The government of Tanzania (“GoT”) and Barrick Gold Corporation
(NYSE:GOLD)(TSX:ABX) (“Barrick” or the “Company”) have reached an
agreement to settle all disputes between the GoT and the mining
companies formerly operated by Acacia but now managed by Barrick.
The final agreements have been submitted to the Tanzanian
Attorney General for review and legalization.
The terms of the agreement include the payment
of $300 million to settle all outstanding tax and other disputes;
the lifting of the concentrate export ban; the sharing of future
economic benefits from the mines 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
Corporation (“Twiga”) has been formed to manage the Bulyanhulu,
North Mara and Buzwagi mines. (Twiga is the Swahili word for
giraffe, Tanzania’s national symbol.) The GoT will acquire a
free carried shareholding of 16% in each of the mines and will
receive its half of the economic benefits from taxes, royalties,
clearing fees and participation in all cash distributions made by
the mines and Twiga. An annual true-up mechanism will ensure
the maintenance of the 50/50 split.
Speaking after a meeting with the chairman of
the Negotiating Committee of the Government of Tanzania, Prof
Palamagamba Kabudi, Barrick president and chief executive Mark
Bristow said the agreements introduced a new era of productive
partnership with the GoT and would ensure that Tanzania and its
people would share fully in the value created by the mines they
hosted. It also marked the end of the long impasse between
the GoT and Acacia which had led, among other things, to the
closure of North Mara and the freezing of export concentrate from
the two other operations.
Barrick took over the management of the mines
after its buy-out of the Acacia minorities last month. Since
then it has negotiated the re-opening of North Mara and is engaging
with the mines’ host communities to restore their social
license.
“Rebuilding these operations after three years
of value destruction will require a lot of work, but the progress
we’ve already made will be greatly accelerated by this
agreement. Twiga, which will give the government full
visibility of and participation in operating decisions made for and
by the mines, represents our new partnership not only in spirit but
also in practice,” Bristow said.
He noted that Tanzanian nationals were already
being employed and trained to replace expatriate staff as had been
done very successfully at Barrick’s other African operations.
Barrick Enquiries
President and chief executiveMark Bristow+1 647 205 7694+44 788 071
1386 |
COO, Africa and Middle EastWillem Jacobs+44 779 557 5271+243 820
678 040 |
Investor and media relationsKathy du Plessis+44 20 7557 7738Email:
barrick@dpapr.com |
Website: www.barrick.com
Cautionary Statement on Forward-Looking
Information
Certain information contained or incorporated by
reference in this press release, including any information as to
Barrick’s strategy, projects, plans, or future financial or
operating performance, constitutes “forward-looking statements”.
All statements, other than statements of historical fact, are
forward-looking statements. The words “herald”, “will”,
“establish”, “ensure”, “engage”, “restore”, “rebuild”, “progress”,
“would” and similar expressions identify forward-looking
statements. In particular, this press release contains
forward-looking statements including, without limitation, with
respect to the new partnership between Barrick and the GoT and the
agreement to resolve all outstanding disputes between Acacia Mining
plc (“Acacia”) and the GoT, including with respect to the
settlement of outstanding tax and other disputes; the lifting of
the concentrate export ban; the timing and amount of payments made
to the GoT; the acquisition of the GoT’s free carried shareholding
of 16% in the Bulyanhulu, North Mara and Buzwagi mines; the sharing
of future economic benefits with the GoT on a 50/50 basis and the
establishment of an African-focused dispute resolution
framework.
Forward-looking statements are necessarily based
upon a number of estimates and assumptions including material
estimates and assumptions related to the factors set forth below
that, while considered reasonable by the Company as at the date of
this press release in light of management’s experience and
perception of current conditions and expected developments, are
inherently subject to significant business, economic and
competitive uncertainties and contingencies. Known and unknown
factors could cause actual results to differ materially from those
projected in the forward-looking statements, and undue reliance
should not be placed on such statements and information. Such
factors include, but are not limited to: whether the agreement to
settle all disputes between Acacia and the GoT will be legalized
and executed by the GoT; the Company’s ability to successfully
re-integrate Acacia’s operations; timing of receipt of, or failure
to comply with, necessary permits and approvals;
non-renewal of key licenses by governmental
authorities; changes in national and local government
legislation, taxation, controls or regulations and/or changes in
the administration of laws, policies and practices, expropriation
or nationalization of property and political or economic
developments in Tanzania and other jurisdictions in which the
Company or its affiliates do or may carry on business in the
future; lack of certainty with respect to foreign legal systems,
corruption and other factors that are inconsistent with the rule of
law; litigation and legal and administrative proceedings;
fluctuations in the spot and forward price of gold, copper, or
certain other commodities (such as silver, diesel fuel, natural
gas, and electricity); the speculative nature of mineral
exploration and development; changes in mineral production
performance, exploitation, and exploration successes; diminishing
quantities or grades of reserves; increased costs, delays,
suspensions and technical challenges associated with the
construction of capital projects; operating or technical
difficulties in connection with mining or development activities,
including geotechnical challenges and disruptions in the
maintenance or provision of required infrastructure and information
technology systems; failure to comply with environmental and health
and safety laws and regulations; the impact of global liquidity and
credit availability on the timing of cash flows and the values of
assets and liabilities based on projected future cash flows;
fluctuations in the currency markets; damage to the Company’s
reputation due to the actual or perceived occurrence of any number
of events, including negative publicity with respect to the
Company’s handling of environmental or human rights matters or
dealings with community groups, whether true or not; risk of loss
due to acts of war, terrorism, sabotage and civil disturbances;
contests over title to properties, particularly title to
undeveloped properties, or over access to water, power and other
required infrastructure; employee relations including loss of key
employees; increased costs and physical risks, including extreme
weather events and resource shortages, related to climate change;
and availability and increased costs associated with mining inputs
and labor. In addition, there are risks and hazards associated with
the business of mineral exploration, development and mining,
including environmental hazards, industrial accidents, unusual or
unexpected formations, pressures, cave-ins, flooding and gold
bullion, copper cathode or gold or copper concentrate losses (and
the risk of inadequate insurance, or inability to obtain insurance,
to cover these risks).
Many of these uncertainties and contingencies
can affect our actual results and could cause actual results to
differ materially from those expressed or implied in any
forward-looking statements made by, or on behalf of, us. Readers
are cautioned that forward-looking statements are not guarantees of
future performance. All of the forward-looking statements made in
this press release are qualified by these cautionary statements.
Specific reference is made to the most recent Form 40- F/Annual
Information Form on file with the SEC and Canadian provincial
securities regulatory authorities for a more detailed discussion of
some of the factors underlying forward-looking statements and the
risks that may affect Barrick’s ability to achieve the expectations
set forth in the forward-looking statements contained in this press
release.
Barrick Gold Corporation disclaims any intention
or obligation to update or revise any forward-looking statements
whether as a result of new information, future events or otherwise,
except as required by applicable law.
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