Barrick Gold to extend wings in Dar as it spots golden sky

TUESDAY November 1, 2022

By Deus Bugaywa

The Tranquility News Correspondent

Hardly did Rodgers and Hammerstein knew that the song they composed in 1945 for musical Carousel, the film released in 1956, will be translated across all walks of life globally, including by world class football clubs and multinational mining companies.

In 1960s, Liverpool fans turned the song into their club’s anthem, and its title You will Never Walk Alone as their slogan.  One of the song’s verses, which goes at the end of the storm, there’s a golden sky, kept on coming into my mind.

I could not resist from relating it to the optimism I heard during Barrick Gold president and CEO Mark Bristow’s media briefing at Ingwe Secondary School, at Mjini Kati Village, near Barrick North Mara Gold Mine, in October 2022, as it sums up the experience of the mining giant in Tanzania.

Three years ago, Barrick Gold acquired all outstanding Acacia-issued shares and took over operations of its Tanzania assets, marking the end of a longstanding impasse that pitted the government against Acacia.

The move led to, among other things, the closure of North Mara and the freezing concentrate export from the two other operations.

A new era is, however, dawning in Barrick Gold operations on this side of the globe, as it is now eyeing expansion of its activities in the East African nation.

The agreements, which led to the formation of Twiga Minerals Corporation, a new operating company formed to manage Bulyanhulu, North Mara and Buzwagi mines, introduced a new era of productive partnership with the Tanzania government to ensure the country and its people fully share the value created by the mines they host.

Bristow said the resurrection of moribund mines and their transformation into an asset with the potential for being incorporated into Barrick’s elite Tier One portfolio, as a combined complex, was a remarkable success story.

Tier One Gold is an asset with a reserve potential for delivering a minimum of 10-year production life, annual production of at least 500,000 ounces of gold, and total cash costs-per-ounce over the mine’s life that are in the lower-half of the industry’s cost curve.

“Our groundbreaking Twiga partnership with the Tanzanian government not only settled its long-running disputes with the mines’ previous operators, but has established a model for mutual beneficial cooperation between miners and their host countries, particularly in Africa.

“By demonstrating that Tanzania is an investor-friendly destination, it also augurs well for the future of the country’s mining industry,” he said.

Barrick bought out minority shareholders and assumed control of Tanzanian operations in 2019 after Acacia, formerly African Barrick Gold, lost its license for operating in the country.

Since then Barrick has been redesigning and reengineering the two assets, North Mara and Bulyanhulu gold mines to create what are in effect new mines.

The two mines are now set to achieve a combined production in excess of 500,000 ounces for the second year running, the success that lead Barrick Gold Corporation to mull over expanding its East African footprint from this base.

“In addition to the brown fields exploration designed to maintain the positive trend on resource expansion and conversion at the two mines, we are also looking further afield.

“A better understanding of the region’s geological architecture will improve our ability to discover new world-class development opportunities in our areas of interest,” Bristow said.

After the takeover from Acacia, the government of Tanzania and Barrick Gold Corporation reached an agreement to settle all disputes between the government and the mining companies formerly operated by Acacia.

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 agreement, the government acquired a free carried shareholding of 16 per cent in each mine and receives 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.

Both North Mara and Bulyanhulu have been ramping up production, with North Mara hitting a record 505,000 tonnes of ore and waste mined last quarter.

The mines continue optimising the underground operation while the change to an owner-mining strategy has boosted the expansion of both the mine and open pit operations.

At Bulyanhulu, the development of the main declines to access the deep west zone of the ore body started last quarter. The production ramp-up at both mines is being supported by fleet upgrades.

“We continue targeting further growth through reconnaissance and the consolidation of key licenses. Extension opportunities are being assessed along the Gokona strike and throughout the Bulyanhulu Inlier.

“Results from the deep drilling at Gokona are pointing to a significant potential for extending North Mara’s life,” Bristow said.

North Mara Gold Mine operation results indicate a higher throughput, grade and recovery drove an 18 per cent increase in 2022 second quarter production compared to the prior quarter.

The open pit ramp-up continues advancing at Rama pit, as open pit and underground productivity are expected to further improve with the arrival of new equipment.

The agreement between the Tanzania government and the Barrick Gold is hailed as an exemplary African model for win-win cooperation between multinational investors and African governments.

Barrick Gold Corporation is a mining company that produces gold and copper with 16 operating sites in 13 countries. It is headquartered in Toronto, Ontario, CanadaΩ