Thursday, July 13, 2017

AngloGold taking Tanzania to UN court over new mining law

South African AngloGold Ashanti (JSE:ANG) said it had begun arbitration proceedings against Tanzania over a new law that allows authorities to renegotiate contracts with mining firms. The world’s third-biggest gold producer said that changes to the mining legislation gave it “no choice” but to safeguard its agreements with Tanzania.

The Geita gold mine produced 489,000 ounces of gold last year, and is AngloGold’s largest mine. The company was expected to invest to extend Geita's life beyond 2025. More than 3,000 people are employed at the Geita Gold Mine. Geita paid a total of $130 million in taxes and contributed $593 million in revenue to Tanzania’s GDP last year.
AngloGold follows Barrick Gold's Acacia announcement last week that it had begun arbitration proceedings. Tanzania said the firm has been operating illegally and evading tens of billions of dollars in taxes by understating the amount of metal concentrate in exports from the three gold and copper mines it operates.