In its capacity as a facilitator, Barrick Gold Corp. announced it has arrived at a proposal with the government of Tanzania to resolve outstanding disputes concerning Acacia Mining’s operations in Tanzania. This proposal includes the creation of a local company to manage Acacia’s operations as well as a payment of $300 million to the government to resolve the outstanding tax claims. The taxes will be paid over time.
Economic benefits from Acacia’s operations will 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.
“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,” President and CEO of Barrick Mark Bristow said.
According to Barrick, work is under way to finalize the definitive agreements. To become effective, the proposal and those agreements must be approved by Acacia and the government of Tanzania. Barrick holds a 63.9% equity interest in Acacia.
According to Acacia, it has not received any proposal from Barrick regarding a resolution.
“Any proposal received by Acacia will be subject to review by the Independent Committee of the Acacia Board of Directors,” the company said.