(Ecofin Agency) - After months of negotiations, the Malian government acquired the Morila gold mine for a symbolic dollar. The asset was transferred to SOREM-SA, a State company. Now, however, the mine is at the heart of a legal dispute between a Malian subcontractor who asks the mine’s former owner for unpaid dues.

The subcontractor, Entreprise Générale Traoré et Frères SARL (EGTF), has launched an arbitration procedure to recover 12.84 billion CFA francs ($21.26 million) from Firefinch. In its complaint, EGTF named Firefinch's former local subsidiary, Morila SA, the mine’s owner before its transfer to the State.

Firefinch stopped financing the Morila mine in 2022 due to liquidity issues and planned to sell the asset. The Malian government blocked the sale and negotiated the transfer of ownership to SOREM-SA. 

Firefinch said it is not a party to the mining services contract and is not bound by the arbitration provisions it contains. "Firefinch is not a party to the mining services contract [and is not bound by the arbitration provisions it contains], and there is no agreement between Firefinch and Morila SA that would require Firefinch to honor Morila SA's debts or other obligations," it said.

Over the 20 years it was in activity, Morila produced over 7.5 million ounces of gold (+200 tonnes) of gold, making it a top contributor to Mali’s total output.

Emiliano Tossou