Gold miner Resolute Mining has found itself at the heart of significant regulatory shifts in West Africa after the recent detention of the company’s CEO in Mali. Cash-strapped governments in the region are increasingly looking to tap into higher revenues from their natural resources, and Mali’s military junta—cut off from Western aid and burdened by sanctions—is leading the way.
Pressure Mounts on Foreign Miners as West Africa Revises Mining Codes
Alongside Resolute, Canadian mining giant Barrick Gold has also come under scrutiny, with its employees detained and a key mining license recently threatened. Neighboring nations like Niger, Burkina Faso, Senegal, and Ivory Coast are similarly updating mining codes, revoking permits, or initiating sector-wide audits as part of broader efforts to capture more mining revenue.
Rising Gold Prices Fuel Demand for Greater State Revenue
“The environment we’re seeing across Africa, especially in West Africa, is unfortunately challenging,” said Resolute CFO Chris Eger during a recent earnings call. “With the current gold price environment generating significant cash flows, there’s increased demand for potentially a larger share of that value.”
This trend coincides with a sharp rise in gold prices, with the metal soaring about 30% this year to reach a historic high of $2,790.10 per ounce, partly driven by mounting geopolitical tensions leading up to Donald Trump’s recent election victory in the United States.
Resolute and Barrick Face Heightened Scrutiny Amid New Mining Legislation
Following an industry-wide audit and new mining legislation in Mali that increases the government’s stake in mining projects, Resolute CEO Terry Holohan’s detention underscores the military junta’s pressure on foreign mining companies. Although firms like Resolute and Barrick had previously established operational agreements with former governments, Mali’s revised mining laws now impose new challenges on foreign operators.
Neighboring Countries Follow Mali’s Lead with Sector Reforms
In Niger, the military government blocked uranium exports from France’s Orano SA, which sparked a rapid surge in uranium prices. Burkina Faso raised the state’s royalty share through changes in its mining code last year, while Ivory Coast is updating its tax regime, and Senegal’s new administration is conducting a mining sector audit going back to 2017.
The news had an immediate impact on mining stocks, with Resolute shares plummeting by a third on Monday. Other companies active in Mali, such as Kodal Minerals—which is developing a lithium project—also saw their stock prices decline, with Kodal falling as much as 13%.
