Global mining giant Barrick Gold has solidified its commitment to Zambia, signing a strategic memorandum of understanding (MoU) with the government’s Industrial Resources Limited (IRL). This move signals a significant push to bolster exploration and mining activities in the mineral-rich nation, aligning with Zambia’s ambitious goal of tripling its copper production in the coming decades.
The partnership comes as Barrick, under the leadership of South African-born CEO Dr. Mark Bristow, enjoys robust financial performance, despite facing considerable challenges in Mali. The contrasting fortunes highlight the volatile nature of the mining industry in Africa, where geopolitical complexities can swiftly impact operations.
Barrick’s Zambian venture, anchored by the Lumwana Super Pit copper expansion project, is poised for significant growth. The mine, once unprofitable and burdened by a $5 billion writedown, has been transformed through rigorous cost control and strategic exploration. “Today, the mine is sustainably profitable and a pillar of our copper growth strategy,” Bristow declared, celebrating Lumwana’s record quarterly production.
The Super Pit expansion, now fully permitted, will be funded by Barrick’s robust cash flow, avoiding the need for new share issuances or debt. “This highlights the big advantage of emerging markets, where large expansions and new projects can be completed much more quickly than in the developed world,” Bristow noted, emphasizing the project’s efficiency.
However, Barrick’s success in Zambia stands in stark contrast to its predicament in Mali. Export restrictions and the “unjust incarceration” of team members have severely hampered operations at the Loulo Gounkoto mine. Despite a strong fourth quarter and exceeding annual guidance, the company has been forced to file for arbitration to protect its rights.
Bristow, while expressing hope for a resolution through dialogue, has been vocal about the “misinformation” surrounding Barrick’s contributions to Mali. “Since 2005, Barrick has contributed more than $3.2 billion to the Malian Treasury,” he stated, highlighting the mine’s crucial role in the country’s economy.
The situation in Mali has prompted Barrick to emphasize its broader impact, beyond mere financial contributions. “We have built and developed local talent,” Bristow explained, noting the expertise of Malian employees across Barrick’s global operations. “The economic multiplier effect of mining is immense, creating opportunities far beyond the mine itself.”
While the future of Barrick’s Malian operations remains uncertain, its strategic alliance with Zambia underscores the company’s long-term vision for African mining. The Lumwana expansion, coupled with the new MoU, positions Barrick to capitalize on the continent’s vast mineral wealth, while navigating the inherent risks of operating in a complex geopolitical landscape.
