Barrick Gold Corporation has announced that it would spend $6 for every ounce of gold sold by its two mines in the country on improving healthcare, education, infrastructure and access to potable water in the communities around them.
At the same time, it has committed up to $70 million for investment in value-adding national projects, including mining-related training, skills development and scientific facilities at Tanzanian universities, as well as road infrastructure.
This is in accordance with the conditions underlying Barrick’s framework agreement with the government, which included the establishment of their Twiga joint venture. Twiga oversees a 50/50 split of the economic benefits generated by the mines as well as their management.
Barrick President and Chief Executive, Mark Bristow said today, the investment program was the latest evolution of the company’s very successful partnership with the government.
“Since we took over the Tanzanian mines from their previous operator in 2019, we have rebuilt relations with the state and renewed our social license to operate here. North Mara has been redesigned as an integrated underground/open pit mine and Bulyanhulu has been resuscitated as a long-life underground mine. Together they are expected to produce more than 500,000 ounces of gold per year at the lower end of the cost spectrum.”Mark Bristow
Barrick Strengthens Relationship with Government
In line with the 500koz gold output expectation, Barrick’s Q1 2022 report, Barrick Gold’s North Mara mine produced 56,000 ounces of attributable gold at a reduced all-in sustaining cost (AISC) of $874 per ounce of gold compared to $1,033 per ounce of gold.
The company’s Q1 2022 report indicated that last year Barrick spent $5.5 billion with host country suppliers, equating to 81 per cent of its global procurement expenditure. Host country nationals accounted for 96 per cent of its total workforce and 78 per cent of its management, and the drive to employ more women is succeeding.
Barrick has spent more than $1.9 billion in taxes, salaries and payments to local businesses over the past two years. At least 73 per cent of the mines’ goods and services are sourced locally and they give preference to the employment of Tanzanian nationals. Barrick has to date also paid the government $140 million of the $300 million settlement included in the framework agreement.
Things have not been all flowery, especially, after the late President of Tanzania John Magufuli changed mining laws and regulations charting the country on a path towards resource nationalism. On account of this, Barrick Gold Corp signed a deal with Tanzania in which the government will take stakes in three gold mines, ending a long-running tax dispute and setting a template for negotiations with other firms.
In line with efforts to improve training and skills development in Tanzania, Barrick’s local business development program started in 2021, recently graduated fifteen (15) SMEs. The program was implemented by Kengo in partnership with Barrick and College of Business Education (CBE). Since its inception, it has provided professional training and business consulting to small-to-medium sized enterprises (SMEs) to strengthen their skills and enable them to profit from the mining value chain.
The graduates also benefitted through mentorship from the Ministry of Minerals, Tanzania Revenue Authority (TRA), Dar es Salaam Stock Exchange (DSE), Human Resources consultants, and financial institutions. These efforts puts Barrick in a good light and strengthens its relationship with the government.
READ ALSO: Ghana: Gas from Jubilee Fuels 30% of Thermal Power Generation, Tullow Says
Leave a Reply