Barrick confident over joint venture with Tanzania government

Kahama. A year since Barrick signed a deal with the government, the company has expressed its confidence over the mining sector, projecting better days ahead.

Last year, Barrick Gold ended its dispute with the government when the two sides agreed to form a joint venture in which the government of Tanzania owned stake in the three mines of Buzwagi, Bulyanhulu and North Mara.

The government owns 16 percent equity in Twiga Minerals Corporation which was formed to replace Acacia Mining that was accused of tax evasions and operating illegally.

Barrick chief executive officer. who doubles as chairman of Twiga Minerals Corporation, Mark Bristow, who briefed the media on Thursday said they have successfully revived North Mara and Bulyanhulu, promising more investment.

“These mines are now very different businesses,” said Mr Bristow after a board meeting he chaired at Bulyanhulu.

According to him, North Mara delivered significant improvements and underground production restarted at Bulyanhulu.

The media witnessed ongoing operations in the underground mining at Bulyanhulu while preparations were ongoing for the closure of Buzwagi.

The Buzwagi mine, which is open pit, is expected to close in June this year.

“North Mara’s life of mine production profile has been vastly improved and implementation of its comprehensive water management plan is on track.

Bulyanhulu’s resurrection was a particularly exceptional achievement, considering that both its shaft and plant had to be refurbished extensively. The new mine plan is designed to deliver a long-term value-driven operation,” Mr Bristow said.

He said Barrick invested $800 million in the Tanzanian economy in the form of taxes, permits, infrastructure development, salaries and payments to local suppliers during 2020.

Capital and exploration expenditures exceeded $180 million for the year, of which half related to growth projects, and the investment is planned to continue into 2021.

Barrick also agreed to pay $300 million to settle outstanding taxes and other disputes, the lifting of an export ban on concentrates and the sharing of future economic benefits from mines.

The company already paid $100 million the remaining amount will be paid in instalment of $50 million per year.

Mr Bristow allayed doubts, saying there is no risk for delays following the improvement of the gold price in the world market.

A board member representing the Government of Tanzania in Twiga Minerals Corporation, Mr Casmir Kyuki, said the joint venture was ongoing “very well as things are moving smoothly.”

Last year, Twiga paid $250 million as dividend to the shareholders with the Government of Tanzania getting $40 million (about Sh100 billion).

“Even in our board meeting today, we discussed another dividend but it will be announced later when the discussions are complete,” said Mr Kyuki, who refused to disclose the amount allocated for the dividend.

“Our partnership is going very fantastic and a lot of things are smoothly moving nowadays. The government is now part of the investors and it’s providing all necessary support when needed,” added Mr Kyuki, who was also one of the members in the government negotiating team with Barrick.