Resolute Mining Shares Slump as Mali Military Junta Holds CEO, Staff in Custody

Solomon Ekanem

11 November 2024 09:53 AM

Australian gold miner, Resolute Mining’s shares witnessed a 32% drop on Monday following the arrests of three of its employees including CEO Terence Holohan by Malian government officials.

Miningweekly reports that on Monday, November 11, 2024, the gold miner’s shares slumped as much as 32% to A$0.455, their worst day since October 2008.

AP reports that the company’s non-executive chairman, Andrew Wray, in a statement said the three officials were “unexpectedly detained” after they attended discussions with the government about “claims made against” the company.

Mali, one of Africa's leading gold producers, is witnessing a push by the junta-led government to capture a larger portion of gold revenues with the introduction of a revised mining code. This code seeks to boost the government's ownership in gold projects, part of efforts to funnel more mining profits into state coffers.

The shake up in the mining sector is also seen as Mali’s efforts to cut off its long standing ties with western allies such as France, as it seeks closer diplomatic, security, and commercial relations with Russia.

This new mining code introduced last year by interim president Assimi Goïta, allows the state to acquire up to 30% of a project and removes certain tax and customs exemptions.

The latest arrest comes amid heavy scrutiny of the country's mining sector, which is heavily dominated by foreign corporations. This crackdown began after the junta seized power in a 2020 coup.

This arrest makes it the second time in two months employees of foreign mining firms have been detained in the country.

In September, the Malian government ordered the arrest of four employees of the Canadian company, Barrick Gold.

Resolute Mining, which operates the Syama gold mine in Mali, has refuted claims made by the Malian government, asserting that it has conducted its business in the country in accordance with all relevant laws and regulations