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Barrick handshake opens door

for Aussie juniors

he wider Tanzanian mining indus- The dispute originally involved Acacia Tanzania.
Ttry breathed a sigh of relief following Mining, which was bought out by Barrick. “It’s encouraging for all stakeholders in
news that the Government and Barrick The Government imposed a ban on export- the mining industry that Tanzania and Bar-
Gold Corp had finalised a new invest- ing mineral concentrates in 2017 after ac- rick have formalised an agreement and
ment deal. Now, the Australian juniors in cusing Acacia of tax evasion, leading to a have started a new chapter in the country,”
the country hope the three-year develop- one-third cut in the miner’s output. an AngloGold Ashanti spokesman said.
ment freeze will be lifted. Deputy Minister for Minerals Stanslaus Clifford Chance Partner in international
Canadian gold major Barrick signed a Nyongo told Mining Indaba delegates the arbitration Sam Luttrell told Paydirt plenty
deal with Tanzania on January 24 which Government was “very much happy now of positives could be gleaned from the fi-
will see the Government take stakes in its that we will share economic benefits 50/50”. nalisation of the Barrick deal.
three gold mines, ending a long-running tax The Government said it was renegoti- “It is a positive and I’m more optimistic
dispute and setting a template for negotia- ating mining agreements with all existing about Tanzania now,” Luttrell said. “The fact
tions with other firms. companies to get a minimum 16% stake in the Government has been able to do a deal
Completion of the deal follows an an- each large-scale mine, in accordance with within the legal framework bodes well for
nouncement by the two sides in October in mining laws passed in 2017. Tanzania as a host of mining investment.
which they agreed to a payment of $US300
million to settle outstanding tax and other
disputes, the lifting of an export ban on
concentrates and the sharing of future eco-
nomic benefits from mines.
Barrick chief executive Mark Bristow –
who has been at the heart of negotiations
since arriving at the company in 2018 –
struck a conciliatory tone in a speech at the
ceremony broadcast on state TV.
“Many people said your criticism will
chase away investors ... what it’s done is
challenge the mining industry and all of us
to embark on something where we win to-
gether or lose together,” Bristow said to ap-
plause.
Bristow called it a “historical day” for Af-
rica and said the company had budgeted
$US50 million for brown and greenfield ex-
ploration in Tanzania in 2020.
“I thank God for the success of this
agreement,” Tanzanian President John
Magufuli said. While Barrick and the Tanzanian Govern- Andrew Spinks
He said confiscated containers of gold ment were congratulating each other, ques-
and copper concentrate could now be ex- tions remain about contracts with other min- “The Government has got some dif-
ported to the benefit of Twiga Minerals, a ers, developers and explorers in the East ficult issues to work through in relation to
new JV set up to manage the Bulyanhulu, African country. the changes they made to their natural re-
North Mara and Buzwagi mines. The agreement was part of a wider pol- sources laws but my impression is that they
“Twiga Minerals represents a structure icy shift in the East African country which have received and understood the signal
which allows the Government and the saw amendments to its Minerals Act. from the market and are probably to a de-
people of Tanzania to be involved in the The dispute with Barrick and some of the gree more willing to show some flexibility in
decision-making of everything that we do more radical aspects of the amendment the legislative framework than they were in
together,” Bristow said. act saw investment in the country grind to 2017.”
Foreign Affairs Minister Palamagamba a halt as investors absorbed the changes. Among the most encouraging aspects of
Kabudi, who led Tanzania’s negotiating Under the amendments, the Govern- the Barrick deal was the inclusion of sev-
team, said Tanzania now owned 16% un- ment will receive a 16% free-carried inter- eral terms deemed “unconscionable” in the
diluted shares in Twiga Minerals, as well as est in all mines while recourse to interna- 2017 legislation.
a 16% stake in each of the Barrick mines. tional arbitration was also removed. ASX-listed companies were highly active
“We almost lost hope in the discussions Mining licences will now be issued by in Tanzania prior to the 2017 changes to the
with Barrick and I was ready to tender my the newly established Mining Commis- Mining Act. Since then, their progress has
resignation to the President for failing to sion, under the guidance of the President. been stymied by uncertainty around the
complete this task, but we ultimately got the South African miner AngloGold Ashanti Acacia deal and future mining policies.
deal done,” Kabudi said. Ltd’s Geita is the largest gold mine in The finalisation of the agreement be-

aUSTRaLIa’S PaYDIRT MaRCH 2020 Page 33