On the DSO The Company progressed shipments of DSO on the basis of the (then) Minister of Mines being very supportive with views that it proved the mine early, brought forward revenue into the country and also demonstrated the viability of the mine/project.
What we do know is the new Minister of Mines (elected in July) directed the Company to suspend DSO operations, with the only reason provided to the Company was DSO was not included in the original project submission. ~ after the Company provided information to the Minister, including the process of the mine and operations, DSO operation and the trialling of the transport or ore to port (using 5 different contractors? being part of the tender process for the cartage contract?) ~ the Government remains interested in DSO with discussions ongoing and it may still be permitted to proceed.
I disagree that it was an informal approach to DSO, in the Establishment Agreement DSO is allowed under the trial mining provisions which enables limited mining to occur in the early stages of proving up a project. ~ the financials - (assuming you are referring to) taxes & royalties etc, are covered in the relevant Mining Code.
The Mining Code does not give percentage amount of the said taxes & royalties but refers it back to the Establishment Agreement (or Convention) whereas taxes & royalties are covered. ~ the Company has provided evidence of what these amounts will be in the Supplementary Prospectus and in the updated DFS under C3 costs. ~ although in this case this may be different, but the agreement was signed off on in 2017 (from memory) and across all mining companies operating in Mali, royalties and taxes were a consistent standard.
Quite honestly, I would have been happy for the Government to take all the profit from the sales of DSO just to allow the Company to trial the two routes including the cross over route, trucking contractors and the port facilities but have since changed that thought post the announced "settlement" that Leo Lithium solely (opinion) has to fund.
The 10% free-carry to the Mali government is quite baffling though, but I opine that the delay is related to the new Minister of Mines not being across and fully understanding the model. As previously posted, under the 2023 Mining Code the free carried component is clearly states a minimum of 10% and no indication of a maximum (or cap)
The arrest of the ex Minister of Mines I am not surprised, and it helps explain why the new minister was appointed. In its attempt to rid the stigma of corruption in Mali, the Government is following the recommendations of both the World Bank (who recommended the audit of the Mining industry that was completed in 2022) and the concerns of the IMF over EDM (energy provider)
cheers
LLL Price at posting:
50.5¢ Sentiment: Hold Disclosure: Held
(20min delay)