AFRICAN BARRICK GOLD PLC: Agreement to transfer Tulawaka
15 November 2013
African Barrick Gold plc (the "Company" or "ABG")
Agreement to transfer Tulawaka
ABG today announces it is has reached an agreement with STAMICO, the Tanzanian State Mining Corporation, whereby STAMICO will acquire the Tulawaka Gold Mine ("Tulawaka") and certain exploration licenses surrounding Tulawaka for consideration of US$4.5 million and the grant of a 2% net smelter royalty on future production in excess of 500,000 ounces, capped at US$500,000.
As part of the agreement, STAMICO will take ownership and management of the rehabilitation fund established as part of the closure plan for the mine, in return for the assumption of all remaining past and future closure and rehabilitation liabilities for Tulawaka, and will indemnify the other parties to the agreement in relation to these liabilities. This will result in a cash payment by ABG to STAMICO of the balance of the rehabilitation fund, which currently stands at US$17.6 million, less the transaction consideration on completion.
Tulawaka is 100% owned by the Tulawaka Joint Venture, in which ABG holds a 70% economic interest through a wholly owned subsidiary, with MDN Inc holding the remaining 30% of the Joint Venture. Production at Tulawaka ceased in Q2 2013.
The transaction, which has been approved by the Board of ABG and its subsidiaries and STAMICO, is subject to the satisfaction of regulatory approvals before completion.
Brad Gordon, ABG's Chief Executive Officer, said, "Tulawaka was a highly successful mine for African Barrick Gold and this transaction provides STAMICO the opportunity to further develop the domestic Tanzanian mining industry."
For further information contact:
African Barrick Gold plc +44 20 7129 7150 Andrew Wray, Chief Financial Officer Giles Blackham, Investor Relations Manager
Bell Pottinger +44 207 861 3800 Charles Vivian Daniel Thöle
ABG is Tanzania's largest gold producer and one of the five largest gold producers in Africa. We have three producing mines, all located in Northwest Tanzania, and several exploration projects at various stages of development in Tanzania and Kenya. We have a high-quality asset base, solid growth opportunities and a clear strategy of optimising, expanding and growing our business.
Maintaining our licence to operate through acting responsibly in relation to our people, the environment and the communities in which we operate is central to achieving our objectives.
ABG is a UK public company with its headquarters in London. We are listed on the Main Market of the London Stock Exchange under the symbol ABG and have a secondary listing on the Dar es Salaam Stock Exchange.
Historically and prior to our initial public offering (IPO), our operations comprised the Tanzanian gold mining business of Barrick Gold Corporation, our majority shareholder. ABG reports in US dollars in accordance with IFRS as adopted by the European Union, unless otherwise stated in this announcement.
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