China’s Zijin Mining “paying attention to Tanzania” but “not yet negotiating”

ZIJIN Mining Group, the Chinese company that last month agreed to buy Nevsun Resources for C$1.86bn, was “paying attention” to Tanzania, but it was “not yet negotiating” with the country, said Reuters which cited the group’s chairman, Chen Jinghe.

The company has made no secret of its interest in investing further in Africa’s gold sector. “Zijin considers Africa to be one of the most prospective regions on the planet,” it said on September 26 following the proposed merger of Barrick Gold with Randgold Resources.

Barrick’s executive chairman, John Thornton, has made the point that Chinese capital would be welcomed by the combined company as a risk diversifier – a comment that quite possibly refers to Barrick’s 64% stake in Acacia Mining, a UK-listed group. It’s not clear whether the Acacia mines would be high enough quality for the Barrick-Randgold entity.

Acacia Mining is also embroiled in a dispute with the Tanzanian government over claims it owes the government billions of dollars in unpaid tax, interest and penalties. The relationship between Acacia and the government has only worsened in the last two weeks after several Acacia past and current employees were arrested on charges of fraud.

Commenting on the proposed merger of Barrick Gold and Randgold Resources, Zijin said it was aligned with Barrick whilst it had come to know Randgold as both companies operate in the Democratic of Congo. Zijin is in joint venture with Barrick in the Papua New Guinea gold mining asset of Porgera.

 

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