Acacia Mining PLC (LON:ACA) said it was seeking clarification following a media report that its parentcompany may have to force an end to stalled talks with the Tanzania government over a long-running dispute.
Barrick Gold Corp (NYSE:GOLD), the parent company, has been negotiating with the Tanzania government on behalf of Acacia, which allegedly owes royalties on undeclared exports.
The government has banned Acacia from exporting gold and copper concentrates from the country since 2017 due to the row.
Barrick reached a settlement proposal with the government in February but a final deal is yet to be agreed.
Barrick’s chief executive Mark Bristow told Bloomberg: “We would definitely at a point intervene and force the process, but right now it’s not a constructive way to try to solve this problem.”
Acacia said in a statement on Thursday that the comments were not consistent with its own understanding of the position so planned to ask Bristow for an explanation.
In the meantime, the Tanzanian miner will continue to provide support to Barrick in its talks, it said.
“Once Barrick has been able to bring their discussions with the government of Tanzania (GoT) to a successful conclusion, and the company receives a proposal agreed in principle between Barrick and the GoT, the independent committee of the board of Acacia will be able to decide whether to recommend the proposal to the company’s shareholders for approval,” Acacia said.
More positively, Acacia said it delivered a rebound in production at the start of the second-quarter, led by an improvement at its North Mara mine.
Total gold production in April was 47,805 ounces, 37% higher than the monthly average during the first quarter.
North Mara made up the bulk of production at 33,941 ounces for the month, some 52% above March and 54% above the first quarter’s monthly average.
“Although still early in the second quarter, I am pleased with the improved production levels now being achieved and remain confident of delivering against our full year production guidance of 500,000 to 550,000 ounces,” said interim chief executive Peter Geleta.
In the first quarter, gold production dropped 13% to 104,899 ounces due to a fall of ground in the North Mara Gokona underground mine, an excavator breakdown in the Nyabirama open pit and weaker output at Buzwagi.
Shares rose 2.8% to 149.7p in morning trading.