After months of back and forth, Barrick Gold Corp. and the government of Tanzania have agreed on a framework for a new partnership between Acacia Mining plc and the government where economic benefits from Acacia would be shared with Tanzania on a 50/50 basis. The framework was signed on October 19 in Dar es Salaam following a meeting between Barrick Executive Chairman John L. Thornton and the President of the United Republic of Tanzania His Excellency Dr. John P. Magufuli.
“Following constructive discussions with our Tanzanian partners, we have developed a framework for a modern, 21st century partnership that should ensure Acacia’s operations generate sustainable benefits and mutual prosperity for the people of Tanzania, as well as for the owners of Barrick and Acacia,” said Thornton. “A partnership requires trust between the parties, and transparency is the currency of trust. Through our discussions over the last three months, we have established both and this will form the basis of our relationship in the future.”
Barrick, which holds a 63.9% interest in Acacia, and the government of Tanzania have also agreed to form a working group that will focus on the resolution of outstanding tax claims against Acacia. Under this proposal, as a gesture of good faith, Acacia would make a payment of $300 million to the government with payment terms to be settled by the working group.
Acacia said it has received a copy of the framework agreement and is seeking further clarification. No formal proposal, however, has been put to Acacia for consideration at this point in time. And, any proposal agreed in principle between Barrick and the government will require Acacia’s approval.
For more details on the proposed framework, go here.