Barrick Gold, the world’s largest gold mining company, has announced it will resume its operations in Tanzania after agreeing to pay $300 million in tax disputes.
An agreement between the firm and the government will facilitate the lifting of the ban on concentrate export. Besides, the new deal will split benefits on a 50-50 basis between Barrick and Tanzania Government.
The new arrangement sees an end to a long-standing dispute between Tanzania and the mining firm. In March 2017, the government banned the export of concentrates over monstrous amounts of underpaid taxes by mining companies.
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Tanzania alleged that mining companies owe over $50 billion in underpaid taxes for the past 20 years. As such, the government stated that it would not sign any agreements related to exports of commodities extracted in the country by Acacia. Therefore, Barrick’s new management offered to consolidate its ownership of Acacia with the state to facilitate a deal with the government.
At the same time, under the new agreement, the Tanzania government will buy 16% of the shareholding of each mine.
“A true partnership can only be described when you have 50/50, and our joint venture with the government of Tanzania is exactly that — a committed partnership to develop Tanzania’s gold assets for the benefit of all stakeholders,” said Mark Bristow, Barrick President, and CEO.
Barrick Gold will form a new company which will run three mines in the country. The operating company, Twiga Minerals Corp, will manage operations of Bulyanhulu, North Mara, and Buzwagi mines after a review by Tanzania’s attorney general. Details of the review will come out by November 15.
Lastly, Twiga, which will have headquarters in Mwanza, sets an example other investors can take to solve disputes.
Barrick Gold Corporation is the largest gold mining company in the world, with its headquarters in Toronto, Ontario, Canada. The company has mining operations in Argentina, Australia, Canada, Chile, the Dominican Republic, Papua New Guinea, Peru, Saudi Arabia, Tanzania, the United States and Zambia.
