Barrick Gold CEO Mark Bristow
Photo by: Creamer Media
Global major Barrick Gold has formed a new partnership with the Tanzania government, setting the company on path to resume concentrate exports from the mines formerly operated by Acacia Mining.
The Canada-headquartered group has agreed to a $300-million payment to settle outstanding tax and other disputes and to share future economic benefits from the Bulyanhulu, North Mara and Buzwagi mines on a 50:50 basis.
The mines will be managed by a new operating company called Twiga Minerals, in which the government will have a free-carried shareholding of 16% in each of the mines and receive half the economic benefits from taxes, royalties, clearing fees and participation in all cash distributions.
The parties also established an Africa-focused international dispute resolution framework.
The agreement, which was announced on Sunday, marks the end of a long impasse between Tazania and Acacia, which had led to, among other things, the closure of North Mara and the freezing of export concentrate form the two other operations.
Barrick took over the management of the mines after its buy-out of the Acacia minorities last month. Since then it has negotiated the reopening of North Mara and is engaging with the mines’ host communities to restore their social licence.
“Rebuilding these operations after three years of value destruction will require a lot of work, but the progress we’ve already made will be greatly accelerated by this agreement. Twiga, which will give the government full visibility of and participation in operating decisions made for and by the mines, represents our new partnership not only in spirit, but also in practice,” Barrick Gold CEO Mark Bristow said.
He noted that Tanzanian nationals were already being employed and trained to replace expatriate staff as had been done successfully at Barrick’s other African operations.