African Mining November 2021 | Page 21

COUNTRY IN FOCUS •

Bristow founded Randgold Resources , a company that developed several world class gold mines across Africa . Randgold was bought by Barrick for about USD6.5-billion in 2018 and Bristow became Barrick ’ s new CEO .

Bristow said that to fix Barrick ’ s mounting problem in Tanzania would require a collective strategy that has not been used before . Eventually , towards the end of 2019 , Barrick Gold signed a deal to settle the tax dispute .

As part of the agreement , Barrick would pay USD300-million to the Tanzanian Government , while Tanzania got a 16 % stake in each of the Bulyanhulu , North Mara and the Buzwagi mines . These mines were to be managed by a new operating company called Twiga Minerals , headquartered in Mwanza .

Zaynab Mohamed , political analyst at research company NKC African Economics , does not believe Hassan has full control over the recent arrests .

“ It will take the new president more time to alleviate state suppression of the opposition and civil society . Earlier this year , she tried to make a positive move for civil liberties and announced that suspended media outlets can now operate , but this decision was shortly overridden by other CCM members .

“ Hassan ’ s remarks in April suggest that she is not as authoritarian as Magufuli was , but we presume that she does not have enough political capital right now to make changes that would allow full opposition freedom . So far , her leadership has consisted of making positive moves towards curbing the spread of Covid-19 as well as getting the ball rolling on development projects that were stalled under Magufuli . We continue to believe that once she has firmly established her authority in the CCM , she will make positive strides for civil liberties too ,” says Mohamed .

Mending relationships with business Since the passing of Magufuli earlier this year , Suluhu has been mending relationships between the government and the private sector .

Although Magufuli was lauded in some quarters for his bold actions , his relationship with foreign investors and the private sector was tumultuous at best . In 2017 the Tanzanian authorities hit gold miner Acacia Mining with a demand for USD190-billion in unpaid taxes which the London listed company at the time called inaccurate and unexplainable .

Barrick Gold , who held 63.9 % shares in Acacia , announced in October 2017 that Acacia would pay a percentage of the taxes slapped on them by Magufuli . In addition , they would split the economic benefits gained from the company ’ s gold operations with Tanzania in a deal proposed to resolve the ongoing dispute .

The dispute lasted two more years before the incoming president and CEO of Barrick Gold , Mark Bristow , reached an agreement with Magufuli after Barrick acquired Acacia in a USD1.2-billion buy-out deal . Bristow said at the time that it was of the utmost importance to settle the dispute in order the save the mining industry in Tanzania . freepik . com

Magufuli suddenly died early in 2021 and Samia Suluhu Hassan became president . Her first moves included reviving several business deals which were halted during Magufuli ’ s rule .

The Tanzanian president and Bristow met soon after her appointment to review progress at Twiga , and to discuss the joint venture ’ s future plans and prospects .

Since Barrick took over the management of the mines in September 2019 , North Mara and Bulyanhulu gold mines have been revived , returned to profitability and are now truly world-class assets , with the potential to become Barrick ’ s seventh Tier One gold complex .

According to Bristow , the Tanzanian government received more than USD370-million ( TShs856-billion ) in cash inflows from the Twiga partnership through taxes , dividends and the first USD100- million ( TShs231-billion ) tranche of the settlement agreement .

“ Barrick has also invested USD800-million ( TShs1.851-billion ) in the country ’ s economy , spent USD2-million ( TShs4.6-billion ) on community development .”

“ We have recruited more than 600 new local employees , with Tanzanian nationals now making up 96 % of the mines ’ workforce ,” says Bristow .

The company has appointed local Tanzanians to key management and technical positions and continues to work closely with the Mining Commission on its local content program . Local content spending already accounts for 73 % of the mines ’ purchases .

Bristow said after the meeting with President Samia Suluhu Hassan that both parties agreed that the success of the Twiga joint venture – a first for Africa – had demonstrated the value that could be created by a genuine economic benefit sharing partnership between a mining company and its host country .

“ I confirmed that Barrick was in Tanzania for the long term and that we ’ ll be using our North Mara-Bulyanhulu complex as the base for further investment in the country , which is highly prospective but still largely unexplored .

“ We see the potential for more world-class gold discoveries here but in order to achieve exploration success we need to keep turning over our licences and assessing new ground . The process of acquiring new licences is ongoing ,” says Bristow . •