Barrick CEO Mark Bristow
Canadian miner Barrick Gold has made progress in reshaping its Tanzania operations, acquired through the takeover of Acacia Mining in September last year, by formally establishing a joint venture (VJ) with the government.
At a signing ceremony on Friday, CEO Mark Bristow and Tanzanian President Dr John Magufuli formalised the JV, which would give the government full visibility of, and participation in, decisions made for the North Mara, Bulyanhulu and Buzwagi mines.
The company, in a statement on Friday, said it was a “pioneering move” that would take Barrick’s policy of partnership with its host countries to a new level.
The agreement also ratified the creation of Twiga Minerals Corporation – a management company that was jointly formed by government and Barrick to oversee the management of Barrick’s local operations.
Barrick’s Tanzanian operations are 84%-owned by Barrick and 16%-owned by the government. The JV between the parties provides for a 50:50 sharing in the economic benefits generated by the mining operations after the recoupment of capital investments.
Barrick and Tanzania in October last year settled a tax dispute, after the company agreed to a $300-million payment and committed to Twiga Minerals. The government had accused the mining company of tax evasion and banned the export of mineral concentrates from Acacia's mines.
Barrick said it would work together with the Tanzanian government on various projects, including partnering with the University of Dar es Salaam, and commit up to $10-million in funding over the next decade for training and skills development in the mining industry.
“Since taking over the operatorship, we have been engaging with local communities to restore the mines’ social licence to operate and we are cooperating closely with the authorities to address the environmental issues at North Mara.
“Additionally, we are working on a local supplier strategy as well as a community development plan to create sustainable economic opportunities for the people around our mines,” Bristow said.
Moreover, the gold major's CEO mentioned that the company had a strong focus on rationalising and optimising the mine plans. Following a successful transition to owner-mining at North Mara, it had already reduced costs and increased free cash flow. The company expected a similar result at Bulyanhulu, where an integrated study aimed at optimising the complete orebody should kickstart the resumption of mining operations later this year.
Barrick had budgeted to spend $50-million on green- and brownfield exploration in Tanzania this year.