Mining execs in Mali: from boardrooms to behind bars

While the world was processing Trump’s landslide victory last week, authorities detained an obscure Australian mining executive in Mali. Terry Holohan, head of Resolute Mining, went from discussing taxes over coffee, to finding himself and two other executives cooling their heels in a Malian detention facility — all in the span of an afternoon.

Holohan had just flown into Bamako to meet with local mining and tax officials about their expanding projects in the country. The meetings? Routine. The aftermath? Not so much. 

Fast forward to yesterday (Wednesday), and Mali’s military junta is basically now invoicing Resolute a casual $160M (in alleged back taxes) for Holohan’s freedom. Meanwhile, Resolute shares plunged more than 30%, wiping $500M from the miner’s market cap. So that $160M demand? It’s now the equivalent of more than a quarter Resolute’s market cap.

And if you think this is a one-off, think again. Back in September, local authorities detained four top executives from Canada’s Barrick Gold, the world’s second-largest gold miner, currently negotiating its Loulo mine permit that expires in 2026. Plus… 

• 🇨🇦 Allied Gold forked over $116M to keep its Sadiola project running
• 🇨🇦 B2Gold Corp is paying $204M to keep its Fekola project online, and
• 🇿🇦 AngloGold Ashanti and 🇨🇦 Iamgold have just closed down local operations entirely.

So what’s going on?

Mali is part of Africa’s so-called ‘coup belt’ — Mali’s military kicked things off with a coup in 2020, and there’ve since been 10 or so other attempted coups across Central and West Africa. As those juntas take power, they’re grappling with interlinked challenges around 1) sanctions 2) importing goods, and 3) accessing debt markets. And that’s all exacerbated by the chilling effect coups usually have on investors, businesses, and other visitors.

It’s all left these regimes scrambling for revenue, so some of them (like Burkina Faso and Mali) have revamped their mining code to get a better deal with the Western companies extracting resources in their territory.

Malian officials announced their own revised mining code last year, allowing the government to take a 10% stake in projects plus the option to buy an additional 20% within the first two years of commercial production. The rules also included a mandatory 5% local ownership stake and fewer tax breaks for international firms.

Initially, Assane Sidibe (the junta’s top mining official) said these rules would only apply to new contracts or renewals. But as the regime’s cash crunch intensified, this promise faded for executives like Holohan, whose Syama asset in Mali was set to run until 2029.

Of course, the miners aren’t all squeaky clean.

Mali is Africa’s third-largest gold producer, with the sector supporting around two million people (more than 10% of its population). But smugglers yoink an estimated $30B in gold out of Africa each year, much of it ending up in the UAE as a middleman. So Mali’s goldfields, long seen as a lucrative opportunity, are now a flashpoint for a growing resource sovereignty battle. And that’s all against the backdrop of a bitter colonial legacy.

Anyway, Switzerland (the world’s top gold buyer) has already raised alarm bells, looking to tighten up audits on gold from the UAE, while some companies like Metalor Technologies have axed Emirati gold from their supply chain completely. 

But there’s a geopolitical angle here, too.

It might just be an anomaly that Western miners are the ones getting detained in Mali — several smaller miners already renegotiated (or ceded) their deals and avoided detention.

But these detentions come after the junta ousted UN peacekeepers and French troops (the former colonial power), and instead cosied up to Russia’s Wagner mercenaries. They were meant to help fight Mali’s Islamist insurgency, but they’ve also been laser-focused on controlling Mali’s gold, while Moscow has now committed to building a refinery there. Why gold? It helps Russia stabilise its wartime currency and evade sanctions.

So then, what does Mali get from Russia? In addition to providing the mercenaries, Russia has also used its heft at the UN to shield the ruling junta from scrutiny, and even vetoed a sanctions measure last year.

So can you see the journey we’ve just completed here? Starting out with an obscure Aussie getting detained in Bamako, we’ve zoomed out to a full global power struggle.

INTRIGUE’S TAKE

There’s plenty at stake for everyone here: Resolute produces around two-thirds of its gold in Mali, and that number is still a serious 13% for the much larger Barrick. There are several other companies still in negotiations with the junta, and you can imagine the risk of detention or nationalisation might now sharpen their senses a little.

Plus there’s clearly plenty at stake for the Malians, too: in trying to rebalance their ties with foreign investors with hopes of lifting local living standards and/or bolstering the junta’s grip on power, they’re negotiating with giants like Barrick who have leverage of their own: the company’s capital, know-how, and global customers all help make it Mali’s single largest taxpayer and employer. So this latest escalation could mean any short-term boost in cashflow is outweighed by a longer-term collapse in investment.

But for now at least, Mali’s coup-belt neighbours don’t seem to see it that way: Burkina Faso recently nationalised two gold mines, while Niger stripped France’s Orano of its licence to operate one of the world’s largest uranium sites.

Also worth noting: 

• On Monday, Resolute said in a statement that “The employees are being treated well and continue to receive support on the ground from the UK and international embassies and consulates.”
• The sub-region’s main bloc (the Economic Community of West African States, or Ecowas) lifted sanctions on Mali earlier this year, citing assurances from the junta that it was transitioning to civilian rule.