The world’s largest gold producing company, Barrick Gold Corp., which recently completed the acquisition of Randgold Resources, is reportedly looking out for a solution to end a tax dispute in Tanzania that has put most of its mining operations in the country to a halt. The company is even considering selling its stake in Acacia Mining PLC.
Due to the tax dispute, the government of Tanzania has restricted the company’s majority-owned subsidiary Acacia Mining PLC from exporting gold concentrate outside of the country. In 2017, Barrick tried to settle the tax and revenue-sharing dispute with the government by offering to pay $300 million and other benefits, but the two sides have been unable to strike a final agreement.
Mark Bristow, Barrick’s new Chief Executive Officer, is hopeful that tax dispute, which began when the Tanzanian government slapped Acacia with a $190 billion tax bill in March 2017, would soon be resolved, reported Business Live.
“This has been a very complex and challenging situation where no one has won. It’s untenable and will be resolved,” said Bristow. “This conflict has destroyed lots of value. We need to make sure there’s enough value to work out a solution that various interested and affected parties get something that’s fair and proper for them.”
According to Bristow, Barrick could buy out the rest of Acacia that it does not own or it could split up the company, among other options. The CEO is expected to unveil in February a number of strategic changes that could include asset sales and new mining investments.
Bristow, who was Randgold’s chief executive earlier, became the CEO of Barrick as part of the US$5.4-billion acquisition deal that was announced back in September 2018. The merger of Barrick Gold and Randgold Resources has created a sector-leading miner which owns five of the five of the 10 best gold mines in the world, with operations from Nevada to South America and Mali and the Democratic Republic of Congo. Barrick is now well placed to be the world’s most valued gold mining business.