Clive Johnson has built a reputation for making successful bets on geologically promising jurisdictions that make others nervous.
As president and CEO of Bema Gold, he led the company on early successful forays into Chile in the late 1980s and Russia in the late 1990s.
And after Bema was acquired by Kinross Gold (TSX: K; NYSE: KGC) in 2007 for its prized Kupol gold-silver mine, at the time under construction in Russia’s Far East, he led Bema’s successor company B2Gold (TSX: BTO) into Nicaragua, the Philippines, Namibia and Mali.
“Part of our strategy is to go where others fear to tread – or to be ahead of the pack, Johnson told The Northern Miner in an interview. “That’s where you get some very good opportunities.”
Those opportunities can also come with turbulence – for example, skepticism about the company’s entry into Russia, especially at a time when the gold price was under US$300 per ounce.
“A lot of people at the time thought, ‘Clive and the guys, they’ve completely lost the plot. There’s no way they’re gonna succeed in financing and building a mine in the Far East of Russia in a very cold environment, similar to the Yukon.”
More recently, B2Gold shares have been punished this year for the company’s exposure to military-ruled Mali, which is fighting off jihadist insurgents with help from Russia’s Wagner Group.
The country will account for 55% of its 2024 production, and the government has been pressing for greater ownership of gold mines and more taxes after passing a new mining code last year.
Johnson notes that B2Gold reached an agreement in September that keeps the status quo on income taxes and government ownership (20%) of its large Fekola mine in the country under the previous 2012 code. But he says that the market reaction has been overdone. (B2Gold shares are down 5% year-to-date against gold’s 28% increase this year).
“There’s no evidence at all the government is looking to expropriate or take over the gold mines in the country. They want payments for taxes in the past and they want a bigger piece of the pie going forward,” Johnson said, adding it’s a common trend in the industry internationally. “Mining is a huge part of the economy and they desperately need the revenue.”
Still, the government has detained personnel from Barrick Gold (TSX: ABX; NYSE: GOLD) and Resolute Mining (LSE: RSG; ASX: RSG) – the former for a few days in September – amid talks on taxes and the mining code. Resolute staff, including CEO Terence Holohan, were released on Nov. 20 after being held for 12 days. That came after the company said it would pay US$160 million in taxes Mali said it was owed.
“You never want to see it get to a level like that, and I hope there is a quick resolution,” Johnson said on Nov. 13. “One of the important things to recognize is that every company there, they all have different mining codes and therefore different issues or negotiations with the government about taxation and back taxes.”
Fekola is forecast to produce up to 450,000 oz. gold this year. B2Gold has been reassured enough by its agreement with Mali that it decided to go ahead with its Fekola Regional development, which will see ore trucked to the Fekola mill from satellite deposits about 20 km north, adding 100,000 oz. of gold a year in production. Fekola Regional will be developed under the 2023 mining code with Mali owning 30% of the project (compared to 20% at Fekola).
These types of judgment calls have sometimes perplexed others, but they’ve also been at the core of some of Johnson’s biggest successes.
To understand how the Bema and B2Gold teams got their risk appetite, you’d have to go back to the 1970s.
Johnson got his start in exploration as a line cutter and claim staker with B.C. and Yukon focused contractor Bema Industries, started in the 1970s by a group that included his older brother, Ian. It was just a summer job for the 19-year-old to pay his way through university, where he was studying political science.
“I was the youngest of the group, and that’s where I learned a lot about the industry, and being entrepreneurial,” the 67-year-old executive said.
He decided not to return for his third year of studies because the company was growing so rapidly. Instead, working with Bema Industries Johnson found his niche as a problem-solver, doing expediting and logistical work for companies exploring in the Yukon – and found his calling as an entrepreneur.
The group, consisting of original core founders Mike Beley, Rick Barclay, Gary Nordin and Clive’s brother Ian, had plenty of experience in Western Canada. But they weren’t sure they could finance and build a mine there because of uncertainty around permitting, timing and Indigenous support and participation in projects at that time.
So the team decided to merge three of its exploration ventures into Bema Gold and search for international opportunities instead.
That’s where Johnson’s continued fascination with politics and history has proven useful.
In 1988, Bema was a first mover into Chile, at the time ruled by dictator Augusto Pinochet.
“There were a lot of raised eyebrows about that,” Johnson admits.
But the team saw the major copper producer’s potential for gold and also believed Pinochet’s rule would come to an end. They pounced on an opportunity to acquire the Refugio deposit.
