Tanzania: the thorny Acacia Mining case finally settled!

Present Sunday, October 20 in Dar es Salaam, Mark Bristow, CEO of Barrick Gold Mining Group, announced that « Barrick[was] definitely back in Tanzania », after reaching an agreement to settle a long-standing tax dispute between the country and the gold mining company Acacia Mining, recently acquired by Barrick.

In its press release, published on the same day on its website, the Canadian firm states that the « terms of the agreement include the payment of $300 million to settle all outstanding tax and other disputes, the lifting of the embargo on exports of concentrate (the first product processed from gold ore), the sharing of mining profits on a 50/50 basis and the establishment of a specific framework for resolving potential future disputes…. ». The agreement, which is subject to the approval of the Tanzanian Attorney General, also provides that a new operating company, called Twiga Minerals, will be created to manage the group’s three mines in the country (Bulyanhulu, North Mara and Buzwagi). Barrick Gold’s statement also states that the Tanzanian government will be allocated – without a free grant – a 16% stake in each of the three mines. This lays the foundation for a « partnership committed to developing Tanzania’s gold assets for the benefit of all stakeholders » and finally putting an end to nearly « three years of value destruction », according to Bristow.

The Buzwagi mining site (Tanzania), now owned by Barrick Gold Photo credit: Acacia Mining

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After being hit in March 2017 by an embargo on exports from its mines and then by a massive $190 billion tax adjustment, Barrick’s subsidiary Acacia Mining had been in a deadlock for more than two years. The episode is now closed.