers for search permits will remain suspended.
Initially instituted by the Ministry of Mines in November 2022, the suspension aimed to evaluate mining operations and reassess the Mining Code established in 2019. Phil Russo, Managing Director of Toubani Resources, perceives this decision as indicative of a return to normal operations within the industry. He remarked that acquiring licenses for mining operations is essential and that the regulatory body in Mali has been inactive for several years, preventing the natural progression of projects.
The resumption of permit approvals is seen as an essential step for projects to advance from exploration to mining. Russo expressed optimism regarding the normalization of the industry, stating that the functioning of the regulatory body would catalyze progress for ongoing projects, benefiting stakeholders across the board. Mali’s updated mining code aims to enhance the government’s share of mining revenues and is consistent with global shifts towards increased state revenue from mining activities.
Several mining companies, including Allied Gold and B2Gold, have successfully established agreements with the Malian government, showcasing a collaborative investment framework. Toubani Resources is finalizing its own investment framework for the Kobada Gold Project, which is projected to significantly contribute to the Malian economy, generating over US$1.2 billion in direct economic benefits while creating numerous jobs in both construction and operations.
As Mali’s fifth-largest gold mine upon completion, the Kobada Gold Project is expected to entail an upfront capital cost of US$216 million. An updated feasibility study indicates a robust financial outlook, projecting a post-tax net present value (NPV) of US$635 million at a gold price of US$2,200 per ounce, and a compelling internal rate of return (IRR) of 58%. The project aims to achieve readiness by 2025, with expected immediate benefits upon completion.
Mali presently stands as Africa’s third-largest gold producer, with the mining sector contributing approximately 8% to the nation’s GDP and nearly 75% of export revenues. The global gold market continues to thrive, valued at over US$13 trillion as of 2023, and the lifting of the mining permit suspension is anticipated to enhance investor confidence and propel new developments within the industry.
The partial lifting of the suspension on mining permits in Mali marks a significant milestone for the industry, fostering renewed confidence and momentum for mining operations. This development aligns with Toubani Resources’ initiatives for advancing projects like the Kobada Gold Project, which promises substantial economic benefits for Mali. As Mali strives to enhance its mining revenues, the government’s actions indicate a strategic alignment with global mining trends, essential for attracting future investments and supporting economic growth.
Original Source: colitco.com
