Iamgold (TSX: IMG; NYSE: IAG) has delayed the sale of its Sadiola gold mine in Mali, a joint venture with South Africa's AngloGold Ashanti (NYSE:AU), as the country reels from a coup, the second in less than ten years.
The Toronto-based miner and its partner reached a US$105 million deal in December to sell their 82% combined stake (41% each) in the gold project to Australia's Allied Gold.
The transaction was expected to close in April, but the coronavirus pandemic affected the timeline.
Mali President Ibrahim Boubacar Keita resigned on Aug. 18, after seven years as head of state, and dissolved parliament hours after soldiers detained him at gunpoint and seized power in a coup.
The coup sparked international condemnation and is likely to further destabilize the West African nation, following months of anti-government mass protests and a rising insurgency from Islamist militants.
On Aug. 19, Colonel Assimi Goita declared himself the leader of the military figures behind the coup - a group that identifies itself as the National Committee for the Salvation of People (CNSP).
Experts believe that miners operating in the country's west and south are unlikely to face any significant threats to their assets. They will, however, deal with disruptions, including the imposition of a nightly curfew and the closure of all Malian borders, according to Alexandre Raymakers, senior Africa analyst at risk analysis company Verisk Maplecroft.
Mining companies should also expect substantial administrative delays when dealing with authorities as government structures will be paralyzed by the ongoing political crisis, the expert told MINING.com.
Mines and petroleum minister Lelenta Hawa Baba Bah and her closest associates are unlikely to return to the ministry; however, operators can expect some form of continuity as senior civil servants will remain in their posts.
Furthermore, ECOWAS sanctions will involve the closure of land and air borders, paralyzing operators' export routes and logistical lines.
"Considering the fragility of the Malian economy, we do not expect a new transitional government to drastically alter government policy towards the country's mining sector," Raymakers stated in an email response to questions. "Elites from all walks of the Malian political sphere welcome foreign investment in the mining sector as a crucial part of the economy."
Sadiola, one of the three assets AngloGold Ashanti put on the chopping block this year and Iamgold's founding asset, is also owned by the Mali government, which has an 18% interest.
"We note that the only outstanding matter is the signature of the prevailing government authorities," Iamgold spokeswoman Indi Gopinathan told Reuters. She did not provide an estimate on closing.
The open-pit mine is near Mali's border with Senegal, 70 km south of the town of Kayes, and 510 km northwest of the Mali capital of Bamako.