Resolute mining (ASX:RSG) today announced the completion of a second settlement payment of approximately US$50 million to the Government of Mali, marking significant progress in resolving outstanding disputes with the West African nation. The payment is part of a broader settlement totaling US$160 million and will be made from existing cash reserves, with the final payment expected to be approximately US$30 million by the end of 2024.

These payments are pursuant to a Memorandum of Understanding (Protocol) signed on November 18, 2024, at which time the first payment was approximately USD 80 million.

The agreement seeks to resolve long-standing claims by the Malian government, including taxes, customs duties and offshore account management, and provides a framework for future cooperation. This protocol will facilitate Resolute’s transition to Mali’s 2023 Mining Law and ensure the safety of its employees during the process.

detention of executives

The announcement comes just days after the safe release of Resolute CEO Terrence Holohan and two other executives who were detained by Malian authorities on November 8, 2024. The executives were detained at the economic and financial center of Bamako. On November 21, the detainees were confirmed free and subsequently departed Mali.

Under the Mining Act 2023, the government sought to renegotiate contracts that would increase state revenue and increase its stake in mining projects from 20% to 35%. The Syama Gold Mine, the cornerstone of Resolute’s operations, is operated under a contract valid until 2029.

The detentions followed a similar case involving Canadian mining company Barrick Gold, in which four senior Malian employees were detained in September 2024 on suspicion of financial crimes. This comes amid long-running negotiations regarding the Barrick’s Louro and Gounkoto mines. Malian authorities have accused Barrick of failing to deliver on commitments on environmental standards, corporate social responsibility and foreign exchange regulations.

Following news of the detention, Resolute’s stock price plummeted 32.84% on November 11, closing at 45 cents, the largest single-day decline since 2008.

Syama’s operations remain stable

Despite these challenges, Resolute reported that operations at the Syama gold mine remain unaffected.

“Resolute remains focused on securing and creating certainty for the long-term future of the Shama gold mine and its expansion plans,” said Resolute’s non-executive chairman, Andrew Ley.

Resolute’s next steps include completing the payment of the US$30 million settlement and continuing discussions to clarify the elements of the Protocol. We remain committed to the safety of our employees and to maintaining cooperative relationships with our stakeholders.

The company’s stock price rose 5.42% to $43.75.