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ACACIA SERVES GOVERNMENT WITH NOTICE OF ARBITRATION "Credit News 24"

Acacia Mining has now served the government with notices of arbitration on their lingering dispute over the export of mineral concentrate from its two mines in the country.

The mining firm announced yesterday that notices of arbitration were served in Tanzania on behalf of Bulyanhulu Gold Mine Ltd. (BGML), the owner of the Bulyanhulu mine, and Pangea Minerals Ltd.

(PML), the owner of the Buzwagi mine. The new development is in accordance with the dispute resolution processes agreed by the government in their Mineral Development Agreements with Bulyanhulu Gold Mine Ltd and Pangea Minerals Ltd, the miner said.

"The serving of the notices at this time is necessary to protect the company, but, this notwithstanding, Acacia remains of the view that a negotiated resolution is the preferable outcome to the current disputes and the company will continue to work to achieve this, " it said.

The government is locked in a standoff with the Acacia Mining, the country's biggest gold producer over the export of mineral concentrate from its two mines in the country.

The government had imposed a ban on the exports, accusing Acacia of under-declaring its gold shipments and mining illegally. A presidential committee found the value of minerals within concentrates in containers at the port city of Dar es Salaam was more than 10 times the amount declared by Acacia.

As a result, the government decided to keep an export ban issued in March on the London-listed miner’s copper and gold concentrates. The probe's results also led to the firing of Energy and Minerals mining minister and as well as the board of the mineral audit agency, which were accused of failing to supervise exports properly.

However, the mining company refuted the committee's findings, saying that if they were correct it would imply that Acacia "is the world’s third largest gold miner" and "produces more gold from just three mines than companies like AngloGold Ashanti from 19 mines, Goldcorp from 11 mines, and Kinross from their 9 mines."

However, last month President John Magufuli said the gold miner's majority shareholder, Barrick Gold Corp, had “repented” and would repay all the losses the country had in curred on behalf of Acacia to settle the dispute.

Acacia’s woes grew after the government last week approved a new Finance Act, which will impose a 1% clearing fee on all minerals exports. Analysts estimated that the new levy will cost Acacia another US$7mln to US$9mln each year based on last year’s revenues.

"The Government of Tanzania has informed Barrick Gold Corporation (ABX) that at this stage it wishes to continue their dialogue, and therefore Acacia will not participate directly in these discussions when they commence.

Any potential resolution that might be identified as a result of such discussions will be subject to approval by Acacia, and the company will work with Barrick as necessary to support such discussions, it said.
Title : ACACIA SERVES GOVERNMENT WITH NOTICE OF ARBITRATION "Credit News 24"
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