Barrick Gold Corporation (Barrick) has got its Tanzanian operations – previously run by subsidiary Acacia Mining – back on their feet after today formalising the creation of jointly-owned management company Twiga Minerals Corporation (Twiga) with the Tanzanian government.
Twiga is the Swahili word for giraffe which is Tanzania’s national symbol.
Barrick CEO Mark Bristow said the group had now budgeted $50m for brownfields and greenfields exploration in Tanzania during 2020 alone and was “looking at various opportunities to sustain and expand our operations.”
Twiga will oversee the running of Barrick’s Tanzanian operations which are now owned 84% by Barrick and 16% by the Tanzanian government. The deal provides for a 50/50 sharing in the economic benefits generated by the mining operations after recoupment of capital investments.
The deal also involves the payment of $300m to the Tanzanian government from Barrick to settle all outstanding tax and other disputes between the government and Acacia which had hamstrung Acacia’s operations in the country for the past few years.
Barrick previously controlled Acacia but last year was forced take the company over completely through buying out the minorities to be able to reach the settlement now signed.
That settlement has been signed despite a cautionary report issued earlier this month by Canadian political risk consultancy DaMina Advisors which claimed the agreement was being delayed by a difference of opinion between Tanzania’s foreign minister Palamagamba Kabudi and Attorney General Adelardus Kilangi “who do not agree on the contours of the agreement.”
Bristow – speaking at the signing ceremony today with Tanzanian president John Magufuli – said the Twiga JV “ was a pioneering move which would take Barrick’s policy of partnership with its host countries to a new level.”
He added, “since taking over the operatorship we have been engaging with local communities to restore the mines’ social licence to operate”
Barrick is also recruiting and training Tanzanian nationals “to replace expatriate employees as has been successfully done at Barrick’s other African operations. Acacia’s offices outside the country have been closed while company records and day-to-day decision making and accountability have been moved back to the operations in Tanzania.