Barrick Gold to hold talks with Tanzania over export row

Wed Jun 14, 2017 8:28pm EDT
 
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By Fumbuka Ng'wanakilala and David Lewis

DAR ES SALAAM/NAIROBI (Reuters) - Barrick Gold's (ABX.TO: Quote) chairman and Tanzania's president met on Wednesday and agreed to hold talks aimed at resolving an escalating dispute over an export ban which has hit Barrick's Acacia Mining PLC (ACAA.L: Quote).

Shares in Acacia, which is 63.9 percent owned by Barrick, jumped as much as 11 percent, to 303 pence, after the news and closed 5.5 percent higher, outpacing sector rivals .

Tanzania is Africa's fourth-largest gold producer, and Acacia its largest miner, with three gold mines that also produce copper in the East African country.

Acacia's market value has nearly halved to about $1.4 billion since Tanzania banned the export of unprocessed ore in March, part of a push for the construction of a local smelter to make the country's gold exports more valuable.

"I feel very optimistic that we will reach a resolution which is a win-win," Barrick Chairman John Thornton said after meeting Tanzanian President John Magufuli.

"We'll be sitting down soon with a team designated by the president and our own team."

A statement from the president's office said that Barrick is ready to discuss "the payment of compensation of losses incurred by Tanzania from the company's operations in the country."

It also said Thornton agreed to cooperate with Tanzania to build a smelter in the country.   Continued...