Mali begins building a gold refinery supported by Russia

The West African nation’s military chief claimed that Monday’s start of work on a new gold refinery supported by Russia will bring Mali one step closer to claiming sovereignty over its natural riches.

Mali owns a majority ownership in the 200-ton capacity plant, which will be constructed in collaboration with a Swiss investment firm and Russia’s Yadran Group.

Colonel Assimi Goita, the acting president of Mali, declared last year that a revamped mining code will mandate that all mining companies process their gold domestically, although he did not provide a timeframe.

In the Sahel, Guinea, Niger, and Burkina Faso have also updated their mining regulations to require local processing, which adds value to their exports and increases the economic benefits of their resources. This is part of a larger regional change.

At the groundbreaking ceremony for the new factory in Senou, outside the capital Bamako, Goita stated, “Mali’s gold has been exported for refining and sale to countries such as the United Arab Emirates, South Africa, and Switzerland since 1980.”

“This deprives our country of substantial revenues that could be used for the development of its economy.”

A completion date for the facility has not been specified by the government. With a capacity of about four times Mali’s yearly gold production, once fully operational, it will convert all of the country’s gold into dore bars prior to export.

According to Yadran President Irek Salikhov, who echoed Goita’s remarks, the refinery will serve as “a regional center for processing gold extracted not only in Mali, but also in neighboring countries — like Burkina Faso” at the ceremony.

Despite efforts to build one, particularly by Ghana, the continent’s largest gold producer, West Africa, a significant producer of gold, does not yet have a working, internationally recognized gold refinery.

Since the military leader took over in 2021 and broke off ties with Western allies, Goita has implemented extensive mining reforms, including the refinery. Similar to Guinea, Niger, and Burkina Faso, Mali’s updated mining regulations have alarmed investors.

This month, a Malian court escalated a protracted disagreement over Mali’s tax claims by placing Canadian miner Barrick’s (ABX.TO) new massive Loulo-Gounkoto gold complex under interim state administration.

According to Goita, Mali would be able to better monitor its gold exports and production thanks to the refinery. Due to the lack of accredited gold refineries and traceability initiatives, it loses billions of dollars to gold smuggling, just like many other African nations.