Following Arrest of Executives, Australian Mining Company Pays Mali $80 Million as Part of Tax Dispute Settlement

Australian gold miner Resolute Mining has paid $80 million to the Malian government for a $160 million settlement over a tax dispute. The remaining $80 million will be paid in the coming months, according to a statement from the company.

The protocol [a memorandum of understanding between the Malian government and the miner] also 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, the statement adds.

The settlement follows the detention of Resolute’s CEO, Terence Holohan, and two senior executives in Mali’s capital, Bamako. Earlier in November, the executives were detained at a hotel in the Malian capital before being transferred to a specialised anti-corruption centre. They were accused of forgery and damage to public property but denied the allegations. However, the company’s shares dropped by 32 per cent on November 11, 2024, marking the company’s worst trading day in 16 years.

Resolute’s recent statement stated that the initial payment was made from existing cash reserves and pledged to complete the payment. The company holds an 80 per cent stake in the Syama gold mine in Mali, while the Malian government owns the remaining 20 per cent. Resolute also operates the Mako gold mine in Senegal and explores gold reserves in Guinea.

Recently, Mali’s government has increased scrutiny of foreign mining companies under its military-led administration. Recent changes in the country’s mining laws require state and private ownership stakes in projects to increase from 20 per cent to 35 per cent.

In September, four Canadian firm Barrick Gold employees were briefly detained over a similar tax-related dispute. Barrick agreed to pay $83 million to resolve the issue, but Malian officials later threatened further legal action as the company failed to meet its commitments. This push by Mali’s government to tighten control over its mining sector is crucial to the country’s economy.

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