Randgold's Mali offices closed in tax dispute

Randgold Resources said Monday the government of Mali had closed its offices in the capital Bamako over a $85.5 million tax claim that the South African gold producer is contesting.

In a statement, Randgold Resources said it was disappointed at Bamako's move but insisted that "the closure does not affect the operations of our three mines in Mali."

Randgold had earlier put the amount of the disputed tax claim at $230 million.

The London- and New York-quoted firm added it had been professionally advised "that a large proportion of the tax claims received from the state of Mali in respect of its operations in that country are without merit or foundation.

"Following the appropriate legal process, it is strongly defending its position in relation to these claims."

Randgold also noted that the International Center for Settlement of Investment Disputes had recently awarded $29.2 million plus costs to its Loulo operation for taxes which the centre found the Malian government had wrongly collected.

"We have continued to engage with the Malian authorities at the highest level to resolve the remaining issues," Randgold Resources chief executive Mark Bristow said, urging a constructive approach to bring about a "mutually acceptable solution."

In a statement late Monday, a Malian finance ministry source who requested anonymity told AFP "the law is the law", and would be applied as such.

"We don't want to get involved in a pointless controversy... other mining companies came by and regularised their situation," the source said.

"This firm owes almost 48 billion FCFA ($81.5 million, 76 million euros ). Despite all our overtures, they ignored us," the source added, vowing "other measures" would be taken to claw back the money owed.

Mali is of strategic importance for the group, which also has a gold mine in Ivory Coast and the Democratic Republic of Congo.

Last year it posted net profits of $189 million on sales of $1.4 billion.

Bristow had earlier hailed the mine at Loulo and neighbouring site of Gounkoto as being of major benefit to the Malian economy, indicating the complex had contributed some $700 million "in taxes, royalties and dividends" to the state, while injecting "an additional $1.9 billion into the economy" through supplier and contractor payments and employee wages.

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