Gold Mining: Osun indicts Thor Explorations, Segilola Operating Resources for infractions, demands N60bn payment

*The Osun State Government of Nigeria accuses Thor Explorations Limited UK, and Segilola Operating Resources Limited, one of its subsidiaries operating the Segilola Gold Project, of failure to honour commitment to payment of over N60 billion as accrued financial considerations due to the state on the ‘Transformational Acquisition’ of Osun State’s interest, aside from breaching extant Personal Income Tax Act and Company Income Tax Act governing tax levies in the country

Isola Moses | ConsumerConnect

For alleged infractions, including tax liabilities, the Osun State Government of Nigeria has accused Segilola Operating Resources Limited (SORL) of failure to honour its commitment to payments of the accrued financial considerations due to state on the “transformational acquisition” of Osun State’s interest between 2016 and 2019.

The Osun State Government is now demanding over N60 billion from Thor Explorations, London, in the United Kingdom (UK), as the parent company, and Segilola Resources Operating Limited, its subsidiary operating the Segilola Gold Project in Osun State.ConsumerConnect reports ‘Segilola’ has been described as “an orogenic-style lode gold deposit, which occurs within a regional-scale shear zone.”

The Osun State Government said the Thor Explorations Limited’s subsidiaries are Segilola Resources Operating Limited (SROL or Segilola) and Segilola Gold Limited (SGL), Operators of Segilola Gold Project (SGP) by Osun State Government.

Its parent company, Thor Explorations is a TSX-V listed Canadian mineral exploration firm engaged in the acquisition, exploration, and development of mineral properties in West Africa.

Thor is currently advancing two high value gold projects in West Africa.

The company’s most advanced project is the Segilola Gold Project, located in Ijesaland, in Atakumosa East Local Government Area (LGA) of Osun State.

It was gathered the Segilola Gold Project is considered “Nigeria’s most advanced gold project” with an indicated resource of 556,000 ounces grading at 4.2g/t, an inferred resource of 306,000 ounces grading at 4.7g/t and a probable reserve of 448,000 ounces grading at 4.2 g/t.

Osun Government accuses companies of ‘annihilating’ state’s interests in ownership of TML

Speaking on behalf of the Osun State Government Thursday, September 26, 2024, Dr. Wale Bolorunduro, Financial Consultant to the Office of Mining and Mineral Resources, in a statement, said since the ‘operation operandi’ was purely commercial, and it was Segilola Resources Operating Limited that carried out strategic annihilation of Osun State’s interests in the ownership of the Tropical Mines Limited (TML), in 2016, and the eventual commercial transaction of Transformational Acquisition by Thor Explorations Limited (Thor) UK, “without due financial considerations to Osun State”, it is now imperative for the companies involved to pay over N60 billion to the Osun State Government.

Dr. Bolorunduro recalled while other legacy co-shareholders of Tropical Mines Limited got financial considerations for the Commercial Transaction, including Shares in Thor Explorations Limited, UK, and other financial considerations at the time, Osun State got nothing, as the state later discovered, based on its review of the transaction, which commenced early 2023.

The consultant also alleged that for the past 20 months, Segilola Operating Resources has refused to honour its commitment to commencing payments on the accrued financial considerations due to Osun State on the said Transformational Acquisition of Osun’s interest between 2016 and 2019.

Bolorunduro reportedly stated: “Even, when a tenor repayment plan payable over two years was offered by Osun state Governor to them to preserve the need to encourage the national and the state investment drives in the mining sector.

“The efforts and demand of Osun State to realise our claims, which is over 60 billion Naira in monetary value and Redeemable Shares as financial considerations for acquiring Osun State’s interest in Tropical Mines Limited have always been rebuffed by Segilola Operating Resources Limited.”

He further noted: “At least four meetings had been held with the Executive Governor, H.E. Governor Adeleke and the CEO of SROL, Mr. Segun Lawson, in attendance and with promises made to commence payment.

“Only for the company to renege on its promises, and choose to go and misrepresent the state in Abuja, Ministry of Solid Minerals (Development).”

Osun State remains a significant shareholder in Thor, declares Financial Consultant

Taking a swipe at the company’s suggestion to direct the Osun State Government to TML, Dr. Bolodunro stated that the attempt “offends our collective sensibility as people with culture and dignity.

“It is the responsibility of Thor UK to return the values which ought to have been given to Osun State abinitio.

“As co-shareholder in Thor, UK. Osun deserves to treated with fairness, equity and without prejudice to our interest.”

He further contended “let no mischief makers, political oppositions especially Osun APC spin it, in their usual dirty way.

“Recovering Osun interest and encouraging a global company (though a junior Miner) to treat its co-shareholder properly is proper under company law and in any jurisdiction. “The fact that Thor has admitted a shareholding proportion, which is significant in the Legacy Company, Tropical Mines Ltd makes Osun state a significant shareholder.”

‘We won’t sell Osun’s interests’

According to the state financial consultant, the Osun State Government has capacity to de-convolute the complex structure employed to gradually, strip the Osun state’s interest between 2016 and 2019.

He averred: “We know the roles played by various special purpose vehicles (SPVs) that were set up, including Segilola Resources Operating Limited, Segilola Gold Ltd and the eventual transformational acquisition by Thor Explorations Ltd, UK.

“Unlike the previous administration, we are not interested in selling Osun’s interests, which include the shares, partially redeemed, now and grudgingly so by Thor Explorations UK from the complex and multiple-convoluted commercial transaction. “We will continue to pursue the cash considerations and others, due to Osun State, without losing our dignity and without compromising our integrity.”

Reacting to the development also, Prof. Lukman Jimoda, Special Adviser to the Governor on Mining and Mineral Resource, raised serious concerns about the operations of the Segilola Gold Project, managed by subsidiaries of Thor Explorations Limited, UK.

Prof. Jimoda also accused the company of tax infractions, stressing despite the significant production of the Segilola Gold Project since 2019, it has resisted complying with extant laws, such as the Personal Income Tax (PIT) Act and Companies Income Tax (PIT) Act, which govern tax levies in the West African country, a report said.