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Resolute Mining CEO and executives detained in Mali

Resolute Mining (ASX:RSG) confirmed in an announcement this morning that CEO Terence Holohan and two other executives were detained in Mali after discussions with government officials. The executives were in Bamako, the capital city, addressing issues related to the company’s business practices and responding to claims made by the authorities, which Resolute maintains are unfounded. The detentions, which took place on Friday 8 November 2024, underscore mounting challenges for foreign mining firms operating in the region.

The detentions follow a similar incident involving Barrick Gold Corp, a Canadian mining company, whose four senior Malian employees were detained in September 2024 on allegations of financial crimes. This occurred amid protracted negotiations concerning Barrick’s Loulo and Gounkoto mines. Malian authorities accused Barrick of failing to meet commitments related to environmental standards, corporate social responsibility and foreign exchange regulations. Barrick, in response, denied these allegations and highlighted its cooperative efforts, including an $85m payment made in early October.

These detentions are part of a broader initiative by Mali’s military-led government to renegotiate mining contracts in an effort to increase state revenue. The Mali junta took power 18 August 2020, following a coup d’état that ousted then-President Ibrahim Boubacar Keïta. This was the country’s second coup in less than 10 years, following the 2012 coup d’état.

The government’s new mining code, adopted in 2023, permits an increase in the state’s stake in mining projects to 35%, up from the previous 20%. 

Industry insiders suggest that Resolute had resisted pressure to renegotiate terms related to its Syama Gold Mine, which operates under agreements set to last until 2029. The company has reiterated that it has adhered to all official processes and provided detailed responses to the claims against it. “Resolute’s priority remains the safety and wellbeing of its employees,” the company said, adding that the detained executives are being held at the Economic and Financial Centre of Bamako and are receiving support from UK and international consular services.

Premier Roger Cook of Western Australia commented that Mr Holohan, a British citizen, is being treated well. “This underscores the risks involved when operating in certain jurisdictions,” Cook noted. “We hope for a swift and safe return.”

Following confirmation of the detentions, Resolute Mining’s shares dropped sharply on Monday. They closed down 32.84% at 45 cents, marking their steepest one-day drop since 2008. 

Resolute Mining holds an 80% stake in the Syama Gold Mine — a vital part of its operations — and is committed to continuing dialogue with the authorities to reach a resolution.