Mali’s military-led government has detained Terry Holohan, CEO of Australia’s Resolute Mining Ltd. (ASX: RSG), along with two other company executives, marking a serious escalation in the country’s strained relations with foreign mine operators. The detentions, which occurred after the executives traveled to the capital, Bamako, for meetings with Malian mining and tax officials, were confirmed by Resolute on Sunday.
This latest action underscores the mounting risks for international mining companies in Mali, as the government seeks to tighten control over its mineral resources, raising significant concerns among investors worldwide.
Holohan and his team had traveled to Bamako for discussions with Mali’s mining and tax authorities regarding the company’s Syama mine operations. The executives, who reportedly complied with all official processes and attended the meetings as scheduled, were detained following the conclusion of the talks.
Resolute Mining’s detentions come amid a growing crackdown by Mali’s ruling military government, which has tightened its grip on the country since a 2020 coup. The government’s efforts to reassert control over Mali’s mineral wealth have placed particular strain on foreign mining companies operating within its borders. In October, four employees of Barrick Gold Corp. (NYSE: GOLD) were also detained as part of what appears to be an increasingly assertive campaign to generate more revenue from foreign-operated gold projects.
International mining corporations, including B2Gold Corp. (NYSE: BTG), Allied Gold Corp. (TSX: AAUC), and AngloGold Ashanti (NYSE: AU), have been under mounting pressure to renegotiate their contracts under the military-led administration. These efforts align with a mining code adopted by the government last year, which was initially announced as applying only to new agreements or renewals of existing permits.
However, recent actions indicate a wider attempt by the junta to exert authority over existing contracts, a move that Assane Sidibe, the president of Mali’s mining commission, had previously suggested would not be the case.
Resolute Mining, which operates Mali’s large-scale Syama gold project, has sought to keep its operations compliant with all government requirements.
“Resolute has followed all official processes with respect to its affairs and has provided the authorities with detailed responses to all the claims made,” the company said in its statement.
Resolute’s Syama mine, located in southeastern Mali, represents one of the country’s largest industrial-scale gold projects. The mine currently produces approximately 210,000 ounces of gold annually, and the government holds a 20% stake in the project. Resolute has invested heavily in expanding the Syama operation, with a second phase expected to begin in 2025.
Gold mining is one of Mali’s economic pillars, accounting for an estimated 10% of the nation’s GDP and about 70% of its export revenues. With limited access to the regional debt market due to sanctions imposed in response to the 2020 coup, the military government has relied on its mineral resources to stabilize Mali’s economy and support essential imports. However, the junta’s increasingly forceful tactics, including detentions and demands for renegotiated terms, have raised concerns about the future of foreign investment in the country’s mining sector.
Since seizing power, Mali’s military government has aimed to reshape the country’s mining sector to increase state revenue. It has been suggested that the junta views foreign mining contracts as overly favorable to international companies, with the government collecting minimal revenues from the exploitation of Malian resources. The latest moves to detain corporate leaders signal a willingness to act unilaterally, raising questions about the stability of existing mining agreements.
However, this assertive strategy has brought potential drawbacks. Mali’s reputation as an investment destination has suffered as foreign entities hesitate to commit capital under such unpredictable conditions. Although the government has championed the revised mining code as a pathway to economic self-reliance, the detentions are likely to deter future investments essential for broader development goals.
Information for this story was found via Bloomberg and the sources mentioned. The author has no securities or affiliations related to the organizations discussed. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
