Courtesy of The Africa Report, an article on Wagner’s mercenary gold rush in Mali

Since its arrival in Bamako at the end of 2021, Yevgeny Prigozhin’s group Wagner has been eyeing Mali’s considerable gold resources. Recovery of mining permits, creation of local companies, artisanal gold panning, trafficking via Dubai; all avenues are being explored to make the most of Mali’s mines.

Russian mercenaries have set up two mining companies and have since been trying to recover mining licences with the support of the Malian business sector. Their interest in gold has increased tenfold since the start of the war in Ukraine.

According to our information, Yevgeny Prigozhin’s men have also embarked on artisanal gold panning, investing in at least three sites south of Bamako, and gold trafficking via Dubai, the hub of their illegal trade.

Legend has it that he was the richest man of all time. Mansa Musa, who ruled the Malian empire in the early 14th century, built his immense fortune on the tonnes of gold that abounded beneath his kingdom’s feet. Seven centuries later, Mali’s reserves of the precious metal are far from exhausted and remain a source of international envy.

When he arrived in Bamako in July 2021, Sergueï Laktionov’s mission was to draw up a precise map of Mali’s golden potential. This 54-year-old Russian geologist, who speaks fluent French, first appeared on the radar of Western intelligence services while working for Wagner’s mining interests in the Central African Republic (CAR).

Le président de la transition au Mali, Assimi Goïta, avec le ministre russe des Affaires étrangères, Sergueï Lavrov, à Bamako, le 7 février 2023. © Présidence de la République du Mali
The President of the Transition in Mali, Assimi Goïta, with the Russian Foreign Minister, Sergueï Lavrov, in Bamako on 7 February 2023. Presidency of the Republic of Mali

Mine visits

For several weeks, Laktionov’s boss, Yevgeny Prigozhin, has been negotiating the arrival of his men with Goïta’s junta. The broad outlines of the contract, built around 1,400 mercenaries at a $10m monthly clip, are beginning to take shape. As in the CAR, where the paramilitary group arrived at the end of 2017, the aim is to be paid directly from the source, in the gold mines.

During his first weeks of prospecting in the former lands of Kankan Moussa, Laktionov visited several mining sites in the south of the country. He also had several meetings with the minister of mines and energy, Lamine Seydou Traoré. Before being forced to resign on 31 May, officially because of the serious problems of power cuts across the country, the ambitious 40-year-old, a former executive at Orange Mali, had long been an influential figure in the transitional regime.

Above all, he is very close to one of the pillars of the junta: his brother-in-law, Colonel Sadio Camara, the Russophile Defence minister and architect of the partnership with Wagner, a quasi-subsidiary relationship which some say has made him the collateral victim of the growing rivalry between Camara and Goïta.

Thanks to his strategic ministry and his power to allocate mining titles – withdrawn at the end of 2022, following the launch of an audit of the sector by the ministry of finance – Traoré had become one of the most courted men in Bamako. He was also accused of corruption.

Laktionov is working with the former mining minister to renew certain mining licences. One of these is Menankoto, where Traoré ousted the Canadian major B2Gold in early 2021 to impose a small company unknown in the mining sector – Little Big Mining, one of whose three shareholders is his cousin, Aboubacar Traoré.

Are Wagner’s managers wary of the litigation (and potential public exposure) surrounding this mine? Do they consider it profitable enough in the short term? Was it the junta that opposed the operation? It’s hard to say, but the operation never went ahead and B2Gold finally recovered the Menankoto licence a few months later, at the end of 2021.

Malian intermediary

But that did not make Wagner back down. While the first mercenaries were preparing to land in Bamako in December 2021, Laktionov and his colleague Viktor Popov continued to secretly work on the mining aspect.

Andreï Mandel, head of M-Invest – a Wagner subsidiary – in Sudan, was sent to Mali to structure the group’s future mining activities. As in the other countries on the continent where Prigozhin operates, the decision was taken to set up local supply chains and rely on intermediaries to avoid appearing on the front line.

By the end of 2021, Alpha Development was created by Bakin Gassimi Guindo. This businessman, a nephew of a former minister under Ibrahim Boubacar Keïta, started out in the mining sector in the mid-2000s with his company Gold Resources du Mali, before diversifying into IT and audio-visual production.

