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Barrick Gold to pay US$300M in settlement of disputes with Tanzania


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Barrick Gold to pay US$300M in settlement of disputes with Tanzania

Barrick Gold Corp. said Oct. 20 that it agreed to pay US$300 million as settlement for all outstanding tax and other disputes with the government of Tanzania, related to the mining firms formerly operated by Acacia Mining PLC and now managed by Barrick.

The final agreement was submitted to the Tanzanian Attorney General for review and legalization.

Other terms of the agreement include the lifting of the concentrate export ban, sharing of future economic benefits on a 50/50 basis, and the establishment of a unique, Africa-focused international dispute resolution framework.

In conjunction with the finalization of the agreement, a new operating company called Twiga Minerals Corp. was formed to manage the Bulyanhulu, North Mara, and Buzwagi mines.

The Tanzania government will hold a 16% free-carried interest in each of the operations held by Twiga and will receive its portion of the economic benefits via taxes, royalties, clearing fees and participation in all cash distributions made by the mines and Twiga.

In September, the High Court of Justice in England and Wales made an order sanctioning the scheme of arrangement for the consolidation of Barrick's interest in Acacia Mining, which was part of a strategy to resolve the tax dispute.

Since the deal took effect, Barrick negotiated the reopening of the North Mara operation and is in talks with the local communities hosting the mine in order to restore its social license.

Meanwhile, local workers have been hired and trained, in lieu of expatriate staff, to work at Twiga's mining operations.