Acacia aims to save Buzwagi through processing adaptation


ACACIA Mining expected to restore Buzwagi to a cashflow positive position after adapting the mine’s processing method so it only produces gold bars, known as doré, until the end of its operating life in 2020.

Buzwagi has been losing money since around April when the Tanzanian government imposed an export ban on gold produced in concentrate form. The government alleged Acacia had under-estimated the value of the concentrate produced from Buzwagi as well as from another mine, Bulyanhulu, and therefore owed taxes worth billions of dollars.

The matter is the subject of negotiations between the government and Acacia Mining’s 64% shareholder, Barrick Gold. Acacia has, meanwhile, placed Bulyanhulu on care and maintenance. A third mine, North Mara, produces doré and is, therefore, not subject to any export bans which relate to gold sold in concentrate form.

The UK-listed company said in an announcement today that following a processing trial it was able to achieve gold recoveries of 85% at Buzwagi by using additional reagents in the leaching circuit. The increase in costs was “limited”. It was also able to increase total saleable gold by 8,000 to 10,000 ounces per month.

“We believe that the changes will move the mine from a monthly cashflow negative position to a monthly cashflow positive position, strengthening Acacia’s balance sheet and helping to protect thousands of direct and indirect jobs that the company supports,” it said.

Acacia said there would be no alteration to group production or cost guidance as a result of the processing change at Buzwagi. Tanzanian government royalties and local service levies from Buzwagi are also expected to more than double for the remainder of the year due to the increase in sales compared to the last six months, it said.

Acacia is engaged in a desperate struggle to survive whilst negotiations drag on with the Tanzanian government. Earlier this month it bought put options for 210,000 ounces of gold at a strike price of $1,300/oz as another means of keeping its mines afloat. The hedge would provide a minimum price for the majority of its doré gold production for the next six months above the firm’s budgeted price of $1,200/oz.

There is significant pressure though. The suspension of production from Bulyanhulu would result in a 65% to 67% reduction in net income for the firm’s 2018/19 financial year.


    Do those billionaire gold miners have no shame? We see their forked tongues over and over.

    A public letter to our President, Dr. John P. Magufuli
    Copies to Prime Ministers of Canada and England, Barrick, Acacia and many more – please see below.

    Dear Mr. President, Dr. Magufuli

    On 14 February 2017, we sent you a copy of our website blog, “Acacia Mining – Buzwagi Mine Deception & Scam in President Magufuli’s Face”. Here is the link:

    At that time, Barrick Gold, 63.9% owners of Acacia Mining were DESPERATELY trying to finalize the merger of Acacia Mining into Endeavor Mining. Thank God that did not happen. Better the devil we know than the devil we don’t know.

    And the devil we know is continuing with their dishonesty and deception, Mr. President, right in your face again. Your Nation are all watching for results in the negotiations between your team and Barrick Gold. Whilst these negotiations are happening, in true Tanzanian hospitality and positive spirit, please look at the trickery and corrupt news that Barrick-Acacia are feeding to their shareholders via the media:

    Fact: 4 October 2016
    The Buzwagi Mines’s Sustainability Manager, Mr. George Mkanza, told journalists that there was no hope for Buzwagi to do better after the year (2016).
    He added that production declined and the company incurred a big loss and that they lost Sh40 billion during the first half of 2016.
    The Planning Manager, Ms. Zonnastraal Mumbi, complained that Buzwagi only has the potential to produce under 900,000 ounces of gold and other sad woes.
    The Business Improvement and Mining Manager, Mr Rodney Burgess concluded by saying that Acacia would close the mine in December 2017.

    Stock brokers at the Dar es Salaam Stock Exchange said that these Acacia announcements were really actually threats to close Buzagwi Mine in retaliation against the you, Mr. President who, just weeks before the announcement, publicly told Acacia Mining to go back home if they do not make profits (but they declare hundreds of millions of Dollars in dividends overseas??).

