NYSE/TSX-listed Barrick Gold and the Government of Tanzania have arrived at a proposal that sets forth the commercial terms to resolve outstanding disputes concerning Acacia Mining operations in Tanzania.
The company will present this proposal to the Independent Directors of Acacia in the near future for their consideration.
The proposed framework is consistent with the agreement announced in October 2017 and includes the following elements:
- The creation of a local operating company to manage Acacia’s operations in the country
- Economic benefits from Acacia’s operations to be shared on a 50/50 basis. The Government’s share of economic benefits would be in the form of royalties, taxes and a 16% free carry interest in the Tanzanian operations
- A payment of $300 million to the Government of Tanzania to resolve outstanding tax claims, to be paid over time on terms to be settled by the parties.
Mark Bristow, President and CEO of Barrick, says:
“Significant amounts of real value have been destroyed by this dispute and, in Barrick`s view, this proposal will allow the business to focus on rebuilding its mining operations in partnership with their respective stakeholders, and most importantly long suffering investors, including Barrick”.
Work is underway to finalize the definitive agreements needed to give effect to the proposal.
To become effective, the proposal and those agreements must be approved by Acacia and the Government of Tanzania, in keeping with applicable laws and regulations.
Barrick holds a 63.9% equity interest in Acacia, a publicly traded company listed on the London Stock Exchange that is operated independently of Barrick.