Saturday , June 12 2021

RPT-New Barrick CEO looks at miners' allies to repair the government in Tanzania



(Repeats the Friday story without changes in the text)

* Mark Bristow plans to talk to Tanzania before closing the merger

* The Alliance's strategy has not been very successful in the Congo

By Zandi Shabalala and Susan Taylor

LONDON / TORONTO, 23 November (Reuters) – General manager Barrick Gold said he wants to connect the mining industry of Tanzania to face "desperate" tax disputes involving several companies, including Acacia Mining.

In an increasingly stubborn conflict that lasted almost two years, the government broke up mining contracts, raised taxes and license fees, and banned export of mineral resources.

President John Magufuli, nickname "The Bulldozer", in 2015. He announced that he would take the lead to secure a greater share of resources and reduce corruption. Acacia later received a 190 billion dollar tax – about four times more than gross domestic product – for under-production.

The miner, 63.9 percent of whom belongs to Barrick, is now facing many criminal penalties, from tax evasion to money laundering, and three employees have been arrested for similar accusations

Randgold's founder, Mark Bristow, new general manager of Barrick, after his 1-billionth Randgold purchase ends on January 1, says increasing Barrick's problem in Tanzania may require a common strategy that has not been applied before.

"Tanzania has a wider (mining) industry, and the importance of the industry itself that meets with the government is not a bad idea," said Bristow in an interview with Reuters this month.

Although there is still no coordination, "I do not think it's a bad place to start," he said.

In 2016, Mining accounted for 4.8% of Tanzania's GDP, the last year for which figures are available. Acacia dominates the industry, followed by AngloGold Ashanti, Petra Diamonds and Shanta Gold.

AngloGold said he would consider allying with Acacia in this matter. A source in another mining company that did not want to speak in public stated that the unification of Tanzania's mining industry, which may "not want to inherit" the problems of the acacia, may be a challenge.

A collective approach does not guarantee success.

A new code in the Democratic Republic of the Congo, which broke the agreement on stability during the movement of royalties and taxes, was passed despite the energetic opposition from the miners led by Randgold and Glencore.

But Bristow, who says he plans to intervene in Tanzania before closing the acquisition, is convinced he can break the deadlock.

"Barrick is worried about the current situation in the country. It's very desperate," he said.

Executive CEO John Thornton, who signed a framework agreement with the government in October last year, which has still not been passed, said Bristow has a "big position" in Tanzania.

According to the October agreement, Acacia was to pay the government $ 300 million, give it 16 percent ownership and share the economic benefits of its mines.

Acacia, which lost more than two-thirds of its value from the beginning of 2017, was annulled by the transaction, the source said. The biggest obstacle to its adoption is the dispute over the payment schedule of USD 300 million and whether it sets a long-standing tax dispute, sources said.

One of Barricek's main negotiators, a special envoy to Tanzania and former Chief Operating Officer Richard Williams, recently left the company.

Kevin Thomson, head of strategy for Barrick, will now work on the case of new boss Barrick from Africa and the Middle East, Willem Jacobs, who will take over Williams' responsibilities.

Jacobs, previously head of operations in Central and Eastern Africa, Randgold, was in talks for a miner in Congo. (Edition: Jan Harvey)


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