Above all, he is an old acquaintance of A. Traoré. On 19 February 2021, four days after co-founding Little Big Mining, he revised the articles of association of another of his companies, Baris Travaux, which he had set up in 2011, to include Guindo as a shareholder. The two men each hold 50%.

According to the notarial deed that we were able to obtain a copy of, the company’s objective was also changed: in addition to building and civil engineering works and the marketing of construction materials, it now “researches and exploits mines and quarries.” A few months later, Baris Travaux was awarded the operating licence for the Bakolobi mine, which was also coveted by Canada’s B2Gold – before finally being sold back to them in April 2022.

Financing the war effort

“It was likely Aboubacar Traoré who suggested Guindo to the Wagner people when they were looking for a Malian intermediary,” says one businessman. They had already worked together on the Bakolobi case and it would have been too obvious to put his own cousin in charge. According to French intelligence services, Guindo was recruited directly by Laktionov. Another Malian source refers to his “nocturnal meetings with Russians” in a well-known bar on Rue Princesse in Bamako.

When we contacted him, Guindo acknowledged having set up Alpha Development, but said he was “the sole shareholder” with “no links with Wagner”. He declined to comment on his various mining-related administrative procedures on behalf of his Russian partners, and working with the notary Mohamed Zouboye, son of Fatimata Zouboye, former president of the Bamako Chamber of Notaries, M. Zouboye, whom we also sought comment from, saying he was “bound by professional secrecy”.

During the first quarter of 2022, Wagner set up a second mining company in Bamako, following a similar model, Marko Mining. The paramilitary group, now fully engaged in the Ukraine-Russia war, is hoping to take advantage of the gold mines in Mali to support the deployment of its mercenaries on the Ukrainian front and to pursue its various military operations and influence in Africa.

Some Western analysts believe that the nuggets collected by Wagner from the four corners of the continent could also directly serve Vladimir Putin’s interests and replenish Russian treasury reserves.

“Since the invasion of Ukraine, Russia has been dipping into its coffers to finance its war effort and cover its deficit,” explained a highly-placed source in Paris. “The Russian authorities could buy the Wagner group’s gold opaquely in roubles and then make payments to its partners, such as China, India and Iran. China, for example, increased its imports of Russian gold in 2022. This solution would enable Wagner to launder its gold while Moscow tries to limit the depreciation of the rouble.”

Highly coveted operating licences

In April 2022, Laktionov returned to his Malian contacts to argue in favour of a nationalisation scheme for gold mines, intending to recover operating licences for deposits that were already in operation. He is targeting three of the country’s most prolific deposits: Fekola, operated by B2Gold; Loulo-Gounkoto, owned by another Canadian miner, Barrick Gold; and Syama, owned by Australian Resolute Mining.

At the various mining companies’ respective headquarters, the news is causing a few cold sweats and little else. “It’s impossible to withdraw an operating licence and issue it to another operator,” says a lawyer. “The Malian authorities know what they would be exposing themselves to if they engaged in such practices.”

Other sources in Bamako are less categorical. “The mining companies are supported by large foreign investment funds – American, Chinese or others – who, in the event of a dispute, put pressure on them to settle it by traditional diplomatic means,” explained a professional in the sector.

“There is nothing normal about a military transition regime like in Mali. Nothing is impossible, and there are always ways of expropriating someone without saying they are being expropriated. We are in a country where the law is made to suit the colonels. Why shouldn’t they be able to decide to withdraw a mining licence?” says the businessman.

Some will also remember the precedent of the Ndassima gold mine, one of the largest in the CAR. Initially granted to the Canadian company Axmin, its operating licence was finally reallocated by the Central African authorities to Midas Ressources – a company within the Prigozhin sphere of influence – at the end of 2019, some two years after Wagner set up operations in Bangui.

Major overhaul of the mining sector

Without necessarily succeeding in winning back the operating licences for the mines he has his eye on, Wagner could also capture, through the back door, part of the state’s 10% to 20% stake in each of them. “When we give our share to the Malian treasury every year, we don’t know how they use it,” said an employee of a major mining company.

At the end of 2022, the junta launched a major audit and overhaul of the mining sector, created Société de recherche exploitation minière (Sorem) to increase state profits, and suspended exploration and exploitation permits to “improve the process of issuing and monitoring authorisations”.

However, despite pressure from their new Russian allies, the colonels do not seem to be in a hurry to open the mines to them, proof that their relations are more complex than they appear.

