Resolute Mining's Syama gold mine in Mali, West Africa

Resolute Mining has reinstated an updated production guidance at its Syama gold mine in Mali of between 400 000 oz to 430 000 oz of gold at an all-in sustaining cost of between US$980/oz and $1 080 oz for the 12 months to 31 December 2020.

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The company initially withdrew its guidance on 9 September following the receipt of a strike notice from Union Nationale des Travailleurs du Mali, the union representing workers at the Syama gold mine in Mali, informing the company of its intention to observe a 10-day strike at mine if certain demands are not met. The principal demand of the Union relates to a request to reinstate Syama workers who have been stood down on full pay due to the company’s COVID-19 protocols.

Following negotiations with the union, Resolute signed a conciliation agreement with the union, which confirms the cancellation of further planned strike action at Syama.

A compromise has been achieved between Resolute’s subsidiary company in Mali, the Société des Mines de Syama S.A. (SOMISY), and the union under which a commission will be established to evaluate and support measures that SOMISY believes are required in response to COVID-19 and current economic conditions. The union has agreed to be involved in identifying solutions and has cancelled proposed strike action at Syama.

Following the conciliation agreement operations at Syama have returned to normal and all efforts will be made to ensure a stable industrial relations platform is maintained for the rest of 2020 and beyond.

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While no guarantee can be provided that the union will not reinstate future strike action, all parties have agreed to the framework of a win-win partnership. The industrial relations dispute and strike actions taken prior to the agreement will result in reduced gold production in the current quarter. The total expected negative impacts on Syama for the September 2020 quarter is a delay in production of approximately 15 000 oz of gold.

Mali government update

Resolute notes the appointment of former Malian Minister of Defence and retired colonel Mr. Bah N’DAW as interim President and Colonel Assimi GOITA as interim Vice President.

These appointments were made as part of new transitional government arrangements expected to be in place for a maximum of 18 months to allow for and plan new democratic elections. Upon his inauguration on 25 September 2020, Interim President N’DAW stated that “the transition period which begins will not dispute any international undertaking by Mali, nor the agreements signed by the government”.

The impact of the new appointments on sanctions imposed by the Economic Community of West African States (ECOWAS) is not immediately clear. ECOWAS has previously agreed to normalise relations with Mali on the provision formal elections take place within 18 months and the transitional arrangements include civilian rule and confirm maintenance of Mali’s constitutional democracy.

Consistent with previous announcements, operations at Syama have not been impacted by recent political events. Resolute will continue to monitor the progress of the new transitional government including the potential impact of ECOWAS sanctions which, if sustained, may have an impact on supply links to and production at Syama.