B2Gold's Fekola Mine in Mali.B2Gold/Supplied
Three Canadian mining companies in Mali are indirectly helping its government finance the cost of Russian mercenaries who have been implicated in massacres and other atrocities in the country, a new report says.
Mali’s military junta, which came to power in a series of coups in 2020 and 2021, is paying a reported US$10-million a month to the Wagner Group, a Russian military contractor, in exchange for the deployment of an estimated 1,000 soldiers in the West African country.
By June this year, those payments had amounted to more than US$200-million, according to the Blood Gold Report, a 62-page report published Tuesday.
Human-rights groups and other analysts have accused Wagner of complicity in massacres of civilians in Mali, often in collaboration with the country’s army. The Russian mercenaries and Malian forces executed as many as 500 civilians in the town of Moura last year, according to reports by human-rights groups. United Nations experts said the reports of the Moura massacre were credible.
Mali’s government gets more than half of its tax revenue from the gold-mining sector, which is dominated by three Canadian companies – Barrick Gold Corp. ABX-T, B2Gold Corp. BTO-T and Allied Gold Corp. AAUC-T – and an Australian company, Resolute Mining.
The junta is “dependent on a small number of Western mining companies for the revenue it needs to pay Wagner,” the Blood Gold Report said.
“Despite the military junta’s increasing grip over Mali’s political institutions, and the growing influence of Wagner in the country, gold mining companies operating in the country continue to increase production and explore opportunities for expansion,” it said.
“Their status as the state’s biggest taxpayers means that they are necessarily contributing to the junta’s ability to pay Wagner an estimated US$10-million per month.”
The report was written by a team of five international researchers and human-rights activists, including two at 21 Democracy, a Washington-based group that opposes the growth of authoritarian regimes.
The four companies provided about US$588-million in taxes and royalties to Mali’s government last year. Barrick alone is the country’s single-biggest tax contributor; in just the first half of this year, it paid US$206-million in taxes, compared with US$263-million in all of last year.
Barrick and B2Gold also have formal partnerships with the Malian government, which owns 20 per cent of their main mining operations in Mali. The government has proposed new rules that would allow it to own as much as 35 per cent of new mining projects.
“Mining companies which have elected to continue this partnership despite the military takeover have derived vast revenues from their ongoing operations,” the report said.
“The junta-controlled government also benefits extensively from this system, with revenues derived from gold mining increasing significantly since the 2021 coup.”
Russia’s role in Mali’s mining sector could be increasing soon. Last month, Wagner forces helped the Malian military capture the former rebel stronghold of Kidal, in a gold-rich region of northern Mali, potentially paving the way for Wagner to become directly involved in the country’s gold industry, as it has already done in Sudan and the Central African Republic.
Mali’s government also announced last month that it had signed an agreement with Russia to build a gold refinery capable of producing 200 tonnes a year, the biggest in West Africa.
“Given that Mali’s annual industrial gold production stood at 66.2 tonnes in 2022, the proposed capacity of this new refinery suggests that the junta intends for all gold mined in Mali to pass through this new 200-tonne refinery,” the report said.
Barrick chief executive officer Mark Bristow, in an exchange of letters with the Blood Gold Report researchers, said the views expressed by the researchers were “grossly inaccurate.” Barrick and its Mali mining operation have never engaged directly with the Wagner Group, and there are no sanctions preventing the company from operating in Mali, he said in his letter.
“We do not get involved with geopolitics,” Mr. Bristow said. “Our primary objectives are to create a sustainable and secure environment for the people and communities in the countries we operate in and to ensure that the host countries get their legal, fair and contracted share of the economic value generated for the ultimate benefit of the citizens of the country.”
He added: “The key question is whether you believe it would be in the best interest of Mali and its people to see a widespread exit of all Western corporations from the country?”
Randall Chatwin, senior vice-president at B2Gold, said the company received a letter from the Blood Gold Report researchers that made an “irrational and illogical” attempt to link the Canadian company to Russian activities.
“There is nothing that we have seen or been made aware of that provides any such link or supports any such conclusion,” he told The Globe and Mail in response to questions about the report.
“Taxation is one of the most significant and direct ways we can contribute to the well-being of our host jurisdictions,” Mr. Chatwin said. “We also must recognize and respect the rights of our host jurisdictions to self-govern, which includes the redistribution of tax revenue.”
B2Gold conducts its business in accordance with a code that respects human rights and complies with international standards, he said.
Allied Gold did not respond to questions from The Globe.