Gold boom in Africa: What makes the continent so attractive for Barrick Mining, Desert Gold, B2Gold, and your portfolio

Barrick Mining – Mali conflict settled, and strategy readjusted

For Canadian mining giant Barrick, a months-long period of uncertainty in West Africa has come to an end. A comprehensive settlement with the Malian government has ended the dispute over the Loulo-Gounkoto mining complex. The agreement stipulates that Barrick will regain full operational control of the facility and that the Malian authorities will drop all charges against the Company and its employees. Four employees who had been detained since November 2024 have already been released. In addition, a court ordered the return of 3 tons of gold to Barrick that had been seized earlier this year. This development ends a grueling standstill that had crippled production at one of Africa's most productive gold sites.

The agreement removes a massive geopolitical risk factor that had been wearing on investors' nerves. Loulo-Gounkoto is a so-called "Tier One" asset and contributed around 723,000 ounces to production in 2024. The months-long shutdown not only depressed Barrick's output but was also a major driver of a 32% decline in national production in Mali. The return to normalcy is now stabilizing the operational base and cash flows. At the same time, Barrick is sparing itself the lengthy and costly international arbitration proceedings that it had initiated. The solution provides the necessary planning security to invest in the long-term future of the site and replenish depleted resources.

The resolution of the Mali risk comes during a phase of strategic realignment. Barrick remains Africa's largest gold producer with a strong portfolio. In addition to Loulo-Gounkoto, the Kibali mine in the DR Congo is one of the world's top 10 gold mines. In Tanzania, the North Mara and Bulyanhulu mines together also achieve "Tier One" production levels. At the same time, however, management is sharpening its profile for the stock market. The board of directors is considering an initial public offering (IPO) of a subsidiary that would bundle the high-quality North American gold assets. This step aims to make the value of these projects in stable legal regions, including Nevada Gold Mines and the Fourmile discovery, more visible and potentially achieve higher valuations.
The stock is currently trading at USD 44.73.

Desert Gold - A gold explorer with underestimated potential

Sometimes there is a gap between market value and fundamentals that catches the attention of disciplined investors. A current example can be found in an explorer in West Africa. While the market treats the Company as a pure exploration company, it already has a concrete mining plan for its flagship SMSZ project in Mali. This plan deliberately uses only the easily minable oxide resources to generate cash flow quickly with low capital expenditure. The planned lean construction and low operating costs are hardly reflected in the current valuation.

Desert Gold's strategy is dual and deliberately structured. In addition to the advanced Mali project, it owns an exploration area in the politically more stable Côte d'Ivoire. This holds the classic upside potential of an early discovery, but is practically not included in the valuation. This mix of a developed asset with a clear path and a pure exploration project offers an interesting risk diversification. However, the market does not yet recognize this differentiation and currently lumps both projects together in an undifferentiated "West Africa drawer."

A crucial, often overlooked lever is gold price sensitivity. The economic calculations for Mali are based on conservative assumptions that are well below current levels. If the strong gold price persists, the project's economics would improve significantly. The next operational milestones, from project financing in Mali to the first drillings in Côte d'Ivoire, will show whether the market will correct its blanket view. For investors who take a closer look, there could be an opportunity here. The stock is currently trading at CAD 0.075.

B2Gold – Operational strength and financial robustness

For B2Gold, the last quarter was better than some headlines suggest. While attention is often focused on technical start-up difficulties in the new Canadian Goose project or political tensions in Mali, the core operating business delivered a robust performance. The established Fekola, Masbate, and Otjikoto mines consistently exceeded expectations. This operational strength, driven by the African sites, generates the cash flows that enable B2Gold to finance new projects such as Goose and pay dividends.

Financially, the Company is on solid ground. In the third quarter, it achieved adjusted net income of USD 180 million on a realized gold price of over USD 3,100 per ounce. Operating cash flow of USD 171 million underscores the profitability of ongoing operations. With USD 367 million in cash at the end of the quarter, B2Gold has enough leeway to overcome short-term challenges while investing in its future - a balancing act that not every mining company can pull off.

However, the key question for investors is: What is the real foundation of B2Gold? The answer inevitably leads to Africa. The continent is not merely an area of operation, but the strategic heart of the Company. The Fekola mine in Mali, one of Africa's largest gold producers, accounts for more than half of the planned annual production. Together with the low-cost Otjikoto mine in Namibia, these assets form the backbone of cash flow generation. These profitable, high-volume operations with comparatively low costs are the reason why B2Gold is able to maintain its annual price despite individual setbacks. Africa is not the risk; it is the solution. Currently, one share costs USD 4.54.

With its potential for innovation and low-cost deposits, the African gold sector offers a unique investment environment. Barrick Mining has eliminated a major geopolitical risk factor by resolving the Mali conflict and stabilizing its operational base. Desert Gold offers an interesting, market-underestimated risk diversification with its advanced Mali project and an exploration project in Côte d'Ivoire. B2Gold continues to rely on its profitable core mines in Africa, which form the financial backbone for expansion and dividends. Africa thus remains the strategic centerpiece for sustainable value creation in the gold industry.