Resolute Mining to Pay $160M to Mali in Tax Dispute Settlement

AFRICAN BUSINESS AND ECONOMYNovember 20, 2024 at 8:58 AM UTC

TLDR

Resolute Mining agrees to pay Malian government $160 million to settle tax dispute, leading to CEO detention.
Initial $80 million already paid, with remaining amount to be disbursed in coming months.
Stock of Resolute fell 14% in Sydney, executives still in custody as negotiations for their release continue.

Resolute Mining has agreed to pay the Malian government about $160 million to settle a tax dispute that led to the detention of its CEO, Terry Holohan, and two colleagues.

The Australian gold miner has already paid an initial $80 million, with the remainder to be disbursed in the coming months from existing liquidity. Resolute’s stock fell as much as 14% in Sydney on Monday, extending a 40% decline since the detentions were reported on Nov. 10.

The executives remain in custody as Resolute continues negotiations for their release. The dispute stems from claims of back taxes following a sector-wide audit, with Mali seeking 100 billion CFA francs ($161 million).

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Key Takeaways

Resolute’s settlement highlights growing tensions between Mali's military rulers and mining firms, as the government seeks to increase revenues from the resource-rich sector. The agreement includes a framework to transition Resolute’s operations under Mali’s 2023 Mining Code. The resolution underscores challenges foreign firms face in Mali’s shifting regulatory environment, compounded by geopolitical complexities, including the presence of Kremlin-backed Wagner Group mercenaries and the withdrawal of Western forces. Resolute’s ability to navigate these issues will be critical to its future in Africa’s third-largest gold producer.

Mali

Resolute Mining

Mining

Gold Mining

Tax Dispute