Miners in Ivory Coast begin to pay increased royalties following unsuccessful opposition, according to sources
Gold mining companies in Ivory Coast have started to pay a new 8% royalty on revenue, retroactive to January, following months of debate over the legality of the levy, according to three industry sources who spoke to Reuters.
Reuters previously reported that the leading cocoa producer, aiming to diversify its economy, has substituted the earlier range of 3% to 6% associated with contract terms for a fixed rate of 8%.
Miners initially declined to pay, contending that the action was illegal as their contracts protected them from financial alterations, and they engaged in discussions with the government to eliminate the new royalty.
Nevertheless, companies have begun to make payments following the government’s decision to maintain its stance, according to three individuals with knowledge of the situation, who requested anonymity as they were not permitted to discuss the matter with the press.
“All parties have now consented to the payments – the issue at hand is whether penalties will be enforced,” remarked one executive, noting that companies were hurrying to reach settlements to evade fines.
The mines chamber of Ivory Coast, along with its ministries of mines and finance, has not yet provided a response to requests for comment.
David Whittle, the chief operating officer for Fortuna Mining in West Africa, has confirmed compliance.
“We have processed our payments of 8%, retroactively effective from the date it was implemented.” “We didn’t observe the negotiations progressing,” he stated.
“The gold price has managed this,” Whittle stated, alluding to its approximate 65% surge this year.
Prominent mining companies in Ivory Coast consist of Perseus Mining, Endeavour Mining, Fortuna, Allied Gold, along with newcomers such as Montage Gold.
With the rise in gold and other commodity prices, West African states are intensifying fiscal pressure on miners, which is straining relations with operators who caution that these measures may hinder investment.
In contrast to military-led Guinea, Mali, Niger, and Burkina Faso, which are actively revoking licenses and seizing assets to secure concessions from operators, countries like Ghana and the Ivory Coast are implementing new laws and levies aimed at enhancing state revenues.