“They want to confine Wagner to the military and what his mercenaries were hired for – the war against the jihadists. As soon as the Russians try to make progress in the mines, they put the brakes on. And you have to hand it to them, they have a talent for dragging things out,” said someone close to the matter in Bamako. “The colonels want to show that they remain sovereign at home and do not want the Russians to become visible everywhere, as they are in the CAR. This applies to the administration as well as the mines,” added a foreign diplomat.

Artisanal gold panners

While waiting to set up a well-oiled mining system in Mali, Wagner executives are exploring all avenues for extracting gold. On 30 September 2022, Gold Resources du Mali, one of Guindo’s companies, obtained two three-month exploration licences at Diangouémérila-Ouest (covering an area of 40km2) and Ourou-Ourou (covering 22km2), in the Yanfolila district. Did the founder of Alpha Development carry out prospecting there on behalf of his Russian partners? On this, the parties in question again had no comment.

At the same time, Laktionov and his comrades have embarked on artisanal gold panning, which is estimated to account for around a third of national production or more than 20tn of gold per year. According to our information, since the beginning of the year, Wagner’s men have taken over at least three sites south of Bamako, some of which were operated by Chinese companies.

One site is in Balandougou, some 20km from the border with Guinea. “There were a lot of them that came with their machines, worked with the locals for a few weeks, and then left again,” a witness said. These miners “who didn’t speak French” then headed for Koyoko, another gold-panning site close to the border, located in the Kangaba cercle. The third site is near Yanfolila.

It is difficult, if not impossible, to know how much gold has been extracted from these artisanal gold panning sites by Wagner’s men. In mid-May, around 10 of them were spotted at Kayes airport, central to the Kayes region, reputed to be rich in gold – far from their traditional military zones of activity in the north and centre of the country.

Traffic via Dubai

In 2022, the managers of the Russian group also approached one of Bamako’s many gold traders to help their business grow. Kossa Dansoko has been in the business for a decade – buying, exporting and selling gold to Dubai. In recent years, the wealthy UAE metropolis has become the preferred destination for illegal gold trafficking from the continent. The nuggets in question – not 100% refined – from the mines of West Africa very often pass through Mali because of its advantageous tax regime on exports and its extensive network of corruption.

As a report by the Institute for Security Studies (ISS) pointed out, in 2016, the Emirates declared that they had imported $1.52bn worth of gold from Mali, while Mali only recorded $216m.

“There’s a whole trafficking system in place at Bamako airport, with the complicity of customs and the police. This allows traders to pass through the controls without a hitch and fly off to the Emirates with several kilos of gold in their suitcases,” explained an import expert.

“Dansoko sells his gold in Dubai and collects the cash, which he places in offshore accounts or brings back to Bamako to exchange it directly with major traders rather than using banks,” added one of our sources. Dansoko is also a regular visitor to Bangui, where he works with Wagner via his compatriot Souleymane Bassoum. Well-established in the Central African capital and close to the government of President Faustin-Archange Touadéra, this Malian import-export businessman is involved in the local diamond trade set up by the Prigozhin group.

Intriguing aerial ballet in Sikasso

Wagner also transports its gold from Africa directly to Russia. To transport this valuable commodity out of the continent unseen, the private military company uses a number of channels, including its own air resources – Mil helicopters, Antonov small aircraft, Ilyushin wide-body aircraft, and so on.

For its activities in Mali, it relies on an aviation company founded in 2008 in the Emirates, Kratol Aviation, which has a small fleet of Antonov An-28s, robust aircraft that can land almost anywhere. Pinpointed in January by the US treasury department as one of the entities “supporting the Wagner group’s military operations” in Africa, this company is, according to a source close to the French intelligence services, “at the heart of an air logistics network serving Russian interests, particularly mining, on the continent”.

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In July 2022, one of its An-28s was photographed by satellite on the tarmac at Mopti-Sévaré airport, one of Wagner’s logistics hubs in the country. The completely white, civilian-looking aircraft was registered TZ-99T, a Malian air force code.

Another lesser-known Malian airport is used by Wagner – Sikasso, 400km southeast of Bamako. With no permanent connection or commercial airline with ASECNA, it offers advantages to those desirous of discretion with their arrivals and departures. Between late 2022 and early 2023, several Russian aircraft landed on its decaying runway at night to unload and load goods.

“They were most likely carrying military equipment. But it wouldn’t be surprising if gold was also being transported through this channel,” said a Malian source.