Resolute CEO Terry Holohan and two colleagues released by Mali junta in $250m deal
Australian gold miner Resolute’s CEO Terry Holohan has been released from the detention imposed by Mali’s ruling military junta.
Resolute Mining chief executive Terry Holohan and two colleagues have been released from detention in Mali after the company agreed to pay the military junta that runs the West African nation almost $250m.
The three men spent almost two weeks in detention in what industry sources described as a shakedown of the gold miner by authorities in Mali.
Resolute said all three had left the country immediately after their release from the Economic and Financial Centre in the capital Bamako. The company said the trio were safe and well after their ordeal in what sources described as very trying and intimidating circumstances.
Resolute remained silent in response to questions about what security advice it received before the three men travelled to Mali.
It is understood Resolute was involved in a previous security incident involving in Mali.
The Australian reported on Monday that executives with links to Resolute’s Mali subsidiary, Societe des Mines de Syama, were detained earlier this year amid escalating tensions with the government.
ASX-listed Marvel Gold revealed on Wednesday that it planned sale of assets in Mali would not go ahead as the fallout continues from recent detentions of mining executives and heavy-handed demands for payments.
The junior miner said Precious Metal Consulting and Engineering had pulled out of a $3m deal “to owing to recent developments in Mali”. Mali’s military leaders have been accused of gouging gold mining companies to keep the country running after kicking out United Nations peacekeepers last year.
The West African state is embroiled in a political, security and economic crisis, and since 2012 has been battling al-Qaeda and Islamic State armed groups, as well as a separatist insurgency in the north. Resolute faces giving up a big stake in its Syama gold mine to the military junta on top of agreeing to pay out $US160m ($248m) in talks around the release of its three employees.
A Malian official from the Syama mine confirmed to AFP that “the CEO and the two other officials of the company have indeed been released”.
The $US160m payment is a significant hurdle for Resolute, which according to financial statements currently holds $US157m in cash. Resolute, dual listed in London and on the ASX, has said it will pay the Malian government $US80m from “existing cash reserves”, with a further payment of $US80m in the “coming months”.
It is understood Resolute had been trying to settle a dispute with the authorities in Mali for about $75m but bowed to pressure in trying to secure the release of its employees. Gold heavyweight Barrick Gold paid out $US85 million in securing the release of four of its executives in a similar incident. Mali is understood to be seeking as much as $US850m from Barrick to settle tax and other claims around its Loulo-Gounkoto mining complex.
Resolute has signed a protocol with the Mali government that includes a framework for discussions about the long-term future of the Syama mine and the safety of Resolute employees. The discussions will cover moving Resolute’s assets in Mali to the country’s 2023 Mining Code, which allows the state to acquire up to 35 per cent of projects, including 5 per cent of local entities.
Additional reporting by AFP