Pinochet’s regime did end in 1990, and Johnson notes the years following the country’s move to democracy marked a period of economic expansion dubbed the “Chilean economic miracle.”
“The new government turned the country around into a democracy and a free market economy after having this significant history of anti-foreign investment and civil rights abuses,” he said. “So sometimes part of our judgment is predicting when countries are in economic and or political transition.”
That’s not to say there are no red lines B2Gold won’t cross. The safety of its 6,700 employees around the world is paramount, Johnson says, and being willing to take measured risk is not the same as being reckless.
B2Gold’s credo is to bring what Johnson calls the “Canadian values” of fairness, respect and transparency to the world.
Johnson, the youngest of four children born to immigrants from Britain, credits his parents’ working-class roots for both his entrepreneurial bent, and for that credo.
“(My parents) started with very little, they both had to quit school at 14 in Liverpool to go to work during the war,” he says. “They’re one of millions of success stories of people leaving somewhere and taking a chance on Canada. They instilled the idea that you treat people with fairness and respect until they give you a reason not to.”
Johnson’s code has kept him grounded, even in the C-suite, says Kelvin Dushnisky, former CEO of AngloGold Ashanti (NYSE: AU) and B2Gold chair since 2023.
“His success is very clear, but I don’t think that’s fundamentally changed him,” Dushnisky said. “When you look beneath Clive’s force-of-nature personality, and I say that in a positive way, you find that he has a very strong sense of humanity and a social conscience.”
That was reflected in October 2022, when Johnson chose to speak out publicly about his struggles with depression and anxiety for World Mental Health Day. He also spoke about the loss of his son, who succumbed in 2021 to an accidental fentanyl drug overdose at the age of 30.
“There are so many people that are dying tragically, completely unnecessarily. We have to deal with it – it’s become the top cause of death amongst young people, which is just shocking.”
While Johnson, an ex-rugby player in his youth and keenly aware that he’s supposed to be the “powerful leader,” was at first unsure about going public, he wanted to lead by example.
“I did it for a lot of reasons but one of them was to help our employees and other people realize that it’s OK to reach out if you’re struggling emotionally, mentally, psychologically, physically. Whatever it is, reach out.”
Peers like Dushnisky say it was a brave thing to do in service of helping others.
“His candour and his willingness to reveal his own pain and personal vulnerability having come through this, I think it’s contributed to making what’s already a very strong family culture at B2Gold even stronger.”
Given B2Gold’s reputation for taking on risk, how to explain B2Gold’s latest acquisition of Nunavut-focused gold developer Sabina Resources last year in an all-stock deal valued at $1.1 billion?
Part of it was driven by the opportunity for geopolitical diversification, Johnson said.
Once the $1.5-billion, 300,000 oz. per year Goose mine starts up in mid-2025, Canada will account for just under a third of B2Gold’s output. The company’s overall output next year is projected at 1 million to 1.1 million oz. of gold.
But he also notes that permitting in Canada, as well as Indigenous participation in mining, have both improved since Bema made its decision to go international over 35 years ago.
“(The acquisition) doesn’t reflect a change in strategy or risk appetite,” Dushnisky said. “It’s consistent with how the company has historically generated its success: taking on projects in highly prospective areas and levering its competitive advantage – in this case building in colder climates – to the benefit of B2Gold shareholders.”
Describing the complicated logistical ballet of bringing supplies to the mine via 10 ships travelling from Montreal through Bathurst Inlet in Nunavut before the ocean freezes and building 160 km of ice roads to site, Johnson notes: “It’s a huge undertaking and it’s right up our alley.”
Notably, B2Gold and Bema before it both build their own projects rather than hire outside contractors to do the job.
It’s a key reason for their success, and Johnson says being a generalist – an objective outsider – has also helped him get and retain the technical teams that are crucial to pull together.
“Geologists and engineers don’t always get along but they both desperately need each other,” he said, explaining that sometimes geologists see engineers as “deposit killers” while engineers view geologists as “arm wavers.”
“One of my roles as CEO has been to get everyone on the same page and break down the silos,” he says, adding he’s fortunate to have worked with remarkably talented and experienced teams over the years.
It’s a job that Johnson – who was recovering from a knee replacement surgery at press time – doesn’t appear ready to give up in favour of retirement.
“I’m still passionate about what we do. I’ll know when the time comes.”
