Resolute Mining, an African-focused gold miner, has signed a memorandum of understanding (protocol) with the Government of Mali to pay $160m to resolve a tax dispute.
This comes after the West African country detained Resolute Mining’s CEO Terence Holohan and two other employees this month.
The signing of the protocol establishes a framework for ongoing discussions with the government about the long-term future of operations in the country, including the transition of the company’s assets to the 2023 Mining Code and ensuring the safety of its employees.
The protocol also ensures the settlement of all outstanding claims by the government against the company, including those related to taxes, customs levies, and the maintenance and management of offshore accounts.
Under the protocol, Resolute has made an initial settlement payment of around $80m to the government from its existing cash reserves, with additional payments of approximately $80m to be made over the coming months from available liquidity sources.
Additional details on other aspects of the protocol and the impact of their implementation will be provided after further legal and financial analysis, along with the finalisation of the relevant documentation.
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By GlobalData
Resolute also confirms that it is working with the government on the remaining procedural steps for the release of three employees including CEO Terence Holohan.
Resolute Mining non-executive chairman Andrew Wray said: “The employees remain safe and in good health, receiving support from UK and international embassies and consulates on the ground.
“The company also notes that on-site operations are continuing as usual and have not been affected.”
Last year, Mali revised its mining laws to boost state and local ownership in the sector and secure a larger share of revenue from foreign companies.
Negotiations with global mining companies have been tense, reported the Guardian. In September this year, the government detained four local employees of Barrick Gold for four days.
