(Ecofin Agency) - Four employees from Barrick Gold, a Canadian mining company, were detained in Mali in September 2024 amid accusations from the government regarding financial misconduct by mining firms. Mali is aiming to recover approximately CFA600 billion  (around $980 million) in lost revenue.

On November 10, Resolute Mining, an Australian company, confirmed the arrest of its CEO Terence Holohan, and two other employees in Mali. This incident marks the second time in less than three months that Malian authorities have arrested mining personnel, as they investigate allegations against gold producers for various financial infractions.

First Barrick and now #RSG Resolute Mining.

A feature on their recent call was how African nations are wanting a bigger piece of the pie giving soaring gold prices.

I had been with Terry recently so this update feels all the more real and concerning. pic.twitter.com/M1IJNbeIda

— Baron Investments (@baroninvestment) November 10, 2024

The arrest of a CEO from a foreign publicly listed company signifies an escalation in the government's efforts to exert pressure on gold producers. These companies are accused of contributing to a revenue shortfall of between CFA300 and CFA600 billion ($490 million to $980 million) to the Malian State over recent years. The accusations stemmed from a 2023 audit of the gold mining sector. Resolute’s CEO was arrested during negotiations aimed at recovering these funds.

According to Resolute, its executives were in Bamako, Mali’s capital, Bamako, to meet with mining and tax authorities about the company's business operations in the country and to further discuss accusations Resolute claimed to be baseless.

As the situation unfolds, it is important to note that the earlier arrests of Barrick employees prompted a press release from the Canadian company announcing an agreement with local authorities. However, the specifics of this agreement remain undisclosed. Last month, Mali accused Barrick of breaching this agreement, raising concerns about the potential non-renewal of one of its permits set to expire in 2026. 

Last week, Barrick Gold CEO Mark Bristow stated that he anticipates a final agreement with the Malian government by year’s end. Barrick has reportedly offered the Malian State 55% of the profits from its operations at Loulo-Gounkoto, Mali's largest gold mine. According to local sources, relayed by Reuters, the Malian government is seeking around $500 million from Barrick for unpaid dividends and taxes. 

Additionally, the government aims to align the country's mining operations with a new mining code that mandates a 35% stake for the state and local investors, up from the current 20%.

Emiliano Tossou