Barrick's Thornton Meets Tanzania Leader in Acacia Tax FeudBy
Two sides agree to negotiate; Acacia says no agreement reached
State says mining companies evaded billions of dollars in tax
Barrick Gold Corp. Executive Chairman John Thornton met with Tanzania’s president in an effort to resolve an impasse between the government and Acacia Mining Plc, of which Barrick is a majority shareholder.
“As the negotiations have yet to commence, no agreements have been reached,” Acacia said in a statement Wednesday. “The negotiations will seek a resolution that is in the best interests of all stakeholders.”
Earlier, Tanzania’s presidency said Thornton had already had an initial meeting with President John Magufuli in the commercial capital, Dar es Salaam, and that Barrick is willing to reimburse money that’s owed to the government. Magufuli has accused Acacia of failing to pay billions of dollars of taxes. Acacia surged as much as 11 percent in London.
“Thornton said his company is ready to hold talks with Tanzania that will consider the interests of both sides and is ready to pay all the money it’s expected to pay Tanzania,” Magufuli’s office said. The government welcomes such talks and will establish a panel of experts to negotiate how the company will pay the money and how it will conduct future operations in the country, according to the statement.
Barrick confirmed the meeting but not the details of what, if anything, had been agreed.
The meeting took place two days after the Tanzanian leader accused Acacia of operating illegally and demanded it remit unpaid taxes. The accusation followed an audit of the country’s mineral exports over the past 19 years that found mining companies failed to remit taxes of as much as 108.5 trillion shillings ($48.5 billion) since 1998.
Toronto-based Barrick, which owns 64 percent of Acacia, also agreed on Wednesday to help Tanzania build a smelter, according to the presidency’s statement, which didn’t provide further details.
“The meeting was constructive and open, with the parties agreeing to enter into negotiations to seek a resolution that is in the best interests of all stakeholders, including Tanzania, Barrick, and Acacia,” Barrick said in a statement Wednesday.