JV with Tanzania will net Barrick up to $280m windfall as three-year gold ban lifted

BARRICK Gold would ship up to $280m in gold from Tanzania after the government lifted an export ban, said Reuters citing comments by Mark Bristow, the Canadian firm’s CEO.

“The shipments will start immediately and, as we speak, we are mobilising the concentrates,” said Bristow in an interview with Reuters. “It’s (worth) around $260m to $280m depending on … metal prices at the time of sale.”

Bristow was instrumental in ending a three-year tax dispute with the Tanzanian government which claimed Barrick listed subsidiary, Acacia Mining, had underpaid the fiscus by tens of billions of dollars going back 20 years.

The government subsequently imposed export bans on gold-in-concentrate exports that nearly hobbled Acacia. The company recovered but John Magufuli, Tanzanian president, refused to negotiate with Acacia eventually forcing Barrick to buy out Acacia minority shareholders. Barrick owned about 64% in Acacia Mining.

Earlier this month, Barrick signed an agreement with the Tanzanian government that the former Acacia mines be held jointly in a joint venture called Twiga Minerals Corporation. There was also an agreement that Barrick pay the Tanzanian government a $300m one-off fee. The joint venture agreement should have been signed at the end of December.

Speaking in August, Bristow said the integration of the former Acacia mines into Barrick would comprise “a great deal of work”.

“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,” said Bristow.

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