An Australian goldmining company has agreed to pay $160m ($A247m, £126m) to Mali’s government after the west African country’s junta detained its chief executive and two other employees.
Resolute Mining’s chief executive, Terence Holohan, and the other two employees were detained on 8 November in Mali’s capital, Bamako, at the end of a meeting with government officials over tax and other state claims that the miner had previously said were “unsubstantiated”.
Resolute, which is headquartered in Perth, said in a stock market announcement on Monday that it had already paid Mali $80m, with the money coming out of its $157m cash reserves, and would pay another $80m in the coming months.
The statement said an agreement with the government “provides that all outstanding claims by the government against the company, including those related to tax, customs levies, maintenance and management of offshore accounts are settled”.
Resolute said it was working with the government on “the remaining procedural steps” to secure the release of Holohan and the two other employees. All three are British citizens.
Holohan is based in London and has also worked in South Africa, Zimbabwe and Indonesia, according to his LinkedIn profile.
Resolute said last week that the three staff members had been treated well and were receiving support from the UK and other embassies and consulates.
Mali rewrote its mining laws last year to increase state and local ownership in the industry and extract more money from international companies.
Negotiations with international mining companies have been fraught. In September, the government detained four local employees of Barrick Gold, the world’s second largest goldminer by market capitalisation, for four days.
“Some have called it hostage taking,” said Beverly Ochieng, an analyst at the risk consultancy Control Risks. “It feels like an escalation.”
Mali has been battling a jihadist insurgency and uprisings by Tuareg rebels demanding independence since the 2011 Libyan civil war, which sent fighters and weapons spilling southwards into the arid Sahel region south of the Sahara.
There was a coup in 2012, another in 2020, and what analysts labelled a “coup within a coup” in 2021, when Col Assimi Goita deposed another military leader.
Goita’s regime kicked out French troops that had failed to fully defeat Islamist groups and invited in Russian mercenaries, who have been accused of massacring civilians while also not stopping the jihadi attacks.
Gold is Mali’s biggest export and the country is one of Africa’s top five gold producers.
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The government can now take stakes of up to 30% in mining projects and force companies to sell another 5% to Malian investors. Previously the maximum stake it could mandate companies to sell to them was 20%.
In October it nationalised the Yatela mine, which had been dormant since 2016 and in which South Africa’s AngloGold Ashanti and Canada’s Iamgold each had a 40% stake, with the government owning the remaining 20%.
“Mali really needs money; they have these Russian mercenaries who are quite expensive. And many NGOs and western donors have pulled out because of the government’s relationship with Russia,” said Ulf Laessing, the Bamako-based head of the German thinktank Konrad Adenauer’s Sahel programme.
“It’s definitely going to deter future investments. You can’t issue a law which clearly states it’s only for new projects and then the government says: ‘No, no, we’re going apply it retroactively.’”
Resolute holds an 80% stake in a subsidiary that owns the Syama goldmine in south-west Mali, with the government owning the other 20% stake. Its only other mine is another goldmine, in Senegal.
Australian Associated Press contributed to this report.