JOHANNESBURG (miningweekly.com) - LSE-listed African Barrick Gold (ABG) downgraded its 2010 production forecast, after it suspended 40% of its work force at the Buzwagi mine, in Tanzania, suspected to be linked to fuel theft syndicates.

The gold-miner said in a statement on Thursday that investigations indicated that "criminal fuel theft syndicates had widely infiltrated" the company's mining department.

The investigations lead to the suspension of about 60 employees and a number of contractors, pending further disciplinary procedures.

Consequently, ABG had to delay the mining of higher-grade ore at Buzwagi, which led to a reduction of about 10 000 oz of production during the mine's third quarter.

ABG said that finding replacement operators had proved challenging, and that about 20 operators had to be seconded from its head company, Barrick Gold, to assist with operations and the training of new teams.

The delay would reduce full-year production at Buzwagi by about 30 000 oz.
ABG lowered its full-year production forecast to around 716 000 oz, from between 750 000 oz and 800 000 oz.

The company, which was spun out of Canada-based Barrick Gold, initially expected to produce as much as 850 000 oz of gold in 2010, but lowered its forecast in July, because of delays accessing higher-grade ore at Buzwagi.

ABG, in which Barrick still owns a controlling interest, listed in London in March.

The Africa-focused miner's share price took a beating on Thursday, falling by 10% to 558p a share, making it the biggest loser of the FTSE 100 index.

ABG has set a target of increasing production to about one-million ounces a year in the next four to five years by expanding output from its four producing mines.

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