Johannesburg - London-listed Randgold Resources said the decision of the Malian government to close its office in the country’s capital, Bamako, did not affect the operations of its three mines in the west African country.
Reuters on Monday reported that Mali’s government had ordered Randgold to pay half the 46.89 billion CFA francs (R1.11 billion) that it said the mining company owed it before opening talks about the remaining sum.
“We have said that we first demand the payment of 50 percent,”Mohamed Lamine Samake, an adviser to the economy ministry, said. “And that then, we will come to the table to discuss a repayment schedule for the remainder.”
Randgold Resources - which operates Mali’s Morila, Loulo and Gounkoto gold mines and was co-founded by South African businessman, Mark Bristow - is embroiled in a long-running tax battle with Malian authorities.
It said recently that a large portion of Mali’s government’s tax claim was unfounded and that it looked forward to discussing the dispute with authorities.
The company received tax claims amounting to $231 million (R3 billion) from the government for its Malian operations and believed that these were without foundation.
It noted that the International Centre for Settlement of Investment Disputes had recently awarded $29.2 million plus costs to Loulo for taxes found by the tribunal to have been wrongfully collected by the Malian government.
“Having taken professional advice, the group considers the claims to be without merit or foundation and is strongly defending its position in relation to these claims and following the appropriate legal process for disputes within Mali,” the company said.
No provision has been made for the material claims.
A Randgold representative said Bristow was not immediately available for comment.
Randgold said its mines accounted for between 7 percent and 11 percent of gross domestic product in that country.
It said it was disappointed that the Mali government had escalated the long-running tax dispute to the extent of closing the group’s offices.
Bristow, who was recently in South Africa for The Joburg Indaba, said in a statement the group had been working towards finding a solution to the problem.
“Randgold does not have a history of meekly conceding on such issues, so a resolution might take some time,” Investec said yesterday.
At the same time, “the government knows not to hurt the golden goose”, so the dispute is not expected to affect mining operations.
- Additional reporting by Bloomberg
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