Aussie miner frees staff with $250m payment

An Australian mining company will pay a West African government nearly $250m to free its boss and two other staff.

The military-led government of Mali in West Africa detained the Resolute Mining chief executive and two senior staff on November 8 in the capital city Bamako.

The arrests were over a purported tax issue.

In an announcement to the ASX on Monday, the Perth-headquartered miner said the company had signed a memorandum of understanding with the Mali government to pay US$80m and a further US$80m in the coming months.

“Resolute further confirms that it is working with the Government on the remaining procedural steps for the release of the three employees, including the Company’s CEO, Terence Holohan, who were recently detained in connection with these matters,” the market announcement reads.

“They remain safe and well and continue to receive support on the ground from the UK and International Embassies and Consulates.”

The three employees are British nationals.

The company’s mining operations in Mali have continued as normal.

Resolute owns 80 per cent of its Syama Gold Mine in the south of the country by way of a subsidiary; the Mali government owns 20 per cent.

The memorandum has been signed “in the context of ongoing discussions with the Government of Mali”, the company says.

Mali’s government is a military junta, having seized power in a coup in 2021. The President and Head of State, Colonel Assimi Goïta, promoted himself to the rank of army general last month.

President Goïta rewrote the mining code last year to allow the government – and the Malian private sector – to acquire a combined 35 per cent of projects, up from 20 per cent, and renegotiate mining contracts. From there the government has used ransom-style tactics to demand back-taxes.

In October, Canadian miner Barrick Gold – the second largest gold miner in the world – paid US$85m to the Mali government.

The government said Barrick breached environmental, corporate social responsibility and foreign exchange rules: four Barrick staff were detained, and the company denied the allegations.

“While Barrick does not accept any claims of wrongdoing, it has chosen to act in good faith as a long-standing partner of Mali,” the miner said in a statement.

Perth-headquartered Leo Lithium recently transferred management of its project in Mali to Chinese battery materials giant Ganfeng.

Resolute’s share price has fallen 40 per cent ($0.38) since news of the arrests broke.

West Australia Premier Roger Cook said Resolute’s situation highlighted the fact some jurisdictions were risky for mining operations.

“It does underpin and underscore just how risky these jurisdictions are when it comes to undertaking these industries,” Mr Cook said earlier this month.

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