    In addition, analysts said that the timing of Acacia’s announcement to close Buzwagi mine end of 2017 was also planned to scare you, Mr. President and also the Appeal Board who was exactly at that time dealing with Barrick Gold and Acacia Mining’s appeal against the Tax Evasion guilty verdict handed down about six months earlier.

    Fact: 14 February 2017:
    Barrick-Acacia were in the middle of their merger discussions. Brad Gordon, also known in the media as the “Mining Bad Boy” of Tanzania, announced to the media that Acacia would boost its gold production at its Buzwagi mine by 40 per cent in 2017. Of course, Acacia’s shares jumped UP six percent that same morning.

    So in October 2016, Barrick-Acacia use the closure of the Buzwagi mine as a threat against the President and to try scare him into taking a lower profile position against Acacia Mining and then suddenly, hocus pocus, only a matter of a few months later, Endeavour Mining pops up onto the Tanzania mining scene and the “Mining Bad Boy” does a 180 degree turn and tries to deceive the public and Endeavour Mining with the announcement that Acacia expect a 40 percent boost from a mine-life extension of Buzwagi gold mine in 2017.

    Mr. President, what Barrick Gold and Acacia Mining did NOT calculate into their corrupt plans, was that t our President Magufuli would NOT be afraid of their threats and would NOT crumble at the knees. They still don’t realize that Colonization is history!

    In fact, not only were you not afraid of their threats, you actually shocked them so deeply that the big boss of mother company, Barrick Gold, came running to talk to you!

    Fact: 22 March 2017:
    Only a matter of about five weeks later, after Acacia’s announcements on 14 Feb 2017 about the 40 percent boost at Buzwagi Mine, Endeavor Mining announced that they suspended merger talks with Acacia (thank the Good Lord). Obviously Endeavor saw the truth behind the decades of corruption, fraud, tax problems, false export declarations and more, and they ran away from the merger table as quick as they could.

    Fact: 18 May 2017:
    Mother company Barrick Gold and daughter company Acacia Mining are standing all alone in the world. What happened to the 40 percent boost from Buzwagi?
    On this day, Buzwagi General Manager ,Stewart Hamilton, wrote in an internal memo (as reported by The Citizen newspaper) that the company will stop the mining activities at the site in December (2017)….

    The analysts were all correct about the deception of the yo-yo announcements made only for Endeavor Mining and the stakeholders.

    Fact: 22 September 2017:
    Hocus Pocus strikes again and Barrick – Acacia have wonderful news. Suddenly, they are changing Buzwagi Mine and the mine is now designed to maximize gold doré (bars) production. Should we be surprised? After all, it is public knowledge that Acacia Mining have been exporting sand ore from its mines and NOT declaring the true contents and value of the sand ore.

    Mr. President, we are all confident that your minerals investigating team will have the capability to find where the sand ore came from, what mines it came from, what areas it came from. Even though Barrick – Acacia deny the charges, they think Tanzanian’s cannot put one and one together to see the truth.

    Analysts told us that this announcement made (about the gold bars from Buzwagi) a few days ago did not have any influence at all on Acacia Mining’s share value in the London stock exchange. Actually, the analysts added, the market sees the value today in Acacia Mining and that is why their shares are struggling. After all, last year in August, the shares almost passed the 600 mark. Acacia was really the “up & coming” company to watch in the mining industry. From there, it has been downhill all the way. At the last week of July, the shares collapsed to under the 160 mark and since then, the share value is struggling and limping along.

    We have always wanted Acacia Mining to succeed in Tanzania. We have written this dozens of times. However, their success must be unconditionally and tightly bound to the ethical, moral and honest ways of business in our country. No more fraud. No more corruption. No more deception. No more tax evasion. No more murder. No more rape. No more destruction to our villages. No more devastation to our environment. We believe all Tanzanians with give you their blessings to make your millions from our gold BUT only in with integrity and honor.

    May God bless you and grant you wisdom and understanding for your loyal and dedicated work that you do for our country.

    May God bless Tanzania and all our Nation.

    Samantha Cole
    Tanzania Business Ethics Group

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